3.LOANS AND ALLOWANCE FOR LOAN AND LEASE LOSSES

The composition of the loan portfolio at March 31, 2015 and December 31, 2014 follows:

(in thousands)	March 31, 2015			December 31, 2014

Residential real estate:
Owner occupied	$	1,096,008		$	1,118,341
Owner occupied - correspondent*	231,451			226,628
Non owner occupied	98,476			96,492
Commercial real estate	778,179			772,309
Commercial real estate - purchased whole loans*	35,086			34,898
Construction & land development	40,104			38,480
Commercial & industrial	172,017			157,339
Lease financing receivables	4,004			2,530
Warehouse lines of credit	423,155			319,431
Home equity	248,830			245,679
Consumer:
RPG loans	4,109			4,095
Credit cards	9,946			9,573
Overdrafts	777			1,180
Purchased whole loans*	4,321			4,626
Other consumer	8,973			8,894
Total loans**	3,155,436			3,040,495
Allowance for loan and lease losses	(24,631		)	(24,410		)

Total loans, net	$	3,130,805		$	3,016,085

* - Identifies loans to borrowers located primarily outside of the Bank’s historical market footprint.

** - Total loans are presented inclusive of premiums, discounts and net loan origination fees and costs. See table directly below for expanded detail.

The table below reconciles the contractually receivable and carrying amounts of loans at March 31, 2015 and December 31, 2014:

(in thousands)	March 31, 2015			December 31, 2014

Contractually receivable	$	3,164,578		$	3,050,599
Unearned income(1)	(425		)	(174		)
Unamortized premiums(2)	4,242			4,490
Unaccreted discounts(3)	(14,322		)	(15,675		)
Net unamortized deferred origination fees and costs	1,363			1,255
Carrying value of loans	$	3,155,436		$	3,040,495

(1) - Relates to lease financing receivables.

(2) - Premiums predominately relate to loans acquired through the Bank’s Correspondent Lending channel.

(3) - Discounts predominately relate to loans acquired in the Bank’s 2012 FDIC-assisted transactions.

Loan Purchases

In May 2014, the Bank began acquiring single family, first lien mortgage loans for investment within its loan portfolio through its Correspondent Lending channel. Correspondent Lending generally involves the Bank acquiring, primarily from Warehouse clients, closed loans that meet the Bank’s specifications. Substantially all loans purchased through the Correspondent Lending channel are purchased at a premium. Loans acquired through the Correspondent Lending channel generally reflect borrowers outside of the Bank’s historical market footprint, with 76% of such loans as of March 31, 2015 secured by collateral in the state of California.

In addition to secured mortgage loans acquired through its Correspondent Lending channel, the Bank also began acquiring unsecured consumer installment loans for investment from a third-party originator in April 2014. Such consumer loans are purchased at par and are selected by the Bank based on certain underwriting characteristics.

The table below reflects the purchased activity of single family, first lien mortgage loans and unsecured consumer loans, by class, during the first quarter of 2015. No purchases of these types of loans were made during the first quarter of 2014.

	Loan Purchase Activity*
	Three Months Ended
	March 31,
(in thousands)	2015		2014
Residential real estate:
Owner occupied - correspondent	$	19,170	$	—
Consumer:
Purchased whole loans	361		—
Total purchased loans	$	19,531	$	—

* - Represents origination amount, inclusive of purchase premiums, where applicable.

Purchased Credit Impaired (“PCI”) Loans

PCI loans acquired during the Bank’s 2012 FDIC-assisted transactions are accounted for under ASC 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality.

