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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, 2016
Receivables [Abstract]  
Loan Composition Schedule
Loan and lease receivables consist of the following:
 
 
December 31,
2016
 
December 31,
2015
 
 
(In Thousands)
Commercial real estate:
 
 
 
 
Commercial real estate — owner occupied
 
$
176,459

 
$
176,322

Commercial real estate — non-owner occupied
 
473,158

 
436,901

Land development
 
56,638

 
59,779

Construction
 
101,206

 
100,625

Multi-family
 
92,762

 
80,254

1-4 family
 
45,651

 
50,304

     Total commercial real estate
 
945,874

 
904,185

Commercial and industrial
 
450,298

 
472,193

Direct financing leases, net
 
30,951

 
31,093

Consumer and other:
 
 
 
 
Home equity and second mortgages
 
8,412

 
8,237

Other
 
16,329

 
16,319

Total consumer and other
 
24,741

 
24,556

Total gross loans and leases receivable
 
1,451,864

 
1,432,027

Less:
 
 
 
 
   Allowance for loan and lease losses
 
20,912

 
16,316

   Deferred loan fees
 
1,189

 
1,062

     Loans and leases receivable, net
 
$
1,429,763

 
$
1,414,649

Schedule of Fair Value of Credit Impaired Loans Acquired
The following table reflects the contractually required payments receivable and fair value of the Corporation’s purchased credit-impaired loans as of December 31, 2016 and 2015:
 
December 31,
2016
 
December 31,
2015
 
(In Thousands)
Contractually required payments
$
3,265

 
$
5,291

Fair value of purchased credit-impaired loans
1,432

 
3,250

Accretable Yield Rollforward
The following table presents a rollforward of the accretable yield for the year ended December 31, 2016 and 2015:
 
December 31,
2016
 
December 31,
2015
 
(In Thousands)
Accretable yield, beginning of period
$
414

 
$
676

Accretion recognized in interest income
(129
)
 
(50
)
Reclassification to nonaccretable difference for loans with changing cash flows(1)
(244
)
 
(60
)
Changes in accretable yield for non-credit related changes in expected cash flows(2)
94

 
(152
)
Accretable yield, end of period
$
135

 
$
414

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, 2016 and 2015:
 
 
December 31, 2016
 
 
Category
 
 
 
 
I
 
II
 
III
 
IV
 
Total
 
 
(Dollars in Thousands)
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
Commercial real estate — owner occupied
 
$
142,704

 
$
20,294

 
$
11,174

 
$
2,287

 
$
176,459

Commercial real estate — non-owner occupied
 
447,895

 
20,933

 
2,721

 
1,609

 
473,158

Land development
 
52,082

 
823

 
293

 
3,440

 
56,638

Construction
 
93,510

 
3,154

 
1,624

 
2,918

 
101,206

Multi-family
 
87,418

 
1,937

 
3,407

 

 
92,762

1-4 family
 
38,504

 
3,144

 
1,431

 
2,572

 
45,651

      Total commercial real estate
 
862,113

 
50,285

 
20,650

 
12,826

 
945,874

Commercial and industrial
 
348,201

 
42,949

 
46,675

 
12,473

 
450,298

Direct financing leases, net
 
29,351

 
1,600

 

 

 
30,951

Consumer and other:
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
8,271

 
121

 
12

 
8

 
8,412

Other
 
15,714

 

 
11

 
604

 
16,329

      Total consumer and other
 
23,985

 
121

 
23

 
612

 
24,741

Total gross loans and leases receivable
 
$
1,263,650

 
$
94,955

 
$
67,348

 
$
25,911

 
$
1,451,864

Category as a % of total portfolio
 
87.04
%
 
6.54
%
 
4.64
%
 
1.78
%
 
100.00
%


 
 
December 31, 2015
 
 
Category
 
 
 
 
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

Land development
 
52,817

 
2,241

 
309

 
4,412

 
59,779

Construction
 
98,693

 
851

 
564

 
517

 
100,625

Multi-family
 
79,368

 
884

 

