The following table presents total loans outstanding, by portfolio segment, as of September 30, 2021 and December 31, 2020:

(1)	Included Paycheck Protection Program, or PPP, loans of $103.5 million at September 30, 2021 and $268.4 million at December 31, 2020.

Total loans included net deferred loan fees and costs of $2.4 million and $4.7 million at September 30, 2021 and December 31, 2020, respectively. Deferred loan fees on PPP loans were $2.9 million at September 30, 2021 and $4.3 million at December 31, 2020.

Management monitors the credit quality of its loan portfolio on an ongoing basis. Measurements of delinquency and past due status are based on the contractual terms of each loan. Past due loans are reviewed regularly to identify loans for nonaccrual status. Loan modifications made in accordance with the Interagency Statement on Loan Modifications and Reporting for Financial Institutions as issued on April 7, 2020, are included as accruing current.

The following tables present a past due aging analysis of total loans outstanding, by portfolio segment, as of September 30, 2021 and December 31, 2020:


	September 30, 2021
					90 Days
	Accruing		30 - 89 Days		or More				Total
(dollars in thousands)	Current		Past Due		Past Due		Nonaccrual		Loans
Commercial
Commercial and industrial	$	504,309	$	657	$	—	$	1,633	$	506,599
Real estate construction		37,751		—		—		—		37,751
Commercial real estate		569,209		—		—		4,309		573,518
Total commercial		1,111,269		657		—		5,942		1,117,868
Consumer
Residential real estate first mortgage		500,350		876		—		113		501,339
Residential real estate junior lien		129,521		552		—		170		130,243
Other revolving and installment		50,735		197		—		4		50,936
Total consumer		680,606		1,625		—		287		682,518
Total loans	$	1,791,875	$	2,282	$	—	$	6,229	$	1,800,386


	December 31, 2020
					90 Days
	Accruing		30 - 89 Days		or More				Total
(dollars in thousands)	Current		Past Due		Past Due		Nonaccrual		Loans
Commercial
Commercial and industrial	$	689,340	$	500	$	30	$	1,988	$	691,858
Real estate construction		44,451		—		—		—		44,451
Commercial real estate		558,127		2,449		—		2,431		563,007
Total commercial		1,291,918		2,949		30		4,419		1,299,316
Consumer
Residential real estate first mortgage		461,179		1,752		—		439		463,370
Residential real estate junior lien		143,060		191		—		165		143,416
Other revolving and installment		73,128		118		—		27		73,273
Total consumer		677,367		2,061		—		631		680,059
Total loans	$	1,969,285	$	5,010	$	30	$	5,050	$	1,979,375

The Company’s consumer loan portfolio is primarily comprised of secured loans that are evaluated at origination on a centralized basis against standardized underwriting criteria. The Company generally does not risk rate consumer loans unless a default event such as bankruptcy or extended nonperformance takes place. Credit quality for the consumer loan portfolio is measured by delinquency rates, nonaccrual amounts and actual losses incurred.

The Company assigns a risk rating to all commercial loans, except pools of homogeneous loans, and periodically performs detailed internal and external reviews of risk rated loans over a certain threshold to identify credit risks and to assess the overall collectability of the portfolio. These risk ratings are also subject to examination by the Company’s regulators. During the internal reviews, management monitors and analyzes the financial condition of borrowers and guarantors, trends in the industries in which the borrowers operate and the estimated fair values of collateral securing the loans. These credit quality indicators are used to assign a risk rating to each individual loan.

The Company’s ratings are aligned to pass and criticized categories. The criticized category includes special mention, substandard, and doubtful risk ratings. The risk ratings are defined as follows:

Pass: A pass loan is a credit with no existing or known potential weaknesses deserving of management’s close attention.

Special Mention: Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, this potential weakness may result in deterioration of the repayment prospects for the loan or of the Company’s credit position at some future date. Special mention loans are not adversely classified and do not expose the Company to sufficient risk to warrant adverse classification.

Substandard: Loans classified as substandard are not adequately protected by the current net worth and paying capacity of the borrower or of the collateral pledged, if any. Loans classified as substandard have a well-defined weakness or weaknesses that jeopardize the repayment of the debt. Well-defined weaknesses include a borrower’s lack of marketability, inadequate cash flow or collateral support, failure to complete construction on time, or the failure to fulfill economic expectations. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or repayment in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loss: Loans classified as loss are considered uncollectible and charged off immediately.

