ce for credit losses (the “Allowance”) is a valuation allowance for probable incurred credit losses in the Company’s loan portfolio. The Allowance is established through a provision for credit losses which is charged to expense. Additions to the Allowance are expected to maintain the adequacy of the total Allowance after credit losses and loan growth. Credit exposures determined to be uncollectible are charged against the Allowance. Cash received on previously charged off credits is recorded as a recovery to the Allowance. The overall Allowance consists of two primary components, specific reserves related to impaired loans and general reserves for probable incurred losses related to loans that are not impaired.

For all portfolio segments, the determination of the general reserve for loans that are not impaired is based on estimates made by management, including but not limited to, consideration of historical losses by portfolio segment (and in certain cases peer data) over the most recent 20 quarters, and qualitative factors including economic trends in the Company’s service areas, industry experience and trends, geographic concentrations, estimated collateral values, the Company’s underwriting policies, the character of the loan portfolio, and probable losses inherent in the portfolio taken as a whole.

The following table shows the summary of activities for the Allowance as of and for the three months ended June 30, 2015 and 2014 by portfolio segment (in thousands):



	Commercial			Real Estate			Consumer			Unallocated			Total
Allowance for credit losses:
Beginning balance, April 1, 2015	$	3,129		$	4,457		$	765		$	48		$	8,399
Provision charged to operations	610			(36		)	(26		)	(48		)	500
Losses charged to allowance	(287		)	—			(42		)	—			(329		)
Recoveries	101			8			35			—			144
Ending balance, June 30, 2015	$	3,553		$	4,429		$	732		$	—		$	8,714

Allowance for credit losses:
Beginning balance, April 1, 2014	$	2,012		$	4,672		$	1,391		$	246		$	8,321
Provision charged to operations	78			(340		)	(187		)	49			(400		)
Losses charged to allowance	(265		)	(183		)	(325		)	—			(773		)
Recoveries	49			8			102			—			159
Ending balance, June 30, 2014	$	1,874		$	4,157		$	981		$	295		$	7,307

The following table shows the summary of activities for the allowance for loan losses as of and for the six months ended June 30, 2015 and 2014 by portfolio segment of loans (in thousands):



	Commercial			Real Estate			Consumer			Unallocated			Total
Allowance for credit losses:
Beginning balance, January 1, 2015	$	3,130		$	4,058		$	1,078		$	42		$	8,308
Provision charged to operations	917			355			(730		)	(42		)	500
Losses charged to allowance	(697		)	—			(73		)	—			(770		)
Recoveries	203			16			457			—			676
Ending balance, June 30, 2015	$	3,553		$	4,429		$	732		$	—		$	8,714
Allowance for credit losses:
Beginning balance, January 1, 2014	$	2,444		$	5,174		$	1,168		$	422		$	9,208
Provision charged to operations	526			(850		)	51			(127		)	(400		)
Losses charged to allowance	(1,194		)	(183		)	(410		)	—			(1,787		)
Recoveries	98			16			172			—			286
Ending balance, June 30, 2014	$	1,874		$	4,157		$	981		$	295		$	7,307

The following is a summary of the Allowance by impairment methodology and portfolio segment as of June 30, 2015 and December 31, 2014 (in thousands):



	Commercial		Real Estate		Consumer		Unallocated		Total
Allowance for credit losses:
Ending balance, June 30, 2015	$	3,553	$	4,429	732		$	—	$	8,714
Ending balance: individually evaluated for impairment	$	12	$	150	40		$	—	$	202
Ending balance: collectively evaluated for impairment	$	3,541	$	4,279	692		$	—	$	8,512

Ending balance, December 31, 2014	$	3,130	$	4,058	$	1,078	$	42	$	8,308
Ending balance: individually evaluated for impairment	$	230	$	162	$	220	$	—	$	612
Ending balance: collectively evaluated for impairment	$	2,900	$	3,896	$	858	$	42	$	7,696

The following table shows the ending balances of loans as of June 30, 2015 and December 31, 2014 by portfolio segment and by impairment methodology (in thousands):



	Commercial		Real Estate		Consumer		Total
Loans:
Ending balance, June 30, 2015	$	137,864	$	405,730	$	51,713	$	595,307
Ending balance: individually evaluated for impairment	$	276	$	8,334	$	1,982	$	10,592
Ending balance: collectively evaluated for impairment	$	137,588	$	397,396	$	49,731	$	584,715

