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LOANS AND LEASES (Tables)

9 Months Ended

Sep. 30, 2019

Commercial and Consumer Credit Exposure by Risk Attribute

Commercial and consumer credit exposure by risk attribute was as follows:



	As of September 30, 2019
	Commercial		Real Estate				Lease
(Dollars in thousands)	& industrial		Construction		Commercial		financing		Total
Pass	$	2,321,468	$	515,955	$	3,939,531	$	88,866	$	6,865,820
Special Mention	90,663		0		26,147		793		117,603
Substandard	57,886		5		50,230		2,957		111,078
Doubtful	0		0		0		0		0
Total	$	2,470,017	$	515,960	$	4,015,908	$	92,616	$	7,094,501



(Dollars in thousands)	Residential real estate		Home equity		Installment		Credit card		Total
Performing	$	1,038,874	$	770,941	$	88,171	$	48,723	$	1,946,709
Nonperforming	16,133		5,944		104		287		22,468
Total	$	1,055,007	$	776,885	$	88,275	$	49,010	$	1,969,177



	As of December 31, 2018
	Commercial		Real Estate				Lease
(Dollars in thousands)	& industrial		Construction		Commercial		financing		Total
Pass	$	2,432,834	$	548,323	$	3,664,434	$	90,902	$	6,736,493
Special Mention	24,594		603		38,653		0		63,850
Substandard	57,233		9		51,594		2,513		111,349
Doubtful	0		0		0		0		0
Total	$	2,514,661	$	548,935	$	3,754,681	$	93,415	$	6,911,692



(Dollars in thousands)	Residential real estate		Home equity		Installment		Credit card		Total
Performing	$	939,936	$	811,108	$	93,038	$	46,382	$	1,890,464
Nonperforming	15,710		6,174		174		0		22,058
Total	$	955,646	$	817,282	$	93,212	$	46,382	$	1,912,522

Loan Delinquency, including Nonaccrual Loans

Loan delinquency, including loans classified as nonaccrual, was as follows:



	As of September 30, 2019
(Dollars in thousands)	30 – 59 days past due		60 – 89 days past due		> 90 days past due		Total past due		Current		Subtotal		Purchased impaired		Total		> 90 days past due and still accruing
Loans
Commercial & industrial	$	9,709	$	358	$	4,268	$	14,335	$	2,452,565	$	2,466,900	$	3,117	$	2,470,017	$	0
Lease financing	1,782		0		0		1,782		90,834		92,616		0		92,616		0
Construction real estate	0		0		0		0		515,935		515,935		25		515,960		0
Commercial real estate	637		1,267		11,298		13,202		3,961,547		3,974,749		41,159		4,015,908		0
Residential real estate	809		2,784		5,682		9,275		1,016,632		1,025,907		29,100		1,055,007		0
Home equity	2,426		1,308		2,881		6,615		767,525		774,140		2,745		776,885		0
Installment	240		29		71		340		87,638		87,978		297		88,275		0
Credit card	286		185		175		646		48,364		49,010		0		49,010		287
Total	$	15,889	$	5,931	$	24,375	$	46,195	$	8,941,040	$	8,987,235	$	76,443	$	9,063,678	$	287



	As of December 31, 2018
(Dollars in thousands)	30 – 59 days past due		60 – 89 days past due		> 90 days past due		Total past due		Current		Subtotal		Purchased impaired		Total		> 90 days past due and still accruing
Loans
Commercial & industrial	$	13,369	$	41	$	7,423	$	20,833	$	2,488,450	$	2,509,283	$	5,378	$	2,514,661	$	0
Lease financing	352		0		0		352		93,063		93,415		0		93,415		0
Construction real estate	0		0		0		0		548,687		548,687		248		548,935		0
Commercial real estate	6,279		1,158		12,644		20,081		3,682,455		3,702,536		52,145		3,754,681		0
Residential real estate	11,060		2,976		4,535		18,571		902,404		920,975		34,671		955,646		0
Home equity	5,245		1,228		2,578		9,051		804,835		813,886		3,396		817,282		0
Installment	420		37		145		602		92,128		92,730		482		93,212		0
Credit card	541		96		63		700		45,682		46,382		0		46,382		63
Total	$	37,266	$	5,536	$	27,388	$	70,190	$	8,657,704	$	8,727,894	$	96,320	$	8,824,214	$	63

Loans Restructured During Period

The following tables provide information on loan modifications classified as TDRs during the three and nine months ended September 30, 2019 and 2018:



	Three months ended
	September 30, 2019					September 30, 2018
(Dollars in thousands)	Number of loans	Pre-modification loan balance		Period end balance		Number of loans	Pre-modification loan balance		Period end balance
Commercial & industrial	2	$	2,482	$	2,521	0	$	0	$	0
Construction real estate	0	0		0		0	0		0
Commercial real estate	2	1,659		1,658		0	0		0
Residential real estate	5	478		455		1	148		143
Home equity	1	35		36		1	10		10
Installment	1	30		29		0	0		0
Total	11	$	4,684	$	4,699	2	$	158	$	153

	Nine months ended
	September 30, 2019					September 30, 2018
(Dollars in thousands)	Number of loans	Pre-modification loan balance		Period end balance		Number of loans	Pre-modification loan balance		Period end balance
Commercial & industrial	8	$	25,009	$	25,071	12	$	7,149	$	7,096
Construction real estate	0	0		0		0	0		0
Commercial real estate	9	3,024		2,932		6	2,119		2,088
Residential real estate	22	2,944		2,626		4	442		437
Home equity	13	358		330		1	10		10
Installment	1	30		29		0	0		0
Total	53	$	31,365	$	30,988	23	$	9,720	$	9,631

For TDRs identified during the three and nine months ended September 30, 2019, there were $2.3 million of chargeoffs for the portion of TDRs determined to be uncollectible. For TDRs identified during the three months ended September 30, 2018, there were $0.7 million of chargeoffs for the portion of TDRs determined to be uncollectible. For TDRs identified during the nine months ended September 30, 2018, there were $0.8 million of chargeoffs for the portion of TDRs determined to be uncollectible.

Loans Restructured, Modifications

The following table provides information on how TDRs were modified during the three and nine months ended September 30, 2019 and 2018:



	Three months ended				Nine months ended
	September 30,				September 30,
(Dollars in thousands)	2019		2018		2019		2018
Extended maturities	$	0	$	143	$	2,877	$	3,031
Adjusted interest rates	0		0		5,284		52
Combination of rate and maturity changes	0		0		508		0
Forbearance	4,349		0		19,984		6,199
Other ⁽¹⁾	350		10		2,335		349
Total	$	4,699	$	153	$	30,988	$	9,631

⁽¹⁾ Includes covenant modifications and other concessions, or combination of concessions, that do not consist of interest rate adjustments, forbearance and maturity extensions

Nonaccrual, Restructured and Impaired Loans

The following table provides information on impaired loans, excluding purchased impaired loans:



(Dollars in thousands)	September 30, 2019		December 31, 2018
Impaired loans
Nonaccrual loans⁽¹⁾
Commercial & industrial	$	28,358	$	30,925
Lease financing	284		22
Construction real estate	5		9
Commercial real estate	14,889		20,500
Residential real estate	11,655		13,495
Home equity	5,427		5,580
Installment	75		169
Nonaccrual loans	60,693		70,700
Accruing troubled debt restructurings	18,450		16,109
Total impaired loans	$	79,143	$	86,809

⁽¹⁾ Nonaccrual loans include nonaccrual TDRs of $21.5 million and $22.4 million as of September 30, 2019 and December 31, 2018, respectively.



	Three months ended				Nine months ended
	September 30,				September 30,
(Dollars in thousands)	2019		2018		2019		2018
Interest income effect on impaired loans
Gross amount of interest that would have been recorded under original terms	$	1,568	$	1,192	$	4,648	$	3,126
Interest included in income
Nonaccrual loans	336		169		863		395
Troubled debt restructurings	184		187		689		500
Total interest included in income	520		356		1,552		895
Net impact on interest income	$	1,048	$	836	$	3,096	$	2,231

Investment in Impaired Loans

First Financial's investment in impaired loans was as follows:



	As of September 30, 2019						As of December 31, 2018
(Dollars in thousands)	Current balance		Contractual principal balance		Related allowance		Current balance		Contractual principal balance		Related allowance
Loans with no related allowance recorded
Commercial & industrial	$	36,705	$	57,623	$	0	$	36,694	$	42,561	$	0
Lease financing	0		0		0		22		22		0
Construction real estate	5		24		0		9		26		0
Commercial real estate	18,653		24,744		0		23,513		31,375		0
Residential real estate	15,838		18,421		0		17,297		19,975		0
Home equity	5,944		6,793		0		6,351		7,461		0
Installment	104		241		0		174		563		0
Total	77,249		107,846		0		84,060		101,983		0

