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Loans, net and allowance for loan losses | 12 Months Ended
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Dec. 31, 2015
Receivables [Abstract] |
Loans, net and allowance for loan losses | 5. Loans, net and allowance for loan losses: The major classifications of loans outstanding, net of deferred loan origination fees and costs at December 31, 2015 and 2014 are summarized as follows. Net deferred loan costs were $690 and $651 in 2015 and 2014, respectively.
December 31 |  | 2015 |  | 2014 |
Commercial |  | $ | 365,767 |  | $ | 319,590 |
Real estate: |  |  |  |  |  |  |
Commercial |  |  | 567,277 |  |  | 493,481 |
Residential |  |  | 306,218 |  |  | 322,454 |
Consumer |  |  | 101,603 |  |  | 74,369 |
Total |  | $ | 1,340,865 |  | $ | 1,209,894 |
Loans outstanding to directors, executive officers, principal stockholders or to their affiliates totaled $10,187 and $11,913 at December 31, 2015 and 2014, respectively. Advances and repayments during 2015 totaled $20,236 and $21,962 respectively. There were no related party loans that were classified as nonaccrual, past due, or restructured or considered a potential credit risk at December 31, 2015 and 2014. At December 31, 2015, the majority of the Company’s loans were at least partially secured by real estate in Northeastern Pennsylvania. Therefore, a primary concentration of credit risk is directly related to the real estate market in this area. Changes in the general economy, local economy or in the real estate market could affect the ultimate collectability of this portion of the loan portfolio. Management does not believe there are any other significant concentrations of credit risk that could affect the loan portfolio. The changes in the allowance for loan losses account by major classification of loan for the year ended December 31, 2015, 2014, and 2013 were as follows:
|  |  |  |  | Real estate |  |  |  |  |  |  |  |  |  |
December 31, 2015 |  | Commercial |  | Commercial |  | Residential |  | Consumer |  | Unallocated |  | Total |
Allowance for loan losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning balance |  | $ | 2,321 |  | $ | 3,037 |  | $ | 3,690 |  | $ | 1,290 |  | $ |  |  | $ | 10,338 |
Charge-offs |  |  | (246) |  |  | (325) |  |  | (523) |  |  | (333) |  |  |  |  |  | (1,427) |
Recoveries |  |  | 77 |  |  | 144 |  |  | 26 |  |  | 117 |  |  |  |  |  | 364 |
Provisions |  |  | 890 |  |  | 1,389 |  |  | 889 |  |  | 509 |  |  | 23 |  |  | 3,700 |
Ending balance |  | $ | 3,042 |  | $ | 4,245 |  | $ | 4,082 |  | $ | 1,583 |  | $ | 23 |  | $ | 12,975 |
Ending balance: individually evaluated for impairment |  |  | 759 |  |  | 126 |  |  | 1,138 |  |  | 117 |  |  |  |  |  | 2,140 |
Ending balance: collectively evaluated for impairment |  |  | 2,283 |  |  | 4,012 |  |  | 2,944 |  |  | 1,466 |  |  | 23 |  |  | 10,728 |
Ending balance: loans acquired with deteriorated credit quality |  | $ |  |  | $ | 107 |  | $ |  |  |  |  |  | $ |  |  | $ | 107 |
Loans receivable: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Ending balance |  | $ | 365,767 |  | $ | 567,277 |  | $ | 306,218 |  | $ | 101,603 |  | $ |  |  | $ | 1,340,865 |
Ending balance: individually evaluated for impairment |  |  | 1,196 |  |  | 4,006 |  |  | 4,917 |  |  | 148 |  |  |  |  |  | 10,267 |
Ending balance: collectively evaluated for impairment |  |  | 363,620 |  |  | 561,903 |  |  | 301,252 |  |  | 101,455 |  |  |  |  |  | 1,328,230 |
