ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (Tables)

9 Months Ended

Sep. 30, 2015

In Allowance For Loan Losses and Recorded Investment In Loans By Portfolio Segment

The following tables present the activity in the allowance for loan losses by portfolio segment for the three-month periods ended September 30, 2015 and 2014:

				Commercial
				Real Estate
		Commercial		and		Agri-business				Consumer
		and		Multifamily		and		Other		1-4 Family		Other
(dollars in thousands)		Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
Three Months Ended September 30, 2015
Beginning balance, July 1	$	22,360	$	13,112	$	1,881	$	358	$	3,473	$	392	$	3,240	$	44,816
Provision for loan losses		(88)		(235)		103		11		14		(13)		208		0
Loans charged-off		(2)		0		0		0		(152)		(74)		0		(228)
Recoveries		43		14		5		0		21		23		0		106
Net loans charged-off		41		14		5		0		(131)		(51)		0		(122)
Ending balance	$	22,313	$	12,891	$	1,989	$	369	$	3,356	$	328	$	3,448	$	44,694

				Commercial
				Real Estate
		Commercial		and		Agri-business				Consumer
		and		Multifamily		and		Other		1-4 Family		Other
(dollars in thousands)		Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
Three Months Ended September 30, 2014
Beginning balance, July 1	$	20,922	$	15,975	$	1,404	$	234	$	3,275	$	487	$	3,308	$	45,605
Provision for loan losses		919		(1,275)		(34)		76		179		68		67		0
Loans charged-off		(147)		0		0		0		(60)		(62)		0		(269)
Recoveries		291		670		5		0		59		26		0		1,051
Net loans charged-off		144		670		5		0		(1)		(36)		0		782
Ending balance	$	21,985	$	15,370	$	1,375	$	310	$	3,453	$	519	$	3,375	$	46,387

The following tables present the activity in the allowance for loan losses by portfolio segment for the nine-month periods ended September 30, 2015 and 2014:

				Commercial
				Real Estate
		Commercial		and		Agri-business				Consumer
		and		Multifamily		and		Other		1-4 Family		Other
(dollars in thousands)		Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
Nine Months Ended September 30, 2015
Beginning balance, January 1	$	22,785	$	14,153	$	1,790	$	276	$	3,459	$	483	$	3,316	$	46,262
Provision for loan losses		240		(856)		184		215		149		(64)		132		0
Loans charged-off		(878)		(459)		0		(122)		(292)		(180)		0		(1,931)
Recoveries		166		53		15		0		40		89		0		363
Net loans charged-off		(712)		(406)		15		(122)		(252)		(91)		0		(1,568)
Ending balance	$	22,313	$	12,891	$	1,989	$	369	$	3,356	$	328	$	3,448	$	44,694

				Commercial
				Real Estate
		Commercial		and		Agri-business				Consumer
		and		Multifamily		and		Other		1-4 Family		Other
(dollars in thousands)		Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
Nine Months Ended September 30, 2014
Beginning balance, January 1	$	21,005	$	18,557	$	1,682	$	391	$	3,045	$	608	$	3,509	$	48,797
Provision for loan losses		1,296		(1,334)		(323)		(81)		587		(11)		(134)		0
Loans charged-off		(660)		(2,553)		0		0		(282)		(180)		0		(3,675)
Recoveries		344		701		16		0		102		102		0		1,265
Net loans charged-off		(316)		(1,852)		16		0		(180)		(78)		0		(2,410)
Ending balance	$	21,985	$	15,371	$	1,375	$	310	$	3,452	$	519	$	3,375	$	46,387

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 September 30, 2015 and December 31, 2014:

				Commercial
				Real Estate
		Commercial		and		Agri-business				Consumer
		and		Multifamily		and		Other		1-4 Family		Other
(dollars in thousands)		Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
September 30, 2015
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	3,129	$	783	$	0	$	0	$	333	$	59	$	0	$	4,304
Collectively evaluated for impairment		19,184		12,108		1,989		369		3,023		269		3,448		40,390
Total ending allowance balance	$	22,313	$	12,891	$	1,989	$	369	$	3,356	$	328	$	3,448	$	44,694

