Loans Receivable, Net

The Company’s loan portfolio is comprised of three segments: residential real estate, commercial, and consumer and other loans. The loan segments are further disaggregated into the following classes: residential real estate, commercial real estate, other commercial, home equity and other consumer loans. The following table presents loans receivable for each portfolio class of loans:



	At or for the Year ended
(Dollars in thousands)	December 31, 2015			December 31, 2014
Residential real estate loans	$	688,912		611,463
Commercial loans
Real estate	2,633,953			2,337,548
Other commercial	1,099,564			925,900
Total	3,733,517			3,263,448
Consumer and other loans
Home equity	420,901			394,670
Other consumer	235,351			218,514
Total	656,252			613,184
Loans receivable ¹	5,078,681			4,488,095
Allowance for loan and lease losses	(129,697		)	(129,753	)
Loans receivable, net	$	4,948,984		4,358,342
Weighted-average interest rate on loans (tax-equivalent)	4.84		%	4.86	%

__________


¹	Includes net deferred fees, costs, premiums and discounts of $15,529,000 and $13,710,000 at December 31, 2015 and 2014, respectively.

The following tables summarize the activity in the ALLL by portfolio segment:



	Year ended December 31, 2015
(Dollars in thousands)	Total			Residential Real Estate		Commercial Real Estate		Other Commercial		Home Equity		Other Consumer
Balance at beginning of period	$	129,753		14,680		67,799		30,891		9,963		6,420
Provision for loan losses	2,284			640		(696	)	3,030		(480	)	(210	)
Charge-offs	(7,002		)	(985	)	(1,920	)	(2,322	)	(809	)	(966	)
Recoveries	4,662			92		2,694		926		324		626
Balance at end of period	$	129,697		14,427		67,877		32,525		8,998		5,870



	Year ended December 31, 2014
(Dollars in thousands)	Total			Residential Real Estate		Commercial Real Estate		Other Commercial		Home Equity		Other Consumer
Balance at beginning of period	$	130,351		14,067		70,332		28,630		9,299		8,023
Provision for loan losses	1,912			716		(2,877	)	3,708		1,254		(889	)
Charge-offs	(7,603		)	(431	)	(1,802	)	(3,058	)	(1,038	)	(1,274	)
Recoveries	5,093			328		2,146		1,611		448		560
Balance at end of period	$	129,753		14,680		67,799		30,891		9,963		6,420

Note 3. Loans Receivable, Net (continued)



	Year ended December 31, 2013
(Dollars in thousands)	Total			Residential Real Estate		Commercial Real Estate		Other Commercial		Home Equity		Other Consumer
Balance at beginning of period	$	130,854		15,482		74,398		21,567		10,659		8,748
Provision for loan losses	6,887			(921	)	(3,670	)	10,271		868		339
Charge-offs	(13,643		)	(793	)	(3,736	)	(4,671	)	(2,594	)	(1,849	)
Recoveries	6,253			299		3,340		1,463		366		785
Balance at end of period	$	130,351		14,067		70,332		28,630		9,299		8,023

The following tables disclose the balance in the ALLL and the recorded investment in loans by portfolio segment:



	December 31, 2015
(Dollars in thousands)	Total		Residential Real Estate	Commercial Real Estate	Other Commercial	Home Equity	Other Consumer
Allowance for loan and lease losses
Individually evaluated for impairment	$	8,124	782	1,629	5,277	64	372
Collectively evaluated for impairment	121,573		13,645	66,248	27,248	8,934	5,498
Total allowance for loan and lease losses	$	129,697	14,427	67,877	32,525	8,998	5,870
Loans receivable
Individually evaluated for impairment	$	140,773	20,767	85,845	23,874	6,493	3,794
Collectively evaluated for impairment	4,937,908		668,145	2,548,108	1,075,690	414,408	231,557
Total loans receivable	$	5,078,681	688,912	2,633,953	1,099,564	420,901	235,351



	December 31, 2014
(Dollars in thousands)	Total		Residential Real Estate	Commercial Real Estate	Other Commercial	Home Equity	Other Consumer
Allowance for loan and lease losses
Individually evaluated for impairment	$	11,597	853	2,967	6,836	447	494
Collectively evaluated for impairment	118,156		13,827	64,832	24,055	9,516	5,926
Total allowance for loan and lease losses	$	129,753	14,680	67,799	30,891	9,963	6,420
Loans receivable
Individually evaluated for impairment	$	161,366	19,576	105,264	25,321	6,901	4,304
Collectively evaluated for impairment	4,326,729		591,887	2,232,284	900,579	387,769	214,210
Total loans receivable	$	4,488,095	611,463	2,337,548	925,900	394,670	218,514

