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LOANS AND ALLOWANCE FOR LOAN LOSSES | 9 Months Ended
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Sep. 30, 2022
Receivables [Abstract] |
LOANS AND ALLOWANCE FOR LOAN LOSSES | LOANS AND ALLOWANCE FOR LOAN LOSSES The composition of the loan portfolio, net of deferred origination fees and costs, is summarized as follows (in thousands):
|  | September 30, 2022 |  | December 31, 2021
Commercial and agricultural: |  |  |  |
Commercial and industrial |  | $ | 262,014 |  |  | $ | 256,893 |
Agricultural |  | 75 |  |  | 394 |
Commercial mortgages: |  |  |  |
Construction |  | 105,330 |  |  | 82,204 |
Commercial mortgages, other |  | 836,190 |  |  | 720,358 |
Residential mortgages |  | 283,128 |  |  | 259,334 |
Consumer loans: |  |  |  |
Home equity lines and loans |  | 76,871 |  |  | 70,670 |
Indirect consumer loans |  | 168,214 |  |  | 118,569 |
Direct consumer loans |  | 10,933 |  |  | 9,827 |
Total loans, net of deferred loan fees and costs |  | 1,742,755 |  |  | 1,518,249 |
Interest receivable on loans |  | 5,128 |  |  | 4,133 |
Total recorded investment in loans |  | $ | 1,747,883 |  |  | $ | 1,522,382 |
The Corporation's concentrations of credit risk by loan type are reflected in the preceding table. The concentrations of credit risk with standby letters of credit, committed lines of credit and commitments to originate new loans generally follow the loan classifications in the table above. As of September 30, 2022 and December 31, 2021, the Corporation had outstanding PPP loan balances of $1.4 million and $43.2 million, respectively, which were included in commercial and industrial loans in the table above. These loans require no allowance for loan losses as of September 30, 2022 and December 31, 2021 since they are government guaranteed loans. The following tables present the activity in the allowance for loan losses by portfolio segment for the three month periods ended September 30, 2022 and 2021 (in thousands):
| Three Months Ended September 30, 2022
Allowance for loan losses | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Beginning balance | $ | 3,564 |  |  | $ | 10,314 |  |  | $ | 1,714 |  |  | $ | 1,893 |  |  | $ | 17,485 |
Charge-offs | — |  |  | — |  |  | — |  |  | (277) |  |  | (277) |
Recoveries | 6 |  |  | 1 |  |  | 40 |  |  | 121 |  |  | 168 |
Net recoveries (charge-offs) | 6 |  |  | 1 |  |  | 40 |  |  | (156) |  |  | (109) |
Provision | (55) |  |  | 671 |  |  | 42 |  |  | 597 |  |  | 1,255 |
Ending balance | $ | 3,515 |  |  | $ | 10,986 |  |  | $ | 1,796 |  |  | $ | 2,334 |  |  | $ | 18,631 |
| Three Months Ended September 30, 2021
Allowance for loan losses | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Beginning balance | $ | 3,628 |  |  | $ | 12,963 |  |  | $ | 1,791 |  |  | $ | 2,294 |  |  | $ | 20,676 |
Charge-offs | — |  |  | (44) |  |  | — |  |  | (190) |  |  | (234) |
Recoveries | 8 |  |  | 1 |  |  | — |  |  | 133 |  |  | 142 |
Net recoveries (charge-offs) | 8 |  |  | (43) |  |  | — |  |  | (57) |  |  | (92) |
Provision | (15) |  |  | 361 |  |  | 80 |  |  | (70) |  |  | 356 |
Ending balance | $ | 3,621 |  |  | $ | 13,281 |  |  | $ | 1,871 |  |  | $ | 2,167 |  |  | $ | 20,940 |
The following tables present the activity in the allowance for loan losses by portfolio segment for the nine month periods ended September 30, 2022 and 2021 (in thousands):
| Nine Months Ended September 30, 2022
Allowance for loan losses | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Beginning balance | $ | 3,591 |  |  | $ | 13,556 |  |  | $ | 1,803 |  |  | $ | 2,075 |  |  | $ | 21,025 |