Loans:
Loans individually evaluated for impairment	$	9,140	$	10,530	$	472	$	0	$	2,434	$	90	$	0	$	22,666
Loans collectively evaluated for impairment		1,162,373		1,085,215		248,678		82,971		321,393		48,984		0		2,949,614
Total ending loans balance	$	1,171,513	$	1,095,745	$	249,150	$	82,971	$	323,827	$	49,074	$	0	$	2,972,280

				Commercial
				Real Estate
		Commercial		and		Agri-business				Consumer
		and		Multifamily		and		Other		1-4 Family		Other
(dollars in thousands)		Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
December 31, 2014
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	3,306	$	1,531	$	14	$	15	$	482	$	73	$	0	$	5,421
Collectively evaluated for impairment		19,479		12,622		1,776		261		2,977		410		3,316		40,841
Total ending allowance balance	$	22,785	$	14,153	$	1,790	$	276	$	3,459	$	483	$	3,316	$	46,262

Loans:
Loans individually evaluated for impairment	$	14,702	$	13,005	$	486	$	30	$	3,614	$	127	$	0	$	31,964
Loans collectively evaluated for impairment		1,020,897		1,011,858		273,388		75,684		299,189		49,340		0		2,730,356
Total ending loans balance	$	1,035,599	$	1,024,863	$	273,874	$	75,714	$	302,803	$	49,467	$	0	$	2,762,320

Loans individually evaluated for impairment

The following table presents loans individually evaluated for impairment by class of loans as of September 30, 2015:

		Unpaid				Allowance for
		Principal		Recorded		Loan Losses
(dollars in thousands)		Balance		Investment		Allocated
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	20	$	20	$	0
Non-working capital loans		2,431		665		0
Commercial real estate and multi-family residential loans:
Owner occupied loans		2,441		2,261		0
Nonowner occupied loans		5,272		5,276		0
Agri-business and agricultural loans:
Loans secured by farmland		971		472		0
Consumer 1-4 family loans:
Closed end first mortgage loans		535		383		0
Open end and junior lien loans		128		128		0
Other consumer loans		3		3		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		1,916		1,915		822
Non-working capital loans		8,732		6,540		2,307
Commercial real estate and multi-family residential loans:
Construction and land development loans		340		339		40
Owner occupied loans		2,684		2,654		743
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,999		1,923		333
Other consumer loans		87		87		59
Total	$	27,559	$	22,666	$	4,304

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2014:

		Unpaid				Allowance for
		Principal		Recorded		Loan Losses
(dollars in thousands)		Balance		Investment		Allocated
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	21	$	21	$	0
Non-working capital loans		1,673		279		0
Commercial real estate and multi-family residential loans:
Construction and land development loans		526		526		0
Owner occupied loans		554		374		0
Nonowner occupied loans		3,030		3,036		0
Agri-business and agricultural loans:
Loans secured by farmland		603		283		0
Consumer 1-4 family loans:
Closed end first mortgage loans		724		712		0
Open end and junior lien loans		317		317		0
Residential construction loans		129		129		0
Other consumer loans		1		1		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		1,409		1,408		837
Non-working capital loans		15,557		12,994		2,469
Commercial real estate and multi-family residential loans:
Construction and land development loans		449		448		107
Owner occupied loans		5,298		5,297		1,213
Nonowner occupied loans		3,324		3,324		211
Agri-business and agricultural loans:
Loans secured by farmland		381		203		14
Other commercial loans		30		30		15
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		2,505		2,375		474
Open end and junior lien loans		81		81		8
Other consumer loans		126		126		73
Total	$	36,738	$	31,964	$	5,421

The following table presents loans individually evaluated for impairment by class of loans as of and for the three-month period ended September 30, 2015:

						Cash Basis
		Average		Interest		Interest
		Recorded		Income		Income
(dollars in thousands)		Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	20	$	0	$	0
Non-working capital loans		709		1		1
Commercial real estate and multi-family residential loans:
Owner occupied loans		2,442		0		0
Nonowner occupied loans		5,404		26		27
Agri-business and agricultural loans:
Loans secured by farmland		474		0		0
Consumer 1-4 family loans:
Closed end first mortgage loans		415		0		0
Open end and junior lien loans		130		0		0
Other consumer loans		5		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		1,202		3		4
Non-working capital loans		6,092		47		43
Commercial real estate and multi-family residential loans:
Construction and land development loans		351		4		2
Owner occupied loans		2,682		0		0
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		2,125		15		14
Other consumer loans		99		1		2
Total	$	22,150	$	97	$	93

