XML 24 R12.htm IDEA: XBRL DOCUMENT v3.5.0.2
Allowance for Loan Losses
 6 Months Ended
Jun. 30, 2016
Receivables [Abstract]  
Allowance for Loan Losses
Allowance for Loan Losses
A summary of changes in the allowance for loan losses (“ALL”) by loan portfolio type is as follows.
 
 
Three Months Ended June 30, 2016
(in thousands)
 
Commercial
 
Construction
 
Consumer
 
Mortgage
 
Unallocated
 
Total
Beginning balance
 
$
10,881

 
$
1,925

 
$
8,466

 
$
4,570

 
$
884

 
$
26,726

Charge-offs
 
(1,344
)
 
—

 
(1,245
)
 
(137
)
 
—

 
(2,726
)
Recoveries
 
22

 
264

 
400

 
19

 
—

 
705

Net (charge offs) / recoveries
 
(1,322
)
 
264

 
(845
)
 
(118
)
 
—

 
(2,021
)
Increase (decrease) in FDIC indemnification asset
 
150

 
(19
)
 
73

 
—

 
—

 
204

Provision for loan losses(1)
 
1,028

 
(14
)
 
1,052

 
519

 
543

 
3,128

Ending balance
 
$
10,737

 
$
2,156

 
$
8,746

 
$
4,971

 
$
1,427

 
$
28,037

 
 
Three Months Ended June 30, 2015
(in thousands)
 
Commercial
 
Construction
 
Consumer
 
Mortgage
 
Unallocated
 
Total
Beginning balance
 
$
11,507

 
$
1,354

 
$
6,753

 
$
3,323

 
$
821

 
$
23,758

Charge-offs
 
(90
)
 
—

 
(896
)
 
(21
)
 
—

 
(1,007
)
Recoveries
 
133

 
674

 
357

 
3

 
—

 
1,167

Net recoveries / (charge offs)
 
43

 
674

 
(539
)
 
(18
)
 
—

 
160

(Decrease) increase in FDIC indemnification asset
 
(54
)
 
(310
)
 
36

 
17

 
—

 
(311
)
Provision for loan losses(1)
 
(755
)
 
(181
)
 
99

 
(54
)
 
709

 
(182
)
Ending balance
 
$
10,741

 
$
1,537

 
$
6,349

 
$
3,268

 
$
1,530

 
$
23,425

 
 
Six Months Ended June 30, 2016
(in thousands)
 
Commercial
 
Construction
 
Consumer
 
Mortgage
 
Unallocated
 
Total
Beginning balance
 
$
11,025

 
$
1,711

 
$
8,668

 
$
4,284

 
$
776

 
$
26,464

Charge-offs
 
(1,613
)
 
—

 
(2,408
)
 
(181
)
 
—

 
(4,202
)
Recoveries
 
744

 
797

 
758

 
20

 
—

 
2,319

Net (charge offs) / recoveries
 
(869
)
 
797

 
(1,650
)
 
(161
)
 
—

 
(1,883
)
Increase (decrease) in FDIC indemnification asset
 
97

 
(367
)
 
74

 
24

 
—

 
(172
)
Provision for loan losses(1)
 
484

 
15

 
1,654

 
824

 
651

 
3,628

Ending balance
 
$
10,737

 
$
2,156

 
$
8,746

 
$
4,971

 
$
1,427

 
$
28,037

 
 
Six Months Ended June 30, 2015
(in thousands)
 
Commercial
 
Construction
 
Consumer
 
Mortgage
 
Unallocated
 
Total
Beginning balance
 
$
13,167

 
$
1,486

 
$
6,591

 
$
3,475

 
$
731

 
$
25,450

Charge-offs
 
(976
)
 
—

 
(2,151
)
 
(61
)
 
—

 
(3,188
)
Recoveries
 
204

 
772

 
740

 
4

 
—

 
1,720

Net (charge offs) / recoveries
 
(772
)
 