Charge-offs | (20) |  |  | (687) |  |  | — |  |  | (599) |  |  | (1,306) |
Recoveries | 37 |  |  | 3 |  |  | 40 |  |  | 466 |  |  | 546 |
Net recoveries (charge-offs) | 17 |  |  | (684) |  |  | 40 |  |  | (133) |  |  | (760) |
Provision | (93) |  |  | (1,886) |  |  | (47) |  |  | 392 |  |  | (1,634) |
Ending balance | $ | 3,515 |  |  | $ | 10,986 |  |  | $ | 1,796 |  |  | $ | 2,334 |  |  | $ | 18,631 |
| Nine Months Ended September 30, 2021
Allowance for loan losses | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Beginning balance | $ | 4,493 |  |  | $ | 11,496 |  |  | $ | 2,079 |  |  | $ | 2,856 |  |  | $ | 20,924 |
Charge-offs | (25) |  |  | (44) |  |  | (71) |  |  | (510) |  |  | (650) |
Recoveries | 283 |  |  | 2 |  |  | 10 |  |  | 424 |  |  | 719 |
Net recoveries (charge-offs) | 258 |  |  | (42) |  |  | (61) |  |  | (86) |  |  | 69 |
Provision | (1,130) |  |  | 1,827 |  |  | (147) |  |  | (603) |  |  | (53) |
Ending balance | $ | 3,621 |  |  | $ | 13,281 |  |  | $ | 1,871 |  |  | $ | 2,167 |  |  | $ | 20,940 |
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 September 30, 2022 and December 31, 2021 (in thousands):
| September 30, 2022
Allowance for loan losses: | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Ending allowance balance attributable to loans: |  |  |  |  |  |  |  |  |
Individually evaluated for impairment | $ | 1,323 |  |  | $ | 41 |  |  | $ | — |  |  | $ | 41 |  |  | $ | 1,405 |
Collectively evaluated for impairment | 2,192 |  |  | 10,945 |  |  | 1,796 |  |  | 2,293 |  |  | 17,226 |
Total ending allowance balance | $ | 3,515 |  |  | $ | 10,986 |  |  | $ | 1,796 |  |  | $ | 2,334 |  |  | $ | 18,631 |
| December 31, 2021
Allowance for loan losses: | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Ending allowance balance attributable to loans: |  |  |  |  |  |  |  |  |
Individually evaluated for impairment | $ | 1,394 |  |  | $ | 1,571 |  |  | $ | — |  |  | $ | 65 |  |  | $ | 3,030 |
Collectively evaluated for impairment | 2,197 |  |  | 11,985 |  |  | 1,803 |  |  | 2,010 |  |  | 17,995 |
Total ending allowance balance | $ | 3,591 |  |  | $ | 13,556 |  |  | $ | 1,803 |  |  | $ | 2,075 |  |  | $ | 21,025 |
| September 30, 2022
Loans: | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Loans individually evaluated for impairment | $ | 2,531 |  |  | $ | 4,313 |  |  | $ | 768 |  |  | $ | 277 |  |  | $ | 7,889 |
Loans collectively evaluated for impairment | 260,388 |  |  | 940,188 |  |  | 283,076 |  |  | 256,342 |  |  | 1,739,994 |
Total ending loans balance | $ | 262,919 |  |  | $ | 944,501 |  |  | $ | 283,844 |  |  | $ | 256,619 |  |  | $ | 1,747,883 |
| December 31, 2021
Loans: | Commercial and Agricultural |  | Commercial Mortgages |  | Residential Mortgages |  | Consumer Loans |  | Total
Loans individually evaluated for impairment | $ | 2,427 |  |  | $ | 7,967 |  |  | $ | 938 |  |  | $ | 315 |  |  | $ | 11,647 |
Loans collectively evaluated for impairment | 255,586 |  |  | 796,858 |  |  | 259,029 |  |  | 199,262 |  |  | 1,510,735 |
Total ending loans balance | $ | 258,013 |  |  | $ | 804,825 |  |  | $ | 259,967 |  |  | $ | 199,577 |  |  | $ | 1,522,382 |
The following table presents loans individually evaluated for impairment recognized by class of loans as of September 30, 2022 and December 31, 2021 (in thousands):
| September 30, 2022 |  | December 31, 2021
With no related allowance recorded: | Unpaid Principal Balance |  | Recorded Investment |  | Allowance for Loan Losses Allocated |  | Unpaid Principal Balance |  | Recorded Investment |  | Allowance for Loan Losses Allocated