The tables below present total loans outstanding, by loan portfolio segment, and risk category as of September 30, 2021 and December 31, 2020:


	September 30, 2021
			Criticized
			Special
(dollars in thousands)	Pass		Mention		Substandard		Doubtful		Total
Commercial
Commercial and industrial	$	498,201	$	1,777	$	6,374	$	247	$	506,599
Real estate construction		37,751		—		—		—		37,751
Commercial real estate		553,492		2,316		17,710		—		573,518
Total commercial		1,089,444		4,093		24,084		247		1,117,868
Consumer
Residential real estate first mortgage		499,497		—		1,842		—		501,339
Residential real estate junior lien		129,303		—		940		—		130,243
Other revolving and installment		50,932		—		4		—		50,936
Total consumer		679,732		—		2,786		—		682,518
Total loans	$	1,769,176	$	4,093	$	26,870	$	247	$	1,800,386


	December 31, 2020
			Criticized
			Special
(dollars in thousands)	Pass		Mention		Substandard		Doubtful		Total
Commercial
Commercial and industrial	$	669,602	$	5,415	$	16,841	$	—	$	691,858
Real estate construction		44,451		—		—		—		44,451
Commercial real estate		533,733		6,686		22,588		—		563,007
Total commercial		1,247,786		12,101		39,429		—		1,299,316
Consumer
Residential real estate first mortgage		461,221		1,406		743		—		463,370
Residential real estate junior lien		140,461		1,819		1,136		—		143,416
Other revolving and installment		73,236		—		37		—		73,273
Total consumer		674,918		3,225		1,916		—		680,059
Total loans	$	1,922,704	$	15,326	$	41,345	$	—	$	1,979,375

The adequacy of the allowance for loan losses is assessed at the end of each quarter. The allowance for loan losses includes a specific component related to loans that are individually evaluated for impairment and a general component related to loans that are segregated into homogeneous pools and collectively evaluated for impairment. The factors applied to these pools are an estimate of probable incurred losses based on management’s evaluation of historical net losses from loans with similar characteristics, which are adjusted by management to reflect current events, trends, and conditions. The adjustments include consideration of the following: changes in lending policies and procedures, economic conditions, nature and volume of the portfolio, experience of lending management, volume and severity of past due loans, quality of the loan review system, value of underlying collateral for collateral dependent loans, concentrations, and other external factors.

The following tables present, by loan portfolio segment, a summary of the changes in the allowance for loan losses for the three and nine months ended September 30, 2021 and 2020:


	Three months ended September 30, 2021
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	9,620	$	(825)	$	(747)	$	1,052	$	9,100
Real estate construction		587		92		—		—		679
Commercial real estate		12,937		(413)		—		—		12,524
Total commercial		23,144		(1,146)		(747)		1,052		22,303
Consumer
Residential real estate first mortgage		6,176		625		—		—		6,801
Residential real estate junior lien		1,401		6		—		16		1,423
Other revolving and installment		574		(32)		(46)		27		523
Total consumer		8,151		599		(46)		43		8,747
Unallocated		2,469		(1,453)		—		—		1,016
Total	$	33,764	$	(2,000)	$	(793)	$	1,095	$	32,066


	Nine months ended September 30, 2021
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	10,205	$	(1,378)	$	(1,224)	$	1,497	$	9,100
Real estate construction		658		21		—		—		679
Commercial real estate		14,105		(1,049)		(536)		4		12,524
Total commercial		24,968		(2,406)		(1,760)		1,501		22,303
Consumer
Residential real estate first mortgage		5,774		1,027		—		—		6,801
Residential real estate junior lien		1,373		(63)		—		113		1,423
Other revolving and installment		753		(196)		(139)		105		523
Total consumer		7,900		768		(139)		218		8,747
Unallocated		1,378		(362)		—		—		1,016
Total	$	34,246	$	(2,000)	$	(1,899)	$	1,719	$	32,066


	Three months ended September 30, 2020
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	10,797	$	(846)	$	(10)	$	432	$	10,373
Real estate construction		443		40		—		—		483
Commercial real estate		9,948		1,828		—		95		11,871
Total commercial		21,188		1,022		(10)		527		22,727
Consumer
Residential real estate first mortgage		2,673		1,694		—		—		4,367
Residential real estate junior lien		1,102		28		—		81		1,211
Other revolving and installment		546		108		(41)		24		637
Total consumer		4,321		1,830		(41)		105		6,215
Unallocated		1,747		648		—		—		2,395
Total	$	27,256	$	3,500	$	(51)	$	632	$	31,337


