XML 25 R9.htm IDEA: XBRL DOCUMENT

Allowance for Loan Losses

3 Months Ended

Mar. 31, 2013

Allowance For Loan Losses Disclosure [Abstract]

2. Allowance for Loan Losses

The following tables present the activity of the allowance for loan losses by portfolio segment at March 31.

Allowance for Loan Losses:	March 31, 2013
(Dollar amounts in thousands)	Commercial			Residential			Consumer			Unallocated		Total
Beginning balance	$	10,987		$	5,426		$	3,879		$	1,666	$	21,958
Provision for loan losses*		1,264			197			233			581		2,275
Loans charged -off		(450	)		(272	)		(1,026	)		-		(1,748	)
Recoveries		2,343			49			395			-		2,787
Ending Balance	$	14,144		$	5,400		$	3,481		$	2,247	$	25,272

* Provision before increase of $746 thousand in 2012 for decrease in FDIC indemnification asset

Allowance for Loan Losses:	March 31, 2012
(Dollar amounts in thousands)	Commercial			Residential			Consumer			Unallocated		Total
Beginning balance	$	12,119		$	2,728		$	3,889		$	505	$	19,241
Provision for loan losses*		997			683			319			461		2,460
Loans charged -off		(1,858	)		(1,336	)		(783	)		-		(3,977	)
Recoveries		190			17			381			-		588
Ending Balance	$	11,448		$	2,092		$	3,806		$	966	$	18,312

* Provision before increase of $496 thousand in 2012 for decrease in FDIC indemnification asset

The following table presents the allocation of the allowance for loan losses and the recorded investment in loans by portfolio segment and based on the impairment method at March 31, 2013 and December 31, 2012.

Ending Balance Attributable to Loans:	March 31, 2013
(Dollar amounts in thousands)	Commercial		Residential		Consumer		Unallocated		Total
Individually evaluated for impairment		6,610		3,920		-		-		10,530
Collectively evaluated for impairment		6,320		1,361		3,481		2,247		13,409
Acquired with deteriorated credit quality		1,214		119		-		-		1,333
Ending Balance	$	14,144	$	5,400	$	3,481	$	2,247	$	25,272

Loans:	March 31, 2013
(Dollar amounts in thousands)	Commercial		Residential		Consumer		Total
Individually evaluated for impairment		27,839		6,989		-		34,828
Collectively evaluated for impairment		1,026,231		485,157		268,056		1,779,444
Acquired with deteriorated credit quality		13,104		3,489		4		16,597
Ending Balance	$	1,067,174	$	495,635	$	268,060	$	1,830,869

Allowance for Loan Losses:	December 31, 2012
(Dollar amounts in thousands)	Commercial		Residential		Consumer		Unallocated		Total
Individually evaluated for impairment		3,453		3,920		-		-		7,373
Collectively evaluated for impairment		7,286		1,506		3,879		1,666		14,337
Acquired with deteriorated credit quality		248		-		-		-		248
Ending Balance	$	10,987	$	5,426	$	3,879	$	1,666	$	21,958

Loans	December 31, 2012
(Dollar amounts in thousands)	Commercial		Residential		Consumer		Total
Individually evaluated for impairment		23,721		6,973		-		30,694
Collectively evaluated for impairment		1,056,861		487,486		269,882		1,814,229
Acquired with deteriorated credit quality		13,582		3,421		6		17,009
Ending Balance	$	1,094,164	$	497,880	$	269,888	$	1,861,932

The following tables present loans individually evaluated for impairment by class of loans.

