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Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses (Tables)
12 Months Ended
Dec. 31, 2015
Receivables [Abstract]  
Loan Composition Schedule
Loan and lease receivables, including loans held for sale, consist of the following:
 
 
December 31,
2015
 
December 31,
2014
 
 
(In Thousands)
Commercial real estate
 
 
 
 
Commercial real estate — owner occupied
 
$
176,322

 
$
163,884

Commercial real estate — non-owner occupied
 
436,901

 
417,962

Construction and land development
 
160,404

 
121,160

Multi-family
 
80,254

 
72,578

1-4 family (1)
 
51,607

 
36,182

Total commercial real estate
 
905,488

 
811,766

Commercial and industrial (2)
 
473,592

 
416,654

Direct financing leases, net
 
31,093

 
34,165

Consumer and other
 
 
 
 
Home equity and second mortgages
 
8,237

 
7,866

Other
 
16,319

 
11,341

Total consumer and other
 
24,556

 
19,207

Total gross loans and leases receivable
 
1,434,729

 
1,281,792

Less:
 
 
 
 
   Allowance for loan and lease losses
 
16,316

 
14,329

   Deferred loan fees
 
1,062

 
1,025

Loans and leases receivable, net
 
$
1,417,351

 
$
1,266,438

Schedule of Fair Value of Credit Impaired Loans Acquired
 
December 31,
2015
 
December 31,
2014
 
(In Thousands)
Contractually required payments
$
5,291

 
$
6,874

Fair value of credit impaired loans acquired
$
3,250

 
$
4,025

Accretable Yield Rollforward
The following table presents a rollforward of the accretable yield for the year ended December 31, 2015 and 2014.
 
December 31,
2015
 
December 31,
2014
 
(In Thousands)
Accretable yield, beginning of period
$
676

 
$
683

Accretion recognized in earnings
(50
)
 
(7
)
Reclassification to nonaccretable difference for loans with changing cash flows(1)
(60
)
 

Changes in accretable yield for non-credit related changes in expected cash flows(2)
(152
)
 

Accretable yield, end of period
$
414

 
$
676

Financing Receivable by Credit Quality Indicators
The following information illustrates ending balances of the Corporation’s loan and lease portfolio, including impaired loans by class of receivable, and considering certain credit quality indicators as of December 31, 2015 and 2014:
 
 
Category
 
 
As of December 31, 2015
 
I
 
II
 
III
 
IV
 
Total
 
 
(Dollars in Thousands)
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
Commercial real estate — owner occupied
 
$
156,379

 
$
7,654

 
$
9,311

 
$
2,978

 
$
176,322

Commercial real estate — non-owner occupied
 
410,517

 
20,662

 
3,408

 
2,314

 
436,901

Construction and land development
 
151,508

 
3,092

 
874

 
4,930

 
160,404

Multi-family
 
79,368

 
884

 

 
2

 
80,254

1-4 family (1)
 
42,389

 
3,985

 
1,865

 
3,368

 
51,607

      Total commercial real estate
 
840,161

 
36,277

 
15,458

 
13,592

 
905,488

 
 
 
 
 
 
 
 
 
 
 
Commercial and industrial (2)
 
431,598

 
7,139

 
25,706

 
9,149

 
473,592

 
 
 
 
 
 
 
 
 
 
 
Direct financing leases, net
 
29,514

 
1,013

 
528

 
38

 
31,093

 
 
 
 
 
 
 
 
 
 
 
Consumer and other:
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
7,497

 

 
141

 
599

 
8,237

Other
 
15,616

 
48

 

 
655

 
16,319

      Total consumer and other
 
23,113

 
48

 
141

 
1,254

 
24,556

 
 
 
 
 
 
 
 
 
 
 
Total gross loans and leases receivable
 
$
1,324,386

 
$
44,477

 
$
41,833

 
$
24,033

 
$
1,434,729

Category as a % of total portfolio
 
92.30
%
 
3.10
%
 
2.92
%
 
1.68
%
 
100.00
%
(1)
Includes residential real estate loans held for sale totaling $1.3 million in Category I.
(2)
Includes guaranteed portion of SBA loans held for sale totaling $1.4 million in Category I.