The following table presents loans individually evaluated for impairment by class of loans as of and for the three-month period ended September 30, 2014:

						Cash Basis
		Average		Interest		Interest
		Recorded		Income		Income
(dollars in thousands)		Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	22	$	0	$	0
Non-working capital loans		290		0		0
Commercial real estate and multi-family residential loans:
Construction and land development loans		533		0		0
Owner occupied loans		160		0		0
Nonowner occupied loans		327		0		0
Agri-business and agricultural loans:
Loans secured by farmland		284		0		0
Consumer 1-4 family loans:
Closed end first mortgage loans		695		0		0
Open end and junior lien loans		286		0		0
Residential construction loans		135		0		0
Other consumer loans		1		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		1,680		22		18
Non-working capital loans		13,662		127		126
Commercial real estate and multi-family residential loans:
Construction and land development loans		1,679		7		5
Owner occupied loans		3,241		26		29
Nonowner occupied loans		6,485		35		36
Agri-business and agricultural loans:
Loans secured by farmland		203		0		0
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		2,568		17		17
Open end and junior lien loans		48		0		0
Other consumer loans		89		1		1
Total	$	32,388	$	235	$	232

The following table presents loans individually evaluated for impairment by class of loans as of and for the nine-month period ended September 30, 2015:

						Cash Basis
		Average		Interest		Interest
		Recorded		Income		Income
(dollars in thousands)		Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	21	$	0	$	0
Non-working capital loans		613		2		2
Commercial real estate and multi-family residential loans:
Construction and land development loans		175		0		0
Owner occupied loans		1,950		0		0
Nonowner occupied loans		4,504		80		83
Agri-business and agricultural loans:
Loans secured by farmland		412		0		0
Consumer 1-4 family loans:
Closed end first mortgage loans		301		0		0
Open end and junior lien loans		238		0		0
Residential construction loans		14		0		0
Other consumer loans		3		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		1,069		19		18
Non-working capital loans		9,443		281		290
Commercial real estate and multi-family residential loans:
Construction and land development loans		391		12		11
Owner occupied loans		3,695		21		22
Nonowner occupied loans		1,090		0		0
Agri-business and agricultural loans:
Loans secured by farmland		67		0		0
Other commercial loans		3		0		0
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		2,608		48		44
Open end and junior lien loans		23		0		0
Other consumer loans		110		3		4
Total	$	26,730	$	466	$	474

The following table presents loans individually evaluated for impairment by class of loans as of and for the nine-month period ended September 30, 2014:

						Cash Basis
		Average		Interest		Interest
		Recorded		Income		Income
(dollars in thousands)		Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	186	$	1	$	1
Non-working capital loans		133		0		0
Commercial real estate and multi-family residential loans:
Construction and land development loans		178		0		0
Owner occupied loans		215		0		0
Nonowner occupied loans		341		0		0
Agri-business and agricultural loans:
Loans secured by farmland		226		0		0
Consumer 1-4 family loans:
Closed end first mortgage loans		691		0		0
Open end and junior lien loans		170		0		0
Residential construction loans		141		0		0
Other consumer loans		1		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		1,893		55		47
Non-working capital loans		13,762		387		388
Commercial real estate and multi-family residential loans:
Construction and land development loans		2,341		37		36
Owner occupied loans		2,956		45		43
Nonowner occupied loans		8,507		104		105
Agri-business and agricultural loans:
Loans secured by farmland		411		0		0
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		2,740		50		53
Open end and junior lien loans		66		0		0
Other consumer loans		87		1		1
Total	$	35,045	$	680	$	674

Aging of the Recorded Investment in Past Due Loans

The following table presents the aging of the recorded investment in past due loans as of September 30, 2015 by class of loans:

				30-89		Greater than
		Loans Not		Days		90 Days				Total
(dollars in thousands)		Past Due		Past Due		Past Due		Nonaccrual		Past Due		Total
Commercial and industrial loans:
Working capital lines of credit loans	$	591,700	$	0	$	0	$	1,566	$	1,566	$	593,266
Non-working capital loans		574,413		252		0		3,582		3,834		578,247
Commercial real estate and multi-family
residential loans:
Construction and land development loans		176,615		0		0		0		0		176,615
Owner occupied loans		403,775		0		0		4,915		4,915		408,690
Nonowner occupied loans		414,336		0		0		3,115		3,115		417,451
Multifamily loans		92,989		0		0		0		0		92,989
Agri-business and agricultural loans:
Loans secured by farmland		154,639		0		0		471		471		155,110
Loans for agricultural production		93,937		103		0		0		103		94,040
Other commercial loans		82,971		0		0		0		0		82,971
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		151,857		1,367		0		512		1,879		153,736
Open end and junior lien loans		161,375		163		0		128		291		161,666
Residential construction loans		8,425		0		0		0		0		8,425
Other consumer loans		48,951		103		0		20		123		49,074
Total	$	2,955,983	$	1,988	$	0	$	14,309	$	16,297	$	2,972,280

The following table presents the aging of the recorded investment in past due loans as of December 31, 2014 by class of loans:

				30-89		Greater than
		Loans Not		Days		90 Days				Total
(dollars in thousands)		Past Due		Past Due		Past Due		Nonaccrual		Past Due		Total
Commercial and industrial loans:
Working capital lines of credit loans	$	543,613	$	0	$	0	$	632	$	632	$	544,245
Non-working capital loans		487,655		0		101		3,598		3,699		491,354
Commercial real estate and multi-family
residential loans:
Construction and land development loans		155,711		0		0		526		526		156,237
Owner occupied loans		399,028		800		0		3,049		3,849		402,877
Nonowner occupied loans		390,394		31		0		3,629		3,660		394,054
Multi-family loans		71,695		0		0		0		0		71,695
Agri-business and agricultural loans:
Loans secured by farmland		136,923		0		0		485		485		137,408
Loans for agricultural production		136,466		0		0		0		0		136,466
Other commercial loans		75,684		0		0		30		30		75,714
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		142,615		1,198		20		1,051		2,269		144,884
Open end and junior lien loans		150,551		235		9		398		642		151,193
Residential construction loans		6,597		0		0		129		129		6,726
Other consumer loans		49,308		108		0		51		159		49,467
Total	$	2,746,240	$	2,372	$	130	$	13,578	$	16,080	$	2,762,320

Troubled Debt Restructuring

The Company is not committed to lend additional funds to debtors whose loans have been modified in a troubled debt restructuring.

	September 30	December 31,
(dollars in thousands)	2015	2014
Accruing troubled debt restructured loans	$7,605	$16,492
Nonaccrual troubled debt restructured loans	10,934	9,161
Total troubled debt restructured loans	$18,539	$25,653

Loans by Class Modified as Troubled Debt Restructurings

The following table presents loans, not previously discussed, by class modified as new troubled debt restructurings that occurred during the three month period ending September 30, 2015:

	All Modifications			Modified Repayment Terms
		Pre-Modification	Post-Modification		Extension
		Outstanding	Outstanding		Period or
	Number of	Recorded	Recorded	Number of	Range
(dollars in thousands)	Loans	Investment	Investment	Loans	(in months)
Troubled Debt Restructurings
Consumer 1-4 family loans:
Closed end first mortgage loans	1	$65	$78	1	208
Total	1	$65	$78	1	208

The following table presents loans, not previously discussed, by class modified as new troubled debt restructurings that occurred during the nine month period ending September 30, 2015:

	All Modifications			Modified Repayment Terms
		Pre-Modification	Post-Modification
		Outstanding	Outstanding		Period or
	Number of	Recorded	Recorded	Number of	Range
(dollars in thousands)	Loans	Investment	Investment	Loans	(in months)
Troubled Debt Restructurings
Commercial and industrial loans:
Working capital lines of credit loans	2	$ 564	$ 564
Non-working capital loans	1	783	783	1	12
Commercial real estate and multi-
family residential loans:
Owner occupied loans	2	855	855	1	6
Consumer 1-4 family loans:
Closed end first mortgage loans	1	65	78	1	208
Total	6	$ 2,267	$ 2,280	3	6-208

