Loans:

Loan balances were as follows:

(In Thousands of Dollars)	March 31, 2016			December 31, 2015
Originated loans:
Commercial real estate
Owner occupied	$	112,454		$	113,160
Non-owner occupied		150,137			139,502
Other		50,002			50,855
Commercial		168,686			157,447
Residential real estate
1-4 family residential		192,001			179,657
Home equity lines of credit		43,985			41,171
Consumer
Indirect		127,118			127,335
Direct		19,965			17,325
Other		4,708			4,508
Subtotal	$	869,056		$	830,960
Net deferred loan costs		2,698			2,731
Allowance for loan losses		(9,376	)		(8,947	)
Total originated loans	$	862,378		$	824,744
Acquired loans:
Commercial real estate
Owner occupied	$	132,512		$	131,673
Non-owner occupied		27,102			28,045
Other		19,397			23,536
Commercial		65,683			73,621
Residential real estate
1-4 family residential		130,545			133,701
Home equity lines of credit		39,508			40,929
Consumer
Direct		28,725			31,465
Other		275			204
Subtotal	$	443,747		$	463,174
Allowance for loan losses		(14	)		(31	)
Total acquired loans		443,733			463,143
Net loans	$	1,306,111		$	1,287,887

Certain loan categories have been reclassified in the current presentation. The reclassifications had no effect on net income or stockholders’ equity.

Purchased credit impaired loans

As part of the NBOH acquisition the Company acquired various loans that displayed evidence of deterioration of credit quality since origination and which was probable that all contractually required payments would not be collected. The carrying amounts and contractually required payments of these loans which are included in the loan balances above are summarized in the following tables:

(In Thousands of Dollars)	March 31, 2016		December 31, 2015
Commercial real estate
Owner occupied	$	696	$	986
Non-owner occupied		477		501
Commercial		1,273		1,576
Total outstanding balance	$	2,446	$	3,063
Carrying amount, net of allowance of $14 in 2016 and $31 in 2015	$	1,902	$	2,184

Accretable yield, or income expected to be collected, is shown in the table below:

(In Thousands of Dollars)	March 31, 2016
Beginning balance	$	323
New loans purchased	0
Accretion of income		(18	)
Ending balance	$	305

The key assumptions considered include probability of default and the amount of actual prepayments after the acquisition date. Prepayments affect the estimated life of the loans and could change the amount of interest income and principal expected to be collected. In reforecasting future estimated cash flows, credit loss expectations are adjusted as necessary. There were no adjustments to forecasted cash flows that impacted the allowance for loan losses for the three months ended March 31, 2016.

The following tables present the activity in the allowance for loan losses by portfolio segment for the three month periods ended March 31, 2016 and 2015:

Three Months Ended March 31, 2016

(In Thousands of Dollars)	Commercial Real Estate		Commercial		Residential Real Estate			Consumer			Unallocated		Total
Allowance for loan losses
Beginning balance	$	3,127	$	1,373	$	1,845		$	2,160		$	473	$	8,978
Provision for loan losses		43		64		75			446			152		780
Loans charged off		0		0		(34	)		(544	)		0		(578	)
Recoveries		11		15		28			156			0		210
Total ending allowance balance	$	3,181	$	1,452	$	1,914		$	2,218		$	625	$	9,390

Three Months Ended March 31, 2015

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Unallocated			Total
Allowance for loan losses
Beginning balance	$	2,676		$	1,420		$	1,689		$	1,663		$	184		$	7,632
Provision for loan losses		232			(70	)		10			352			(74	)		450
Loans charged off		(4	)		0			(81	)		(533	)		0			(618	)
Recoveries		13			1			22			223			0			259
Total ending allowance balance	$	2,917		$	1,351		$	1,640		$	1,705		$	110		$	7,723

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 March 31, 2016 and December 31, 2015. The recorded investment in loans includes the unpaid principal balance and unamortized loan origination fees and costs, but excludes accrued interest receivable, which is not considered to be material:

March 31, 2016

(In Thousands of Dollars)	Commercial Real Estate		Commercial		Residential Real Estate		Consumer		Unallocated		Total
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	418	$	5	$	59	$	0	$	0	$	482
Collectively evaluated for impairment		2,763		1,433		1,855		2,218		625		8,894
Acquired loans		0		0		0		0		0		0
Acquired with deteriorated credit quality		0		14		0		0		0		14
Total ending allowance balance	$	3,181	$	1,452	$	1,914	$	2,218	$	625	$	9,390