 
 
Category
 
 
As of December 31, 2014
 
I
 
II
 
III
 
IV
 
Total
 
 
(Dollars in Thousands)
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
Commercial real estate — owner occupied
 
$
131,094

 
$
15,592

 
$
16,621

 
$
577

 
$
163,884

Commercial real estate — non-owner occupied
 
378,671

 
20,823

 
17,498

 
970

 
417,962

Construction and land development
 
100,934

 
8,193

 
6,876

 
5,157

 
121,160

Multi-family
 
70,897

 
751

 
913

 
17

 
72,578

1-4 family (1)
 
25,997

 
5,278

 
3,336

 
1,571

 
36,182

      Total commercial real estate
 
707,593

 
50,637

 
45,244

 
8,292

 
811,766

 
 
 
 
 
 
 
 
 
 
 
Commercial and industrial
 
383,755

 
18,524

 
12,026

 
2,349

 
416,654

 
 
 
 
 
 
 
 
 
 
 
Direct financing leases, net
 
32,756

 
1,120

 
289

 

 
34,165

 
 
 
 
 
 
 
 
 
 
 
Consumer and other:
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
7,039

 
205

 
189

 
433

 
7,866

Other
 
10,570

 
50

 

 
721

 
11,341

      Total consumer and other
 
17,609

 
255

 
189

 
1,154

 
19,207

 
 
 
 
 
 
 
 
 
 
 
Total gross loans and leases receivable
 
$
1,141,713

 
$
70,536

 
$
57,748

 
$
11,795

 
$
1,281,792

Category as a % of total portfolio
 
89.07
%
 
5.50
%
 
4.51
%
 
0.92
%
 
100.00
%
Past Due Financing Receivables
The delinquency aging of the loan and lease portfolio by class of receivable as of December 31, 2015 and 2014 were as follows:
As of December 31, 2015
 
30-59
days past due
 
60-89
days past due
 
Greater
than 90
days past due
 
Total past due
 
Current
 
Total loans
 
 
(Dollars in Thousands)
Accruing loans and leases
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$

 
$

 
$

 
$

 
$
173,416

 
$
173,416

Non-owner occupied
 

 

 

 

 
435,222

 
435,222

Construction and land development
 

 

 

 

 
155,675

 
155,675

Multi-family
 

 

 

 

 
80,252

 
80,252

1-4 family (1)
 
78

 

 

 
78

 
48,918

 
48,996

Commercial & industrial (2)
 

 

 

 

 
464,456

 
464,456

Direct financing leases, net
 

 

 

 

 
31,055

 
31,055

Consumer and other:
 
 
 
 
 
 
 

 
 
 

Home equity and second mortgages
 

 

 

 

 
7,695

 
7,695

Other
 

 

 

 

 
15,664

 
15,664

Total
 
$
78

 
$

 
$

 
$
78

 
$
1,412,353

 
$
1,412,431

Non-accruing loans and leases
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$

 
$
473

 
$

 
$
473

 
$
2,434

 
$
2,907

Non-owner occupied
 

 

 

 

 
1,678

 
1,678

Construction and land development
 
397

 

 

 
397

 
4,332

 
4,729

Multi-family
 

 

 

 

 
2

 
2

1-4 family
 
430

 
34

 
895

 
1,359

 
1,252

 
2,611

Commercial & industrial
 
2,077

 

 
564

 
2,641

 
6,495

 
9,136

Direct financing leases, net
 

 

 

 

 
38

 
38

Consumer and other:
 
 
 
 
 
 
 

 
 
 

Home equity and second mortgages
 

 

 
250

 
250

 
292

 
542

Other
 

 

