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LOANS AND ALLOWANCE FOR LOAN LOSSES | 12 Months Ended
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Dec. 31, 2020
Loans and Leases Receivable Disclosure [Abstract] |
LOANS AND ALLOWANCE FOR LOAN LOSSES | LOANS AND ALLOWANCE FOR LOAN LOSSES The composition of the loan portfolio, net of deferred loan fees is summarized as follows (in thousands):
| December 31, 2020 |  | December 31, 2019
Commercial and agricultural: |  |  |
Commercial and industrial | $ | 368,663 |  |  | $ | 230,018 |
Agricultural | 283 |  |  | 274 |
Commercial mortgages: |  |  |
Construction | 61,945 |  |  | 43,962 |
Commercial mortgages | 654,663 |  |  | 604,832 |
Residential mortgages | 239,401 |  |  | 188,338 |
Consumer loans: |  |  |
Home equity lines and loans | 78,547 |  |  | 91,784 |
Indirect consumer loans | 120,538 |  |  | 134,973 |
Direct consumer loans | 12,423 |  |  | 15,038 |
Total loans, net of deferred loan fees | 1,536,463 |  |  | 1,309,219 |
Interest receivable on loans | 5,035 |  |  | 3,684 |
Total recorded investment in loans | $ | 1,541,498 |  |  | $ | 1,312,903 |
Residential mortgages held for sale as of December 31, 2020 and 2019 totaling $0.2 million and $1.2 million, respectively, are not included in the above table. Residential mortgages totaling $101.9 million at December 31, 2020 and $170.0 million at December 31, 2019 were pledged under a blanket collateral agreement for the Corporation's line of credit with the FHLBNY. As of December 31, 2020, the Corporation had outstanding loan balances of $150.9 million for PPP loans which are included in commercial and industrial loans in the table above. These loans require no allowance for loan losses as of December 31, 2020 since they are government guaranteed loans. The following tables present the activity in the allowance for loan losses by portfolio segment for the years ended December 31, 2020, 2019 and 2018, respectively (in thousands):
| December 31, 2020
Allowance for loan losses | Commercial, and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  |  |  | Total
Beginning balance: | $ | 10,227 |  |  | $ | 8,869 |  |  | $ | 1,252 |  |  | $ | 3,130 |  |  |  |  | $ | 23,478 |
Charge Offs: | (4,068) |  |  | (2,143) |  |  | (56) |  |  | (1,113) |  |  |  |  | (7,380) |
Recoveries: | 89 |  |  | 14 |  |  | 86 |  |  | 398 |  |  |  |  | 587 |
Net (charge offs) recoveries | (3,979) |  |  | (2,129) |  |  | 30 |  |  | (715) |  |  |  |  | (6,793) |
Provision | (1,755) |  |  | 4,756 |  |  | 797 |  |  | 441 |  |  |  |  | 4,239 |
Ending balance | $ | 4,493 |  |  | $ | 11,496 |  |  | $ | 2,079 |  |  | $ | 2,856 |  |  |  |  | $ | 20,924 |
| December 31, 2019
Allowance for loan losses | Commercial, and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  |  |  | Total
Beginning balance: | $ | 5,383 |  |  | $ | 8,184 |  |  | $ | 1,226 |  |  | $ | 4,151 |  |  |  |  | $ | 18,944 |
Charge Offs: | (312) |  |  | (1) |  |  | (151) |  |  | (1,511) |  |  |  |  | (1,975) |
Recoveries: | 59 |  |  | 4 |  |  | 45 |  |  | 456 |  |  |  |  | 564 |
Net recoveries (charge offs) | (253) |  |  | 3 |  |  | (106) |  |  | (1,055) |  |  |  |  | (1,411) |
Provision | 5,097 |  |  | 682 |  |  | 132 |  |  | 34 |  |  |  |  | 5,945 |
Ending balance | $ | 10,227 |  |  | $ | 8,869 |  |  | $ | 1,252 |  |  | $ | 3,130 |  |  |  |  | $ | 23,478 |
| December 31, 2018
Allowance for loan losses | Commercial, and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  |  |  | Total
Beginning balance: | $ | 6,976 |  |  | $ | 8,514 |  |  | $ | 1,316 |  |  | $ | 4,355 |  |  |  |  | $ | 21,161 |
Charge Offs: | (3,644) |  |  | (213) |  |  | (226) |  |  | (1,836) |  |  |  |  | (5,919) |
Recoveries: | 47 |  |  | 3 |  |  | 5 |  |  | 494 |  |  |  |  | 549 |