Substantially all of the Company’s loans receivable are with customers in the Company’s geographic market areas. Although the Company has a diversified loan portfolio, a substantial portion of its customers’ ability to honor their obligations is dependent upon the economic performance in the Company’s market areas. The Company is subject to regulatory limits for the amount of loans to any individual borrower and the Company is in compliance with this regulation as of December 31, 2015 and 2014. No borrower had outstanding loans or commitments exceeding 10 percent of the Company’s consolidated stockholders’ equity as of December 31, 2015.

At December 31, 2015, the Company had $3,298,198,000 in variable rate loans and $1,780,483,000 in fixed rate loans. At December 31, 2015, 2014, and 2013, loans sold and serviced for others were $128,499,000, $133,768,000, and $148,376,000, respectively. At December 31, 2015, the Company had loans of $2,899,827,000 pledged as collateral for FHLB advances and FRB discount window. There were no significant purchases or sales of portfolio loans during 2015, 2014 and 2013.

Note 3. Loans Receivable, Net (continued)

The Company has entered into transactions with its executive officers and directors and their affiliates. The aggregate amount of loans outstanding to such related parties at December 31, 2015 and 2014 was $57,764,000 and $55,427,000, respectively. During 2015, new loans to such related parties were $10,435,000 and repayments were $8,098,000. In management’s opinion, such loans were made in the ordinary course of business and were made on substantially the same terms as those prevailing at the time for comparable transaction with other persons.

The following tables disclose information related to impaired loans by portfolio segment:



	At or for the Year ended December 31, 2015
(Dollars in thousands)	Total		Residential Real Estate	Commercial Real Estate	Other Commercial	Home Equity	Other Consumer
Loans with a specific valuation allowance
Recorded balance	$	34,683	8,253	12,554	11,923	102	1,851
Unpaid principal balance	36,157		9,198	12,581	12,335	109	1,934
Specific valuation allowance	8,124		782	1,629	5,277	64	372
Average balance	36,176		6,393	15,827	11,768	426	1,762
Loans without a specific valuation allowance
Recorded balance	$	106,090	12,514	73,291	11,951	6,391	1,943
Unpaid principal balance	132,718		13,969	94,028	15,539	7,153	2,029
Average balance	116,356		13,615	78,684	15,479	6,350	2,228
Total
Recorded balance	$	140,773	20,767	85,845	23,874	6,493	3,794
Unpaid principal balance	168,875		23,167	106,609	27,874	7,262	3,963
Specific valuation allowance	8,124		782	1,629	5,277	64	372
Average balance	152,532		20,008	94,511	27,247	6,776	3,990



	At or for the Year ended December 31, 2014
(Dollars in thousands)	Total		Residential Real Estate	Commercial Real Estate	Other Commercial	Home Equity	Other Consumer
Loans with a specific valuation allowance
Recorded balance	$	45,688	4,110	27,155	11,377	1,214	1,832
Unpaid principal balance	48,477		4,276	28,048	12,461	1,336	2,356
Specific valuation allowance	11,597		853	2,967	6,836	447	494
Average balance	53,339		5,480	24,519	19,874	1,039	2,427
Loans without a specific valuation allowance
Recorded balance	$	115,678	15,466	78,109	13,944	5,687	2,472
Unpaid principal balance	145,038		16,683	100,266	19,117	6,403	2,569
Average balance	128,645		15,580	89,015	14,024	7,163	2,863
Total
Recorded balance	$	161,366	19,576	105,264	25,321	6,901	4,304
Unpaid principal balance	193,515		20,959	128,314	31,578	7,739	4,925
Specific valuation allowance	11,597		853	2,967	6,836	447	494
Average balance	181,984		21,060	113,534	33,898	8,202	5,290

Interest income recognized on impaired loans for the years ended December 31, 2015, 2014, and 2013 was not significant.