 
655

 
655

 

 
655

Total
 
$
2,904

 
$
507

 
$
2,364

 
$
5,775

 
$
16,523

 
$
22,298

Total loans and leases
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$

 
$
473

 
$

 
$
473

 
$
175,850

 
$
176,323

Non-owner occupied
 

 

 

 

 
436,900

 
436,900

Construction and land development
 
397

 

 

 
397

 
160,007

 
160,404

Multi-family
 

 

 

 

 
80,254

 
80,254

1-4 family
 
508

 
34

 
895

 
1,437

 
50,170

 
51,607

Commercial & industrial
 
2,077

 

 
564

 
2,641

 
470,951

 
473,592

Direct financing leases, net
 

 

 

 

 
31,093

 
31,093

Consumer and other:
 
 
 
 
 
 
 

 

 

Home equity and second mortgages
 

 

 
250

 
250

 
7,987

 
8,237

Other
 

 

 
655

 
655

 
15,664

 
16,319

Total
 
$
2,982

 
$
507

 
$
2,364

 
$
5,853

 
$
1,428,876

 
$
1,434,729

Percent of portfolio
 
0.21
%
 
0.04
%
 
0.16
%
 
0.41
%
 
99.59
%
 
100.00
%
(1)
Includes residential real estate loans held for sale totaling $1.3 million.
(2)
Includes guaranteed portion of SBA loans held for sale totaling $1.4 million.


As of December 31, 2014
 
30-59
days past due
 
60-89
days past due
 
Greater
than 90
days past due
 
Total past due
 
Current
 
Total loans
 
 
(Dollars in Thousands)
Accruing loans and leases
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$

 
$

 
$

 
$

 
$
163,384

 
$
163,384

Non-owner occupied
 

 

 

 

 
417,676

 
417,676

Construction and land development
 

 

 

 

 
116,228

 
116,228

Multi-family
 

 

 

 

 
72,561

 
72,561

1-4 family (1)
 

 

 

 

 
35,492

 
35,492

Commercial & industrial
 

 

 

 

 
414,336

 
414,336

Direct financing leases, net
 

 

 

 

 
34,165

 
34,165

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 

 

 

 

 
7,537

 
7,537

Other
 

 

 

 

 
10,621

 
10,621

Total
 
$

 
$

 
$

 
$

 
$
1,272,000

 
$
1,272,000

Non-accruing loans and leases
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$

 
$

 
$

 
$

 
$
500

 
$
500

Non-owner occupied
 

 
215

 

 
215

 
71

 
286

Construction and land development
 

 
193

 

 
193

 
4,739

 
4,932

Multi-family
 

 

 

 

 
17

 
17

1-4 family
 

 
106

 
306

 
412

 
278

 
690

Commercial & industrial
 
364

 
146

 
736

 
1,246

 
1,072

 
2,318

Direct financing leases, net
 

 

 

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 

 

 

 

 
329

 
329

Other
 

 

 
720

 
720

 

 
720

Total
 
$
364

 
$
660

 
$
1,762

 
$
2,786

 
$
7,006

 
$
9,792

Total loans and leases
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$

 
$

 
$

 
$

 
$
163,884

 
$
163,884

Non-owner occupied
 

 
215

 

 
215

 
417,747

 
417,962

Construction and land development
 

 
193

 

 
193

 
120,967

 
121,160

Multi-family
 

 

 

 

 
72,578

 
72,578

1-4 family
 

 
106

 
306

 
412

 
35,770

 
36,182

Commercial & industrial
 
364

 
146

 
736

 
1,246

 
415,408

 
416,654

Direct financing leases, net
 

 

 

 

 
34,165

 
34,165

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 

 

 

 

 
7,866

 
7,866

Other
 

 

 
720

 
720

 
10,621

 
11,341

Total
 
$
364

 
$
660

 
$
1,762

 
$
2,786

 
$
1,279,006

 
$
1,281,792

Percent of portfolio
 
0.03
%
 
0.05
%
 
0.14
%
 
0.22
%
 
99.78
%
 
100.00
%
Schedule of Financing Receivables, Non Accrual Status
The Corporation’s total impaired assets consisted of the following at December 31, 2015 and 2014, respectively.
 