Ending balance: loans acquired with deteriorated credit quality |  | $ | 951 |  | $ | 1,368 |  | $ | 49 |  | $ |  |  | $ |  |  | $ | 2,368 |
|  |  |  |  | Real estate |  |  |  |  |  |  |  |  |
December 31, 2014 |  | Commercial |  | Commercial |  | Residential |  | Consumer |  | Unallocated |  | Total
Allowance for loan losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning balance |  | $ | 2,008 |  | $ | 2,394 |  | $ | 3,135 |  | $ | 1,114 |  | $ |  |  | $ | 8,651
Charge-offs |  |  | (601) |  |  | (500) |  |  | (804) |  |  | (386) |  |  |  |  |  | (2,291)
Recoveries |  |  | 9 |  |  | 292 |  |  | 38 |  |  | 115 |  |  |  |  |  | 454
Provisions |  |  | 905 |  |  | 851 |  |  | 1,321 |  |  | 447 |  |  |  |  |  | 3,524
Ending balance |  | $ | 2,321 |  | $ | 3,037 |  | $ | 3,690 |  | $ | 1,290 |  | $ |  |  | $ | 10,338
Ending balance: individually evaluated for impairment |  |  | 1,072 |  |  | 805 |  |  | 767 |  |  | 38 |  |  |  |  |  | 2,682
Ending balance: collectively evaluated for impairment |  |  | 1,081 |  |  | 2,125 |  |  | 2,921 |  |  | 1,252 |  |  |  |  |  | 7,379
Ending balance: loans acquired with deteriorated credit quality |  | $ | 168 |  | $ | 107 |  | $ | 2 |  |  |  |  | $ |  |  | $ | 277
Loans receivable: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Ending balance |  | $ | 319,590 |  | $ | 493,481 |  | $ | 322,454 |  | $ | 74,369 |  | $ |  |  | $ | 1,209,894
Ending balance: individually evaluated for impairment |  |  | 2,595 |  |  | 5,084 |  |  | 4,001 |  |  | 127 |  |  |  |  |  | 11,807
Ending balance: collectively evaluated for impairment |  |  | 315,642 |  |  | 487,024 |  |  | 318,395 |  |  | 74,242 |  |  |  |  |  | 1,195,303
Ending balance: loans acquired with deteriorated credit quality |  | $ | 1,353 |  | $ | 1,373 |  | $ | 58 |  | $ |  |  | $ |  |  | $ | 2,784
|  |  |  |  | Real estate |  |  |  |  |  |  |  |  |  |
December 31, 2013 |  | Commercial |  | Commercial |  | Residential |  | Consumer |  | Unallocated |  | Total |
Allowance for loan losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning balance |  | $ | 799 |  | $ | 2,304 |  | $ | 2,981 |  | $ | 866 |  | $ |  |  | $ | 6,950 |
Charge-offs |  |  | (5) |  |  | (15) |  |  | (508) |  |  | (313) |  |  |  |  |  | (841) |
Recoveries |  |  | 1 |  |  | 20 |  |  | 111 |  |  | 49 |  |  |  |  |  | 181 |
Provisions |  |  | 1,213 |  |  | 85 |  |  | 551 |  |  | 512 |  |  |  |  |  | 2,361 |
Ending balance |  | $ | 2,008 |  | $ | 2,394 |  | $ | 3,135 |  | $ | 1,114 |  | $ |  |  | $ | 8,651 |
Ending balance: individually evaluated for impairment |  |  | 1,500 |  |  | 300 |  |  | 224 |  |  |  |  |  |  |  |  | 2,024 |
Ending balance: collectively evaluated for impairment |  |  | 508 |  |  | 2,094 |  |  | 2,911 |  |  | 1,114 |  |  |  |  |  | 6,627 |
Ending balance: loans acquired with deteriorated credit quality |  | $ |  |  | $ |  |  | $ |  |  | $ |  |  | $ |  |  | $ |  |
Loans receivable: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Ending balance |  | $ | 350,680 |  | $ | 413,058 |  | $ | 322,062 |  | $ | 90,817 |  | $ |  |  | $ | 1,176,617 |
Ending balance: individually evaluated for impairment |  |  | 4,504 |  |  | 7,711 |  |  | 3,321 |  |  | 90 |  |  |  |  |  | 15,626 |
Ending balance: collectively evaluated for impairment |  |  | 343,502 |  |  | 401,168 |  |  | 318,274 |  |  | 90,727 |  |  |  |  |  | 1,153,671 |