	March 31, 2013
					Allowance
	Unpaid				for Loan		Average		Interest		Cash Basis
	Principal		Recorded		Losses		Recorded		Income		Interest
(Dollar amounts in thousands)	Balance		Investment		Allocated		Investment		Recognized		Recognized
With no related allowance recorded:
Commercial
Commercial & Industrial	$	563	$	399	$	-	$	200	$	-	$	-
Farmland		-		-		-		-		-		-
Non Farm, Non Residential		-		-		-		-		-		-
Agriculture		-		-		-		-		-		-
All Other Commercial		-		-		-		-		-		-
Residential
First Liens		-		-		-		-		-		-
Home Equity		-		-		-		-		-		-
Junior Liens		-		-		-		-		-		-
Multifamily		-		-		-		-		-		-
All Other Residential		-		-		-		-		-		-
Consumer
Motor Vehicle		-		-		-		-		-		-
All Other Consumer		-		-		-		-		-		-
With an allowance recorded:
Commercial
Commercial & Industrial		16,171		16,171		3,721		16,635		-		-
Farmland		891		891		191		891		-		-
Non Farm, Non Residential		8,710		8,644		1,500		8,015		-		-
Agriculture		-		-		-		-		-		-
All Other Commercial		4,326		4,326		1,297		2,768		-		-
Residential
First Liens		1,253		1,253		126		1,254		-		-
Home Equity		196		196		-		188		-		-
Junior Liens		-		-		-		-		-		-
Multifamily		-		-		-		-		-		-
All Other Residential		5,540		5,540		3,794		5,540		-		-
Consumer
Motor Vehicle		-		-		-		-		-		-
All Other Consumer		-		-		-		-		-		-
TOTAL	$	37,650	$	37,420	$	10,629	$	35,491	$	-	$	-

	December 31, 2012
					Allowance						Cash Basis
	Unpaid				for Loan		Average		Interest		Interest
	Principal		Recorded		Losses		Recorded		Income		Income
(Dollar amounts in thousands)	Balance		Investment		Allocated		Investment		Recognized		Recognized
With no related allowance recorded:
Commercial
Commercial & Industrial	$	-	$	-	$	-	$	1,013	$	-	$	-
Farmland		-		-		-		-		-		-
Non Farm, Non Residential		-		-		-		1,679		-		-
Agriculture		-		-		-		-		-		-
All Other Commercial		-		-		-		-		-		-
Residential
First Liens		-		-		-		150		-		-
Home Equity		-		-		-		-		-		-
Junior Liens		-		-		-		-		-		-
Multifamily		-		-		-		50		-		-
All Other Residential		-		-		-		-		-		-
Consumer
Motor Vehicle		-		-		-		-		-		-
All Other Consumer		-		-		-		-		-		-
With an allowance recorded:
Commercial
Commercial & Industrial		17,262		17,098		3,153		16,738		-		-
Farmland		891		891		191		891		-		-
Non Farm, Non Residential		7,438		7,386		293		5,000		179		-
Agriculture		-		-		-		-		-		-
All Other Commercial		1,209		1,209		52		1,362		-		-
Residential
First Liens		1,254		1,254		126		1,230		-		-
Home Equity		179		179		-		75		-		-
Junior Liens		-		-		-		176		-		-
Multifamily		5,540		5,540		3,794		2,216		-		-
All Other Residential		-		-		-		-		-		-
Consumer
Motor Vehicle		-		-		-		-		-		-
All Other Consumer		-		-		-		-		-		-
TOTAL	$	33,773	$	33,557	$	7,609	$	30,580	$	179	$	-

The table below presents non-performing loans.

	March 31, 2013
	Loans Past
	Due Over
	90 Day Still
(Dollar amounts in thousands)	Accruing		Restructured		Nonaccrual
Commercial
Commercial & Industrial	$	26	$	11,283	$	8,383
Farmland		47		-		920
Non Farm, Non Residential		385		4,787		8,475
Agriculture		-		-		92
All Other Commercial		-		-		4,802
Residential
First Liens		678		4,202		6,910
Home Equity		36		-		205
Junior Liens		149		-		783
Multifamily		-		-		5,743
All Other Residential		-		-		145
Consumer
Motor Vehicle		73		700		132
All Other Consumer		5		-		1,542
TOTAL	$	1,399	$	20,972	$	38,132