The table below reconciles the contractually required and carrying amounts of PCI loans at March 31, 2015 and December 31, 2014:

(in thousands)	March 31, 2015			December 31, 2014

Contractually-required principal	$	25,699		$	26,571
Non-accretable amount	(6,470		)	(6,784		)
Accretable amount	(2,170		)	(2,297		)
Carrying value of loans	$	17,059		$	17,490

The following table presents a rollforward of the accretable amount on PCI loans for the three months ended March 31, 2015 and 2014:

	Three Months Ended
	March 31,
(in thousands)	2015			2014

Balance, beginning of period	$	(2,297	)	$	(3,457	)
Transfers between non-accretable and accretable	24			(1,311		)
Net accretion into interest income on loans, including loan fees	103			2,003
Balance, end of period	$	(2,170	)	$	(2,765	)

Credit Quality Indicators

Based on the Bank’s internal analyses performed as of March 31, 2015 and December 31, 2014, the following tables reflect loans by risk category. Risk categories are defined in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014:

									Purchased		Purchased
									Credit		Credit
									Impaired		Impaired		Total
March 31, 2015			Special				Doubtful /		Loans -		Loans -		Rated
(in thousands)	Pass		Mention *		Substandard *		Loss		Group 1		Substandard		Loans**

Residential real estate:
Owner occupied	$	—	$	25,298	$	15,534	$	—	$	1,148	$	—	$	41,980
Owner occupied - correspondent	—		—		—		—		—		—		—
Non owner occupied	—		1,561		2,404		—		1,633		—		5,598
Commercial real estate	744,881		7,741		12,905		—		12,652		—		778,179
Commercial real estate - purchased whole loans	35,086		—		—		—		—		—		35,086
Construction & land development	36,879		118		2,701		—		406		—		40,104
Commercial & industrial	168,472		2,122		205		—		1,218		—		172,017
Lease financing receivables	4,004		—		—		—		—		—		4,004
Warehouse lines of credit	423,155		—		—		—		—		—		423,155
Home equity	—		—		2,690		—		—		—		2,690
Consumer:
RPG loans	—		—		—		—		—		—		—
Credit cards	—		—		—		—		—		—		—
Overdrafts	—		—		—		—		—		—		—
Purchased whole loans	—		—		—		—		—		—		—
Other consumer	—		11		34		—		2		—		47

Total	$	1,412,477	$	36,851	$	36,473	$	—	$	17,059	$	—	$	1,502,860

* - At March 31, 2015, Special Mention and Substandard loans included $184,000 and $4 million, respectively, which were removed from PCI accounting in accordance with ASC 310-30-35-13 due to a post-acquisition troubled debt restructuring.

** - The above table excludes all non-classified residential real estate and consumer loans at the respective period ends. The table also excludes most non-classified small Commercial and Industrial (“C&I”) and Commercial Real Estate (“CRE”) relationships totaling $100,000 or less. These loans are not rated by the Company since they are accruing interest and are not past due 80-days-or-more.

									Purchased		Purchased
									Credit		Credit
									Impaired		Impaired		Total
December 31, 2014			Special				Doubtful /		Loans -		Loans -		Rated
(in thousands)	Pass		Mention *		Substandard *		Loss		Group 1		Substandard		Loans**

Residential real estate:
Owner occupied	$	—	$	26,828	$	14,586	$	—	$	1,205	$	—	$	42,619
Owner occupied - correspondent	—		—		—		—		—		—		—
Non owner occupied	—		844		2,886		—		1,709		—		5,439
Commercial real estate	736,012		7,838		15,636		—		12,823		—		772,309
Commercial real estate - purchased whole loans	34,898		—		—		—		—		—		34,898
Construction & land development	35,339		120		2,525		—		496		—		38,480
Commercial & industrial	153,362		625		2,108		—		1,244		—		157,339
Lease financing receivables	2,530		—		—		—		—		—		2,530
Warehouse lines of credit	319,431		—		—		—		—		—		319,431
Home equity	—		—		2,220		—		—		—		2,220
Consumer:
RPG loans	—		—		—		—		—		—		—
Credit cards	—		—		—		—		—		—		—
Overdrafts	—		—		—		—		—		—		—
Purchased whole loans	—		—		—		—		—		—		—
Other consumer	—		13		38		—		13		—		64

Total	$	1,281,572	$	36,268	$	39,999	$	—	$	17,490	$	—	$	1,375,329

* - At December 31, 2014, Special Mention and Substandard loans included $443,000 and $6 million, respectively, which were removed from PCI accounting in accordance with ASC 310-30-35-13 due to a post-acquisition troubled debt restructuring.