 
2

 
80,254

1-4 family
 
41,086

 
3,985

 
1,865

 
3,368

 
50,304

      Total commercial real estate
 
838,860

 
36,277

 
15,457

 
13,591

 
904,185

Commercial and industrial
 
430,199

 
7,139

 
25,706

 
9,149

 
472,193

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
 
$
1,321,686

 
$
44,477

 
$
41,832

 
$
24,032

 
$
1,432,027

Category as a % of total portfolio
 
92.29
%
 
3.11
%
 
2.92
%
 
1.68
%
 
100.00
%
Past Due Financing Receivables
The delinquency aging of the loan and lease portfolio by class of receivable as of December 31, 2016 and 2015 were as follows:
 
 
December 31, 2016
 
 
30-59
Days Past Due
 
60-89
Days Past Due
 
Greater
than 90
Days Past Due
 
Total Past Due
 
Current
 
Total
 
 
(Dollars in Thousands)
Accruing loans and leases
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$

 
$

 
$

 
$

 
$
174,236

 
$
174,236

Non-owner occupied
 

 

 

 

 
471,549

 
471,549

Land development
 

 

 

 

 
53,198

 
53,198

Construction
 

 

 

 

 
98,288

 
98,288

Multi-family
 

 

 

 

 
92,762

 
92,762

1-4 family
 
75

 

 

 
75

 
43,639

 
43,714

Commercial and industrial
 
55

 
468

 

 
523

 
437,312

 
437,835

Direct financing leases, net
 

 

 

 

 
30,951

 
30,951

Consumer and other:
 
 
 
 
 
 
 

 
 
 

Home equity and second mortgages
 

 

 

 

 
8,412

 
8,412

Other
 

 

 

 

 
15,725

 
15,725

Total
 
$
130

 
$
468

 
$

 
$
598

 
$
1,426,072

 
$
1,426,670

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

 
$

 
$
1,183

 
$
1,183

 
$
1,040

 
$
2,223

Non-owner occupied
 

 

 

 

 
1,609

 
1,609

Land development
 

 

 

 

 
3,440

 
3,440

Construction
 
2,482

 

 
436

 
2,918

 

 
2,918

Multi-family
 

 

 

 

 

 

1-4 family
 

 

 
1,240

 
1,240

 
697

 
1,937

Commercial and industrial
 
3,345

 
168

 
6,740

 
10,253

 
2,210

 
12,463

Direct financing leases, net
 

 

 

 

 

 

Consumer and other:
 
 
 
 
 
 
 

 
 
 

Home equity and second mortgages
 

 

 

 

 

 

Other
 
186

 

 
378

 
564

 
40

 
604

Total
 
$
6,013

 
$
168

 
$
9,977

 
$
16,158

 
$
9,036

 
$
25,194

Total loans and leases
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$

 
$

 
$
1,183

 
$
1,183

 
$
175,276

 
$
176,459

Non-owner occupied
 

 

 

 

 
473,158

 
473,158

Land development
 

 

 

 

 
56,638

 
56,638

Construction
 
2,482

 

 
436

 
2,918

 
98,288

 
101,206

Multi-family
 

 

 

 

 
92,762

 
92,762

1-4 family
 
75

 

 
1,240

 
1,315

 
44,336

 
45,651

Commercial and industrial
 
3,400

 
636

 
6,740

 
10,776

 
439,522

 
450,298

Direct financing leases, net
 

 

 

 

 
30,951

 
30,951

Consumer and other:
 
 
 
 
 
 
 

 

 

Home equity and second mortgages
 

 

 

 

 
8,412

 
8,412

Other
 
186

 

 
378

 
564

 
15,765

 
16,329

Total
 
$
6,143

 
$
636

 
$
9,977

 
$
16,756

 
$
1,435,108

 
$
1,451,864

Percent of portfolio
 
0.42
%
 
0.04
%
 
0.69
%
 
1.15
%
 
98.85
%
 
100.00
%

 
 
December 31, 2015
 
 
30-59
Days Past Due
 
60-89
Days Past Due
 
Greater
than 90
Days Past Due
 
Total Past Due
 
Current
 
Total
 
 
(Dollars in Thousands)
Accruing loans and leases
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$

 
$

 
$

 
$

 
$
173,416

 
$
173,416

Non-owner occupied
 

 

 

 