Ending balance: loans acquired with deteriorated credit quality |  | $ | 2,674 |  | $ | 4,179 |  | $ | 467 |  | $ |  |  | $ |  |  | $ | 7,320 |
The following tables present the major classification of loans summarized by the aggregate pass rating and the classified ratings of special mention, substandard and doubtful within the Company’s internal risk rating system at December 31, 2015 and 2014:
|  |  |  |  | Special |  |  |  |  |  |  |  |  |  |
December 31, 2015 |  | Pass |  | Mention |  | Substandard |  | Doubtful |  | Total |
Commercial |  | $ | 357,894 |  | $ | 3,566 |  | $ | 4,307 |  | $ |  |  | $ | 365,767 |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 538,130 |  |  | 10,150 |  |  | 18,997 |  |  |  |  |  | 567,277 |
Residential |  |  | 296,587 |  |  | 983 |  |  | 8,648 |  |  |  |  |  | 306,218 |
Consumer |  |  | 101,486 |  |  |  |  |  | 117 |  |  |  |  |  | 101,603 |
Total |  | $ | 1,294,097 |  | $ | 14,699 |  | $ | 32,069 |  | $ |  |  | $ | 1,340,865 |
|  |  |  |  | Special |  |  |  |  |  |  |  |  |  |
December 31, 2014 |  | Pass |  | Mention |  | Substandard |  | Doubtful |  | Total |
Commercial |  | $ | 306,066 |  | $ | 6,135 |  | $ | 7,389 |  | $ |  |  | $ | 319,590 |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 472,270 |  |  | 9,858 |  |  | 11,353 |  |  |  |  |  | 493,481 |
Residential |  |  | 312,086 |  |  | 2,123 |  |  | 8,245 |  |  |  |  |  | 322,454 |
Consumer |  |  | 74,250 |  |  | 13 |  |  | 106 |  |  |  |  |  | 74,369 |
Total |  | $ | 1,164,672 |  | $ | 18,129 |  | $ | 27,093 |  | $ |  |  | $ | 1,209,894 |
Information concerning nonaccrual loans by major loan classification at December 31, 2015 and 2014 is summarized as follows:
December 31 |  | 2015 |  | 2014 |
Commercial |  | $ | 1,632 |  | $ | 1,322 |
Real estate: |  |  |  |  |  |  |
Commercial |  |  | 3,859 |  |  | 3,732 |
Residential |  |  | 4,732 |  |  | 3,523 |
Consumer |  |  | 148 |  |  | 122 |
Total |  | $ | 10,371 |  | $ | 8,699 |
The major classification of loans by past due status at December 31, 2015 and 2014 are summarized as follows:
|  |  |  |  |  |  |  | Greater |  |  |  |  |  |  |  |  |  |  | Loans > 90 |
|  | 30-59 Days |  | 60-89 Days |  | than 90 |  | Total Past |  |  |  |  |  |  |  | Days and |
December 31, 2015 |  | Past Due |  | Past Due |  | Days |  | Due |  | Current |  | Total Loans |  | Accruing |
Commercial |  | $ | 126 |  | $ |  |  | $ | 1,632 |  | $ | 1,758 |  | $ | 364,009 |  | $ | 365,767 |  |  |  |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 1,364 |  |  | 165 |  |  | 3,859 |  |  | 5,388 |  |  | 561,889 |  |  | 567,277 |  |  |  |
Residential |  |  | 3,891 |  |  | 1,067 |  |  | 5,257 |  |  | 10,215 |  |  | 296,003 |  |  | 306,218 |  | $ | 525 |
Consumer |  |  | 705 |  |  | 353 |  |  | 386 |  |  | 1,444 |  |  | 100,159 |  |  | 101,603 |  |  | 238 |
Total |  | $ | 6,086 |  | $ | 1,585 |  | $ | 11,134 |  | $ | 18,805 |  | $ | 1,322,060 |  | $ | 1,340,865 |  | $ | 763 |
|  |  |  |  |  |  |  | Greater |  |  |  |  |  |  |  |  |  |  | Loans > 90 |
|  | 30-59 Days |  | 60-89 Days |  | than 90 |  | Total Past |  |  |  |  |  |  |  | Days and |
December 31, 2014 |  | Past Due |  | Past Due |  | Days |  | Due |  | Current |  | Total Loans |  | Accruing |
Commercial |  | $ | 898 |  | $ | 117 |  | $ | 1,322 |  | $ | 2,337 |  | $ | 317,253 |  | $ | 319,590 |  |  |  |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 2,100 |  |  | 888 |  |  | 3,868 |  |  | 6,856 |  |  | 486,625 |  |  | 493,481 |  | $ | 136 |