Net recoveries (charge offs) | (3,597) |  |  | (210) |  |  | (221) |  |  | (1,342) |  |  |  |  | (5,370) |
Provision | 2,004 |  |  | (120) |  |  | 131 |  |  | 1,138 |  |  |  |  | 3,153 |
Ending balance | $ | 5,383 |  |  | $ | 8,184 |  |  | $ | 1,226 |  |  | $ | 4,151 |  |  |  |  | $ | 18,944 |
The following tables present the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2020 and December 31, 2019 (in thousands):
| December 31, 2020
Allowance for loan losses | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Ending allowance balance attributable to loans: |  |  |  |  |  |  |  |  |
Individually evaluated for impairment | $ | 1,401 |  |  | $ | 74 |  |  | $ | — |  |  | $ | 52 |  |  | $ | 1,527 |
Collectively evaluated for impairment | 3,092 |  |  | 11,422 |  |  | 2,079 |  |  | 2,804 |  |  | 19,397 |
Total ending allowance balance | $ | 4,493 |  |  | $ | 11,496 |  |  | $ | 2,079 |  |  | $ | 2,856 |  |  | $ | 20,924 |
| December 31, 2019
Allowance for loan losses | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Ending allowance balance attributable to loans: |  |  |  |  |  |  |  |  |
Individually evaluated for impairment | $ | 6,000 |  |  | $ | 2,097 |  |  | $ | — |  |  | $ | — |  |  | $ | 8,097 |
Collectively evaluated for impairment | 4,227 |  |  | 6,772 |  |  | 1,252 |  |  | 3,130 |  |  | 15,381 |
Total ending allowance balance | $ | 10,227 |  |  | $ | 8,869 |  |  | $ | 1,252 |  |  | $ | 3,130 |  |  | $ | 23,478 |
| December 31, 2020
Loans: | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Loans individually evaluated for impairment | $ | 3,400 |  |  | $ | 5,117 |  |  | $ | 1,271 |  |  | $ | 801 |  |  | $ | 10,589 |
Loans collectively evaluated for impairment | 366,852 |  |  | 714,028 |  |  | 238,742 |  |  | 211,287 |  |  | 1,530,909 |
Total ending loans balance | $ | 370,252 |  |  | $ | 719,145 |  |  | $ | 240,013 |  |  | $ | 212,088 |  |  | $ | 1,541,498 |
| December 31, 2019
Loans: | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Loans individually evaluated for impairment | $ | 6,147 |  |  | $ | 8,844 |  |  | $ | 525 |  |  | $ | 149 |  |  | $ | 15,665 |
Loans collectively evaluated for impairment | 224,775 |  |  | 641,726 |  |  | 188,349 |  |  | 242,388 |  |  | 1,297,238 |
Total ending loans balance | $ | 230,922 |  |  | $ | 650,570 |  |  | $ | 188,874 |  |  | $ | 242,537 |  |  | $ | 1,312,903 |
The following tables present loans individually evaluated for impairment recognized by class of loans as of December 31, 2020 and December 31, 2019, the average recorded investment and interest income recognized by class of loans as of the years ended December 31, 2020, 2019 and 2018 (in thousands):
| December 31, 2020 |  | December 31, 2019
| Unpaid Principal Balance |  | Recorded Investment |  | Allowance for Loan Losses Allocated |  | Unpaid Principal Balance |  | Recorded Investment |  | Allowance for Loan Losses Allocated
With no related allowance recorded: |  |  |  |  |  |  |  |  |  |  |
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | $ | 1,960 |  |  | $ | 1,963 |  |  | $ | — |  |  | $ | 133 |  |  | $ | 133 |  |  | $ | — |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |
Construction | 188 |  |  | 189 |  |  | — |  |  | 247 |  |  | 247 |  |  | — |
Commercial mortgages | 6,814 |  |  | 4,760 |  |  | — |  |  | 3,501 |  |  | 3,503 |  |  | — |
Residential mortgages | 1,283 |  |  | 1,271 |  |  | — |  |  | 554 |  |  | 525 |  |  | — |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 645 |  |  | 631 |  |  | — |  |  | 171 |  |  | 149 |  |  | — |
With an allowance recorded: |  |  |  |  |  |  |  |  |  |  |
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | 5,228 |  |  | 1,437 |  |  | 1,401 |  |  | 6,013 |  |  | 6,014 |  |  | 6,000 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |
Commercial mortgages | 258 |  |  | 168 |  |  | 74 |  |  | 5,093 |  |  | 5,094 |  |  | 2,097 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 170 |  |  | 170 |  |  | 52 |  |  | — |  |  | — |  |  | — |
Total | $ | 16,546 |  |  | $ | 10,589 |  |  | $ | 1,527 |  |  | $ | 15,712 |  |  | $ | 15,665 |  |  | $ | 8,097 |
| December 31, 2020 |  | December 31, 2019 |  | December 31, 2018
| Average Recorded Investment |  | Interest Income Recognized (1) |  | Average Recorded Investment |  | Interest Income Recognized (1) |  | Average Recorded Investment |  | Interest Income Recognized (1)
With no related allowance recorded: |  |  |  |  |  |  |  |  |  |  |
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | $ | 936 |  |  | $ | 16 |  |  | $ | 248 |  |  | $ | — |  |  | $ | 608 |  |  | $ | 12 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |
Construction | 219 |  |  | 8 |  |  | 278 |  |  | 10 |  |  | 337 |  |  | 11 |
Commercial mortgages | 4,103 |  |  | 16 |  |  | 3,605 |  |  | 12 |  |  | 4,193 |  |  | 21 |
Residential mortgages | 952 |  |  | 25 |  |  | 422 |  |  | 44 |  |  | 416 |  |  | 7 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |
Home equity lines & loans | 446 |  |  | 7 |  |  | 137 |  |  | 6 |  |  | 60 |  |  | 3 |
With an allowance recorded: |  |  |  |  |  |  |  |  |  |  |
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | 4,981 |  |  | 4 |  |  | 3,209 |  |  | — |  |  | 3,043 |  |  | 3 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |
Commercial mortgages | 2,949 |  |  | — |  |  | 6,524 |  |  | — |  |  | 2,315 |  |  | 4 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 104 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total | $ | 14,690 |  |  | $ | 76 |  |  | $ | 14,423 |  |  | $ | 72 |  |  | $ | 10,972 |  |  | $ | 61 |
(1) Cash basis interest income approximates interest income recognized. The following tables present the recorded investment in non-accrual and loans past due 90 days or more and still accruing by class of loans as of December 31, 2020 and December 31, 2019 (in thousands):
| Non-accrual |  | Loans Past Due 90 Days or More and Still Accruing
| 2020 |  | 2019 |  | 2020 |  | 2019
Commercial and agricultural: |  |  |  |  |  |  |
Commercial and industrial | $ | 2,167 |  |  | $ | 6,147 |  |  | $ | 2 |  |  | $ | 7 |
Commercial mortgages: |  |  |  |  |  |  |
Construction | 55 |  |  | 80 |  |  | — |  |  | — |
Commercial mortgages | 4,415 |  |  | 8,407 |  |  | — |  |  | — |
Residential mortgages | 1,632 |  |  | 2,155 |  |  | — |  |  | — |
Consumer loans: |  |  |  |  |  |  |
Home equity lines and loans | 1,159 |  |  | 641 |  |  | — |  |  | — |
Indirect consumer loans | 519 |  |  | 571 |  |  | — |  |  | — |
Direct consumer loans | 5 |  |  | 7 |  |  | — |  |  | — |
Total | $ | 9,952 |  |  | $ | 18,008 |  |  | $ | 2 |  |  | $ | 7 |
The following tables present the aging of the recorded investment in loans as of December 31, 2020 and December 31, 2019 (in thousands):
| December 31, 2020
| 30 - 59 Days Past Due |  | 60 - 89 Days Past Due |  | 90 Days or More Past Due |  | Total Past Due |  |  |  | Loans Not Past Due |  | Total
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | $ | 520 |  |  | $ | 14 |  |  | $ | 30 |  |  | $ | 564 |  |  |  |  | $ | 369,404 |  |  | $ | 369,968 |
Agricultural | — |  |  | — |  |  | — |  |  | — |  |  |  |  | 284 |  |  | 284 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |  |  |
Construction | — |  |  | — |  |  | — |  |  | — |  |  |  |  | 62,164 |  |  | 62,164 |
Commercial mortgages | 1,438 |  |  | 3,696 |  |  | 308 |  |  | 5,442 |  |  |  |  | 651,539 |  |  | 656,981 |
Residential mortgages | 817 |  |  | 406 |  |  | 461 |  |  | 1,684 |  |  |  |  | 238,329 |  |  | 240,013 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 521 |  |  | 41 |  |  | 474 |  |  | 1,036 |  |  |  |  | 77,725 |  |  | 78,761 |
