ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY

12 Months Ended

Dec. 31, 2012

Allowance For Loan Losses and Credit Quality [Abstract]

Allowance For Loan Losses and Credit Quality [Text Block]

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY

The following table presents the activity and balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2012:

				Commercial
				Real Estate								Consumer
	Commercial			and Multifamily			Agri-business		Other			1-4 Family			Other
	and Industrial			Residential			and Agricultural		Commercial			Mortgage			Consumer			Unallocated		Total
	(in thousands)
Balance January 1	$	22,830		$	23,489		$	695	$	65		$	2,322		$	645		$	3,354	$	53,400
Provision for loan losses		1,814			(1,772	)		705		(11	)		1,552			258			3		2,549
Loans charged-off		(3,069	)		(1,108	)		0		0			(1,340	)		(405	)		0		(5,922	)
Recoveries		767			203			3		186			148			111			0		1,418
Net loans charged-off		(2,302	)		(905	)		3		186			(1,192	)		(294	)		0		(4,504	)
Balance December 31	$	22,342		$	20,812		$	1,403	$	240		$	2,682		$	609		$	3,357	$	51,445
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	5,542		$	8,559		$	63	$	0		$	607		$	34		$	0	$	14,805
Collectively evaluated for impairment		16,800			12,253			1,340		240			2,075			575			3,357		36,640
Total ending allowance balance	$	22,342		$	20,812		$	1,403	$	240		$	2,682		$	609		$	3,357	$	51,445
Loans:
Loans individually evaluated for impairment	$	18,281		$	36,919		$	797	$	0		$	2,853		$	92		$	0	$	58,942
Loans collectively evaluated for impairment		828,728			763,279			224,008		56,810			280,141			45,612			0		2,198,578
Total ending loans balance	$	847,009		$	800,198		$	224,805	$	56,810		$	282,994		$	45,704		$	0	$	2,257,520

The recorded investment in loans does not include accrued interest.

The following table presents the activity and balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2011:

				Commercial
				Real Estate									Consumer
	Commercial			and Multifamily			Agri-business			Other			1-4 Family			Other
	and Industrial			Residential			and Agricultural			Commercial			Mortgage			Consumer			Unallocated			Total
	(in thousands)
Balance January 1	$	21,479		$	15,893		$	1,318		$	270		$	1,694		$	682		$	3,671		$	45,007
Provision for loan losses		3,112			9,748			(520	)		(205	)		1,632			350			(317	)		13,800
Loans charged-off		(2,587	)		(2,514	)		(103	)		0			(1,050	)		(575	)		0			(6,829	)
Recoveries		826			362			0			0			46			188			0			1,422
Net loans charged-off		(1,761	)		(2,152	)		(103	)		0			(1,004	)		(387	)		0			(5,407	)
Balance December 31	$	22,830		$	23,489		$	695		$	65		$	2,322		$	645		$	3,354		$	53,400
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	9,443		$	8,382		$	213		$	0		$	288		$	0		$	0		$	18,326
Collectively evaluated for impairment		13,387			15,107			482			65			2,034			645			3,354			35,074
Total ending allowance balance	$	22,830		$	23,489		$	695		$	65		$	2,322		$	645		$	3,354		$	53,400
Loans:
Loans individually evaluated for impairment	$	24,204		$	35,794		$	853		$	0		$	2,665		$	0		$	0		$	63,516
Loans collectively evaluated for impairment		727,160			815,883			237,150			58,249			285,791			45,960			0			2,170,193
Total ending loans balance	$	751,364		$	851,677		$	238,003		$	58,249		$	288,456		$	45,960		$	0		$	2,233,709

The recorded investment in loans does not include accrued interest.

The following is an analysis of the allowance for loan losses for 2010:

	2010
	(in thousands)
Balance January 1,	$	32,073
Provision for loan losses		23,947
Loans charged-off		(11,742	)
Recoveries		729
Net loans charged-off		(11,013	)
Balance December 31,	$	45,007

The allowance for loan losses to total loans as of December 31, 2012, 2011 and 2010 was 2.28%, 2.39% and 2.15% respectively.