 
December 31,
2015
 
December 31,
2014
 
 
(Dollars in Thousands)
Non-accrual loans and leases
 
 
 
 
Commercial real estate:
 
 
 
 
Commercial real estate — owner occupied
 
$
2,907

 
$
500

Commercial real estate — non-owner occupied
 
1,678

 
286

Construction and land development
 
4,729

 
4,932

Multi-family
 
2

 
17

1-4 family
 
2,611

 
690

Total non-accrual commercial real estate
 
11,927

 
6,425

Commercial and industrial
 
9,136

 
2,318

Direct financing leases, net
 
38

 

Consumer and other:
 
 
 
 
Home equity and second mortgages
 
542

 
329

Other
 
655

 
720

Total non-accrual consumer and other loans
 
1,197

 
1,049

Total non-accrual loans and leases
 
22,298

 
9,792

Foreclosed properties, net
 
1,677

 
1,693

Total non-performing assets
 
23,975

 
11,485

Performing troubled debt restructurings
 
1,735

 
2,003

Total impaired assets
 
$
25,710

 
$
13,488


 
 
December 31,
2015
 
December 31,
2014
Total non-accrual loans and leases to gross loans and leases
 
1.55
%
 
0.76
%
Total non-performing assets to total gross loans and leases plus foreclosed properties, net
 
1.67

 
0.89

Total non-performing assets to total assets
 
1.34

 
0.70

Allowance for loan and lease losses to gross loans and leases
 
1.14

 
1.12

Allowance for loan and lease losses to non-accrual loans and leases
 
73.17

 
146.33

Troubled Debt Restructurings on Financing Receivables
 
 
As of December 31, 2015
 
As of December 31, 2014
 
 
Number
of
Loans
 
Pre-Modification
Recorded
Investment
 
Post-Modification
Recorded
Investment
 
Number
of
Loans
 
Pre-Modification
Recorded
Investment
 
Post-Modification
Recorded
Investment
 
 
(Dollars in Thousands)
Troubled debt restructurings:
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate — owner occupied
 
3
 
$
1,209

 
$
1,188

 
2
 
$
624

 
$
577

Commercial real estate — non-owner occupied
 
5
 
1,150

 
904

 
5
 
1,095

 
970

Construction and land development
 
3
 
6,034

 
4,593

 
4
 
6,260

 
5,157

Multi-family
 
1
 
184

 
2

 
1
 
184

 
17

1-4 family
 
15
 
2,035

 
1,869

 
16
 
2,119

 
1,368

Commercial and industrial
 
10
 
7,572

 
8,330

 
4
 
361

 
155

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgage
 
4
 
461

 
349

 
6
 
772

 
431

Other
 
1
 
2,076

 
655

 
2
 
2,080

 
721

Total
 
42
 
$
20,721

 
$
17,890

 
40
 
$
13,495

 
$
9,396


Troubled Debt Restructurings by Modification Type
As of December 31, 2015 and 2014, our troubled debt restructurings grouped by type of concession were as follows:
 
 
As of December 31, 2015
 
As of December 31, 2014
 
 
Number
of
Loans
 
Post-Modification
Recorded Investment
 
Number
of
Loans
 
Post-Modification
Recorded Investment
 
 
(Dollars in Thousands)
Commercial real estate
 
 
 
 
 
 
 
 
   Extension of term
 
1

 
$
24

 
1

 
$
39

   Interest rate concession
 
1

 
55

 
1

 
65

   Combination of extension and interest rate concession
 
25

 
8,477

 
26

 
7,984

Commercial and industrial
 
 
 
 
 
 
 