** - The above table excludes all non-classified residential real estate and consumer loans at the respective period ends. The table also excludes most non-classified small C&I and CRE relationships totaling $100,000 or less. These loans are not rated by the Company since they are accruing interest and are not past due 80-days-or-more.

Allowance for Loan and Lease Losses

Activity in the allowance for loan and leases (“Allowance”) follows:

	Three Months Ended
	March 31,
(in thousands)	2015			2014

Allowance, beginning of period	$	24,410		$	23,026

Charge offs - Core Banking	(492		)	(912		)
Charge offs - RPG	(5		)	—
Total charge offs	(497		)	(912		)

Recoveries - Core Banking	338			493
Recoveries - RPG	195			463
Total recoveries	533			956

Net (charge offs) recoveries - Core Banking	(154		)	(419		)
Net (charge offs) recoveries - RPG	190			463
Net (charge offs) recoveries	36			44

Provision for loan and lease losses (“Provision”) - Core Banking	375			(240		)
Provision - RPG	(190		)	(463		)
Total Provision	185			(703		)

Allowance, end of period	$	24,631		$	22,367

The Allowance calculation includes the following qualitative factors, which are considered in combination with the Bank’s historical loss rates in determining the general loss reserve within the Allowance:

Changes in nature, volume and seasoning of the portfolio;

Changes in experience, ability and depth of lending management and other relevant staff;

Changes in the quality of the Bank’s credit review system;

Changes in lending policies and procedures, including changes in underwriting standards and collection, charge-off, and recovery practices not considered elsewhere in estimating credit losses;

Changes in the volume and severity of past due, non-performing and classified loans and leases;

Changes in the value of underlying collateral for collateral-dependent loans and leases;

Changes in international, national, regional, and local economic and business conditions and developments that affect the collectability of portfolios, including the condition of various market segments;

The existence and effect of any concentrations of credit, and changes in the level of such concentrations; and

The effect of other external factors such as competition and legal and regulatory requirements on the level of estimated credit losses in the institution’s existing portfolio.

The following tables present the activity in the Allowance by portfolio class for the three months ended March 31, 2015 and 2014:

											Commercial
	Residential Real Estate										Real Estate -							Lease
Three Months Ended	Owner			Owner Occupied-		Non Owner		Commercial			Purchased		Construction &		Commercial &			Financing
March 31, 2015 (in thousands)	Occupied			Correspondent		Occupied		Real Estate			Whole Loans		Land Development		Industrial			Receivables

Beginning balance	$	8,565		$	567	$	837	$	7,740		$	34	$	926	$	1,167		$	25
Provision	140			12		80		(189		)	1		32		(10		)	15
Charge offs	(136		)	—		—		(7		)	—		—		(29		)	—
Recoveries	60			—		3		9			—		—		29			—

Ending balance	$	8,629		$	579	$	920	$	7,553		$	35	$	958	$	1,157		$	40

	Warehouse					Consumer
	Lines of		Home			RPG			Credit						Purchased			Other
(continued)	Credit		Equity			Loans			Cards			Overdrafts			Whole Loans			Consumer			Total

Beginning balance	$	799	$	2,730		$	44		$	285		$	382		$	185		$	124		$	24,410
Provision	259		(8		)	(190		)	104			(79		)	11			7			185
Charge offs	—		(51		)	(5		)	(40		)	(146		)	(12		)	(71		)	(497		)
Recoveries	—		37			195			13			88			—			99			533

Ending balance	$	1,058	$	2,708		$	44		$	362		$	245		$	184		$	159		$	24,631

												Commercial
	Residential Real Estate											Real Estate -								Lease
Three Months Ended	Owner			Owner Occupied-		Non Owner			Commercial			Purchased		Construction &			Commercial &			Financing
March 31, 2014 (in thousands)	Occupied			Correspondent		Occupied			Real Estate			Whole Loans		Land Development			Industrial			Receivables

Beginning balance	$	7,816		$	—	$	1,023		$	8,309		$	34	$	1,296		$	1,089		$	—
Provision	118			—		(30		)	(178		)	—		(88		)	(57		)	—
Charge offs	(217		)	—		(15		)	(372		)	—		(17		)	—			—
Recoveries	34			—		6			142			—		1			48			—