The following table presents loans by class modified as troubled debt restructurings that occurred during the three months ending September 30, 2014:

	All Modifications			Modified Repayment Terms
		Pre-Modification	Post-Modification		Extension
		Outstanding	Outstanding		Period or
	Number of	Recorded	Recorded	Number of	Range
(dollars in thousands)	Loans	Investment	Investment	Loans	(in months)
Troubled Debt Restructurings
Owner occupied loans	1	$929	$1,000	1	24
Total	1	$929	$1,000	1	24

The following table presents loans by class modified as troubled debt restructurings that occurred during the nine months ending September 30, 2014:

	All Modifications			Interest Rate Reductions			Modified Repayment Terms
		Pre-Modification	Post-Modification					Extension
		Outstanding	Outstanding		Interest at	Interest at		Period or
	Number of	Recorded	Recorded	Number of	Pre-Modification	Post-Modification	Number of	Range
(dollars in thousands)	Loans	Investment	Investment	Loans	Rate	Rate	Loans	(in months)
Troubled Debt Restructurings
Commercial and industrial loans:
Non-working capital loans	2	$433	$433	0	$0	$0	2	12-15
Commercial real estate and multi-
family residential loans:
Owner occupied loans	3	2,639	2,710	1	89	95	2	12-24
Total	5	$3,072	$3,143	1	$89	$95	4	12-24

Credit Quality Indicators

As of September 30, 2015, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

		Special			Not
(dollars in thousands)	Pass	Mention	Substandard	Doubtful	Rated	Total
Commercial and industrial loans:
Working capital lines of credit loans	$552,709	$32,373	$8,184	$0	$0	$593,266
Non-working capital loans	528,158	35,536	11,911	0	2,642	578,247
Commercial real estate and multi-
family residential loans:
Construction and land development loans	172,372	2,009	2,234	0	0	176,615
Owner occupied loans	376,411	22,632	9,647	0	0	408,690
Nonowner occupied loans	404,063	8,158	5,230	0	0	417,451
Multifamily loans	92,989	0	0	0	0	92,989
Agri-business and agricultural loans:
Loans secured by farmland	154,638	0	472	0	0	155,110
Loans for agricultural production	94,040	0	0	0	0	94,040
Other commercial loans	82,966	0	0	0	5	82,971
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans	43,051	126	1,906	0	108,653	153,736
Open end and junior lien loans	8,230	0	1,625	0	151,811	161,666
Residential construction loans	0	0	0	0	8,425	8,425
Other consumer loans	14,080	0	61	0	34,933	49,074
Total	$2,523,707	$100,834	$41,270	$0	$306,469	$2,972,280

As of December 31, 2014, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

		Special			Not
(dollars in thousands)	Pass	Mention	Substandard	Doubtful	Rated	Total
Commercial and industrial loans:
Working capital lines of credit loans	$504,806	$28,485	$10,343	$611	$0	$544,245
Non-working capital loans	436,735	31,781	20,324	0	2,514	491,354
Commercial real estate and multi-
family residential loans:
Construction and land
development loans	150,442	1,033	4,762	0	0	156,237
Owner occupied loans	369,520	20,960	12,397	0	0	402,877
Nonowner occupied loans	375,702	12,512	5,840	0	0	394,054
Multi-family loans	71,695	0	0	0	0	71,695
Agri-business and agricultural loans:
Loans secured by farmland	136,923	0	485	0	0	137,408
Loans for agricultural production	136,466	0	0	0	0	136,466
Other commercial loans	75,680	0	30	0	4	75,714
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans	39,156	0	2,199	0	103,529	144,884
Open end and junior lien loans	8,400	291	2,015	0	140,487	151,193
Residential construction loans	0	0	0	0	6,726	6,726
Other consumer loans	15,879	290	75	0	33,223	49,467
Total	$2,321,404	$95,352	$58,470	$611	$286,483	$2,762,320