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2012:

											Cash Basis
	Unpaid				Allowance for		Average		Interest		Interest
	Principal		Recorded		Loan Losses		Recorded		Income		Income
	Balance		Investment		Allocated		Investment		Recognized		Recognized
	(in thousands)
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	61	$	61	$	0	$	10	$	0	$	0
Non-working capital loans		0		0		0		108		0		0
Commercial real estate and multi-family residential loans:
Owner occupied loans		754		574		0		530		0		0
Nonowner occupied loans		385		385		0		259		17		17
Multifamily loans		410		286		0		83		0		0
Agri-business and agricultural loans:
Loans secured by farmland		645		466		0		307		0		0
Loans for ag production		0		0		0		51		0		0
Consumer 1-4 family loans:
Closed end first mortgage loans		59		59		0		339		0		0
Open end and junior lien loans		41		41		0		25		0		0
Other consumer loans		1		1		0		0		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		5,833		3,224		1,516		4,085		55		54
Non-working capital loans		16,763		14,996		4,026		17,062		667		681
Commercial real estate and multi-family residential loans:
Construction and land development loans		3,352		2,960		934		2,145		48		48
Owner occupied loans		5,869		5,869		1,476		5,157		90		84
Nonowner occupied loans		26,835		26,845		6,149		27,830		363		380
Agri-business and agricultural loans:
Loans secured by farmland		651		331		63		410		0		0
Loans for agricultural production		0		0		0		68		0		0
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		3,387		2,403		415		1,870		36		50
Open end and junior lien loans		379		350		192		343		0		0
Other consumer loans		91		91		34		26		0		0
Total	$	65,516	$	58,942	$	14,805	$	60,708	$	1,276	$	1,314

The recorded investment in loans does not include accrued interest.

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2011:

	Unpaid				Allowance for		Average		Interest		Interest
	Principal		Recorded		Loan Losses		Recorded		Income		Income
	Balance		Investment		Allocated		Investment		Recognized		Recognized
	(in thousands)
With no related allowance recorded:
Commercial and industrial loans:
Non-working capital loans	$	116	$	116	$	0	$	30	$	0	$	0
Commercial real estate and multi-family residential loans:
Nonowner occupied loans		0		0		0		425		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		7,831		5,969		3,206		5,649		23		25
Non-working capital loans		20,867		18,119		6,237		17,202		616		625
Commercial real estate and multi-family residential loans:
Construction and land development loans		816		429		125		1,319		0		0
Owner occupied loans		5,874		5,082		1,566		3,082		41		45
Nonowner occupied loans		30,769		30,283		6,691		24,108		246		252
Agri-business and agricultural loans:
Loans secured by farmland		1,126		628		195		610		0		0
Loans for agricultural production		225		225		18		410		0		0
Other commercial loans		0		0		0		129		0		0
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		2,461		2,256		285		1,872		44		48
Open end and junior lien loans		409		409		3		118		0		0
Total	$	70,494	$	63,516	$	18,326	$	54,954	$	970	$	995

The following table presents information on impaired loans:

	2010
	(in thousands)
Average of impaired loans during the year	$	39,685
Interest income recognized during impairment		450
Cash-basis interest income recognized		465

Nonaccrual loans and loans past due 30 days still on accrual were as follows:

	2012		2011
	(in thousands)
Nonaccrual loans	$	30,829	$	39,425
Interest not recorded on nonaccrual loans		1,681		1,815
Loans past due 30-89 days and still accruing		4,253		4,230
Loans past due 90 days and still accruing		50		52
Nonperforming loans		30,879		39,477

Nonaccrual loans and loans past due 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. For December 31, 2012 and 2011, $30.2 million and $39.0 million of impaired loans were also included in the total for nonaccrual loans. Total impaired loans decreased by $4.6 million to $58.9 million at December 31, 2012 from $63.5 million at December 31, 2011. While there were many changes in nonaccrual loans in 2012, the decrease in nonaccrual loans resulted primarily from charge-offs of $3.1 million on four commercial credits. In addition, two commercial credits totaling $1.6 million paid off and one commercial credit of $2.0 million were returned to accruing status. As discussed earlier, the decrease in impaired loans resulting from these commercial credit charge-offs and payoffs and one additional commercial credit charge-off of $1.0 million were offset by the addition of four other commercial relationships totaling $4.8 million. For December 31, 2011 and 2010, $39.0 million and $35.8 million of impaired loans were also included in the total for nonaccrual loans. Total impaired loans increased by $15.5 million to $63.5 million at December 31, 2011 from $48.0 million at December 31, 2010. The increase in nonaccrual loans resulted primarily from the addition of one commercial credit relationship consisting of 3 loans totaling $7.3 million. As discussed earlier, the increase in impaired loans resulted from this commercial credit, as well as five other commercial relationships totaling $12.1 million.