	December 31, 2012
	Loans Past
	Due Over
	90 Day Still
(Dollar amounts in thousands)	Accruing		Restructured		Nonaccrual
Commercial
Commercial & Industrial	$	724	$	11,573	$	9,360
Farmland		231		-		907
Non Farm, Non Residential		491		4,836		6,718
Agriculture		69		-		104
All Other Commercial		-		-		4,811
Residential
First Liens		1,237		4,126		6,852
Home Equity		24		-		196
Junior Liens		538		-		405
Multifamily		101		-		5,598
All Other Residential		-		-		150
Consumer
Motor Vehicle		133		685		174
All Other Consumer		3		16		1,519
TOTAL	$	3,551	$	21,236	$	36,794

Covered loans included in loans past due over 90 days still on accrual are $27 thousand at March 31, 2013 and $630 thousand at December 31, 2012. Covered loans included in non-accrual loans are $3.7 million at March 31, 2013 and $4.3 million at December 31, 2012. Covered loans of $2.6 million at March 31, 2013 and $2.9 million at December 31, 2012 are deemed impaired and have allowance for loan loss allocated to them of $99 thousand and $236 thousand, respectively for March 31, 2013 and December 31, 2012. Non-performing loans include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans.

The following table presents the aging of the recorded investment in loans by past due category and class of loans.

	March 31, 2013
					Greater
	30-59 Days		60-89 Days		than 90 days		Total
(Dollar amounts in thousands)	Past Due		Past Due		Past Due		Past Due		Current		Total
Commercial
Commercial & Industrial	$	4,884	$	863	$	2,948	$	8,695	$	487,621	$	496,316
Farmland		48		-		941		989		84,378		85,367
Non Farm, Non Residential		2,955		1,774		2,106		6,835		284,252		291,087
Agriculture		736		82		5		823		103,184		104,007
All Other Commercial		134		24		3,473		3,631		86,766		90,397
Residential
First Liens		4,380		748		4,032		9,160		337,766		346,926
Home Equity		155		42		36		233		42,172		42,405
Junior Liens		335		8		565		908		34,666		35,574
Multifamily		361		-		5,639		6,000		57,359		63,359
All Other Residential		177		-		-		177		7,194		7,371
Consumer
Motor Vehicle		2,313		162		84		2,559		243,505		246,064
All Other Consumer		128		22		6		156		21,840		21,996
TOTAL	$	16,606	$	3,725	$	19,835	$	40,166	$	1,790,703	$	1,830,869

	December 31, 2012
					Greater
	30-59 Days		60-89 Days		than 90 days		Total
(Dollar amounts in thousands)	Past Due		Past Due		Past Due		Past Due		Current		Total
Commercial
Commercial & Industrial	$	1,315	$	861	$	3,616	$	5,792	$	487,160	$	492,952
Farmland		534		-		1,122		1,656		87,270		88,926
Non Farm, Non Residential		5,618		1,004		2,449		9,071		290,023		299,094
Agriculture		137		-		78		215		130,404		130,619
All Other Commercial		568		202		350		1,120		81,453		82,573
Residential
First Liens		8,359		1,659		4,599		14,617		336,230		350,847
Home Equity		143		15		24		182		43,317		43,499
Junior Liens		555		98		586		1,239		36,535		37,774
Multifamily		52		-		5,641		5,693		49,019		54,712
All Other Residential		214		-		-		214		10,834		11,048
Consumer
Motor Vehicle		4,164		600		182		4,946		241,303		246,249
All Other Consumer		225		93		3		321		23,318		23,639
TOTAL	$	21,884	$	4,532	$	18,650	$	45,066	$	1,816,866	$	1,861,932

The Corporation has allocated $3.1 million and $1.6 million of specific reserves to customers whose loan terms have been modified in troubled debt restructurings as of March 31, 2013 and December 31, 2012. The Corporation has not committed to lend additional amounts as of March 31, 2013 and December 31, 2012 to customers with outstanding loans that are classified as troubled debt restructurings. There were $73 thousand of modifications and $9 thousand of charge offs in the quarter ended March 31, 2013 that were troubled debt restructurings and the resulting impact to the allowance for loan losses was not material. There were $162 thousand of modifications in the quarter ended March 31, 2012 that were troubled debt restructurings and the resulting impact to the allowance for loan losses was not material. There were no defaults of troubled debt restructurings in the first quarter of 2013 or 2012 of loans restructured in the previous 12 months.