Ending balance	$	7,751		$	—	$	984		$	7,901		$	34	$	1,192		$	1,080		$	—

	Warehouse					Consumer
	Lines of		Home			RPG			Credit						Purchased		Other
(continued)	Credit		Equity			Loans			Cards			Overdrafts			Whole Loans		Consumer			Total

Beginning balance	$	449	$	2,396		$	—		$	289		$	199		$	—	$	126		$	23,026
Provision	28		—			(463		)	(18		)	47			—		(62		)	(703		)
Charge offs	—		(66		)	—			(5		)	(151		)	—		(69		)	(912		)
Recoveries	—		41			463			10			117			—		94			956

Ending balance	$	477	$	2,371		$	—		$	276		$	212		$	—	$	89		$	22,367

Non-performing Loans and Non-performing Assets

Detail of non-performing loans and non-performing assets follows:

(dollars in thousands)	March 31, 2015		December 31, 2014

Loans on non-accrual status(1)	$	24,423	$	23,337
Loans past due 90-days-or-more and still on accrual(2)	572		322

Total non-performing loans	24,995		23,659
Other real estate owned	6,736		11,243
Total non-performing assets	$	31,731	$	34,902

Credit Quality Ratios:
Non-performing loans to total loans	0.79	%	0.78	%
Non-performing assets to total loans (including OREO)	1.00	%	1.14	%
Non-performing assets to total assets	0.80	%	0.93	%

(1)Loans on non-accrual status include impaired loans.

(2)All loans past due 90-days-or-more and still accruing are PCI loans accounted for under ASC 310-30.

The following table presents the recorded investment in non-accrual loans and loans past due 90-days-or-more and still on accrual by class of loans:

					Past Due 90-Days-or-More
	Non-Accrual				and Still Accruing Interest*
(dollars in thousands)	March 31, 2015		December 31, 2014		March 31, 2015		December 31, 2014

Residential real estate:
Owner occupied	$	12,759	$	10,903	$	274	$	322
Owner occupied - correspondent	—		—		—		—
Non owner occupied	1,559		2,352		298		—
Commercial real estate	5,952		6,151		—		—
Commercial real estate - purchased whole loans	—		—		—		—
Construction & land development	1,990		1,990		—		—
Commercial & industrial	—		169		—		—
Lease financing receivables	—		—		—		—
Warehouse lines of credit	—		—		—		—
Home equity	2,077		1,678		—		—
Consumer:
RPG loans	—		—		—		—
Credit cards	—		—		—		—
Overdrafts	—		—		—		—
Purchased whole loans	—		—		—		—
Other consumer	86		94		—		—

Total	$	24,423	$	23,337	$	572	$	322

* - For all periods presented, loans past due 90-days-or-more and still on accrual consist entirely of PCI loans.

Non-accrual loans and loans past due 90-days-or-more and still on accrual include both smaller balance, primarily retail, homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. Non-accrual loans are typically returned to accrual status when all the principal and interest amounts contractually due are brought current and held current for six consecutive months and future contractual payments are reasonably assured. Troubled Debt Restructurings (“TDRs”) on non-accrual status are reviewed for return to accrual status on an individual basis, with additional consideration given to performance under the modified terms.

Delinquent Loans

The following tables present the aging of the recorded investment in loans by class of loans:

	30 - 59			60 - 89			90 or More
March 31, 2015	Days			Days			Days			Total			Total Not
(dollars in thousands)	Delinquent			Delinquent			Delinquent*			Delinquent			Delinquent		Total