The following table presents the recorded investment in nonaccrual and loans past due over 90 days still on accrual by class of loans as of December 31, 2012 and 2011:

					Loans Past Due
					Over 90 Days
	Nonaccrual				Still Accruing
	2012		2011		2012		2011
	(in thousands)
Commercial and industrial loans:
Working capital lines of credit loans	$	1,899	$	4,743	$	0	$	0
Non-working capital loans		4,812		5,433		50		0
Commercial real estate and multi-family residential loans:
Construction and land development loans		398		429		0		0
Owner occupied loans		2,461		4,371		0		0
Nonowner occupied loans		19,200		21,971		0		0
Multifamily loans		286		0		0		0
Agri-business and agricultural loans:
Loans secured by farmland		797		628		0		0
Loans for agricultural production		0		225		0		0
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		504		1,193		0		52
Open end and junior lien loans		391		452		0		0
Other consumer loans		77		7		0		0
Total	$	30,825	$	39,452	$	50	$	52

The recorded investment in loans does not include accrued interest.

The following table presents the aging of the recorded investment in past due loans as of December 31, 2012 by class of loans:

	30-89		Greater than
	Days		90 Days		Total		Loans Not
	Past Due		Past Due		Past Due		Past Due		Total
	(in thousands)
Commercial and industrial loans:
Working capital lines of credit loans	$	233	$	1,899	$	2,132	$	437,705	$	439,837
Non-working capital loans		48		4,862		4,910		402,262		407,172
Commercial real estate and multi-family residential loans:
Construction and land development loans		998		398		1,396		80,954		82,350
Owner occupied loans		1,023		2,461		3,484		354,921		358,405
Nonowner occupied loans		38		19,200		19,238		295,243		314,481
Multifamily loans		0		286		286		44,676		44,962
Agri-business and agricultural loans:
Loans secured by farmland		0		797		797		108,359		109,156
Loans for agricultural production		0		0		0		115,649		115,649
Other commercial loans		0		0		0		56,810		56,810
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,475		504		1,979		107,583		109,562
Open end and junior lien loans		361		391		752		161,172		161,924
Residential construction loans		0		0		0		11,508		11,508
Other consumer loans		81		77		158		45,546		45,704
Total	$	4,257	$	30,875	$	35,132	$	2,222,388	$	2,257,520

The recorded investment in loans does not include accrued interest.

The following table presents the aging of the recorded investment in past due loans as of December 31, 2011 by class of loans:

	30-89		Greater than
	Days		90 Days		Total		Loans Not
	Past Due		Past Due		Past Due		Past Due		Total
	(in thousands)
Commercial and industrial loans:
Working capital lines of credit loans	$	1,051	$	4,743	$	5,794	$	368,098	$	373,892
Non-working capital loans		21		5,433		5,454		372,018		377,472
Commercial real estate and multi-family residential loans:
Construction and land development loans		0		429		429		81,650		82,079
Owner occupied loans		104		4,371		4,475		342,068		346,543
Nonowner occupied loans		0		21,971		21,971		362,710		384,681
Multifamily loans		0		0		0		38,374		38,374
Agri-business and agricultural loans:
Loans secured by farmland		0		628		628		117,619		118,247
Loans for agricultural production		0		225		225		119,531		119,756
Other commercial loans		0		0		0		58,249		58,249
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		2,569		1,245		3,814		102,970		106,784
Open end and junior lien loans		254		452		706		175,517		176,223
Residential construction loans		34		0		34		5,415		5,449
Other consumer loans		192		7		199		45,761		45,960
Total	$	4,225	$	39,504	$	43,729	$	2,189,980	$	2,233,709

The recorded investment in loans does not include accrued interest.

Troubled Debt Restructurings:

Troubled debt restructured loans are included in the totals for impaired loans. The Company has allocated $12.5 million and $15.7 million of specific reserves to customers whose loan terms have been modified in troubled debt restructurings as of December 31, 2012 and 2011. The Company is not committed to lend additional funds to debtors whose loans have been modified in a troubled debt restructuring.