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | $ | 570 |  |  | $ | 569 |  |  | $ | — |  |  | $ | 954 |  |  | $ | 948 |  |  | $ | — |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |
Construction | 12 |  |  | 12 |  |  | — |  |  | 129 |  |  | 130 |  |  | — |
Commercial mortgages, other | 4,261 |  |  | 4,260 |  |  | — |  |  | 6,940 |  |  | 4,278 |  |  | — |
Residential mortgages | 777 |  |  | 768 |  |  | — |  |  | 951 |  |  | 938 |  |  | — |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 160 |  |  | 144 |  |  | — |  |  | 185 |  |  | 169 |  |  | — |
With an allowance recorded: |  |  |  |  |  |  |  |  |  |  |
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | 1,961 |  |  | 1,962 |  |  | 1,323 |  |  | 5,350 |  |  | 1,479 |  |  | 1,394 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |
Commercial mortgages, other | 41 |  |  | 41 |  |  | 41 |  |  | 3,550 |  |  | 3,559 |  |  | 1,571 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 133 |  |  | 133 |  |  | 41 |  |  | 146 |  |  | 146 |  |  | 65 |
Total | $ | 7,915 |  |  | $ | 7,889 |  |  | $ | 1,405 |  |  | $ | 18,205 |  |  | $ | 11,647 |  |  | $ | 3,030 |
The following table presents the average recorded investment and interest income of loans individually evaluated for impairment recognized by class of loans for the three and nine month periods ended September 30, 2022 and 2021 (in thousands):
|  | Three Months Ended September 30, 2022 |  | Three Months Ended September 30, 2021 |  | Nine Months Ended September 30, 2022 |  | Nine Months Ended September 30, 2021
With no related allowance recorded: |  | Average Recorded Investment |  | Interest Income Recognized(1) |  | Average Recorded Investment |  | Interest Income Recognized(1) |  | Average Recorded Investment |  | Interest Income Recognized(1) |  | Average Recorded Investment |  | Interest Income Recognized(1)
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial |  | $ | 585 |  |  | $ | — |  |  | $ | 1,378 |  |  | $ | 3 |  |  | $ | 761 |  |  | $ | — |  |  | $ | 1,645 |  |  | $ | 3 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Construction |  | 55 |  |  | — |  |  | 151 |  |  | 1 |  |  | 88 |  |  | — |  |  | 167 |  |  | 5 |
Commercial mortgages, other |  | 4,150 |  |  | 7 |  |  | 4,665 |  |  | 8 |  |  | 4,171 |  |  | 14 |  |  | 4,743 |  |  | 23 |
Residential mortgages |  | 846 |  |  | 9 |  |  | 950 |  |  | 12 |  |  | 890 |  |  | 19 |  |  | 1,034 |  |  | 29 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines & loans |  | 149 |  |  | — |  |  | 184 |  |  | 2 |  |  | 157 |  |  | — |  |  | 299 |  |  | 5 |
With an allowance recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial |  | 1,643 |  |  | 2 |  |  | 1,545 |  |  | 4 |  |  | 1,545 |  |  | 5 |  |  | 1,511 |  |  | 6 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial mortgages, other |  | 42 |  |  | — |  |  | 3,644 |  |  | 25 |  |  | 1,563 |  |  | — |  |  | 1,905 |  |  | 25 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans |  | 134 |  |  | — |  |  | 155 |  |  | — |  |  | 139 |  |  | — |  |  | 160 |  |  | — |
Total |  | $ | 7,604 |  |  | $ | 18 |  |  | $ | 12,672 |  |  | $ | 55 |  |  | $ | 9,314 |  |  | $ | 38 |  |  | $ | 11,464 |  |  | $ | 96 |
(1)Cash basis interest income approximates interest income recognized. The following table presents the recorded investment in non-accrual and loans past due 90 days or more and still accruing by class of loan as of September 30, 2022 and December 31, 2021 (in thousands):
|  | Non-accrual |  | Loans Past Due 90 Days or More and Still Accruing
|  | September 30, 2022 |  | December 31, 2021 |  | September 30, 2022 |  | December 31, 2021
Commercial and agricultural: |  |  |  |  |  |  |  |
