Loans (Tables)

3 Months Ended

Mar. 31, 2016

Receivables [Abstract]

Major Classifications of Loans

Major classifications of loans at March 31, 2016 and December 31, 2015 are as follows (in thousands):

	March 31, 2016		December 31, 2015
Commercial and industrial	$	45,324	45,275
Commercial, secured by real estate	430,179		419,633
Residential real estate	271,812		273,139
Consumer	17,925		18,510
Agricultural	12,589		13,479
Other loans, including deposit overdrafts	643		665
	778,472		770,701
Deferred net origination costs (fees)	242		237
	778,714		770,938
Less allowance for loan losses	3,150		3,129
Loans, net	$	775,564	767,809

Non-accrual, Past Due, and Accruing Restructured Loans

Non-accrual, past-due, and accruing restructured loans as of March 31, 2016 and December 31, 2015 are as follows (in thousands):

	March 31, 2016		December 31, 2015
Non-accrual loans:
Commercial and industrial	$	—	—
Commercial, secured by real estate	1,759		876
Agricultural	413		48
Residential real estate	1,144		799
Consumer	12		—
Total non-accrual loans	3,328		1,723
Past-due 90 days or more and still accruing	99		559
Total non-accrual and past-due 90 days or more and still accruing	3,427		2,282
Accruing restructured loans	13,955		13,723
Total	$	17,382	16,005

Allowance for Loan Losses and Recorded Investments in Loans

The allowance for loan losses for the three months ended March 31, 2016 and 2015 are as follows (in thousands):

	Commercial & Industrial		Commercial, Secured by Real Estate		Residential Real Estate		Consumer		Agricultural		Other		Total
Three Months Ended March 31, 2016
Allowance for loan losses:
Balance, beginning of year	$	244	1,908		854		54		66		3		3,129
Provision charged to expenses	—		(35	)	66		61		(10	)	8		90
Losses charged off	—		(23	)	(28	)	(44	)	—		(23	)	(118	)
Recoveries	3		18		4		10		—		14		49
Balance, end of period	$	247	1,868		896		81		56		2		3,150
Three Months Ended March 31, 2015
Allowance for loan losses:
Balance, beginning of year	$	129	1,990		926		63		11		2		3,121
Provision charged to expenses	1		(37	)	64		(29	)	66		4		69
Losses charged off	—		(313	)	(82	)	(11	)	—		(14	)	(420	)
Recoveries	1		—		26		31		—		9		67
Balance, end of period	$	131	1,640		934		54		77		1		2,837

A breakdown of the allowance for loan losses and the loan portfolio by loan segment at March 31, 2016 and December 31, 2015 are as follows (in thousands):

	Commercial & Industrial		Commercial, Secured by Real Estate	Residential Real Estate	Consumer	Agricultural	Other	Total
March 31, 2016
Allowance for loan losses:
Individually evaluated for impairment	$	8	210	93	13	—	—	324
Collectively evaluated for impairment	239		1,629	803	68	56	2	2,797
Acquired credit impaired loans	—		29	—	—	—	—	29
Balance, end of period	$	247	1,868	896	81	56	2	3,150
Loans:
Individually evaluated for impairment	$	362	13,065	1,593	63	384	—	15,467
Collectively evaluated for impairment	44,236		410,441	267,682	17,934	12,184	139	752,616
Acquired credit impaired loans	739		6,351	2,986	22	29	504	10,631
Balance, end of period	$	45,337	429,857	272,261	18,019	12,597	643	778,714
December 31, 2015
Allowance for loan losses:
Individually evaluated for impairment	$	9	306	48	—	—	—	363
Collectively evaluated for impairment	235		1,602	806	54	66	3	2,766
Acquired credit impaired loans	—		—	—	—	—	—	—
Balance, end of period	$	244	1,908	854	54	66	3	3,129
Loans:
Individually evaluated for impairment	$	370	12,351	1,541	56	—	—	14,318
Collectively evaluated for impairment	43,726		399,092	269,001	18,516	13,438	179	743,952
Acquired credit impaired loans	1,191		7,877	3,039	27	48	486	12,668
Balance, end of period	$	45,287	419,320	273,581	18,599	13,486	665	770,938

Analysis of the Company's Loan Portfolio by Credit Quality Indicators

A breakdown of the loan portfolio by credit quality indicators at March 31, 2016 and December 31, 2015 is as follows (in thousands):

	Pass		OAEM	Substandard	Doubtful	Total
March 31, 2016
Commercial & industrial	$	44,585	—	752	—	45,337
Commercial, secured by real estate	409,710		7,521	12,626	—	429,857
Residential real estate	266,809		1,198	4,254	—	272,261
Consumer	17,911		—	108	—	18,019
Agricultural	11,111		728	758	—	12,597
Other	643		—	—	—	643
Total	$	750,769	9,447	18,498	—	778,714
December 31, 2015
Commercial & industrial	$	44,596	—	691	—	45,287
Commercial, secured by real estate	397,938		9,316	12,066	—	419,320
Residential real estate	267,567		1,935	4,079	—	273,581
Consumer	18,528		—	71	—	18,599
Agricultural	12,246		850	390	—	13,486
Other	665		—	—	—	665
Total	$	741,540	12,101	17,297	—	770,938