Residential real estate:
Owner occupied	$	3,152		$	1,504		$	3,721		$	8,377		$	1,087,631	$	1,096,008
Owner occupied - correspondent	—			—			—			—			231,451		231,451
Non owner occupied	483			68			308			859			97,617		98,476
Commercial real estate	66			56			2,261			2,383			775,796		778,179
Commercial real estate - purchased whole loans	—			—			—			—			35,086		35,086
Construction & land development	—			—			1,990			1,990			38,114		40,104
Commercial & industrial	—			—			—			—			172,017		172,017
Lease financing receivables	—			—			—			—			4,004		4,004
Warehouse lines of credit	—			—			—			—			423,155		423,155
Home equity	55			225			1,176			1,456			247,374		248,830
Consumer:
RPG loans	133			35			—			168			3,941		4,109
Credit cards	52			26			—			78			9,868		9,946
Overdrafts	104			—			—			104			673		777
Purchased whole loans	30			—			9			39			4,282		4,321
Other consumer	46			11			—			57			8,916		8,973

Total	$	4,121		$	1,925		$	9,465		$	15,511		$	3,139,925	$	3,155,436
Delinquency ratio**	0.13		%	0.06		%	0.30		%	0.49		%

	30 - 59			60 - 89			90 or More
December 31, 2014	Days			Days			Days			Total			Total Not
(dollars in thousands)	Delinquent			Delinquent			Delinquent*			Delinquent			Delinquent		Total

Residential real estate:
Owner occupied	$	3,039		$	1,329		$	3,640		$	8,008		$	1,110,333	$	1,118,341
Owner occupied - correspondent	—			—			—			—			226,628		226,628
Non owner occupied	36			635			105			776			95,716		96,492
Commercial real estate	585			—			2,387			2,972			769,337		772,309
Commercial real estate - purchased whole loans	—			—			—			—			34,898		34,898
Construction & land development	—			—			1,990			1,990			36,490		38,480
Commercial & industrial	211			—			—			211			157,128		157,339
Lease financing receivables	—			—			—			—			2,530		2,530
Warehouse lines of credit	—			—			—			—			319,431		319,431
Home equity	706			158			498			1,362			244,317		245,679
Consumer:
RPG loans	107			34			—			141			3,954		4,095
Credit cards	124			10			—			134			9,439		9,573
Overdrafts	178			—			—			178			1,002		1,180
Purchased whole loans	12			—			—			12			4,614		4,626
Other consumer	38			29			—			67			8,827		8,894

Total	$	5,036		$	2,195		$	8,620		$	15,851		$	3,024,644	$	3,040,495
Delinquency ratio**	0.17		%	0.07		%	0.28		%	0.52		%

* - All loans, excluding PCI loans, 90-days-or-more past due as of March 31, 2015 and December 31, 2014 were on non-accrual status.

** - Represents total loans past due by aging category divided by total loans.

Impaired Loans

The Bank defines impaired loans as follows:

All loans internally rated as “Substandard,” “Doubtful” or “Loss;”

All loans internally rated in a PCI category with cash flows that have deteriorated from management’s initial acquisition day estimate;

All loans on non-accrual status and non-PCI loans past due 90 days-or-more still on accrual;

All retail and commercial TDRs; and

Any other situation where the full collection of the total amount due for a loan is improbable or otherwise meets the definition of impaired.

See the section titled “Credit Quality Indicators” in this section of the filing for additional discussion regarding the Bank’s loan classification structure.

Information regarding the Bank’s impaired loans follows:

(in thousands)	March 31, 2015		December 31, 2014

Loans with no allocated allowance for loan losses	$	29,941	$	32,560
Loans with allocated allowance for loan losses	53,069		53,620

Total impaired loans	$	83,010	$	86,180

Amount of the allowance for loan losses allocated	$	5,136	$	5,564

Approximately $9 million and $10 million of impaired loans at March 31, 2015 and December 31, 2014 were PCI loans. Approximately $4 million and $6 million of impaired loans at March 31, 2015 and December 31, 2014 were formerly PCI loans which became classified as “Impaired” through a post-acquisition troubled debt restructuring.