Note 3. Loans Receivable, Net (continued)

The following tables present an aging analysis of the recorded investment in loans by portfolio segment:



	December 31, 2015
(Dollars in thousands)	Total		Residential Real Estate	Commercial Real Estate	Other Commercial	Home Equity	Other Consumer
Accruing loans 30-59 days past due	$	15,801	4,895	4,393	3,564	1,601	1,348
Accruing loans 60-89 days past due	3,612		961	1,841	286	280	244
Accruing loans 90 days or more past due	2,131		—	231	1,820	15	65
Non-accrual loans	51,133		8,073	28,819	7,691	6,022	528
Total past due and non-accrual loans	72,677		13,929	35,284	13,361	7,918	2,185
Current loans receivable	5,006,004		674,983	2,598,669	1,086,203	412,983	233,166
Total loans receivable	$	5,078,681	688,912	2,633,953	1,099,564	420,901	235,351



	December 31, 2014
(Dollars in thousands)	Total		Residential Real Estate	Commercial Real Estate	Other Commercial	Home Equity	Other Consumer
Accruing loans 30-59 days past due	$	19,139	3,506	7,925	5,310	1,374	1,024
Accruing loans 60-89 days past due	6,765		1,686	3,592	609	679	199
Accruing loans 90 days or more past due	214		35	31	74	17	57
Non-accrual loans	61,882		6,798	39,717	8,421	5,969	977
Total past due and non-accrual loans	88,000		12,025	51,265	14,414	8,039	2,257
Current loans receivable	4,400,095		599,438	2,286,283	911,486	386,631	216,257
Total loans receivable	$	4,488,095	611,463	2,337,548	925,900	394,670	218,514

Interest income that would have been recorded on non-accrual loans if such loans had been current for the entire period would have been approximately $2,471,000, $3,005,000, and $4,122,000 for the years ended December 31, 2015, 2014, and 2013, respectively.

The following tables present TDRs that occurred during the periods presented and the TDRs that occurred within the previous twelve months that subsequently defaulted during the periods presented:



	Year ended December 31, 2015
(Dollars in thousands)	Total		Residential Real Estate	Commercial Real Estate	Other Commercial	Home Equity	Other Consumer
TDRs that occurred during the period
Number of loans	64		3	25	22	1	13
Pre-modification recorded balance	$	22,316	2,259	8,877	10,545	137	498
Post-modification recorded balance	$	23,110	2,203	9,927	10,325	157	498
TDRs that subsequently defaulted
Number of loans	7		1	1	4	—	1
Recorded balance	$	2,556	1,947	78	529	—	2

Note 3. Loans Receivable, Net (continued)



	Year ended December 31, 2014
(Dollars in thousands)	Total		Residential Real Estate	Commercial Real Estate	Other Commercial	Home Equity	Other Consumer
TDRs that occurred during the period
Number of loans	51		—	18	24	6	3
Pre-modification recorded balance	$	37,781	—	21,760	12,522	3,385	114
Post-modification recorded balance	$	37,075	—	21,803	11,884	3,274	114
TDRs that subsequently defaulted
Number of loans	5		—	2	1	2	—
Recorded balance	$	4,453	—	927	693	2,833	—



	Year ended December 31, 2013
(Dollars in thousands)	Total		Residential Real Estate	Commercial Real Estate	Other Commercial	Home Equity	Other Consumer
TDRs that occurred during the period
Number of loans	63		9	21	23	2	8
Pre-modification recorded balance	$	29,046	1,907	20,334	6,087	147	571
Post-modification recorded balance	$	29,359	2,293	20,334	6,087	147	498
TDRs that subsequently defaulted
Number of loans	5		1	1	3	—	—
Recorded balance	$	849	265	79	505	—	—

The modifications for the TDRs that occurred during the years ended December 31, 2015, 2014 and 2013 included one or a combination of the following: an extension of the maturity date, a reduction of the interest rate or a reduction in the principal amount.

In addition to the TDRs that occurred during the period provided in the preceding tables, the Company had TDRs with pre-modification loan balances of $8,893,000, $12,674,000 and $18,345,000 for the years ended December 31, 2015, 2014 and 2013, respectively, for which OREO was received in full or partial satisfaction of the loans. The majority of such TDRs were in commercial real estate for the years ended December 31, 2015, 2014 and 2013. At December 31, 2015 and 2014, the Company had $3,253,000 and $698,000, respectively, of consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings are in process. At December 31, 2015 and 2014, the Company had $1,496,000 and $2,322,000, respectively, of OREO secured by residential real estate properties.

There were $2,803,000 and $4,263,000 of additional unfunded commitments on TDRs outstanding at December 31, 2015 and 2014, respectively. The amount of charge-offs on TDRs during 2015, 2014 and 2013 was $1,310,000, $1,361,000 and $1,945,000, respectively.