Loan Portfolio Aging Analysis

A loan portfolio aging analysis at March 31, 2016 and December 31, 2015 is as follows (in thousands):

	30-59 Days Past Due		60-89 Days Past Due	Greater Than 90 Days Past Due	Total Past Due	Current	Total Loans Receivable	Total Loans Greater Than 90 Days and Accruing
March 31, 2016
Commercial & industrial	$	61	—	—	61	45,276	45,337	—
Commercial, secured by real estate	75		73	836	984	428,873	429,857	—
Residential real estate	1,008		2	1,025	2,035	270,226	272,261	64
Consumer	54		9	48	111	17,908	18,019	35
Agricultural	—		—	—	—	12,597	12,597	—
Other	70		—	—	70	573	643	—
Total	$	1,268	84	1,909	3,261	775,453	778,714	99
December 31, 2015
Commercial & industrial	$	—	—	—	—	45,287	45,287	—
Commercial, secured by real estate	73		81	876	1,030	418,290	419,320	—
Residential real estate	777		198	1,124	2,099	271,482	273,581	516
Consumer	62		7	43	112	18,487	18,599	43
Agricultural	—		—	—	—	13,486	13,486	—
Other	109		—	—	109	556	665	—
Total	$	1,021	286	2,043	3,350	767,588	770,938	559

Impaired Loans

mpaired loans, including acquired credit impaired loans, at March 31, 2016 and December 31, 2015 are as follows (in thousands):

	Recorded Investment		Unpaid Principal Balance	Related Allowance
March 31, 2016
With no related allowance recorded:
Commercial & industrial	$	752	1,036	—
Commercial, secured by real estate	16,811		18,584	—
Residential real estate	3,746		4,976	—
Consumer	38		60	—
Agricultural	413		504	—
Other	504		700	—
Total	$	22,264	25,860	—
With an allowance recorded:
Commercial & industrial	$	349	354	8
Commercial, secured by real estate	2,605		2,731	239
Residential real estate	833		937	93
Consumer	47		66	13
Agricultural	—		—	—
Other	—		—	—
Total	$	3,834	4,088	353
Total:
Commercial & industrial	$	1,101	1,390	8
Commercial, secured by real estate	19,416		21,315	239
Residential real estate	4,579		5,913	93
Consumer	85		126	13
Agricultural	413		504	—
Other	504		700	—
Total	$	26,098	29,948	353
December 31, 2015
With no related allowance recorded:
Commercial & industrial	$	1,205	1,500	—
Commercial, secured by real estate	16,345		18,335	—
Residential real estate	3,734		5,055	—
Consumer	81		109	—
Agricultural	48		151	—
Other	486		701	—
Total	$	21,899	25,851	—
With an allowance recorded:
Commercial & industrial	$	356	356	9
Commercial, secured by real estate	3,883		4,014	306
Residential real estate	846		958	48
Consumer	2		1	—
Total	$	5,087	5,329	363
Total:
Commercial & industrial	$	1,561	1,856	9
Commercial, secured by real estate	20,228		22,349	306
Residential real estate	4,580		6,013	48
Consumer	83		110	—
Agricultural	48		151	—
Other	486		701	—
Total	$	26,986	31,180	363

The following presents information related to the average recorded investment and interest income recognized on impaired loans, including acquired credit impaired loans, for the three months ended March 31, 2016 and 2015 (in thousands):

	2016			2015
	Average Recorded Investment		Interest Income Recognized	Average Recorded Investment	Interest Income Recognized
With no related allowance recorded:
Commercial & industrial	$	978	29	1,232	35
Commercial, secured by real estate	17,631		387	21,608	362
Residential real estate	3,778		67	4,326	82
Consumer	41		7	107	4
Agricultural	422		12	20	97
Other	495		20	522	19
Total	$	23,345	522	27,815	599
With an allowance recorded:
Commercial & industrial	$	352	5	380	5
Commercial, secured by real estate	2,624		19	3,989	27
Residential real estate	834		10	944	10
Consumer	61		1	18	1
Agricultural	—		—	121	—
Other	—		—	—	—
Total	$	3,871	35	5,452	43
Total:
Commercial & industrial	$	1,330	34	1,612	40
Commercial, secured by real estate	20,255		406	25,597	389
Residential real estate	4,612		77	5,270	92
Consumer	102		8	125	5
Agricultural	422		12	141	97
Other	495		20	522	19
Total	$	27,216	557	33,267	642

Troubled Debt Restructurings

Loan modifications that were classified as troubled debt restructurings during the three months ended March 31, 2016 and 2015 are as follows (dollars in thousands):

	2016				2015
	Number of Loans	Pre-Modification Recorded Balance		Post-Modification Recorded Balance	Number of Loans	Pre-Modification Recorded Balance		Post-Modification Recorded Balance
Three Months Ended March 31,
Commercial, secured by real estate	1	$	299	372	—	—		—
Residential real estate	1	18		18	3	87		87
Consumer	1	17		17	—	—		—
Total	3	$	334	407	3	$	87	87