Indirect consumer loans | 1,268 |  |  | 198 |  |  | 252 |  |  | 1,718 |  |  |  |  | 119,135 |  |  | 120,853 |
Direct consumer loans | 34 |  |  | 2 |  |  | — |  |  | 36 |  |  |  |  | 12,438 |  |  | 12,474 |
Total | $ | 4,598 |  |  | $ | 4,357 |  |  | $ | 1,525 |  |  | $ | 10,480 |  |  |  |  | $ | 1,531,018 |  |  | $ | 1,541,498 |
| December 31, 2019
| 30 - 59 Days Past Due |  | 60 - 89 Days Past Due |  | 90 Days or More Past Due |  | Total Past Due |  |  |  | Loans Not Past Due |  | Total
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | $ | 1,285 |  |  | $ | 49 |  |  | $ | 4,398 |  |  | $ | 5,732 |  |  |  |  | $ | 224,916 |  |  | $ | 230,648 |
Agricultural | — |  |  | — |  |  | — |  |  | — |  |  |  |  | 274 |  |  | 274 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |  |  |
Construction | — |  |  | — |  |  | — |  |  | — |  |  |  |  | 44,082 |  |  | 44,082 |
Commercial mortgages | 440 |  |  | 277 |  |  | 2,165 |  |  | 2,883 |  |  |  |  | 603,605 |  |  | 606,488 |
Residential mortgages | 1,016 |  |  | 803 |  |  | 956 |  |  | 2,775 |  |  |  |  | 186,099 |  |  | 188,874 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 353 |  |  | 151 |  |  | 149 |  |  | 653 |  |  |  |  | 91,412 |  |  | 92,065 |
Indirect consumer loans | 1,546 |  |  | 377 |  |  | 355 |  |  | 2,278 |  |  |  |  | 133,088 |  |  | 135,366 |
Direct consumer loans | 32 |  |  | 11 |  |  | 6 |  |  | 49 |  |  |  |  | 15,057 |  |  | 15,106 |
Total | $ | 4,672 |  |  | $ | 1,668 |  |  | $ | 8,029 |  |  | $ | 14,370 |  |  |  |  | $ | 1,298,533 |  |  | $ | 1,312,903 |
Troubled Debt Restructurings: A modification of a loan may result in classification as a TDR when a borrower is experiencing financial difficulty and the modification constitutes a concession. The Corporation offers various types of modifications which may involve a change in the schedule of payments, a reduction in the interest rate, an extension of the maturity date, extending the maturity date at an interest rate lower than the current market rate for new debt with similar risk, requesting additional collateral, releasing collateral for consideration, substituting or adding a new borrower or guarantor, a permanent reduction of the recorded investment in the loan or a permanent reduction of the interest on the loan. Under Section 4013 of the CARES Act, loans less than 30 days past due as of December 31, 2019 will be considered current for COVID-19 related modifications and therefore will not be treated as TDRs. As of December 31, 2020, in conformance with Section 4013 of the CARES Act, the Corporation modified a total of 1,064 commercial and consumer loans represented by a total loan balance of $211.2 million. As of December 31, 2020, 31 loans totaling $20.8 million remained in modified status, of which 18 loans totaling $20.1 million had been modified more than once. As of December 31, 2020, 2019 and 2018, the Corporation has a recorded investment in TDRs of $6.7 million, $9.0 million, and $6.8 million, respectively. There were specific reserves of $0.4 million allocated for TDRs at December 31, 2020, and $2.3 million and $0.9 million allocated for December 31, 2019 and 2018, respectively. As of December 31, 2020, TDRs totaling $2.8 million were accruing interest under the modified terms and $3.9 million were on non-accrual status. As of December 31, 2019, TDRs totaling $0.9 million were accruing interest under the modified terms and $8.1 million were on non-accrual status. As of December 31, 2018, TDRs totaling $0.8 million were accruing interest under the modified terms and $6.0 million were on non-accrual status. The Corporation has committed no additional amounts to customers with outstanding loans that