Troubled Debt Restructurings

3 Months Ended

Mar. 31, 2016

Troubled Debt Restructurings:

Total troubled debt restructurings were $8.8 million and $9.3 million at March 31, 2016 and December 31, 2015, respectively. The Company has allocated $497 thousand and $528 thousand of specific reserves to customers whose loan terms have been modified in troubled debt restructurings as of March 31, 2016 and December 31, 2015. There were no commitments to lend additional amounts to borrowers with loans that were classified as troubled debt restructurings at March 31, 2016 and at December 31, 2015.

During the three month periods ended March 31, 2016 and 2015, the terms of certain loans were modified as troubled debt restructurings. The modification of the terms of such loans included one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; or a legal concession. During 2016, the terms of such loans included a reduction of the stated interest rate of the loan by 1.24% and an extension of the maturity date by 120 months. During the same three month period in 2015, loans modified as trouble debt restructurings had loan maturity dates extended in the range of 9 to 120 months.

The following table presents loans by class modified as troubled debt restructurings that occurred during the three month periods ended March 31, 2016 and 2015:

			Pre-Modification		Post-Modification
Three Months Ended March 31, 2016	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Originated loans:
Residential real estate
1-4 family residential		3	$	47	$	48
Indirect		8		77		77
Total originated loans		11		124		125
Acquired loans:
Consumer		1		33		33
Total loans		12	$	157	$	158

			Pre-Modification		Post-Modification
Three Months Ended March 31, 2015	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Troubled Debt Restructurings:
Commercial		1	$	8	$	8
Residential real estate
1-4 family residential		3		354		354
Home equity lines of credit		1		50		50
Indirect		2		36		36
Total		7	$	448	$	448

There were $11 thousand in charge offs and a $11 thousand increase to the provision for loan losses during the three month period ended March 31, 2016, as a result of troubled debt restructurings. There were $35 thousand in charge offs and a $33 thousand increase to the provision for loan losses during the three month period ended March 31, 2015, as a result of troubled debt restructurings.

There was one residential real estate loan and one home equity line of credit for which there was a payment default for both within twelve months following the modification of the troubled debt restructuring during the three month period ended March 31, 2016. These loans were past due at March 31, 2016. There was no provision recorded as a result of the defaults during 2016. A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.

There was one residential real estate loan modified as a troubled debt restructuring for which there was a payment default within the twelve months following the modification during the three month period ended March 31, 2015. This loan was past due at March 31, 2015. There was a $23 thousand provision to the loan losses as a result of the default during 2015.