	2012		2011		2010
	(in thousands)
Accruing troubled debt restructured loans	$	22,332	$	22,177	$	8,547
Nonaccrual troubled debt restructured loans		28,506		34,273		6,091
Total troubled debt restructured loans	$	50,838	$	56,450	$	14,638

During the year ending December 31, 2012 certain loans were modified as troubled debt restructurings. The modified terms of these loans include one or a combination of the following: inadequate compensation for the terms of the restructure or renewal; a reduction in the interest rate on a loan to one that would not be readily available in the marketplace for borrowers with a similar risk profile; a modification of the repayment terms which delays principal repayment for some period; or renewal terms offered to borrowers in financial distress where no additional credit enhancements were obtained at the time of renewal.

There were renewal terms on several loans offered for loans to borrowers under financial distress which did not require additional compensation or consideration and would not have been readily available in the marketplace for loans bearing similar risk profiles. In these instances, it was determined that a concession had been granted. It is difficult to quantify the concession granted due to an absence of readily available market terms to be used for comparison. The renewals during the first three months were to one borrower engaged in construction and land development, where the aggregate recorded investment totaled $1.6 million. The renewal during the three months ended June 30, 2012, was a non-working capital term loan with a recorded investment of $1.1 million. During the three months ended September 30, 2012, the Bank renegotiated terms on a loan where the collateral securing the original note was sold for an amount that did not satisfy the balance. The Bank agreed to release its collateral interest to facilitate the sale, and renegotiated a new consumer loan with a recorded investment of $17,000 for the remaining balance of the loan. The terms offered in the renegotiated unsecured loan were an exception to bank policy, therefore it was determined that a concession had been granted. These loans are included in the table of all modifications below.

Renegotiated interest rates include loans with a reduction in rate for a short-term (part of the remaining life of the loan) or long-term (life of loan). There were modifications to borrowers at rates that were readily available in the market, but to borrowers who would not have otherwise qualified for the market terms offered in the modification without a concession being granted. Also included are borrowers who received interest rate concessions that were below market rates.

Delays in principal repayment include loans which were intended to be amortizing during the period, but due to financial hardship the borrowers under these loans were unable to meet the original or intended repayment terms. These include loans with principal deferrals for a prolonged period or those with modified payments which are an exception to bank policy.

The following table presents loans by class modified as troubled debt restructurings that occurred during the period ending December 31, 2012:

	All Modifications						Interest Rate Reductions						Modified Repayment Terms
			Pre-Modification		Post-Modification
			Outstanding		Outstanding				Interest at		Interest at				Extension
	Number of		Recorded		Recorded		Number of		Pre-Modification		Post-Modification		Number of		Period or
	Loans		Investment		Investment		Loans		Rate		Rate		Loans		Range
			(in thousands)						(in thousands)						(in months)
Troubled Debt Restructurings
Commercial and industrial loans:
Non-working capital loans		1	$	942	$	1,060		0	$	0	$	0		0		0
Commercial real estate and multi-family residential loans:
Construction and land development loans		5		1,638		1,638		0		0		0		0		0
Owner occupied loans		2		2,260		2,260		1		440		117		1		18
Nonowner occupied loans		1		385		385		0		0		0		1		14
Consumer 1-4 family loans:
Closed end first mortgage loans		5		317		316		5		403		381		0		0
Other consumer loans		1		17		17		0		0		0		0		0
Total		15	$	5,559	$	5,676		6	$	843	$	498		2		14-18

All of the commercial and industrial loan troubled debt restructurings described above also had inadequate compensation of additional collateral as part of the restructuring.

For the period ending December 31, 2012, the commercial and industrial loan troubled debt restructurings described above decreased the allowance for loan losses by $853,000, the commercial real estate and multi-family residential loan troubled debt restructurings described above decreased the allowance for loan losses by $67,000, the consumer 1-4 family loan troubled debt restructurings described above increased the allowance for loan losses by $48,000 and the other consumer loan troubled debt restructurings described above increased the allowance for loan losses by $4,000. The commercial and industrial loan and one commercial real estate and multi-family residential loan that decreased the provision during 2012 had modifications during the first five months of the year and had improved their positions during the remainder of the year warranting the decrease in allocation.

No charge offs resulted from any troubled debt restructurings described above during the period ending December 31, 2012.