The following tables present the balance in the Allowance and the recorded investment in loans by portfolio class based on impairment method as of March 31, 2015 and December 31, 2014:

									Commercial
	Residential Real Estate								Real Estate -						Lease
	Owner		Owner Occupied -		Non Owner		Commercial		Purchased		Construction &		Commercial &		Financing
March 31, 2015 (in thousands)	Occupied		Correspondent		Occupied		Real Estate		Whole Loans		Land Development		Industrial		Receivables

Allowance:
Ending Allowance balance:
Individually evaluated for impairment, excluding PCI loans	$	3,061	$	—	$	162	$	832	$	—	$	187	$	205	$	—
Collectively evaluated for impairment	5,529		579		682		6,350		35		771		905		40
PCI loans with post acquisition impairment	39		—		76		371		—		—		47		—
PCI loans without post acquisition impairment	—		—		—		—		—		—		—		—

Total ending Allowance:	$	8,629	$	579	$	920	$	7,553	$	35	$	958	$	1,157	$	40

Loans:
Impaired loans individually evaluated, excluding PCI loans	$	40,747	$	—	$	3,988	$	19,875	$	—	$	2,802	$	3,822	$	—
Loans collectively evaluated for impairment	1,054,112		231,451		92,856		745,652		35,086		36,896		166,977		4,004
PCI loans with post acquisition impairment	668		—		1,513		5,713		—		—		1,147		—
PCI loans without post acquisition impairment	481		—		119		6,939		—		406		71		—

Total ending loan balance	$	1,096,008	$	231,451	$	98,476	$	778,179	$	35,086	$	40,104	$	172,017	$	4,004

	Warehouse				Consumer
	Lines of		Home		RPG		Credit				Purchased		Other
(continued)	Credit		Equity		Loans		Cards		Overdrafts		Whole Loans		Consumer		Total

Allowance:
Ending Allowance balance:
Individually evaluated for impairment, excluding PCI loans	$	—	$	121	$	—	$	—	$	—	$	—	$	35	$	4,603
Collectively evaluated for impairment	1,058		2,587		44		362		245		184		124		19,495
PCI loans with post acquisition impairment	—		—		—		—		—		—		—		533
PCI loans without post acquisition impairment	—		—		—		—		—		—		—		—

Total ending Allowance:	$	1,058	$	2,708	$	44	$	362	$	245	$	184	$	159	$	24,631

Loans:
Impaired loans individually evaluated, excluding PCI loans	$	—	$	2,690	$	—	$	—	$	—	$	—	$	45	$	73,969
Loans collectively evaluated for impairment	423,155		246,140		4,109		9,946		777		4,321		8,926		3,064,408
PCI loans with post acquisition impairment	—		—		—		—		—		—		—		9,041
PCI loans without post acquisition impairment	—		—		—		—		—		—		2		8,018

Total ending loan balance	$	423,155	$	248,830	$	4,109	$	9,946	$	777	$	4,321	$	8,973	$	3,155,436

									Commercial
	Residential Real Estate								Real Estate -						Lease
	Owner		Owner Occupied -		Non Owner		Commercial		Purchased		Construction &		Commercial &		Financing
December 31, 2014 (in thousands)	Occupied		Correspondent		Occupied		Real Estate		Whole Loans		Land Development		Industrial		Receivables

Allowance:
Ending Allowance balance:
Individually evaluated for impairment, excluding PCI loans	$	3,251	$	—	$	101	$	913	$	—	$	187	$	302	$	—
Collectively evaluated for impairment	5,264		567		672		6,462		34		739		800		25
PCI loans with post acquisition impairment	50		—		64		365		—		—		65		—
PCI loans without post acquisition impairment	—		—		—		—		—		—		—		—

Total ending Allowance:	$	8,565	$	567	$	837	$	7,740	$	34	$	926	$	1,167	$	25

Loans:
Impaired loans individually evaluated, excluding PCI loans	$	41,265	$	—	$	3,388	$	22,521	$	—	$	2,627	$	4,319	$	—
Loans collectively evaluated for impairment	1,075,871		226,628		91,395		736,965		34,898		35,357		151,776		2,530
PCI loans with post acquisition impairment	725		—		1,554		6,341		—		—		1,158		—
PCI loans without post acquisition impairment	480		—		155		6,482		—		496		86		—

Total ending loan balance	$	1,118,341	$	226,628	$	96,492	$	772,309	$	34,898	$	38,480	$	157,339	$	2,530