 
435,222

 
435,222

Land development
 

 

 

 

 
55,386

 
55,386

Construction
 

 

 

 

 
100,228

 
100,228

Multi-family
 

 

 

 

 
80,252

 
80,252

1-4 family
 
78

 

 

 
78

 
47,676

 
47,754

Commercial and industrial
 

 

 

 

 
463,057

 
463,057

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

 
$
1,409,651

 
$
1,409,729

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

 
$
473

 
$

 
$
473

 
$
2,433

 
$
2,906

Non-owner occupied
 

 

 

 

 
1,679

 
1,679

Land development
 

 

 

 

 
4,393

 
4,393

Construction
 
397

 

 

 
397

 

 
397

Multi-family
 

 

 

 

 
2

 
2

1-4 family
 
430

 
34

 
895

 
1,359

 
1,191

 
2,550

Commercial and 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

 
$
175,849

 
$
176,322

Non-owner occupied
 

 

 

 

 
436,901

 
436,901

Land development
 

 

 

 

 
59,779

 
59,779

Construction
 
397

 

 

 
397

 
100,228

 
100,625

Multi-family
 

 

 

 

 
80,254

 
80,254

1-4 family
 
508

 
34

 
895

 
1,437

 
48,867

 
50,304

Commercial and industrial
 
2,077

 

 
564

 
2,641

 
469,552

 
472,193

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

 
$
1,426,174

 
$
1,432,027

Percent of portfolio
 
0.21
%
 
0.04
%
 
0.16
%
 
0.41
%
 
99.59
%
 
100.00
%
Schedule of Financing Receivables, Non Accrual Status
The Corporation’s total impaired assets consisted of the following at December 31, 2016 and 2015, respectively.
 
 
December 31,
2016
 
December 31,
2015
 
 
(In Thousands)
Non-accrual loans and leases
 
 
 
 
Commercial real estate:
 
 
 
 
Commercial real estate — owner occupied
 
$
2,223

 
$
2,907

Commercial real estate — non-owner occupied
 
1,609

 
1,678

Land development
 
3,440

 
4,393

Construction
 
2,918

 
397

Multi-family
 

 
2

1-4 family
 
1,937

 
2,550

Total non-accrual commercial real estate
 
12,127

 
11,927

Commercial and industrial
 
12,463

 
9,136

Direct financing leases, net
 

 
38

Consumer and other:
 
 
 
 
Home equity and second mortgages
 

 
542

Other
 
604

 
655

Total non-accrual consumer and other loans
 
604

 
1,197

Total non-accrual loans and leases
 
25,194

 
22,298

Foreclosed properties, net
 
1,472

 
1,677

Total non-performing assets
 
26,666

 
23,975

Performing troubled debt restructurings
 
717

 
1,735

Total impaired assets
 
$
27,383

 
$
25,710


 
 
December 31,
2016
 
December 31,
2015
Total non-accrual loans and leases to gross loans and leases
 
1.74
%
 
1.56
%
Total non-performing assets to total gross loans and leases plus foreclosed properties, net
 
1.83

 
1.67

Total non-performing assets to total assets
 
1.50

 
1.35

Allowance for loan and lease losses to gross loans and leases
 
1.44

 
1.14

Allowance for loan and lease losses to non-accrual loans and leases
 
83.00

 
73.17

Troubled Debt Restructurings on Financing Receivables
 
 
As of December 31, 2016
 
As of December 31, 2015
 
 
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)
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate — owner occupied
 
3
 
$
1,065

 
$
930

 
3
 
$
1,209

 
$
1,188

Commercial real estate — non-owner occupied
 
1
 
158

 
39

 
5
 
1,150

 
904

Land development
 
1
 
5,745

 
3,440

 
2
 
5,853

 
4,393

Construction
 
2
 
331

 
314

 
1
 
181

 
200

Multi-family
 
 

 

 
1
 
184

 
2

1-4 family
 
11
 
1,391

 
1,393

 
15
 
2,035

 
1,869

Commercial and industrial
 
10
 
8,094

 
7,058

 
10
 
7,572

 
8,330

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgage
 
1
 
37

 
8

 
4
 
461

 
349

Other
 
1
 
2,076

 
378

 
1
 
2,076

 
655

Total
 
30
 
$
18,897

 
$
13,560

 
42
 
$
20,721

 
$
17,890


Troubled Debt Restructurings by Modification Type
As of December 31, 2016 and 2015, the Corporation’s troubled debt restructurings grouped by type of concession were as follows:
 