Commercial and industrial |  | $ | 2,360 |  |  | $ | 1,932 |  |  | $ | — |  |  | $ | 4 |
Commercial mortgages: |  |  |  |  |  |  |  |
Construction |  | 12 |  |  | 34 |  |  | — |  |  | — |
Commercial mortgages, other |  | 3,840 |  |  | 3,844 |  |  | — |  |  | — |
Residential mortgages |  | 699 |  |  | 1,039 |  |  | — |  |  | — |
Consumer loans: |  |  |  |  |  |  |  |
Home equity lines and loans |  | 833 |  |  | 790 |  |  | — |  |  | — |
Indirect consumer loans |  | 565 |  |  | 462 |  |  | — |  |  | — |
Direct consumer loans |  | 1 |  |  | 13 |  |  | — |  |  | — |
Total |  | $ | 8,310 |  |  | $ | 8,114 |  |  | $ | — |  |  | $ | 4 |
The following tables present the aging of the recorded investment in loans as of September 30, 2022 and December 31, 2021 (in thousands):
| September 30, 2022
| 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 | $ | 12 |  |  | $ | — |  |  | $ | 101 |  |  | $ | 113 |  |  |  |  | $ | 262,731 |  |  | $ | 262,844 |
Agricultural | — |  |  | — |  |  | — |  |  | — |  |  |  |  | 75 |  |  | 75 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |  |  |
Construction | 12 |  |  | — |  |  | — |  |  | 12 |  |  |  |  | 105,652 |  |  | 105,664 |
Commercial mortgages, other | 246 |  |  | 17 |  |  | 531 |  |  | 794 |  |  |  |  | 838,043 |  |  | 838,837 |
Residential mortgages | 1,952 |  |  | 316 |  |  | 396 |  |  | 2,664 |  |  |  |  | 281,180 |  |  | 283,844 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 133 |  |  | 159 |  |  | 457 |  |  | 749 |  |  |  |  | 76,356 |  |  | 77,105 |
Indirect consumer loans | 905 |  |  | 230 |  |  | 270 |  |  | 1,405 |  |  |  |  | 167,126 |  |  | 168,531 |
Direct consumer loans | 3 |  |  | 1 |  |  | — |  |  | 4 |  |  |  |  | 10,979 |  |  | 10,983 |
Total | $ | 3,263 |  |  | $ | 723 |  |  | $ | 1,755 |  |  | $ | 5,741 |  |  |  |  | $ | 1,742,142 |  |  | $ | 1,747,883 |
| December 31, 2021
| 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 | $ | 413 |  |  | $ | 148 |  |  | $ | 26 |  |  | $ | 587 |  |  |  |  | $ | 257,031 |  |  | $ | 257,618 |
Agricultural | — |  |  | — |  |  | — |  |  | — |  |  |  |  | 395 |  |  | 395 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |  |  |
Construction | — |  |  | — |  |  | — |  |  | — |  |  |  |  | 82,435 |  |  | 82,435 |
Commercial mortgages, other | 24 |  |  | 224 |  |  | 1,302 |  |  | 1,550 |  |  |  |  | 720,840 |  |  | 722,390 |
Residential mortgages | 580 |  |  | 32 |  |  | 652 |  |  | 1,264 |  |  |  |  | 258,703 |  |  | 259,967 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 256 |  |  | 69 |  |  | 424 |  |  | 749 |  |  |  |  | 70,105 |  |  | 70,854 |
Indirect consumer loans | 1,179 |  |  | 424 |  |  | 255 |  |  | 1,858 |  |  |  |  | 116,997 |  |  | 118,855 |
Direct consumer loans | 24 |  |  | 11 |  |  | 13 |  |  | 48 |  |  |  |  | 9,820 |  |  | 9,868 |
Total | $ | 2,476 |  |  | $ | 908 |  |  | $ | 2,672 |  |  | $ | 6,056 |  |  |  |  | $ | 1,516,326 |  |  | $ | 1,522,382 |
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 were considered current for COVID-19 related modifications and therefore not be treated as TDRs, until January 1, 2022. As of September 30, 2022 and December 31, 2021, the Corporation had a recorded investment in TDRs of $5.9 million and $10.3 million, respectively. There were specific reserves of $0.3 million and $1.9 million allocated for TDRs at September 30, 2022 and December 31, 2021, respectively. As of September 30, 2022, TDRs totaling $1.4 million were accruing interest under the modified terms and $4.4 million were on non-accrual status. As of December 31, 2021, TDRs totaling $5.6 million were accruing interest