772

 
(1,411
)
 
(57
)
 
—

 
(1,468
)
(Decrease) increase in FDIC indemnification asset
 
(54
)
 
(310
)
 
36

 
(155
)
 
—

 
(483
)
Provision for loan losses(1)
 
(1,600
)
 
(411
)
 
1,133

 
5

 
799

 
(74
)
Ending balance
 
$
10,741

 
$
1,537

 
$
6,349

 
$
3,268

 
$
1,530

 
$
23,425

(1) Net of benefit attributable to FDIC indemnification asset.
The following tables present, by loan portfolio type, the balance in the ALL disaggregated on the basis of the Company’s impairment measurement method and the related recorded investment in loans.
 
 
June 30, 2016
(in thousands)
 
Commercial
 
Construction
 
Consumer
 
Mortgage
 
Unallocated
 
Total
Individually evaluated for impairment
 
$
1,062

 
$
—

 
$
254

 
$
1,172

 
$
—

 
$
2,488

Collectively evaluated for impairment
 
9,033

 
2,139

 
8,492

 
3,776

 
1,427

 
24,867

Acquired with deteriorated credit quality
 
642

 
17

 
—

 
23

 
—

 
682

Total allowance for loan losses
 
$
10,737

 
$
2,156

 
$
8,746

 
$
4,971

 
$
1,427

 
$
28,037

Individually evaluated for impairment
 
$
22,983

 
$
5,455

 
$
424

 
$
7,636

 
$
—

 
$
36,498

Collectively evaluated for impairment
 
890,503

 
208,981

 
1,558,145

 
455,566

 
—

 
3,113,195

Acquired with deteriorated credit quality
 
27,883

 
3,108

 
393

 
9,630

 
—

 
41,014

Total loans
 
$
941,369

 
$
217,544

 
$
1,558,962

 
$
472,832

 
$
—

 
$
3,190,707

 
 
December 31, 2015
(in thousands)
 
Commercial
 
Construction
 
Consumer
 
Mortgage
 
Unallocated
 
Total
Individually evaluated for impairment
 
$
1,607

 
$
78

 
$
260

 
$
1,096

 
$
—

 
$
3,041

Collectively evaluated for impairment
 
8,850

 
1,612

 
8,408

 
3,165

 
776

 
22,811

Acquired with deteriorated credit quality
 
568

 
21

 
—

 
23

 
—

 
612

Total allowance for loan losses
 
$
11,025

 
$
1,711

 
$
8,668

 
$
4,284

 
$
776

 
$
26,464

Individually evaluated for impairment
 
$
32,643

 
$
6,100

 
$
2,124

 
$
5,906

 
$
—

 
$
46,773

Collectively evaluated for impairment
 
787,493

 
168,953

 
1,460,039

 
389,209

 
—

 
2,805,694

Acquired with deteriorated credit quality
 
19,148

 
1,980

 
1,373

 
21,980

 
—

 
44,481

Total loans
 
$
839,284

 
$
177,033

 
$
1,463,536

 
$
417,095

 
$
—

 
$
2,896,948


The determination of the overall allowance for credit losses has two components, the allowance for originated loans and the allowance for acquired loans.
Total loans includes acquired loans of $290.7 million and $199.9 million at June 30, 2016 and December 31, 2015, respectively, which were recorded at fair value when acquired. The ALL for acquired loans is evaluated at each reporting date subsequent to acquisition. For acquired performing loans, an allowance is determined for each loan pool using a methodology similar to that used for originated loans and then compared to the remaining fair value discount for that pool. For purchased credit impaired loans, estimated cash flows expected to be collected are re-evaluated at each reporting date for each loan pool. The methodology also considers the remaining fair value discounts recognized upon acquisition associated with acquired performing loans in estimating a general allowance and also includes establishing an ALL for purchased credit-impaired loans that have deteriorated since acquisition.