	Warehouse				Consumer
	Lines of		Home		RPG		Credit				Purchased		Other
(continued)	Credit		Equity		Loans		Cards		Overdrafts		Whole Loans		Consumer		Total

Allowance:
Ending Allowance balance:
Individually evaluated for impairment, excluding PCI loans	$	—	$	225	$	—	$	—	$	—	$	—	$	40	$	5,019
Collectively evaluated for impairment	799		2,505		44		285		382		185		83		18,846
PCI loans with post acquisition impairment	—		—		—		—		—		—		1		545
PCI loans without post acquisition impairment	—		—		—		—		—		—		—		—

Total ending Allowance:	$	799	$	2,730	$	44	$	285	$	382	$	185	$	124	$	24,410

Loans:
Impaired loans individually evaluated, excluding PCI loans	$	—	$	2,220	$	—	$	—	$	—	$	—	$	52	$	76,392
Loans collectively evaluated for impairment	319,431		243,459		4,095		9,573		1,180		4,626		8,829		2,946,613
PCI loans with post acquisition impairment	—		—		—		—		—		—		10		9,788
PCI loans without post acquisition impairment	—		—		—		—		—		—		3		7,702

Total ending loan balance	$	319,431	$	245,679	$	4,095	$	9,573	$	1,180	$	4,626	$	8,894	$	3,040,495

The following tables present loans individually evaluated for impairment by class of loans as of March 31, 2015 and December 31, 2014 and for the three months ended March 31, 2015 and 2014. The difference between the “Unpaid Principal Balance” and “Recorded Investment” columns represents life-to-date partial write downs/charge offs taken on individual impaired credits.

	As of						Three Months Ended
	March 31, 2015						March 31, 2015
											Cash Basis
	Unpaid						Average		Interest		Interest
	Principal		Recorded		Allowance		Recorded		Income		Income
(in thousands)	Balance		Investment		Allocated		Investment		Recognized		Recognized

Impaired loans with no related allowance recorded:
Residential real estate:
Owner occupied	$	5,981	$	5,566	$	—	$	5,881	$	50	$	—
Owner occupied - correspondent	—		—		—		—		—		—
Non owner occupied	2,690		2,588		—		2,402		8		—
Commercial real estate	15,002		13,990		—		15,119		120		—
Commercial real estate - purchased whole loans	—		—		—		—		—		—
Construction & land development	2,124		2,124		—		2,134		3		—
Commercial & industrial	3,618		3,618		—		3,781		55		—
Lease financing receivables	—		—		—		—		—		—
Warehouse lines of credit	—		—		—		—		—		—
Home equity	2,210		2,055		—		1,935		7		—
Consumer:
RPG loans	—		—		—		—		—		—
Credit cards	—		—		—		—		—		—
Overdrafts	—		—		—		—		—		—
Purchased whole loans	—		—		—		—		—		—
Other consumer	—		—		—		—		—		—

Impaired loans with an allowance recorded:
Residential real estate:
Owner occupied	36,341		35,849		3,100		35,822		225		—
Owner occupied - correspondent	—		—		—		—		—		—
Non owner occupied	2,913		2,913		238		2,820		35		—
Commercial real estate	11,659		11,598		1,203		12,106		107		—
Commercial real estate - purchased whole loans	—		—		—		—		—		—
Construction & land development	678		678		187		581		9		—
Commercial & industrial	1,351		1,351		252		1,443		18		—
Lease financing receivables	—		—		—		—		—		—
Warehouse lines of credit	—		—		—		—		—		—
Home equity	759		635		121		521		1		—
Consumer:
RPG loans	—		—		—		—		—		—
Credit cards	—		—		—		—		—		—
Overdrafts	—		—		—		—		—		—
Purchased whole loans	—		—		—		—		—		—
Other consumer	45		45		35		54		—		—
Total impaired loans	$	85,371	$	83,010	$	5,136	$	84,599	$	638	$	—

	As of						Three Months Ended
	December 31, 2014						March 31, 2014
											Cash Basis
	Unpaid						Average		Interest		Interest
	Principal		Recorded		Allowance		Recorded		Income		Income
(in thousands)	Balance		Investment		Allocated		Investment		Recognized		Recognized