are classified as TDRs as of December 31, 2020, $17 thousand to customers with outstanding loans that are classified as TDRs as of December 31, 2019 and no additional amounts as of December 31, 2018. During the years ended December 31, 2020, 2019 and 2018, the terms of certain loans were modified as TDRs. During the year ended December 31, 2020, the modification of the terms of one residential mortgage loan included the postponement of scheduled amortized payments for a period of greater than three-months. Additionally, two commercial and industrial loans were modified with the maturity date extended on both loans and one with an extension at a stated rate lower than the current market rate for new debt with similar risk. Additionally, two commercial and industrial loans had payments deferred and both loans were risk rated Substandard while one loan was in non-accrual status prior to the modification. The modifications of four commercial mortgage loans included the deferral of payments with three of the loans risk rated Substandard and in non-accrual status, three of the borrowers were over one year past due in real estate taxes and two of the loans were over 30 days past due in payments. The modifications of three residential mortgages included the deferral of payments while all three were in non-accrual status prior to the modifications, two were risk rated Substandard and one was over 30 days past due in payments. The modifications of three home equity lines and loans included the deferral of payments while all three loans were risk rated Substandard and in non-accrual status prior to the modifications. During the year ended December 31, 2019, the modification of the terms of one commercial real estate term loan included a reduction of the scheduled amortized payments for greater than a three month period, and modification of the terms of one home equity loan included a reduction in the stated interest rate for the remaining life of the loan, an extension of the maturity date for approximately three years and a reduction of the scheduled amortized payment of the loan for greater than a three month period. Additionally, one residential mortgage loan modification included a reduction in the stated interest rate for the remaining life of the loan, a deferral of the principal balance decreasing the effective borrowing rate, an extension of the maturity date by thirteen years at a stated rate lower than the current market rate for new debt with similar risk and a postponement of the scheduled amortized payments of the loan for greater than a three month period During the year ended December 31, 2018, the modification of the terms of two commercial and industrial term loans included extensions of the maturity dates at stated rates of interest lower than current market rates for new debt with similar risks. The following table presents loans by class modified as troubled debt restructurings that occurred during the years ended December 31, 2020, 2019 and 2018 (in thousands):
December 31, 2020 |  | Number of Loans |  | Pre-Modification Outstanding Recorded Investment |  | Post-Modification Outstanding Recorded Investment
Troubled debt restructurings: |  |  |  |  |  |
Commercial and agricultural: |  |  |  |  |  |
Commercial and industrial |  | 4 |  | $ | 2,068 |  |  | $ | 2,068 |
Commercial mortgages: |  |  |  |  |  |
Commercial mortgages |  | 4 |  | 1,297 |  |  | 1,297 |
Residential mortgages |  | 4 |  | 997 |  |  | 997 |
Consumer loans: |  |  |  |  |  |
Home equity lines and loans |  | 3 |  | 738 |  |  | 738 |
Total |  | 15 |  | $ | 5,100 |  |  | $ | 5,100 |
The TDRs described above increased the allowance for loan losses by $0.2 million and resulted in no charge offs during the year ended December 31, 2020.