During the year ending December 31, 2011, the terms of certain loans were modified as troubled debt restructurings. The modified terms of these loans included one or a combination of the following: a reduction of the stated interest rate of the loan below market rates; principle and interest forgiveness; a modification of repayment terms that delays principal repayment for some period; or inadequate compensation for the terms of the restructure. Clarifications in the accounting guidance for troubled debt restructurings that became effective in the third quarter of 2011 resulted in $15.6 million being added to total troubled debt restructured loans in 2011. Of the $15.6 million added, $15.3 million was included in nonperforming and impaired loans at December 31, 2010.

Renegotiated interest rates include loans with a reduction in rate for a short-term (part of the remaining life of the loan) or long-term (life of loan). Included are modifications to borrowers at a rate that is readily available in the market, but who otherwise would not have qualified for the terms offered in the modification without a concession being granted. Also included are borrowers who received interest rate concessions that are below market rates.

Delays in principal repayment include loans that were intended to be amortizing during the period, but, due to financial hardship, these borrowers were unable to meet the original or intended repayment terms. These include loans with principal deferrals for a prolonged period or those with modified payments, which are an exception to bank policy.

Inadequate compensation for the terms of the restructure were identified in some loans where terms offered would not have been readily available in the marketplace for loans bearing similar risk profiles, including loans that were renewed under terms similar to original terms. In some instances it was determined that a concession had been granted; however, it is difficult to quantify these concessions due to an absence in market terms to be used for comparison. These loans included two non-working capital loans with a recorded investment of $636,000, one non-owner occupied loan with a recorded investment of $642,000 and one loan secured by farmland with a recorded investment of $413,000. These loans are included in the table of all modifications below.

The following tables present loans by class modified as troubled debt restructurings that occurred during the period ending December 31, 2011:

	All Modifications
			Pre-Modification		Post-Modification
			Outstanding		Outstanding
	Number of		Recorded		Recorded
	Loans		Investment		Investment
			(in thousands)
Troubled Debt Restructurings
Commercial and industrial loans:
Working capital lines of credit loans		3	$	639	$	639
Non-working capital loans		6		6,187		6,261
Commercial real estate and multi-family residential loans:
Construction and land development loans
Owner occupied loans		8		6,648		6,651
Nonowner occupied loans		8		23,767		23,767
Agri-business and agricultural loans:
Loans secured by farmland		2		683		683
Consumer 1-4 family loans:
Closed end first mortgage loans		6		942		849
Total		33	$	38,866	$	38,850

	Interest Rate Reductions						Principal and Interest Forgiveness										Modified Repayment Terms
			Interest at		Interest at				Principal at		Principal at		Interest at		Interest at				Extension
	Number of		Pre-Modification		Post-Modification		Number of		Pre-Modification		Post-Modification		Pre-Modification		Post-Modification		Number of		Period or
	Loans		Rate		Rate		Loans		Rate		Rate		Rate		Rate		Loans		Range
			(in thousands)						(in thousands)										(in months)
Troubled Debt Restructurings
Commercial and industrial loans:
Working capital lines of credit loans		0	$	0	$	0		0	$	0	$	0	$	0	$	0		3		11-60
Non-working capital loans		0		0		0		0		0		0		0		0		4		12-36
Commercial real estate and multi-family residential loans:
Owner occupied loans		0		0		0		1		2,125		2,125		641		429		7		20-70
Nonowner occupied loans		0		0		0		0		0		0		0		0		7		6-36
Agri-business and agricultural loans:
Loans secured by farmland		0		0		0		0		0		0		0		0		1		22
Consumer 1-4 family loans:
Closed end first mortgage loans		5		402		324		1		550		450		66		57		0		0
Total		5	$	402	$	324		2	$	2,675	$	2,575	$	707	$	486		22		6-70

All of the commercial and industrial loan troubled debt restructurings described above also had inadequate compensation of additional collateral as part of the restructuring.

For the period ending December 31, 2011, the commercial and industrial loan troubled debt restructurings described above decreased the allowance for loan losses by $112,000, the commercial real estate and multi-family residential loan troubled debt restructurings described above increased the allowance for loan losses by $3.2 million, the agri-business and agricultural loan troubled debt restructurings described above decreased the allowance for loan losses by $11,000 and the consumer 1-4 family loan troubled debt restructurings described above increased the allowance for loan losses by $76,000. The five commercial and industrial loans and one agri-business and agricultural loan that decreased the provision during 2011 had modifications during the first five months of the year and had improved their positions during the remainder of the year warranting the decrease in allocation.