 
   Combination of extension and interest rate concession
 
10

 
8,330

 
4

 
155

Consumer and other
 
 
 
 
 
 
 
 
   Extension of term
 
1

 
655

 
3

 
753

   Combination of extension and interest rate concession
 
4

 
349

 
5

 
400

Total
 
42

 
$
17,890

 
40

 
$
9,396

Impaired Financing Receivables
The following represents additional information regarding the Corporation’s impaired loans and leases by class:
 
 
Impaired Loans and Leases
 
 
As of and for the Year Ended December 31, 2015
 
 
Recorded
investment
 
Unpaid
principal
balance
 
Impairment
reserve
 
Average
recorded
investment(1)
 
Foregone
interest
income
 
Interest
income
recognized
 
Net
foregone
interest
income
 
 
(In Thousands)
With no impairment reserve recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$
2,164

 
$
2,164

 
$

 
$
712

 
$
53

 
$
12

 
$
41

Non-owner occupied
 
2,314

 
2,355

 

 
962

 
25

 

 
25

Construction and land development
 
4,533

 
7,203

 

 
4,807

 
133

 

 
133

Multi-family
 
2

 
369

 

 
10

 
27

 

 
27

1-4 family
 
2,423

 
2,486

 

 
1,604

 
82

 
4

 
78

Commercial and industrial
 
2,546

 
2,590

 

 
544

 
172

 
6

 
166

Direct financing leases, net
 
38

 
38

 

 
4

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
500

 
500

 

 
390

 
23

 
63

 
(40
)
Other
 
655

 
1,321

 

 
688

 
82

 

 
82

Total
 
$
15,175

 
$
19,026

 
$

 
$
9,721

 
$
597

 
$
85

 
$
512

With impairment reserve recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$
814

 
$
814

 
$
20

 
$
215

 
$
7

 
$
2

 
$
5

Non-owner occupied
 

 

 

 

 

 

 

Construction and land development
 
397

 
397

 
48

 
34

 

 

 

Multi-family
 

 

 

 

 

 

 

1-4 family
 
945

 
950

 
173

 
605

 
34

 

 
34

Commercial and industrial
 
6,603

 
6,603

 
847

 
810

 
102

 

 
102

Direct financing leases, net
 

 

 

 

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
99

 
99

 
25

 
58

 
10

 

 
10

Other
 

 

 

 

 

 

 

Total
 
$
8,858

 
$
8,863

 
$
1,113

 
$
1,722

 
$
153

 
$
2

 
$
151

Total:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$
2,978

 
$
2,978

 
$
20

 
$
927

 
$
60

 
$
14

 
$
46

Non-owner occupied
 
2,314

 
2,355

 

 
962

 
25

 

 
25

Construction and land development
 
4,930

 
7,600

 
48

 
4,841

 
133

 

 
133

Multi-family
 
2

 
369

 

 
10

 
27

 

 
27

1-4 family
 
3,368

 
3,436

 
173

 
2,209

 
116

 
4

 
112

Commercial and industrial
 
9,149

 
9,193

 
847

 
1,354

 
274

 
6

 
268

Direct financing leases, net
 
38

 
38

 

 
4

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
599

 
599

 
25

 
448

 
33

 
63

 
(30
)
Other
 
655

 
1,321

 

 
688

 
82

 

 
82

Grand total
 
$
24,033

 
$
27,889

 
$
1,113

 
$
11,443

 
$
750

 
$
87

 
$
663

(1)
Average recorded investment is calculated primarily using daily average balances.
 