December 31, 2019 |  | Number of Loans |  | Pre-Modification Outstanding Recorded Investment |  | Post-Modification Outstanding Recorded Investment
Troubled debt restructurings: |  |  |  |  |  |
Commercial mortgages: |  |  |  |  |  |
Commercial mortgages |  | 1 |  | 4,223 |  |  | 4,223 |
Residential mortgages |  | 1 |  | 123 |  |  | 123 |
Consumer loans: |  |  |  |  |  |
Home equity lines and loans |  | 1 |  | 137 |  |  | 137 |
Total |  | 3 |  | $ | 4,483 |  |  | $ | 4,483 |
The TDRs described above increased the allowance for loan losses by $1.7 million and resulted in no charge offs during the year ended December 31, 2019.
December 31, 2018 |  | Number of Loans |  | Pre-Modification Outstanding Recorded Investment |  | Post-Modification Outstanding Recorded Investment
Troubled debt restructurings: |  |  |  |  |  |
Commercial and agricultural: |  |  |  |  |  |
Commercial and industrial |  | 2 |  | $ | 491 |  |  | $ | 491 |
Total |  | 2 |  | $ | 491 |  |  | $ | 491 |
The TDRs described above increased the allowance for loan losses by $0.4 million and resulted in no charge offs during the year ended December 31, 2018. A loan is considered to be in payment default once it is 90 days contractually past due under the modified terms. The following table presents loans by class modified as TDRs for which there was a payment default within twelve months following the modification during the year ended December 31, 2020:
December 31, 2020 |  | Number of Loans |  | Recorded Investment
Consumer loans: |  |  |  |
Home equity lines and loans |  | 1 |  | $ | 170 |
Total |  | 1 |  | $ | 170 |
There were no payment defaults on any loans previously modified as troubled debt restructurings during the years ended December 31, 2019 and 2018, within twelve months following the modification. Credit Quality Indicators The Corporation establishes a risk rating at origination for all commercial loans. The main factors considered in assigning risk ratings include, but are not limited to: historic and future debt service coverage, collateral position, operating performance, liquidity, leverage, payment history, management ability, and the customer’s industry. Commercial relationship managers monitor all loans in their respective portfolios for any changes in the borrower’s ability to service their debt and affirm the risk ratings for the loans at least annually. For the retail loans, which include residential mortgages, indirect and direct consumer loans, home equity lines and loans, and credit cards, once a loan is properly approved and closed, the Corporation evaluates credit quality based upon loan repayment. Retail loans are not rated until they become 90 days past due. The Corporation uses the risk rating system to identify criticized and classified loans. Commercial relationships within the criticized and classified risk ratings are analyzed quarterly. The Corporation uses the following definitions for criticized and classified loans (which are consistent with regulatory guidelines): Special Mention – Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or the institution’s credit position as some future date. Substandard – Loans classified as substandard are inadequately protected by the current net worth and paying capability of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution 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 liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans. Loans listed as not rated are included in groups of homogeneous loans. Based on the analyses performed as of December 31, 2020 and 2019, the risk category of the recorded investment of loans by class of loans is as follows (in thousands):
| December 31, 2020
| Not Rated |  | Pass |  |  |  | Special Mention |  | Substandard |  | Doubtful |  | Total
