LOANS (covered) (Tables) (Covered Loans)

6 Months Ended

Jun. 30, 2012

Carrying Value of Purchased Impaired and Nonimpaired Loans

The following table reflects the carrying value of all purchased impaired and nonimpaired covered loans:



	June 30, 2012						December 31, 2011
(Dollars in thousands)	Loans Accounted For Under FASB ASC Topic 310-30		Loans excluded from FASB ASC Topic 310-30 ⁽¹⁾		Total Purchased Loans		Loans Accounted For Under FASB ASC Topic 310-30		Loans Excluded From FASB ASC Topic 310-30 ⁽¹⁾		Total Purchased Loans
Commercial	$	133,165	$	8,844	$	142,009	$	182,625	$	13,267	$	195,892
Real estate - construction	15,333		0		15,333		17,120		0		17,120
Real estate - commercial	548,626		8,047		556,673		627,257		9,787		637,044
Real estate - residential	111,720		0		111,720		121,117		0		121,117
Installment	10,791		850		11,641		12,123		1,053		13,176
Home equity	3,330		59,832		63,162		4,146		60,832		64,978
Other covered loans	0		3,324		3,324		0		3,917		3,917
Total covered loans	$	822,965	$	80,897	$	903,862	$	964,388	$	88,856	$	1,053,244

(1) Includes loans with revolving privileges which are scoped out of FASB ASC Topic 310-30 and certain loans which First Financial elected to treat under the cost recovery method of accounting.

Covered Nonaccrual Loans

Information on covered nonaccrual loans, excluding loans accounted for under FASB ASC Topic 310-30, was as follows:



(Dollars in thousands)	June 30, 2012		December 31, 2011
Nonaccrual loans
Commercial	$	3,199	$	7,203
Real estate-commercial	1,523		2,192
Home equity	1,548		1,747
All other	15		18
Total	$	6,285	$	11,160



	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2012		2011		2012		2011
Interest income effect on impaired loans
Gross amount of interest that would have been recorded under original terms	$	150	$	240	$	358	$	501
Interest included in income	13		14		61		41
Net impact on interest income	$	137	$	226	$	297	$	460

Investment in Impaired Loans

First Financial’s investment in covered impaired loans, excluding loans accounted for under FASB ASC Topic 310-30, was as follows:



	As of June 30, 2012
(Dollars in thousands)	Current Balance		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		YTD Interest Income Recognized		Quarterly Interest Income Recognized
Loans with no related allowance recorded:
Commercial	$	3,199	$	5,532	$	0	$	5,228	$	51	$	8
Real estate - commercial	1,523		3,424		0		2,064		9		5
Home equity	1,548		2,419		0		1,314		1		0
All other	15		15		0		16		0		0
Total	$	6,285	$	11,390	$	0	$	8,622	$	61	$	13



	As of December 31, 2011
(Dollars in thousands)	Current Balance		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
Loans with no related allowance recorded:
Commercial	$	7,203	$	10,152	$	0	$	9,873	$	47
Real estate - commercial	2,192		4,002		0		2,504		5
Installment	1,747		2,878		0		1,559		6
Home equity	18		18		0		9		0
Total	$	11,160	$	17,050	$	0	$	13,945	$	58

Commercial and Consumer Credit Exposure by Risk Attribute

Covered commercial and consumer credit exposure by risk attribute was as follows:



	As of June 30, 2012
			Real Estate
(Dollars in thousands)	Commercial		Construction		Commercial		Total
Pass	$	74,047	$	2,363	$	277,046	$	353,456
Special Mention	18,490		3,325		63,192		85,007
Substandard	45,598		9,645		216,168		271,411
Doubtful	3,874		0		267		4,141
Total	$	142,009	$	15,333	$	556,673	$	714,015



(Dollars in thousands)	Real Estate Residential		Installment		Home Equity		Other		Total
Performing	$	111,720	$	11,641	$	61,614	$	3,309	$	188,284
Nonperforming	0		0		1,548		15		1,563
Total	$	111,720	$	11,641	$	63,162	$	3,324	$	189,847