under the modified terms and $4.7 million were on non-accrual status. The Corporation committed no additional amounts as of both September 30, 2022 and December 31, 2021, to customers with outstanding loans that are classified as TDRs. During the three months ended September 30, 2022, no loans were modified as TDRs. During the three month period ended September 30, 2021, the terms and conditions of two commercial mortgage loans were modified as TDRs. The modification of the terms of both of the loans in the three months ended September 30, 2021 included a postponement or reduction of the scheduled amortized payments for greater than a three month period. During the nine months ended September 30, 2022, no loans were modified as TDRs. During the nine month period ended September 30, 2021, the terms and conditions of six commercial mortgage loans were modified as TDRs. The modification of the terms of all of the loans in the nine months ended September 30, 2021 included a postponement or reduction of the scheduled amortized payments for greater than a three month period. The following table presents loans by class modified as TDRs that occurred during the three month period ended September 30, 2021 (dollars in thousands):
September 30, 2021 |  | Number of Loans |  | Pre-Modification Outstanding Recorded Investment |  | Post-Modification Outstanding Recorded Investment
Troubled debt restructurings: |  |  |  |  |  |
Commercial mortgages: |  |  |  |  |  |
Commercial mortgages, other |  | 2 |  |  | $ | 502 |  |  | $ | 502 |
Total |  | 2 |  |  | $ | 502 |  |  | $ | 502 |
The TDRs described above increased the allowance for loan losses by $0.2 million and resulted in no charge-offs during the three month period ended September 30, 2021. The following table presents loans by class modified as TDRs that occurred during the nine month period ended September 30, 2021 (dollars in thousands):
September 30, 2021 |  | Number of Loans |  | Pre-Modification Outstanding Recorded Investment |  | Post-Modification Outstanding Recorded Investment
Troubled debt restructurings: |  |  |  |  |  |
Commercial and agricultural: |  |  |  |  |  |
Commercial and industrial |  | — |  |  | $ | — |  |  | $ | — |
Commercial mortgages: |  |  |  |  |  |
Commercial mortgages, other |  | 6 |  |  | $ | 6,596 |  |  | $ | 6,596 |
Total |  | 6 |  |  | $ | 6,596 |  |  | $ | 6,596 |
The TDRs described above increased the allowance for loan losses by $1.9 million and resulted in no charge-offs during the nine month period ended September 30, 2021. A loan is considered to be in payment default once it is 90 days contractually past due under the modified terms. There were no payment defaults on any loans previously modified as TDRs within twelve months following the modification during the three and nine month periods ended September 30, 2022 and 2021. 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 its debt and affirm the risk ratings for the loans at least annually. For 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 at 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. Commercial loans not meeting the criteria above to be considered criticized or classified, are considered to be pass rated loans. Loans listed as not rated, are included in groups of homogeneous loans performing under terms of the loan notes. Based on the analyses performed as of September 30, 2022 and December 31, 2021, the risk category of the recorded investment of loans by class of loans is as follows (in thousands):
| September 30, 2022
| Not Rated |  | Pass |  | Special Mention |  | Substandard |  | Doubtful |  |  |  | Total