 
As of December 31, 2016
 
As of December 31, 2015
 
 
Number of Loans
 
Post-Modification
Recorded Investment
 
Number of Loans
 
Post-Modification
Recorded Investment
 
 
(Dollars in Thousands)
Commercial real estate:
 
 
 
 
 
 
 
 
   Extension of term
 
1

 
$
8

 
1

 
$
24

   Interest rate concession
 
1

 
52

 
1

 
55

   Combination of extension of term and interest rate concession
 
16

 
6,056

 
25

 
8,477

Commercial and industrial:
 
 
 
 
 
 
 
 
   Combination of extension of term and interest rate concession
 
10

 
7,058

 
10

 
8,330

Consumer and other:
 
 
 
 
 
 
 
 
   Extension of term
 
1

 
378

 
1

 
655

   Combination of extension of term and interest rate concession
 
1

 
8

 
4

 
349

Total
 
30

 
$
13,560

 
42

 
$
17,890

Impaired Financing Receivables
The following represents additional information regarding the Corporation’s impaired loans and leases, including performing troubled debt restructurings, by class:
 
 
As of and for the Year Ended December 31, 2016
 
 
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
 
$
1,788

 
$
1,788

 
$

 
$
3,577

 
$
328

 
$
118

 
$
210

Non-owner occupied
 
1,609

 
1,647

 

 
1,318

 
91

 
79

 
12

Land development
 
3,440

 
6,111

 

 
3,898

 
107

 

 
107

Construction
 
436

 
438

 

 
291

 
20

 

 
20

Multi-family
 

 

 

 

 
1

 
134

 
(133
)
1-4 family
 
2,379

 
2,379

 

 
2,755

 
125

 
94

 
31

Commercial and industrial
 
3,769

 
3,769

 

 
918

 
143

 
62

 
81

Direct financing leases, net
 

 

 

 
6

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
8

 
8

 

 
307

 
16

 
127

 
(111
)
Other
 
604

 
1,270

 

 
529

 
71

 

 
71

Total
 
$
14,033

 
$
17,410

 
$

 
$
13,599

 
$
902

 
$
614

 
$
288

With impairment reserve recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$
499

 
$
499

 
$
70

 
$
111

 
$
28

 
$

 
$
28

Non-owner occupied
 

 

 

 

 

 

 

Land development
 

 

 

 

 

 

 

Construction
 
2,482

 
2,482

 
1,790

 
834

 
45

 

 
45

Multi-family
 

 

 

 

 

 

 

1-4 family
 
193

 
199

 
39

 
203

 
5

 

 
5

Commercial and industrial
 
8,704

 
8,704

 
3,700

 
8,239

 
637

 

 
637

Direct financing leases, net
 

 

 

 

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 

 

 

 

 

 

 

Other
 

 

 

 

 

 

 

Total
 
$
11,878

 
$
11,884

 
$
5,599

 
$
9,387

 
$
715

 
$

 
$
715

Total:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
$
2,287

 
$
2,287

 
$
70

 
$
3,688

 
$
356

 
$
118

 
$
238

Non-owner occupied
 
1,609

 
1,647

 

 
1,318

 
91

 
79

 
12

Land development
 
3,440

 
6,111

 

 
3,898

 
107

 

 
107

Construction
 
2,918

 
2,920

 
1,790

 
1,125

 
65

 

 
65

Multi-family
 

 

 

 

 
1

 
134

 
(133
)
1-4 family
 
2,572

 
2,578

 
39

 
2,958

 
130

 
94

 
36

Commercial and industrial
 
12,473

 
12,473

 
3,700

 
9,157

 
780

 
62

 
718

Direct financing leases, net
 

 

 

 
6

 

 

 

Consumer and other:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Home equity and second mortgages
 
8

 
8

 

 
307

 
16

 
127

 
(111
)
Other
 
604

 
1,270

 

 
529

 
71

 

 
71

Grand total
 
$
25,911

 
$
29,294

 
$
5,599

 
$
22,986

 
$
1,617

 
$
614

 
$
1,003

(1)
Average recorded investment is calculated primarily using daily average balances.
 