Loans:
Ending balance, December 31, 2014	$	128,147	$	386,627	$	57,668	$	572,442
Ending balance: individually evaluated for impairment	$	7,268	$	8,512	$	3,046	$	18,826
Ending balance: collectively evaluated for impairment	$	120,879	$	378,115	$	54,622	$	553,616

The following table shows the loan portfolio by class allocated by management’s internal risk ratings at June 30, 2015 (in thousands):



	Pass		Special Mention		Sub-Standard		Doubtful		Total
Commercial:
Commercial and industrial	$	80,040	$	10,691	$	865	$	—	$	91,596
Agricultural land and production	46,268		—		—		—		46,268
Real Estate:
Owner occupied	165,108		5,530		2,166		—		172,804
Real estate construction and other land loans	28,951		1,975		3,737		—		34,663
Commercial real estate	112,198		3,747		6,336		—		122,281
Agricultural real estate	64,806		2,558		360		—		67,724
Other real estate	8,258		—		—		—		8,258
Consumer:
Equity loans and lines of credit	40,190		464		3,765		—		44,419
Consumer and installment	7,278		—		16		—		7,294
Total	$	553,097	$	24,965	$	17,245	$	—	$	595,307

The following table shows the loan portfolio by class allocated by management’s internally assigned risk grade ratings at December 31, 2014 (in thousands):



	Pass		Special Mention		Sub-Standard		Doubtful		Total
Commercial:
Commercial and industrial	$	78,333	$	2,345	$	8,329	$	—	$	89,007
Agricultural land and production	39,140		—		—		—		39,140
Real Estate:
Owner occupied	170,568		2,778		3,458		—		176,804
Real estate construction and other land loans	32,114		1,130		5,679		—		38,923
Commercial real estate	95,831		215		10,742		—		106,788
Agricultural real estate	55,018		2,123		360		—		57,501
Other real estate	6,611		—		—		—		6,611
Consumer:
Equity loans and lines of credit	42,334		72		5,169		—		47,575
Consumer and installment	10,072		—		21		—		10,093
Total	$	530,021	$	8,663	$	33,758	$	—	$	572,442

The following table shows an aging analysis of the loan portfolio by class and the time past due at June 30, 2015 (in thousands):



	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Loans		Recorded Investment > 90 Days Accruing		Non-accrual
Commercial:
Commercial and industrial	$	—	$	—	$	227	$	227	$	91,369	$	91,596	$	—	$	275
Agricultural land and production	—		—		—		—		46,268		46,268		—		—
Real estate:	—						—		—		—
Owner occupied	—		—		572		572		172,232		172,804		—		939
Real estate construction and other land loans	—		—		547		547		34,116		34,663		—		547
Commercial real estate	—		—		1,408		1,408		120,873		122,281		—		2,112
Agricultural real estate	360		—		—		360		67,364		67,724		—		360
Other real estate	—		—		—		—		8,258		8,258		—		—
Consumer:							—		—		—
Equity loans and lines of credit	—		—		1,743		1,743		42,676		44,419		—		1,967
Consumer and installment	57		—		—		57		7,237		7,294		—		16
Total	$	417	$	—	$	4,497	$	4,914	$	590,393	$	595,307	$	—	$	6,216

The following table shows an aging analysis of the loan portfolio by class and the time past due at December 31, 2014 (in thousands):



	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Loans		Recorded Investment > 90 Days Accruing		Non- accrual
Commercial:
Commercial and industrial	$	172	$	88	$	—	$	260	$	88,747	$	89,007	$	—	$	7,265
Agricultural land and production	—		—		—		—		39,140		39,140		—		—
Real estate:	—
Owner occupied	164		—		249		413		176,391		176,804		—		1,363
Real estate construction and other land loans	547		—		—		547		38,376		38,923		—		547
Commercial real estate	—		—		—		—		106,788		106,788		—		1,468
Agricultural real estate	—		—		—		—		57,501		57,501		—		360
Other real estate	—		—		—		—		6,611		6,611		—		—
Consumer:
Equity loans and lines of credit	—		—		227		227		47,348		47,575		—		3,030
Consumer and installment	30		—		—		30		10,063		10,093		—		19
Total	$	913	$	88	$	476	$	1,477	$	570,965	$	572,442	$	—	$	14,052