Loans:
Loans individually evaluated for impairment	$	5,444	$	670	$	3,354	$	88	$	0	$	9,556
Loans collectively evaluated for impairment		306,334		167,728		232,190		155,946		0		862,198
Acquired loans		178,030		64,748		170,053		29,000		0		441,831
Acquired with deteriorated credit quality		981		935		0		0		0		1,916
Total ending loans balance	$	490,789	$	234,081	$	405,597	$	185,034	$	0	$	1,315,501

December 31, 2015

(In Thousands of Dollars)	Commercial Real Estate		Commercial		Residential Real Estate		Consumer		Unallocated		Total
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	429	$	5	$	63	$	0	$	0	$	497
Collectively evaluated for impairment		2,698		1,337		1,782		2,160		473		8,450
Acquired loans		0		0		0		0		0		0
Acquired with deteriorated credit quality		0		31		0		0		0		31
Total ending allowance balance	$	3,127	$	1,373	$	1,845	$	2,160	$	473	$	8,978

Loans:
Loans individually evaluated for impairment	$	5,853	$	712	$	3,414	$	103	$	0	$	10,082
Loans collectively evaluated for impairment		296,866		156,415		217,023		153,305		0		823,609
Acquired loans		181,987		72,673		174,630		31,669		0		460,959
Acquired with deteriorated credit quality		1,267		948		0		0		0		2,215
Total ending loans balance	$	485,973	$	230,748	$	395,067	$	185,077	$	0	$	1,296,865

The following tables present information related to impaired loans by class of loans as of March 31, 2016 and December 31, 2015:

(In Thousands of Dollars)	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated
March 31, 2016
With no related allowance recorded:
Commercial real estate
Owner occupied	$	2,582	$	2,062	$	0
Non-owner occupied		336		335		0
Commercial		793		590		0
Residential real estate
1-4 family residential		2,540		2,275		0
Home equity lines of credit		248		233		0
Consumer		173		88		0
Subtotal		6,672		5,583		0

With an allowance recorded:
Commercial real estate
Owner occupied		1,587		1,585		373
Non-owner occupied		1,463		1,462		45
Commercial		80		80		5
Residential real estate
1-4 family residential		780		760		57
Home equity lines of credit		86		86		2
Subtotal		3,996		3,973		482
Total	$	10,668	$	9,556	$	482

(In Thousands of Dollars)	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated
December 31, 2015
With no related allowance recorded:
Commercial real estate
Owner occupied	$	2,956	$	2,436	$	0
Non-owner occupied		343		342		0
Commercial		834		631		0
Residential real estate
1-4 family residential		2,575		2,310		0
Home equity lines of credit		283		268		0
Consumer		214		103		0
Subtotal		7,205		6,090		0

With an allowance recorded:
Commercial real estate
Owner occupied		1,597		1,595		379
Non-owner occupied		1,480		1,480		50
Commercial		81		81		5
Residential real estate
1-4 family residential		769		749		61
Home equity lines of credit		87		87		2
Subtotal		4,014		3,992		497
Total	$	11,219	$	10,082	$	497

The following tables present the average recorded investment in impaired loans by class and interest income recognized by loan class for the three month periods ended March 31, 2016 and 2015:

	Average Recorded Investment				Interest Income Recognized
	For Three Months Ended March 31,				For Three Months Ended March 31,
(In Thousands of Dollars)	2016		2015		2016		2015
With no related allowance recorded:
Commercial real estate
Owner occupied	$	2,307	$	2,311	$	10	$	16
Non-owner occupied		336		387		4		6
Commercial		614		463		5		6
Residential real estate
1-4 family residential		2,292		2,125		38		31
Home equity lines of credit		240		251		3		3
Consumer		116		91		3		4
Subtotal		5,905		5,628		63		66

With an allowance recorded:
Commercial real estate
Owner occupied		1,589		2,870		9		24
Non-owner occupied		1,469		1,537		19		20
Commercial		80		1,117		1		1
Residential real estate
1-4 family residential		749		983		9		9
Home equity lines of credit		86		90		1		1
Subtotal		3,973		6,597		39		55
Total	$	9,878	$	12,225	$	102	$	121

Cash basis interest recognized during the three month periods ended March 31, 2016 and 2015 was materially equal to interest income recognized.

Nonaccrual loans and loans past due 90 days or more still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans.