Credit Quality Indicators:

The Corporation categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Corporation analyzes loans individually by classifying the loans as to credit risk. This analysis includes non-homogeneous loans, such as commercial loans, with an outstanding balance greater than $50 thousand. Any consumer loans outstanding to a borrower who had commercial loans analyzed will be similarly risk rated. This analysis is performed on a quarterly basis. The Corporation uses the following definitions for risk ratings:

Special Mention: Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard: Loans classified as substandard are inadequately protected by the current net worth and debt service capacity of the borrower or of any pledged collateral. These loans have a well-defined weakness or weaknesses which have clearly jeopardized repayment of principal and interest as originally intended. They are characterized by the distinct possibility that the institution will sustain some future loss if the deficiencies are not corrected.

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those graded substandard, with the added characteristic that the severity of the weaknesses makes collection or liquidation in full highly questionable or improbable based upon currently existing facts, conditions, and values.

Furthermore, non-homogeneous loans which were not individually analyzed, but are 90+ days past due or on non-accrual are classified as substandard. Loans included in homogeneous pools, such as residential or consumer, may be classified as substandard due to 90+ days delinquency, non-accrual status, bankruptcy, or loan restructuring.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans. Loans listed as not rated are either less than $50 thousand or are included in groups of homogeneous loans. As of March 31, 2013 and December 31, 2012, and based on the most recent analysis performed, the risk category of loans by class of loans are as follows:

	March 31, 2013
			Special
(Dollar amounts in thousands)	Pass		Mention		Substandard		Doubtful		Not Rated		Total
Commercial
Commercial & Industrial	$	418,380	$	32,385	$	30,372	$	7,213	$	6,621	$	494,971
Farmland		79,939		2,627		1,588		-		37		84,191
Non Farm, Non Residential		255,651		11,479		22,099		1,058		44		290,331
Agriculture		94,414		7,800		117		-		75		102,406
All Other Commercial		76,560		1,022		11,537		52		728		89,899
Residential
First Liens		112,920		10,006		10,584		1,269		210,901		345,680
Home Equity		12,565		643		1,365		117		27,638		42,328
Junior Liens		9,263		56		723		70		25,328		35,440
Multifamily		52,566		3,352		7,133		155		2		63,208
All Other Residential		1,149		-		-		-		6,196		7,345
Consumer
Motor Vehicle		11,586		322		290		11		232,680		244,889
All Other Consumer		4,081		74		72		20		17,608		21,855
TOTAL	$	1,129,074	$	69,766	$	85,880	$	9,965	$	527,858	$	1,822,543

	December 31, 2012
			Special
(Dollar amounts in thousands)	Pass		Mention		Substandard		Doubtful		Not Rated		Total
Commercial
Commercial & Industrial	$	414,680	$	31,368	$	31,442	$	7,138	$	7,025	$	491,653
Farmland		81,977		2,718		1,616		-		805		87,116
Non Farm, Non Residential		249,614		25,764		22,038		831		42		298,289
Agriculture		119,789		8,921		134		-		62		128,906
All Other Commercial		69,952		132		11,239		54		803		82,180
Residential
First Liens		113,360		8,986		11,516		689		215,034		349,585
Home Equity		13,035		469		1,631		23		28,267		43,425
Junior Liens		10,419		50		515		70		26,575		37,629
Multifamily		42,719		3,328		8,481		59		-		54,587
All Other Residential		2,840		-		35		-		8,136		11,011
Consumer		-
Motor Vehicle		11,695		262		311		25		232,727		245,020
All Other Consumer		4,614		73		104		21		18,675		23,487
TOTAL	$	1,134,694	$	82,071	$	89,062	$	8,910	$	538,151	$	1,852,888