The following table shows information related to impaired loans by class at June 30, 2015 (in thousands):



	Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:
Commercial:
Commercial and industrial	$	211	$	213	$	—
Real estate:
Owner occupied	749		820		—
Real estate construction and other land loans	547		799		—
Commercial real estate	2,594		2,774		—
Agricultural real estate	360		360		—
Total real estate	4,250		4,753		—
Consumer:
Equity loans and lines of credit	1,755		2,435		—
Total with no related allowance recorded	6,216		7,401		—

With an allowance recorded:
Commercial:
Commercial and industrial	65		67		12
Real estate:
Owner occupied	190		215		25
Real estate construction and other land loans	3,190		3,190		1
Commercial real estate	704		713		124
Total real estate	4,084		4,118		150
Consumer:
Equity loans and lines of credit	211		223		39
Consumer and installment	16		18		1
Total consumer	227		241		40
Total with an allowance recorded	4,376		4,426		202
Total	$	10,592	$	11,827	$	202

The recorded investment in loans excludes accrued interest receivable and net loan origination fees, due to immateriality.

The following table shows information related to impaired loans by class at December 31, 2014 (in thousands):



	Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:
Commercial:
Commercial and industrial	$	6,440	$	9,991	$	—
Agricultural land and production	—		1,722		—
Total commercial	6,440		11,713		—
Real estate:
Owner occupied	1,188		1,255		—
Real estate construction and other land loans	547		799		—
Commercial real estate	1,794		1,794		—
Agricultural real estate	360		360		—
Total real estate	3,889		4,208		—
Consumer:
Equity loans and lines of credit	2,019		2,707		—
Consumer and installment	—		—		—
Total consumer	2,019		2,707		—
Total with no related allowance recorded	12,348		18,628		—

With an allowance recorded:
Commercial:
Commercial and industrial	828		835		230
Real estate:
Owner occupied	199		219		30
Real estate construction and other land loans	3,542		3,542		72
Commercial real estate	882		1,022		60
Total real estate	4,623		4,783		162
Consumer:
Equity loans and lines of credit	1,008		1,026		217
Consumer and installment	19		21		3
Total consumer	1,027		1,047		220
Total with an allowance recorded	6,478		6,665		612
Total	$	18,826	$	25,293	$	612

The recorded investment in loans excludes accrued interest receivable and net loan origination fees, due to immateriality.

The following presents by class, information related to the average recorded investment and interest income recognized on impaired loans for the three months ended June 30, 2015 and 2014.



	Three Months Ended June 30, 2015				Three Months Ended June 30, 2014
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Commercial:
Commercial and industrial	$	4,257	$	—	$	155	$	—
Real estate:
Owner occupied	1,033		—		2,532		20
Real estate construction and other land loans	547		58		1,245		—
Commercial real estate	2,598		—		632		—
Agricultural real estate	360		—		—		—
Total real estate	4,538		58		4,409		20
Consumer:
Equity loans and lines of credit	2,091		—		1,883		—
Consumer and installment	—		—		23		—
Total consumer	2,091		—		1,906		—
Total with no related allowance recorded	10,886		58		6,470		20

With an allowance recorded:
Commercial:
Commercial and industrial	76		—		—		—
Real estate:
Owner occupied	191		—		—		—
Real estate construction and other land loans	3,250		—		3,832		68
Commercial real estate	708		20		—		—
Total real estate	4,149		20		3,832		68
Consumer:
Equity loans and lines of credit	229		—		222		—
Consumer and installment	17		—		—		—
Total consumer	246		—		222		—
Total with an allowance recorded	4,471		20		4,054		68
Total	$	15,357	$	78	$	10,524	$	88

The following presents by class, information related to the average recorded investment and interest income recognized on impaired loans for the six months ended June 30, 2015 and 2014.