	December 31, 2011
			Real Estate
(Dollars in thousands)	Commercial		Construction		Commercial		Total
Pass	$	113,201	$	2,506	$	340,889	$	456,596
Special Mention	22,468		3,597		63,880		89,945
Substandard	52,103		11,017		230,870		293,990
Doubtful	8,120		0		1,405		9,525
Total	$	195,892	$	17,120	$	637,044	$	850,056



(Dollars in thousands)	Real Estate Residential		Installment		Home Equity		Other		Total
Performing	$	121,117	$	13,176	$	63,231	$	3,899	$	201,423
Nonperforming	0		0		1,747		18		1,765
Total	$	121,117	$	13,176	$	64,978	$	3,917	$	203,188

Changes in Other Real Estate Owned

Changes in covered OREO were as follows:



	Three months ended June 30,				Six months ended June 30,
(Dollars in thousands)	2012		2011		2012		2011
Balance at beginning of period	$	41,489	$	33,648	$	44,818	$	35,257
Additions
Commercial	2,349		10,535		5,099		21,732
Residential	62		944		2,686		1,825
Total additions	2,411		11,479		7,785		23,557
Disposals
Commercial	13,554		2,234		18,559		11,500
Residential	1,811		3,755		2,354		6,091
Total disposals	15,365		5,989		20,913		17,591
Write-downs
Commercial	2,332		1,439		5,416		3,524
Residential	795		1,012		866		1,012
Total write-downs	3,127		2,451		6,282		4,536
Balance at end of period	$	25,408	$	36,687	$	25,408	$	36,687

Loans Excluded from FASB ASC Topic 310-30

Carrying Amount of Accretable Yield for Purchased Impaired and Nonimpaired Loans

Changes in the carrying amount of accretable yield for loans accounted for under FASB ASC Topic 310-30 were as follows:



	Three Months Ended						Six months ended
	June 30,						June 30,
(Dollars in thousands)	2012			2011			2012			2011
Balance at beginning of period ⁽¹⁾	$	313,669		$	461,290		$	344,410		$	509,945
Reclassification from non-accretable difference	9,058			11,229			23,442			33,206
Accretion	(24,025		)	(31,818		)	(49,944		)	(66,279		)
Other net activity ⁽²⁾	(15,406		)	(18,920		)	(34,612		)	(55,091		)
Balance at end of period	$	283,296		$	421,781		$	283,296		$	421,781

(1) Excludes loans with revolving privileges which are scoped out of FASB Topic 310-30 and certain loans which First Financial elected to treat under the cost recovery method

(2) Includes the impact of loan repayments and charge-offs

Loan Delinquency, including Nonaccrual Loans

Covered loan delinquency, excluding loans accounted for under FASB ASC Topic 310-30, was as follows:



	As of June 30, 2012
(Dollars in thousands)	30 - 59 days past due		60 - 89 days past due		> 90 days past due		Total past due		Current		Total		> 90 days past due and accruing
Loans
Commercial	$	102	$	66	$	2,577	$	2,745	$	6,099	$	8,844	$	0
Real estate - commercial	0		195		867		1,062		6,985		8,047		0
Installment	0		0		0		0		850		850		0
Home equity	797		218		1,645		2,660		57,172		59,832		0
All other	27		16		80		123		3,201		3,324		65
Total	$	926	$	495	$	5,169	$	6,590	$	74,307	$	80,897	$	65



	As of December 31, 2011
(Dollars in thousands)	30 - 59 days past due		60 - 89 days past due		> 90 days past due		Total past due		Current		Total		> 90 days past due and accruing
Loans
Commercial	$	73	$	294	$	6,490	$	6,857	$	6,410	$	13,267	$	0
Real estate - commercial	184		0		1,870		2,054		7,733		9,787		0
Installment	0		0		0		0		1,053		1,053		0
Home equity	1,344		11		1,679		3,034		57,798		60,832		0
All other	10		6		125		141		3,776		3,917		107
Total	$	1,611	$	311	$	10,164	$	12,086	$	76,770	$	88,856	$	107