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | $ | — |  |  | $ | 360,500 |  |  |  |  | $ | 2,999 |  |  | $ | 5,092 |  |  | $ | 1,377 |  |  | $ | 369,968 |
Agricultural | — |  |  | 284 |  |  |  |  | — |  |  | — |  |  | — |  |  | 284 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |  |  |
Construction | — |  |  | 59,885 |  |  |  |  | — |  |  | 2,279 |  |  | — |  |  | 62,164 |
Commercial mortgages | — |  |  | 616,090 |  |  |  |  | 23,631 |  |  | 16,128 |  |  | 1,132 |  |  | 656,981 |
Residential mortgages | 238,381 |  |  |  |  |  |  | — |  |  | 1,632 |  |  | — |  |  | 240,013 |
Consumer loans |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 77,602 |  |  | — |  |  |  |  | — |  |  | 1,159 |  |  | — |  |  | 78,761 |
Indirect consumer loans | 120,334 |  |  | — |  |  |  |  | — |  |  | 519 |  |  | — |  |  | 120,853 |
Direct consumer loans | 12,470 |  |  | — |  |  |  |  | — |  |  | 4 |  |  | — |  |  | 12,474 |
Total | $ | 448,787 |  |  | $ | 1,036,759 |  |  |  |  | $ | 26,630 |  |  | $ | 26,813 |  |  | $ | 2,509 |  |  | $ | 1,541,498 |
| December 31, 2019
| Not Rated |  | Pass |  |  |  | Special Mention |  | Substandard |  | Doubtful |  | Total
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | $ | — |  |  | $ | 208,552 |  |  |  |  | $ | 5,915 |  |  | $ | 10,361 |  |  | $ | 5,820 |  |  | $ | 230,648 |
Agricultural | — |  |  | 274 |  |  |  |  | — |  |  | — |  |  | — |  |  | 274 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |  |  |
Construction | — |  |  | 40,304 |  |  |  |  | 168 |  |  | 3,610 |  |  | — |  |  | 44,082 |
Commercial mortgages | — |  |  | 577,266 |  |  |  |  | 12,451 |  |  | 12,356 |  |  | 4,415 |  |  | 606,488 |
Residential mortgages | 186,719 |  |  | — |  |  |  |  | — |  |  | 2,155 |  |  | — |  |  | 188,874 |
Consumer loans |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 91,424 |  |  | — |  |  |  |  | — |  |  | 641 |  |  | — |  |  | 92,065 |
Indirect consumer loans | 134,795 |  |  | — |  |  |  |  | — |  |  | 571 |  |  | — |  |  | 135,366 |
Direct consumer loans | 15,099 |  |  | — |  |  |  |  | — |  |  | 7 |  |  | — |  |  | 15,106 |
Total | $ | 428,037 |  |  | $ | 826,396 |  |  |  |  | $ | 18,534 |  |  | $ | 29,701 |  |  | $ | 10,235 |  |  | $ | 1,312,903 |
The Corporation considers the performance of the loan portfolio and its impact on the allowance for loan losses. For residential and consumer loan classes, the Corporation also evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity. Non-performing loans include non-accrual loans and non-accrual troubled debt restructurings. The following table presents the recorded investment in residential and consumer loans based on payment activity as of December 31, 2020 and 2019 (in thousands):
| December 31, 2020
|  |  |  |  | Consumer Loans
| Residential Mortgages |  |  |  | Home Equity Lines and Loans |  | Indirect Consumer Loans |  | Other Direct Consumer Loans
Performing | $ | 238,381 |  |  |  |  | $ | 77,602 |  |  | $ | 120,334 |  |  | $ | 12,470 |
Non-Performing | 1,632 |  |  |  |  | 1,159 |  |  | 519 |  |  | 4 |
Total | $ | 240,013 |  |  |  |  | $ | 78,761 |  |  | $ | 120,853 |  |  | $ | 12,474 |
| December 31, 2019
|  |  |  |  | Consumer Loans
| Residential Mortgages |  |  |  | Home Equity Lines and Loans |  | Indirect Consumer Loans |  | Other Direct Consumer Loans
Performing | $ | 186,719 |  |  |  |  | $ | 91,424 |  |  | $ | 134,795 |  |  | $ | 15,099 |
Non-Performing | 2,155 |  |  |  |  | 641 |  |  | 571 |  |  | 7 |
Total | $ | 188,874 |  |  |  |  | $ | 92,065 |  |  | $ | 135,366 |  |  | $ | 15,106 |

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- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -URI http://asc.fasb.org/subtopic&trid=2196772 + Details
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