Residential |  |  | 3,154 |  |  | 1,239 |  |  | 4,585 |  |  | 8,978 |  |  | 313,476 |  |  | 322,454 |  |  | 1,062 |
Consumer |  |  | 848 |  |  | 247 |  |  | 547 |  |  | 1,642 |  |  | 72,727 |  |  | 74,369 |  |  | 425 |
Total |  | $ | 7,000 |  | $ | 2,491 |  | $ | 10,322 |  | $ | 19,813 |  | $ | 1,190,081 |  | $ | 1,209,894 |  | $ | 1,623 |
The following tables summarize information concerning impaired loans as of and for the years ended December 31, 2015, 2014 and 2013 by major loan classification:
|  |  |  |  |  |  |  |  |  |  | For the Year Ended |
|  |  |  |  | Unpaid |  |  |  |  | Average |  | Interest |
|  | Recorded |  | Principal |  | Related |  | Recorded |  | Income |
December 31, 2015 |  | Investment |  | Balance |  | Allowance |  | Investment |  | Recognized |
With no related allowance: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  | $ | 1,352 |  | $ | 2,720 |  |  |  |  | $ | 1,848 |  | $ | 87 |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 2,731 |  |  | 3,408 |  |  |  |  |  | 2,394 |  |  | 95 |
Residential |  |  | 3,048 |  |  | 3,231 |  |  |  |  |  | 2,664 |  |  | 4 |
Consumer |  |  | 31 |  |  | 31 |  |  |  |  |  | 17 |  |  |  |
Total |  |  | 7,162 |  |  | 9,390 |  |  |  |  |  | 6,923 |  |  | 186 |
With an allowance recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 795 |  |  | 795 |  | $ | 759 |  |  | 1,680 |  |  | 40 |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 2,643 |  |  | 2,643 |  |  | 233 |  |  | 4,155 |  |  | 86 |
Residential |  |  | 1,918 |  |  | 1,918 |  |  | 1,138 |  |  | 1,776 |  |  | 30 |
Consumer |  |  | 117 |  |  | 117 |  |  | 117 |  |  | 126 |  |  |  |
Total |  |  | 5,473 |  |  | 5,473 |  |  | 2,247 |  |  | 7,737 |  |  | 156 |
Commercial |  |  | 2,147 |  |  | 3,515 |  |  | 759 |  |  | 3,528 |  |  | 127 |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 5,374 |  |  | 6,051 |  |  | 233 |  |  | 6,549 |  |  | 181 |
Residential |  |  | 4,966 |  |  | 5,149 |  |  | 1,138 |  |  | 4,440 |  |  | 34 |
Consumer |  |  | 148 |  |  | 148 |  |  | 117 |  |  | 143 |  |  |  |
Total |  | $ | 12,635 |  | $ | 14,863 |  | $ | 2,247 |  | $ | 14,660 |  | $ | 342 |
|  |  |  |  |  |  |  |  |  |  | For the Year Ended |
|  |  |  |  | Unpaid |  |  |  |  | Average |  | Interest |
|  | Recorded |  | Principal |  | Related |  | Recorded |  | Income |
December 31, 2014 |  | Investment |  | Balance |  | Allowance |  | Investment |  | Recognized |
With no related allowance: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  | $ | 2,379 |  | $ | 4,084 |  |  |  |  | $ | 2,669 |  | $ | 141 |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 2,932 |  |  | 3,690 |  |  |  |  |  | 7,944 |  |  | 120 |
Residential |  |  | 2,672 |  |  | 2,857 |  |  |  |  |  | 2,731 |  |  | 4 |
Consumer |  |  | 83 |  |  | 83 |  |  |  |  |  | 94 |  |  |  |
Total |  |  | 8,066 |  |  | 10,714 |  |  |  |  |  | 13,438 |  |  | 265 |
With an allowance recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 1,569 |  |  | 1,569 |  | $ | 1,240 |  |  | 1,787 |  | $ | 58 |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 3,525 |  |  | 3,525 |  |  | 912 |  |  | 2,293 |  |  | 28 |
Residential |  |  | 1,387 |  |  | 1,387 |  |  | 769 |  |  | 590 |  |  | 10 |
Consumer |  |  | 44 |  |  | 44 |  |  | 38 |  |  | 10 |  |  | 1 |
Total |  |  | 6,525 |  |  | 6,525 |  |  | 2,959 |  |  | 4,680 |  |  | 97 |