 
Impaired Loans and Leases
 
 
As of and for the Year Ended December 31, 2014
 
 
Recorded
investment
 
Unpaid
principal
balance
 
Impairment
reserve
 
Average
recorded
investment
(1)
 
Foregone
interest
income
 
Interest
income
recognized
 
Net
foregone
Interest
Income
 
 
(In Thousands)
With no impairment reserve recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Owner occupied
 
$
577

 
$
577

 
$

 
$
484

 
$
30

 
$
79

 
$
(49
)
   Non-owner occupied
 
921

 
921

 

 
349

 
22

 

 
22

   Construction and land development
 
5,157

 
7,828

 

 
5,285

 
155

 

 
155

   Multi-family
 
17

 
384

 

 
24

 
53

 

 
53

   1-4 family
 
1,181

 
1,218

 

 
380

 
15

 
12

 
3

Commercial and industrial
 
2,316

 
2,926

 

 
6,141

 
463

 
649

 
(186
)
Direct financing leases, net
 

 

 

 

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Home equity and second mortgages
 
380

 
380

 

 
495

 
18

 

 
18

   Other
 
721

 
1,389

 

 
768

 
87

 

 
87

      Total
 
$
11,270

 
$
15,623

 
$

 
$
13,926

 
$
843

 
$
740

 
$
103

With impairment reserve recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Owner occupied
 
$

 
$

 
$

 
$

 
$

 
$

 
$

   Non-owner occupied
 
49

 
89

 
49

 
52

 
4

 

 
4

   Construction and land development
 

 

 

 

 

 

 

   Multi-family
 

 

 

 

 

 

 

   1-4 family
 
390

 
390

 
155

 
405

 
18

 

 
18

Commercial and industrial
 
33

 
33

 
33

 
34

 

 

 

Direct financing leases, net
 

 

 

 

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Home equity and second mortgages
 
53

 
53

 
53

 
57

 
5

 

 
5

   Other
 

 

 

 

 

 

 

      Total
 
$
525

 
$
565

 
$
290

 
$
548

 
$
27

 
$

 
$
27

Total:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Owner occupied
 
$
577

 
$
577

 
$

 
$
484

 
$
30

 
$
79

 
$
(49
)
   Non-owner occupied
 
970

 
1,010

 
49

 
401

 
26

 

 
26

   Construction and land development
 
5,157

 
7,828

 

 
5,285

 
155

 

 
155

   Multi-family
 
17

 
384

 

 
24

 
53

 

 
53

   1-4 family
 
1,571

 
1,608

 
155

 
785

 
33

 
12

 
21

Commercial and industrial
 
2,349

 
2,959

 
33

 
6,175

 
463

 
649

 
(186
)
Direct financing leases, net
 

 

 

 

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
433

 
433

 
53

 
552

 
23

 

 
23

Other
 
721

 
1,389

 

 
768

 
87

 

 
87

      Grand total
 
$
11,795

 
$
16,188

 
$
290

 
$
14,474

 
$
870

 
$
740

 
$
130

(1)
Average recorded investment is calculated primarily using daily average balances.
 
 
Impaired Loans and Leases
 
 
As of and for the Year Ended December 31, 2013
 
 
Recorded
investment
 
Unpaid
principal
balance
 
Impairment
reserve
 
Average
recorded
investment(1)
 
Foregone
interest
income
 
Interest
income
recognized
 
Net
foregone
interest
income
 
 
(In Thousands)
With no impairment reserve recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$
339

 
$
339

 
$

 
$
715

 
$
57

 
$
50

 
$
7

Non-owner occupied
 
229

 
229

 

 
1,586

 
198

 
17

 
181

Construction and land development
 
5,489

 
8,160

 

 
5,777

 
203

 
3

 
200

Multi-family
 
31

 
398

 

 
366

 
93

 

 
93

1-4 family
 
244

 
244

 

 
405

 
31

 
34

 
(3
)
Commercial and industrial
 
555

 
766

 

 
434

 
97

 
114

 
(17
)
Direct financing leases, net
 

 

 

 
6

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
518

 
518

 

 
593

 
37

 
3

 
34

Other
 
795

 
1,461

 

 
942

 
100

 

 
100

Total
 
$
8,200

 
$
12,115

 
$

 
$
10,824

 
$
816

 
$
221

 
$
595

With impairment reserve recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$