The following table presents the recorded investment in nonaccrual and loans past due 90 days or more still on accrual by class of loans as of March 31, 2016 and December 31, 2015:

	March 31, 2016				December 31, 2015
(In Thousands of Dollars)	Nonaccrual		Loans Past Due 90 Days or More Still Accruing		Nonaccrual		Loans Past Due 90 Days or More Still Accruing
Originated loans:
Commercial real estate
Owner occupied	$	2,943	$	0	$	3,313	$	0
Non-owner occupied		336		2		345		0
Commercial		571		0		541		73
Residential real estate
1-4 family residential		2,194		451		2,406		336
Home equity lines of credit		131		60		127		112
Consumer
Indirect		216		122		266		297
Direct		19		0		30		3
Other		0		10		0		24
Total originated loans	$	6,410	$	645	$	7,028	$	845
Acquired loans:
Commercial real estate
Owner occupied	$	138	$	0	$	126	$	18
Other		75		0		92		0
Commercial		976		0		1,068		0
Residential real estate
1-4 family residential		447		752		458		467
Home equity lines of credit		124		7		125		7
Consumer
Direct		136		0		161		50
Total acquired loans	$	1,896	$	759	$	2,030	$	542
Total loans	$	8,306	$	1,404	$	9,058	$	1,387

The following table presents the aging of the recorded investment in past due loans as of March 31, 2016 and December 31, 2015 by class of loans:

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
March 31, 2016
Originated loans:
Commercial real estate
Owner occupied	$	182	$	0	$	2,943	$	3,125	$	109,067	$	112,192
Non-owner occupied		0		0		338		338		149,417		149,755
Other		0		0		0		0		49,831		49,831
Commercial		87		48		571		706		167,692		168,398
Residential real estate
1-4 family residential		1,571		1,307		2,645		5,523		185,987		191,510
Home equity lines of credit		318		4		191		513		43,521		44,034
Consumer
Indirect		1,423		312		338		2,073		129,117		131,190
Direct		227		41		19		287		19,848		20,135
Other		17		12		10		39		4,670		4,709
Total originated loans:	$	3,825	$	1,724	$	7,055	$	12,604	$	859,150	$	871,754
Acquired loans:
Commercial real estate
Owner occupied	$	500	$	523	$	138	$	1,161	$	131,351	$	132,512
Non-owner occupied		71		0		0		71		27,031		27,102
Other		0		0		75		75		19,322		19,397
Commercial		567		775		976		2,318		63,365		65,683
Residential real estate
1-4 family residential		749		668		1,199		2,616		127,929		130,545
Home equity lines of credit		86		62		131		279		39,229		39,508
Consumer
Direct		470		50		136		656		28,069		28,725
Other		2		0		0		2		273		275
Total acquired loans	$	2,445	$	2,078	$	2,655	$	7,178	$	436,569	$	443,747
Total loans	$	6,270	$	3,802	$	9,710	$	19,782	$	1,295,719	$	1,315,501

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
December 31, 2015
Originated loans:
Commercial real estate
Owner occupied	$	34	$	0	$	3,313	$	3,347	$	109,532	$	112,879
Non-owner occupied		0		0		345		345		138,824		139,169
Other		112		0		0		112		50,559		50,671
Commercial		0		0		614		614		156,513		157,127
Residential real estate
1-4 family residential		1,694		402		2,742		4,838		174,376		179,214
Home equity lines of credit		62		5		239		306		40,917		41,223
Consumer
Indirect		2,059		525		563		3,147		128,280		131,427
Direct		311		5		33		349		17,124		17,473
Other		13		10		24		47		4,461		4,508
Total originated loans	$	4,285	$	947	$	7,873	$	13,105	$	820,586	$	833,691
Acquired loans:
Commercial real estate
Owner occupied	$	669	$	0	$	144	$	813	$	130,860	$	131,673
Non-owner occupied		0		0		0		0		28,045		28,045
Other		0		0		92		92		23,444		23,536
Commercial		276		2		1,068		1,346		72,275		73,621
Residential real estate
1-4 family residential		1,994		244		925		3,163		130,538		133,701
Home equity lines of credit		78		11		132		221		40,708		40,929
Consumer
Direct		567		56		211		834		30,631		31,465
Other		0		0		0		0		204		204
Total acquired loans	$	3,584	$	313	$	2,572	$	6,469	$	456,705	$	463,174
Total loans	$	7,869	$	1,260	$	10,445	$	19,574	$	1,277,291	$	1,296,865