	Six Months Ended June 30, 2015				Six Months Ended June 30, 2014
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Commercial:
Commercial and industrial	$	5,362	$	—	$	255	$	—
Agricultural land and production	—		—		—		—
Total commercial	5,362		—		255		—
Real estate:
Owner occupied	1,119		—		2,911		41
Real estate construction and other land loans	553		118		1,349		—
Commercial real estate	2,237		—		554		—
Agricultural real estate	360		—		—		—
Other real estate	—		—		—		—
Total real estate	4,269		118		4,814		41
Consumer:
Equity loans and lines of credit	2,219		—		1,917		—
Consumer and installment	—		—		12		—
Total consumer	2,219		—		1,929		—
Total with no related allowance recorded	11,850		118		6,998		41

With an allowance recorded:
Commercial:
Commercial and industrial	415		—		498		—
Agricultural land and production	—		—		—		—
Total commercial	415		—		498		—
Real estate:
Owner occupied	195		—		55		—
Real estate construction and other land loans	3,356		—		3,923		138
Commercial real estate	870		39		—		—
Agricultural real estate	—		—		—		—
Other real estate	—		—		—		—
Total real estate	4,421		39		3,978		138
Consumer:
Equity loans and lines of credit	444		—		224		—
Consumer and installment	18		—		35		—
Total consumer	462		—		259		—
Total with an allowance recorded	5,298		39		4,735		138
Total	$	17,148	$	157	$	11,733	$	179

Foregone interest on nonaccrual loans totaled $355,000 and $185,000 for the six month periods ended June 30, 2015 and 2014, respectively. For the three month periods ended June 30, 2015 and 2014, foregone interest on nonaccrual loans totaled $136,000 and $95,000, respectively.

Troubled Debt Restructurings:

As of June 30, 2015 and December 31, 2014, the Company has a recorded investment in troubled debt restructurings of $6,251,000 and $6,600,000, respectively. The Company has allocated $2,000 and $132,000 of specific reserves to loans whose terms have been modified in troubled debt restructurings as of June 30, 2015 and December 31, 2014, respectively. The Company has committed to lend no additional amounts as of June 30, 2015 to customers with outstanding loans that are classified as troubled debt restructurings.

During the six month period ended June 30, 2015 two loans were modified as a troubled debt restructuring. The modification of the terms of such loan included one or a combination of the following: a reduction of the stated interest rate of the loan or an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk. During the same period, there were no troubled debt restructurings in which the amount of principal or accrued interest owed from the borrower was forgiven. During the three months ended June 30, 2015, no loans were modified as troubled debt restructurings.

The following table presents loans by class modified as troubled debt restructurings that occurred during the six months ended June 30, 2015 (in thousands):



Troubled Debt Restructurings:	Number of Loans	Pre-Modification Outstanding Recorded Investment (1)		Principal Modification (2)		Post Modification Outstanding Recorded Investment (3)		Outstanding Recorded Investment
Commercial and Industrial	2	$	42	$	—	$	42	$	38


(1)	Amounts represent the recorded investment in loans before recognizing effects of the TDR, if any.


(2)	Principal Modification includes principal forgiveness at the time of modification, contingent principal forgiveness granted over the life of the loan based on borrower performance, and principal that has been legally separated and deferred to the end of the loan, with zero percent contractual interest rate.


(3)	Balance outstanding after principal modification, if any borrower reduction to recorded investment.

The following table presents loans by class modified as troubled debt restructurings that occurred during the six months ended June 30, 2014 (in thousands):



Troubled Debt Restructurings:	Number of Loans	Pre-Modification Outstanding Recorded Investment (1)		Principal Modification (2)		Post Modification Outstanding Recorded Investment (3)		Outstanding Recorded Investment
Equity loans and lines of credit	1	$	7	$	—	$	7	$	6

The following table presents loans by class modified as troubled debt restructurings that occurred during the three months ending June 30, 2014 (in thousands):



Troubled Debt Restructurings:	Number of Loans	Pre-Modification Outstanding Recorded Investment (1)		Principal Modification (2)		Post Modification Outstanding Recorded Investment (3)		Outstanding Recorded Investment
Equity loans and lines of credit	1	$	7	$	—	$	7	$	6


(1)	Amounts represent the recorded investment in loans before recognizing effects of the TDR, if any.


(2)	Principal Modification includes principal forgiveness at the time of modification, contingent principal forgiveness granted over the life of the loan based on borrower performance, and principal that has been legally separated and deferred to the end of the loan, with zero percent contractual interest rate.


(3)	Balance outstanding after principal modification, if any borrower reduction to recorded investment.

A loan is considered to be in payment default once it is 90 days contractually past due under the modified terms. There were no defaults on troubled debt restructurings, within twelve months following the modification, during the six months ended June 30, 2015 or June 30, 2014.