 
$

 
$

 
$

 
$

 
$

 
$

Non-owner occupied
 
54

 
94

 
54

 
88

 
6

 

 
6

Construction and land development
 

 

 

 

 

 

 

Multi-family
 

 

 

 

 

 

 

1-4 family
 
422

 
422

 
155

 
437

 
18

 

 
18

Commercial and industrial
 
7,488

 
7,488

 
131

 
670

 
42

 

 
42

Direct financing leases, net
 

 

 

 

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
62

 
62

 
62

 
65

 
5

 

 
5

Other
 

 

 

 

 

 

 

Total
 
$
8,026

 
$
8,066

 
$
402

 
$
1,260

 
$
71

 
$

 
$
71

Total:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$
339

 
$
339

 
$

 
$
715

 
$
57

 
$
50

 
$
7

Non-owner occupied
 
283

 
323

 
54

 
1,674

 
204

 
17

 
187

Construction and land development
 
5,489

 
8,160

 

 
5,777

 
203

 
3

 
200

Multi-family
 
31

 
398

 

 
366

 
93

 

 
93

1-4 family
 
666

 
666

 
155

 
842

 
49

 
34

 
15

Commercial and industrial
 
8,043

 
8,254

 
131

 
1,104

 
139

 
114

 
25

Direct financing leases, net
 

 

 

 
6

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
580

 
580

 
62

 
658

 
42

 
3

 
39

Other
 
795

 
1,461

 

 
942

 
100

 

 
100

Grand total
 
$
16,226

 
$
20,181

 
$
402

 
$
12,084

 
$
887

 
$
221

 
$
666

(1)
Average recorded investment is calculated primarily using daily average balances.
Allowance for Credit Losses on Financing Receivables
A summary of the activity in the allowance for loan and lease losses by portfolio segment is as follows:
 
 
As of and for the Year Ended December 31, 2015
 
 
Commercial
real estate
 
Commercial
and
industrial loans and leases
 
Consumer
and other
 
Total
 
 
(Dollars in Thousands)
Allowance for credit losses:
 
 
 
 
 
 
 
 
Beginning balance
 
$
8,619

 
$
5,492

 
$
218

 
$
14,329

Charge-offs
 
(793
)
 
(711
)
 
(9
)
 
(1,513
)
Recoveries
 
104

 
6

 
4

 
114

Provision
 
3,290

 
(400
)
 
496

 
3,386

Ending balance
 
$
11,220

 
$
4,387

 
$
709

 
$
16,316

Ending balance: individually evaluated for impairment
 
$
240

 
$
847

 
$
26

 
$
1,113

Ending balance: collectively evaluated for impairment
 
$
10,980

 
$
3,540

 
$
683

 
$
15,203

Ending balance: loans acquired with deteriorated credit quality
 
$

 
$

 
$

 
$

Loans and lease receivables:
 
 
 
 
 
 
 
 
Ending balance, gross
 
$
905,488

 
$
504,685

 
$
24,556

 
$
1,434,729

Ending balance: individually evaluated for impairment
 
$
10,849

 
$
8,942

 
$
1,061

 
$
20,852

Ending balance: collectively evaluated for impairment
 
$
891,897

 
$
495,497

 
$
23,302

 
$
1,410,696

Ending balance: loans acquired with deteriorated credit quality
 
$
2,742

 
$
246

 
$
193

 
$
3,181

Allowance as % of gross loans and leases
 
1.24
%
 
0.87
%
 
2.89
%
 
1.14
%

 
 
As of and for the Year Ended December 31, 2014
 
 
Commercial
real estate
 
Commercial
and
industrial loans and leases
 
Consumer
and other
 
Total
 
 
(Dollars in Thousands)
Allowance for credit losses:
 
 
 
 
 
 
 