	Nine months ended September 30, 2020
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	12,270	$	(498)	$	(2,745)	$	1,346	$	10,373
Real estate construction		303		180		—		—		483
Commercial real estate		6,688		5,953		(865)		95		11,871
Total commercial		19,261		5,635		(3,610)		1,441		22,727
Consumer
Residential real estate first mortgage		1,448		2,914		—		5		4,367
Residential real estate junior lien		671		377		(12)		175		1,211
Other revolving and installment		352		371		(194)		108		637
Total consumer		2,471		3,662		(206)		288		6,215
Unallocated		2,192		203		—		—		2,395
Total	$	23,924	$	9,500	$	(3,816)	$	1,729	$	31,337

The following tables present the recorded investment in loans and related allowance for loan losses, by loan portfolio segment, disaggregated on the basis of the Company’s impairment methodology, as of September 30, 2021 and December 31, 2020:


	September 30, 2021
	Recorded Investment						Allowance for Loan Losses
	Individually		Collectively				Individually		Collectively
(dollars in thousands)	Evaluated		Evaluated		Total		Evaluated		Evaluated		Total
Commercial
Commercial and industrial	$	2,161	$	504,438	$	506,599	$	536	$	8,564	$	9,100
Real estate construction		—		37,751		37,751		—		679		679
Commercial real estate		4,493		569,025		573,518		11		12,513		12,524
Total commercial		6,654		1,111,214		1,117,868		547		21,756		22,303
Consumer
Residential real estate first mortgage		121		501,218		501,339		—		6,801		6,801
Residential real estate junior lien		172		130,071		130,243		8		1,415		1,423
Other revolving and installment		4		50,932		50,936		4		519		523
Total consumer		297		682,221		682,518		12		8,735		8,747
Unallocated		—		—		—		—		—		1,016
Total loans	$	6,951	$	1,793,435	$	1,800,386	$	559	$	30,491	$	32,066


	December 31, 2020
	Recorded Investment						Allowance for Loan Losses
	Individually		Collectively				Individually		Collectively
(dollars in thousands)	Evaluated		Evaluated		Total		Evaluated		Evaluated		Total
Commercial
Commercial and industrial	$	2,616	$	689,242	$	691,858	$	336	$	9,869	$	10,205
Real estate construction		—		44,451		44,451		—		658		658
Commercial real estate		5,224		557,783		563,007		837		13,268		14,105
Total commercial		7,840		1,291,476		1,299,316		1,173		23,795		24,968
Consumer
Residential real estate first mortgage		439		462,931		463,370		—		5,774		5,774
Residential real estate junior lien		224		143,192		143,416		19		1,354		1,373
Other revolving and installment		27		73,246		73,273		13		740		753
Total consumer		690		679,369		680,059		32		7,868		7,900
Unallocated		—		—		—		—		—		1,378
Total loans	$	8,530	$	1,970,845	$	1,979,375	$	1,205	$	31,663	$	34,246

The tables below summarize key information on impaired loans. These impaired loans may have estimated losses which are included in the allowance for loan losses.


	September 30, 2021						December 31, 2020
	Recorded		Unpaid		Related		Recorded		Unpaid		Related
(dollars in thousands)	Investment		Principal		Allowance		Investment		Principal		Allowance
Impaired loans with a valuation allowance
Commercial and industrial	$	710	$	725	$	536	$	723	$	725	$	336
Commercial real estate		777		920		11		3,948		3,974		837
Residential real estate junior lien		8		8		8		19		20		19
Other revolving and installment		4		4		4		27		27		13
Total impaired loans with a valuation allowance		1,499		1,657		559		4,717		4,746		1,205
Impaired loans without a valuation allowance
Commercial and industrial		1,451		1,603		—		1,893		2,173		—
Commercial real estate		3,716		3,872		—		1,276		1,415		—
Residential real estate first mortgage		121		123		—		439		464		—
Residential real estate junior lien		164		194		—		205		306		—
Other revolving and installment		—		—		—		—		—		—
Total impaired loans without a valuation allowance		5,452		5,792		—		3,813		4,358		—
Total impaired loans
Commercial and industrial		2,161		2,328		536		2,616		2,898		336
Commercial real estate		4,493		4,792		11		5,224		5,389		837
Residential real estate first mortgage		121		123		—		439		464		—
Residential real estate junior lien		172		202		8		224		326		19
Other revolving and installment		4		4		4		27		27		13
Total impaired loans	$	6,951	$	7,449	$	559	$	8,530	$	9,104	$	1,205