Commercial |  |  | 3,948 |  |  | 5,653 |  |  | 1,240 |  |  | 4,456 |  |  | 199 |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 6,457 |  |  | 7,215 |  |  | 912 |  |  | 10,237 |  |  | 148 |
Residential |  |  | 4,059 |  |  | 4,244 |  |  | 769 |  |  | 3,321 |  |  | 14 |
Consumer |  |  | 127 |  |  | 127 |  |  | 38 |  |  | 104 |  |  | 1 |
Total |  | $ | 14,591 |  | $ | 17,239 |  | $ | 2,959 |  | $ | 18,118 |  | $ | 362 |
|  |  |  |  |  |  |  |  |  |  | For the Year Ended |
|  |  |  |  | Unpaid |  |  |  |  | Average |  | Interest |
|  | Recorded |  | Principal |  | Related |  | Recorded |  | Income |
December 31, 2013 |  | Investment |  | Balance |  | Allowance |  | Investment |  | Recognized |
With no related allowance: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  | $ | 4,978 |  | $ | 9,474 |  |  |  |  | $ | 5,824 |  |  |  |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 10,496 |  |  | 13,352 |  |  |  |  |  | 10,095 |  |  |  |
Residential |  |  | 3,004 |  |  | 3,437 |  |  |  |  |  | 2,614 |  |  |  |
Consumer |  |  | 90 |  |  | 90 |  |  |  |  |  | 95 |  |  |  |
Total |  |  | 18,568 |  |  | 26,353 |  |  |  |  |  | 18,628 |  |  |  |
With an allowance recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 2,200 |  |  | 2,200 |  | $ | 1,500 |  |  | 2,182 |  | $ | 95 |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 1,394 |  |  | 1,394 |  |  | 300 |  |  | 1,409 |  |  | 76 |
Residential |  |  | 784 |  |  | 784 |  |  | 224 |  |  | 672 |  |  | 13 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total |  |  | 4,378 |  |  | 4,378 |  |  | 2,024 |  |  | 4,263 |  |  | 184 |
Commercial |  |  | 7,178 |  |  | 11,674 |  |  | 1,500 |  |  | 8,006 |  |  | 95 |
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 11,890 |  |  | 14,746 |  |  | 300 |  |  | 11,504 |  |  | 76 |
Residential |  |  | 3,788 |  |  | 4,221 |  |  | 224 |  |  | 3,286 |  |  | 13 |
Consumer |  |  | 90 |  |  | 90 |  |  | — |  |  | 95 |  |  |  |
Total |  | $ | 22,946 |  | $ | 30,731 |  | $ | 2,024 |  | $ | 22,891 |  | $ | 184 |
There were no amounts of interest income recognized using the cash-basis method on impaired loans for the years ended December 31, 2015, 2014 and 2013. As a part of the Merger, an adjustment was made to reflect the elimination of the allowance for loan losses related to the Peoples Bank loan portfolio, as required by purchase accounting standards. As a result, the acquired loan portfolio was evaluated based on risk characteristics and other credit and market criteria to determine a credit quality adjustment to the fair value of the loan acquired. The acquired loan balance was reduced by the aggregate amount of the credit quality adjustment in determining the fair value of the loans. The credit quality adjustment does not account for acquired loans deemed to be impaired in accordance with Accounting Standard Codification 310-30-30, previously known as Statement of Position (SOP) 03-3, “Accounting for Certain Loans Acquired in a Transfer.” These impaired loans are accounted for in the credit adjustment on distressed loans, which represents the portion of the loan balance that has been deemed uncollectible based on the management’s expectations of future cash flows for each respective loan. Based on management’s evaluation of the acquired loan portfolio, 29 loans were deemed impaired resulting in a credit adjustment on