Loans with an allowance recorded
Commercial & industrial	212		212		91		939		939		667
Lease financing	284		284		43		0		0		0
Construction real estate	0		0		0		0		0		0
Commercial real estate	1,103		2,465		127		1,509		1,509		461
Residential real estate	295		295		18		301		301		32
Home equity	0		0		0		0		0		0
Installment	0		0		0		0		0		0
Total	1,894		3,256		279		2,749		2,749		1,160

Total
Commercial & industrial	36,917		57,835		91		37,633		43,500		667
Lease financing	284		284		43		22		22		0
Construction real estate	5		24		0		9		26		0
Commercial real estate	19,756		27,209		127		25,022		32,884		461
Residential real estate	16,133		18,716		18		17,598		20,276		32
Home equity	5,944		6,793		0		6,351		7,461		0
Installment	104		241		0		174		563		0
Total	$	79,143	$	111,102	$	279	$	86,809	$	104,732	$	1,160

First Financial's average impaired loans and interest income recognized by class were as follows:



	Three months ended
	September 30, 2019				September 30, 2018
(Dollars in thousands)	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Loans with no related allowance recorded
Commercial & industrial	$	37,835	$	316	$	10,033	$	63
Lease financing	148		0		0		0
Construction real estate	6		0		17		0
Commercial real estate	18,703		94		28,689		136
Residential real estate	15,388		74		13,247		86
Home equity	5,594		29		6,463		31
Installment	150		0		318		1
Total	77,824		513		58,767		317

Loans with an allowance recorded
Commercial & industrial	4,316		1		1,578		28
Lease financing	142		0		0		0
Construction real estate	0		0		0		0
Commercial real estate	1,010		4		1,012		3
Residential real estate	668		2		1,036		7
Home equity	0		0		100		1
Installment	0		0		0		0
Total	6,136		7		3,726		39

Total
Commercial & industrial	42,151		317		11,611		91
Lease financing	290		0		0		0
Construction real estate	6		0		17		0
Commercial real estate	19,713		98		29,701		139
Residential real estate	16,056		76		14,283		93
Home equity	5,594		29		6,563		32
Installment	150		0		318		1
Total	$	83,960	$	520	$	62,493	$	356



	Nine months ended
	September 30, 2019				September 30, 2018
(Dollars in thousands)	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Loans with no related allowance recorded
Commercial & industrial	$	35,626	$	807	$	8,950	$	162
Lease financing	155		0		21		0
Construction real estate	7		0		22		2
Commercial real estate	20,907		295		25,044		375
Residential real estate	16,177		229		9,875		209
Home equity	5,941		95		5,339		78
Installment	162		2		299		2
Total	78,975		1,428		49,550		828

Loans with an allowance recorded
Commercial & industrial	3,213		87		891		34
Lease financing	71		0		0		0
Construction real estate	0		0		0		0
Commercial real estate	1,507		27		1,376		9
Residential real estate	484		10		1,043		21
Home equity	0		0		100		3
Installment	0		0		0		0
Total	5,275		124		3,410		67

Total
Commercial & industrial	38,839		894		9,841		196
Lease financing	226		0		21		0
Construction real estate	7		0		22		2
Commercial real estate	22,414		322		26,420		384
Residential real estate	16,661		239		10,918		230
Home equity	5,941		95		5,439		81
Installment	162		2		299		2
Total	$	84,250	$	1,552	$	52,960	$	895

Changes in Other Real Estate Owned

Changes in OREO were as follows:



	Three months ended						Nine months ended
	September 30,						September 30,
(Dollars in thousands)	2019			2018			2019			2018
Balance at beginning of period	$	1,421		$	1,853		$	1,401		$	2,781
Additions
Commercial & industrial	217			79			353			1,269
Residential real estate	104			739			1,376			1,723
Total additions	321			818			1,729			2,992
Disposals
Commercial & industrial	(228		)	(181		)	(498		)	(2,611		)
Residential real estate	(325		)	(117		)	(709		)	(527		)
Total disposals	(553		)	(298		)	(1,207		)	(3,138		)
Valuation adjustment
Commercial & industrial	(56		)	(258		)	(111		)	(355		)
Residential real estate	480			(197		)	(199		)	(362		)
Total valuation adjustment	424			(455		)	(310		)	(717		)
Balance at end of period	$	1,613		$	1,918		$	1,613		$	1,918