The table below presents the average recorded investment in impaired loans and interest income for the three and nine months ended September 30, 2021 and 2020:


	Three months ended September 30,
	2021				2020
	Average				Average
	Recorded		Interest		Recorded		Interest
(dollars in thousands)	Investment		Income		Investment		Income
Impaired loans with a valuation allowance
Commercial and industrial	$	719	$	3	$	2,541	$	14
Commercial real estate		779		2		197		8
Residential real estate first mortgage		—		—		—		—
Residential real estate junior lien		8		—		19		—
Other revolving and installment		4		—		—		—
Total impaired loans with a valuation allowance		1,510		5		2,757		22
Impaired loans without a valuation allowance
Commercial and industrial		2,016		5		1,013		24
Commercial real estate		3,793		—		1,330		—
Residential real estate first mortgage		121		—		459		—
Residential real estate junior lien		166		—		211		3
Other revolving and installment		—		—		—		—
Total impaired loans without a valuation allowance		6,096		5		3,013		27
Total impaired loans
Commercial and industrial		2,735		8		3,554		38
Commercial real estate		4,572		2		1,527		8
Residential real estate first mortgage		121		—		459		—
Residential real estate junior lien		174		—		230		3
Other revolving and installment		4		—		—		—
Total impaired loans	$	7,606	$	10	$	5,770	$	49


	Nine Months Ended September 30,
	2021				2020
	Average				Average
	Recorded		Interest		Recorded		Interest
(dollars in thousands)	Investment		Income		Investment		Income
Impaired loans with a valuation allowance
Commercial and industrial	$	818	$	10	$	3,815	$	14
Commercial real estate		782		6		200		8
Residential real estate junior lien		11		—		20		—
Other revolving and installment		3		—		—		—
Total impaired loans with a valuation allowance		1,614		16		4,035		22
Impaired loans without a valuation allowance
Commercial and industrial		2,061		15		1,154		26
Commercial real estate		3,980		—		1,699		—
Residential real estate first mortgage		114		—		467		—
Residential real estate junior lien		190		—		217		3
Other revolving and installment		—		—		—		—
Total impaired loans without a valuation allowance		6,345		15		3,537		29
Total impaired loans
Commercial and industrial		2,879		25		4,969		40
Commercial real estate		4,762		6		1,899		8
Residential real estate first mortgage		114		—		467		—
Residential real estate junior lien		201		—		237		3
Other revolving and installment		3		—		—		—
Total impaired loans	$	7,959	$	31	$	7,572	$	51

Loans with a carrying value of $1.2 billion as of September 30, 2021 and December 31, 2020, respectively, were pledged to secure public deposits, and for other purposes required or permitted by law.

Under certain circumstances, the Company will provide borrowers relief through loan restructurings. A restructuring of debt constitutes a TDR if the Company, for economic or legal reasons related to the borrower’s financial difficulties, grants a concession to the borrower that it would not otherwise consider. TDR concessions can include a reduction of interest rates, an extension of maturity dates, forgiveness of principal or interest due, or acceptance of other assets in full or partial satisfaction of the debt.

During the third quarter of 2021, there were no loans modified as a TDR as a result of changing the terms allowing for interest rate reductions and an extension of the maturity dates. During the third quarter of 2020, there were no loans modified as a TDR.

The Company does not have material commitments to lend additional funds to borrowers with loans whose terms have been modified in TDRs or whose loans are on nonaccrual.

Beginning in 2020, in accordance with the Interagency Statement on Loan Modifications and Reporting for Financial Institutions as issued on April 7, 2020, through September 30, 2021, the Company had entered into modifications on 587 loans representing $154.5 million in principal balances, since the beginning of the COVID-19 pandemic. Of those loans, 8 loans with a total outstanding principal balance of $3.4 million, have been granted additional deferrals, 2 loans with a total outstanding principal balance of $69 thousand remain on the first deferral and the remaining loans have been returned to a normal payment status. These deferrals were generally no more than 90 days in duration and were not considered TDRs.