The commercial real estate and multi-family residential loan troubled debt restructurings described above also resulted in charge offs of $667,000 during the period ending December 31, 2011. There were no charge offs resulting from any other troubled debt restructurings described above during the period ending December 31, 2011.

The following table presents loans by class modified as troubled debt restructurings for which there was a payment default within twelve months following the modification during period ending December 31:

	2012				2011
	Number of		Recorded		Number of		Recorded
	Loans		Investment		Loans		Investment
	(in thousands)				(in thousands)
Troubled Debt Restructurings that Subsequently Defaulted
Consumer 1-4 family loans:
Closed end first mortgage loans		1	$	63		4	$	455
Total		1	$	63		4	$	455

A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.

The troubled debt restructurings that subsequently defaulted, as described above, increased the allowance for loan losses by $16,000 and did not result in any charge offs during the period ending December 31, 2012. The troubled debt restructurings that subsequently defaulted, as described above, increased the allowance for loan losses by $34,000 and did not result in any charge offs during the period ending December 31, 2011.

Credit Quality Indicators:

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes commercial loans individually by classifying the loans as to credit risk. This analysis is performed on a quarterly basis for Special Mention, Substandard and Doubtful grade loans and annually on Pass grade loans over $250,000.

The Company uses the following definitions for risk ratings:

Special Mention. Loans classified as Special Mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard. Loans classified as Substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized as the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as Doubtful have all the weaknesses inherent in those classified as Substandard, with the added characteristics that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above-described process are considered to be Pass rated loans with the exception of consumer troubled debt restructurings which are evaluated and listed with Substandard commercial grade loans. Loans listed as not rated are consumer loans included in groups of homogenous loans which are analyzed for credit quality indicators utilizing delinquency status. As of December 31, 2012, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

			Special						Not
	Pass		Mention		Substandard		Doubtful		Rated
					(in thousands)
Commercial and industrial loans:
Working capital lines of credit loans	$	403,778	$	22,591	$	13,468	$	0	$	0
Non-working capital loans		355,772		23,192		26,857		66		1,285
Commercial real estate and multi-family residential loans:
Construction and land development loans		67,002		4,595		10,753		0		0
Owner occupied loans		315,672		24,589		18,144		0		0
Nonowner occupied loans		282,108		6,345		26,028		0		0
Multifamily loans		43,425		345		1,192		0		0
Agri-business and agricultural loans:
Loans secured by farmland		107,734		0		1,404		0		18
Loans for agricultural production		115,649		0		0		0		0
Other commercial loans		56,692		0		118		0		0
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		18,685		343		729		0		89,805
Open end and junior lien loans		7,932		300		0		0		153,692
Residential construction loans		0		0		0		0		11,508
Other consumer loans		10,168		378		497		0		34,661
Total	$	1,784,617	$	82,678	$	99,190	$	66	$	290,969

The recorded investment in loans does not include accrued interest.

Loans not meeting the criteria above that are analyzed individually as part of the above-described process are considered to be Pass rated loans with the exception of consumer troubled debt restructurings which are evaluated and listed with Substandard commercial grade loans. Loans listed as not rated are consumer loans included in groups of homogenous loans which are analyzed for credit quality indicators utilizing delinquency status. As of December 31, 2011, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

			Special						Not
	Pass		Mention		Substandard		Doubtful		Rated
					(in thousands)
Commercial and industrial loans:
Working capital lines of credit loans	$	352,055	$	5,625	$	16,212	$	0	$	0
Non-working capital loans		331,881		7,437		36,751		0		1,403
Commercial real estate and multi-family residential loans:
Construction and land development loans		64,808		3,296		13,976		0		0
Owner occupied loans		318,191		5,913		22,400		0		38
Nonowner occupied loans		337,090		8,875		38,716		0		0
Multifamily loans		37,127		1,247		0		0		0
Agri-business and agricultural loans:
Loans secured by farmland		116,742		70		1,415		0		20
Loans for agricultural production		119,531		0		225		0		0
Other commercial loans		58,061		66		120		0		2
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		17,307		53		974		0		88,450
Open end and junior lien loans		11,569		319		0		0		164,335
Residential construction loans		0		0		0		0		5,449
Other consumer loans		7,416		375		497		0		37,672
Total	$	1,771,778	$	33,276	$	131,286	$	0	$	297,369

The recorded investment in loans does not include accrued interest.