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | $ | — |  |  | $ | 255,235 |  |  | $ | 3,366 |  |  | $ | 3,313 |  |  | $ | 930 |  |  |  |  | $ | 262,844 |
Agricultural | — |  |  | 75 |  |  | — |  |  | — |  |  | — |  |  |  |  | 75 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |  |  |
Construction | — |  |  | 105,473 |  |  | 179 |  |  | 12 |  |  | — |  |  |  |  | 105,664 |
Commercial mortgages | — |  |  | 802,080 |  |  | 28,910 |  |  | 7,806 |  |  | 41 |  |  |  |  | 838,837 |
Residential mortgages | 283,145 |  |  | — |  |  | — |  |  | 699 |  |  | — |  |  |  |  | 283,844 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 76,272 |  |  | — |  |  | — |  |  | 833 |  |  | — |  |  |  |  | 77,105 |
Indirect consumer loans | 167,966 |  |  | — |  |  | — |  |  | 565 |  |  | — |  |  |  |  | 168,531 |
Direct consumer loans | 10,983 |  |  | — |  |  | — |  |  | — |  |  | — |  |  |  |  | 10,983 |
Total | $ | 538,366 |  |  | $ | 1,162,863 |  |  | $ | 32,455 |  |  | $ | 13,228 |  |  | $ | 971 |  |  |  |  | $ | 1,747,883 |
| December 31, 2021
| Not Rated |  | Pass |  | Special Mention |  | Substandard |  | Doubtful |  |  |  | Total
Commercial and agricultural: |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial | $ | — |  |  | $ | 250,529 |  |  | $ | 2,892 |  |  | $ | 3,108 |  |  | $ | 1,089 |  |  |  |  | $ | 257,618 |
Agricultural | — |  |  | 395 |  |  | — |  |  | — |  |  | — |  |  |  |  | 395 |
Commercial mortgages: |  |  |  |  |  |  |  |  |  |  |  |  |
Construction | — |  |  | 82,404 |  |  | — |  |  | 31 |  |  | — |  |  |  |  | 82,435 |
Commercial mortgages | — |  |  | 672,741 |  |  | 31,072 |  |  | 17,458 |  |  | 1,119 |  |  |  |  | 722,390 |
Residential mortgages | 258,928 |  |  | — |  |  | — |  |  | 1,039 |  |  | — |  |  |  |  | 259,967 |
Consumer loans: |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines and loans | 70,064 |  |  | — |  |  | — |  |  | 790 |  |  | — |  |  |  |  | 70,854 |
Indirect consumer loans | 118,393 |  |  | — |  |  | — |  |  | 462 |  |  | — |  |  |  |  | 118,855 |
Direct consumer loans | 9,855 |  |  | — |  |  | — |  |  | 13 |  |  | — |  |  |  |  | 9,868 |
Total | $ | 457,240 |  |  | $ | 1,006,069 |  |  | $ | 33,964 |  |  | $ | 22,901 |  |  | $ | 2,208 |  |  |  |  | $ | 1,522,382 |
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. The following tables present the recorded investment in residential and consumer loans based on payment activity as of September 30, 2022 and December 31, 2021 (in thousands):
| September 30, 2022
|  |  |  |  | Consumer Loans
| Residential Mortgages |  |  |  | Home Equity Lines and Loans |  | Indirect Consumer Loans |  | Other Direct Consumer Loans
Performing | $ | 283,145 |  |  |  |  | $ | 76,272 |  |  | $ | 167,966 |  |  | $ | 10,982 |
Non-Performing | 699 |  |  |  |  | 833 |  |  | 565 |  |  | 1 |
| $ | 283,844 |  |  |  |  | $ | 77,105 |  |  | $ | 168,531 |  |  | $ | 10,983 |
| December 31, 2021
|  |  |  |  | Consumer Loans
| Residential Mortgages |  |  |  | Home Equity Lines and Loans |  | Indirect Consumer Loans |  | Other Direct Consumer Loans
Performing | $ | 258,928 |  |  |  |  | $ | 70,064 |  |  | $ | 118,393 |  |  | $ | 9,855 |
Non-Performing | 1,039 |  |  |  |  | 790 |  |  | 462 |  |  | 13 |
| $ | 259,967 |  |  |  |  | $ | 70,854 |  |  | $ | 118,855 |  |  | $ | 9,868 |

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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 https://asc.fasb.org/subtopic&trid=2196772 + Details
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- References No definition available. + Details
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