distressed loans of $6,892. As of December 31, 2015, there were a total of thirteen loans remaining with a credit adjustment of $2,228. At December 31, 2015, the Company had total impaired loans of $12,635. The impaired loan balance includes $2,368 of impaired loans acquired as part of the merger net of a remaining fair value adjustment of $2,228. Management performed an evaluation of expected future cash flows, including the anticipated cash flow from the sale of collateral, and compared that to the carrying amount of the impaired loans. Based on these evaluations, the Company has determined that an additional reserve of $107 was required against the acquired impaired loans at December 31, 2015. The changes in the accretible yield and nonaccretible difference of acquired loans accounted for under ASC310-30 for the years ended December 31, 2015, 2014 and 2013, were as follows:
|  | 2015 |  | 2014 |  | 2013
Year ended December 31 |  | Accretible |  | Nonaccretible |  | Accretible |  | Nonaccretible |  | Accretible |  | Nonaccretible
Beginning Balance, January 1 |  | $ | 60 |  | $ | 2,588 |  | $ | 895 |  | $ | 6,892 |  |  |  |  |  |
Additions |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 934 |  | $ | 6,892
Accretion |  |  | (60) |  |  |  |  |  | (280) |  |  |  |  |  | (39) |  |  |
Charge-offs |  |  |  |  |  |  |  |  | (398) |  |  | (2,703) |  |  |  |  |  |
Payments |  |  |  |  |  | (360) |  |  | (157) |  |  | (1,601) |  |  |  |  |  |
Ending Balance, December 31 |  | $ |  |  | $ | 2,228 |  | $ | 60 |  | $ | 2,588 |  | $ | 895 |  | $ | 6,892
Included in the commercial loan and commercial real estate categories are troubled debt restructurings that were classified as impaired. Trouble debt restructurings totaled $2,861, $2,933 and $2,487 at December 31, 2015, 2014 and 2013, respectively. There were nine loans modified in 2015, three loans modified in 2014 and no loans modified in 2013 that resulted in troubled debt restructurings. The following tables summarize the loans whose terms have been modified resulting in troubled debt restructurings during the year ended December 31, 2015 and 2014.
|  |  |  | Pre-Modification |  | Post-Modification |  |  |  |
|  | Number |  | Outstanding Recorded |  | Outstanding |  | Recorded |
December 31, 2015 |  | of Contracts |  | Investment |  | Recorded Investment |  | Investment |
Commercial |  | 1 |  | $ | 98 |  | $ | 98 |  |  |  |
Commercial real estate |  | 1 |  |  | 58 |  |  | 58 |  | $ | 54 |
Residential mortgage |  | 7 |  |  | 501 |  |  | 501 |  |  | 484 |
Total |  | 9 |  | $ | 657 |  | $ | 657 |  | $ | 538 |
|  |  |  | Pre-Modification |  | Post-Modification |  |  |  |
|  | Number |  | Outstanding Recorded |  | Outstanding |  | Recorded |
December 31, 2014 |  | of Contracts |  | Investment |  | Recorded Investment |  | Investment |
Commercial real estate |  | 1 |  | $ | 4,408 |  | $ | 2,500 |  | $ | 2,457 |
Residential mortgage |  | 2 |  |  | 479 |  |  | 479 |  |  | 476 |
Total |  | 3 |  | $ | 4,887 |  | $ | 2,979 |  | $ | 2,933 |
There were two payment defaults within 12 months of their modification on loans considered troubled debt restructurings for the year ended December 31, 2015 totaling $166 and no defaults for the years ended December 31, 2014 and 2013. The amount of loans in the formal process of foreclosure totaled $564 at December 31, 2015.

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