 
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

   Land development
 
4,413

 
7,083

 

 
4,333

 
133

 

 
133

   Construction
 
120

 
120




474





 

   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
 

 

 

 

 

 

 

   Land development
 

 









 

   Construction
 
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

   Land development
 
4,413

 
7,083

 

 
4,333

 
133

 

 
133

   Construction
 
517

 
517

 
48

 
508

 

 

 

   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.
 
 
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

Land development
 
4,962

 
7,633

 

 
5,253

 
155

 

 
155

Construction
 
195

 
195

 

 
32

 

 

 

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

Land development
 

 

 

 

 

 

 

Construction
 

 

 

 

 

 

 

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

Land development
 
4,962

 
7,633

 

 
5,253

 
155

 

 
155

Construction
 
195

 
195

 

 
32

 

 

 

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.
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, 2016
 
 
Commercial
Real Estate
 
Commercial
and Industrial
 
Consumer
and Other
 
Total
 
 
(Dollars in Thousands)
Allowance for loan and lease losses:
 
 
 
 
 
 
 
 
Beginning balance
 
$
11,220

 
$
4,387

 
$
709

 
$
16,316

Charge-offs
 
(1,194
)
 
(2,273
)
 
(127
)
 
(3,594
)
Recoveries
 
274

 
91

 
7

 
372

Provision
 
2,084

 
5,765

 
(31
)
 
7,818

Ending balance
 
$
12,384

 
$
7,970

 
$
558

 
$
20,912

Ending balance: individually evaluated for impairment
 
$
1,899

 
$
3,700

 
$

 
$
5,599

Ending balance: collectively evaluated for impairment
 
$
10,485

 
$
4,270

 
$
558

 
$
15,313

Ending balance: loans acquired with deteriorated credit quality
 
$

 
$

 
$

 
$

Loans and lease receivables:
 
 
 
 
 
 
 
 
Ending balance, gross
 
$
945,874

 
$
481,249

 
$
24,741

 
$
1,451,864

Ending balance: individually evaluated for impairment
 
$
11,222

 
$
12,452

 
$
612

 
$
24,286

Ending balance: collectively evaluated for impairment
 
$
933,048

 
$
468,776

 
$
24,129

 
$
1,425,953

Ending balance: loans acquired with deteriorated credit quality
 
$
1,604

 
$
21

 
$

 
$
1,625

Allowance as percent of gross loans and leases
 
1.31
%
 
1.66
%
 
2.26
%
 
1.44
%

 
 
As of and for the Year Ended December 31, 2015
 
 
Commercial
Real Estate
 
Commercial
and Industrial
 
Consumer
and Other
 
Total
 
 
(Dollars in Thousands)
Allowance for loan and lease 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
 
$
904,185

 
$
503,286

 
$
24,556

 
$
1,432,027

Ending balance: individually evaluated for impairment
 
$
10,849

 
$
8,942

 
$
1,061

 
$
20,852

Ending balance: collectively evaluated for impairment
 
$
890,594

 
$
494,098

 
$
23,495

 
$
1,408,187

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

 
$
246

 
$
193

 
$
3,181

Allowance as percent of gross loans and leases
 
1.24
%
 
0.87
%
 
2.89
%
 
1.14
%
Net Investment In Direct Financing Leases
The Corporation’s net investment in direct financing leases consists of the following:
 
 
As of December 31,
 
 
2016
 
2015
 
 
(In Thousands)
Minimum lease payments receivable
 
$
26,096

 
$
27,361

Estimated unguaranteed residual values in leased property
 
7,625

 
7,036

Initial direct costs
 
106

 
158

Unearned lease and residual income
 
(2,876
)
 
(3,462
)
Investment in commercial direct financing leases
 
$
30,951

 
$
31,093

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,
 
 
2017
 
$
7,863

2018
 
7,584

2019
 
5,331

2020
 
3,520

2021
 
1,251

Thereafter
 
547

 
 
$
26,096