 
Beginning balance
 
$
9,055

 
$
4,573

 
$
273

 
$
13,901

Charge-offs
 
(631
)
 
(600
)
 
(2
)
 
(1,233
)
Recoveries
 
44

 
369

 
12

 
425

Provision
 
151

 
1,150

 
(65
)
 
1,236

Ending balance
 
$
8,619

 
$
5,492

 
$
218

 
$
14,329

Ending balance: individually evaluated for impairment
 
$
204

 
$
33

 
$
53

 
$
290

Ending balance: collectively evaluated for impairment
 
$
8,414

 
$
5,368

 
$
165

 
$
13,947

Ending balance: loans acquired with deteriorated credit quality
 
$
1

 
$
91

 
$

 
$
92

Loans and lease receivables:
 
 
 
 
 
 
 
 
Ending balance, gross
 
$
811,766

 
$
450,819

 
$
19,207

 
$
1,281,792

Ending balance: individually evaluated for impairment
 
$
4,877

 
$
1,669

 
$
1,154

 
$
7,700

Ending balance: collectively evaluated for impairment
 
$
803,475

 
$
448,469

 
$
18,053

 
$
1,269,997

Ending balance: loans acquired with deteriorated credit quality
 
$
3,414

 
$
681

 
$

 
$
4,095

Allowance as % of gross loans and leases
 
1.06
%
 
1.22
%
 
1.14
%
 
1.12
%

 
 
As of and for the Year Ended December 31, 2013
 
 
Commercial
real estate
 
Commercial
and
industrial loans and leases
 
Consumer
and other
 
Total
 
 
(Dollars in Thousands)
Allowance for credit losses:
 
 
 
 
 
 
 
 
Beginning balance
 
$
10,693

 
$
4,336

 
$
371

 
$
15,400

Charge-offs
 
(896
)
 
(14
)
 
(4
)
 
(914
)
Recoveries
 
353

 
16

 
5

 
374

Provision
 
(1,095
)
 
235

 
(99
)
 
(959
)
Ending balance
 
$
9,055

 
$
4,573

 
$
273

 
$
13,901

Ending balance: individually evaluated for impairment
 
$
209

 
$
131

 
$
62

 
$
402

Ending balance: collectively evaluated for impairment
 
$
8,846

 
$
4,442

 
$
211

 
$
13,499

Ending balance: loans acquired with deteriorated credit quality
 
$

 
$

 
$

 
$

Loans and lease receivables:
 
 
 
 
 
 
 
 
Ending balance, gross
 
$
645,111

 
$
319,617

 
$
17,244

 
$
981,972

Ending balance: individually evaluated for impairment
 
$
5,379

 
$
8,043

 
$
1,375

 
$
14,797

Ending balance: collectively evaluated for impairment
 
$
638,303

 
$
311,574

 
$
15,869

 
$
965,746

Ending balance: loans acquired with deteriorated credit quality
 
$
1,429

 
$

 
$

 
$
1,429

Allowance as % of gross loans and leases
 
1.40
%
 
1.43
%
 
1.58
%
 
1.42
%
Net Investment In Direct Financing Leases
The Corporation’s net investment in direct financing leases consists of the following:
 
 
As of December 31,
 
 
2015
 
2014
 
 
(In Thousands)
Minimum lease payments receivable
 
$
27,361

 
$
31,204

Estimated unguaranteed residual values in leased property
 
7,036

 
7,053

Initial direct costs
 
158

 
208

Unearned lease and residual income
 
(3,462
)
 
(4,300
)
Investment in commercial direct financing leases
 
$
31,093

 
$
34,165

Schedule of Future Minimum Lease Payments for Capital Leases
Future aggregate maturities of minimum lease payments to be received are as follows:
(In Thousands)
 
 
Maturities during year ended December 31,
 
 
2016
 
$
7,584

2017
 
6,636

2018
 
6,334

2019
 
3,787

2020
 
2,533

Thereafter
 
487

 
 
$
27,361