Impaired loans with no related allowance recorded:
Residential real estate:
Owner occupied	$	6,598	$	6,196	$	—	$	6,960	$	52	$	—
Owner occupied - correspondent	—		—		—		—		—		—
Non owner occupied	2,368		2,215		—		1,306		8		—
Commercial real estate	17,282		16,248		—		20,288		197		—
Commercial real estate - purchased whole loans	—		—		—		—		—		—
Construction & land development	2,144		2,144		—		2,084		1		—
Commercial & industrial	3,943		3,943		—		4,233		59		—
Lease financing receivables	—		—		—		—		—		—
Warehouse lines of credit	—		—		—		—		—		—
Home equity	1,969		1,814		—		1,758		9		—
Consumer:
RPG loans	—		—		—		—		—		—
Credit cards	—		—		—		—		—		—
Overdrafts	—		—		—		—		—		—
Purchased whole loans	—		—		—		—		—		—
Other consumer	—		—		—		9		—		—

Impaired loans with an allowance recorded:
Residential real estate:
Owner occupied	36,361		35,794		3,301		34,475		244		—
Owner occupied - correspondent	—		—		—		—		—		—
Non owner occupied	2,755		2,727		165		6,589		71		—
Commercial real estate	12,653		12,614		1,278		23,197		190		—
Commercial real estate - purchased whole loans	—		—		—		—		—		—
Construction & land development	483		483		187		594		6		—
Commercial & industrial	1,534		1,534		367		1,785		3		—
Lease financing receivables	—		—		—		—		—		—
Warehouse lines of credit	—		—		—		—		—		—
Home equity	452		406		225		740		2		—
Consumer:
RPG loans	—		—		—		—		—		—
Credit cards	—		—		—		—		—		—
Overdrafts	—		—		—		—		—		—
Purchased whole loans	—		—		—		—		—		—
Other consumer	62		62		41		85		—		—
Total impaired loans	$	88,604	$	86,180	$	5,564	$	104,103	$	842	$	—

Troubled Debt Restructurings

A TDR is the situation where, due to a borrower’s financial difficulties, the Bank grants a concession to the borrower that the Bank would not otherwise have considered. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under the Bank’s internal underwriting policy.

All TDRs are considered “Impaired,” including PCI loans subsequently restructured. The majority of the Bank’s commercial related and construction TDRs involve a restructuring of financing terms such as a reduction in the payment amount to require only interest and escrow (if required) and/or extending the maturity date of the debt. The substantial majority of the Bank’s residential real estate TDR concessions involve reducing the client’s loan payment through a rate reduction for a set period of time based on the borrower’s ability to service the modified loan payment. Retail loans may also be classified as TDRs due to legal modifications, such as bankruptcies.

Non-accrual loans modified as TDRs typically remain on non-accrual status and continue to be reported as non-performing loans for a minimum of six months. Accruing loans modified as TDRs are evaluated for non-accrual status based on a current evaluation of the borrower’s financial condition and ability and willingness to service the modified debt. At March 31, 2015 and December 31, 2014, $15 million and $14 million of TDRs were on non-accrual status.

Detail of TDRs differentiated by loan type and accrual status follows:

	Troubled Debt			Troubled Debt			Total
	Restructurings on			Restructurings on			Troubled Debt
	Non-Accrual Status			Accrual Status			Restructurings
	Number of	Recorded		Number of	Recorded		Number of	Recorded
March 31, 2015 (dollars in thousands)	Loans	Investment		Loans	Investment		Loans	Investment

Residential real estate	84	$	7,698	238	$	31,013	322	$	38,711
Commercial real estate	8	4,972		24	12,509		32	17,481
Construction & land development	2	1,990		7	812		9	2,802
Commercial & industrial	—	—		7	3,822		7	3,822

Total troubled debt restructurings	94	$	14,660	276	$	48,156	370	$	62,816

	Troubled Debt			Troubled Debt			Total
	Restructurings on			Restructurings on			Troubled Debt
	Non-Accrual Status			Accrual Status			Restructurings
	Number of	Recorded		Number of	Recorded		Number of	Recorded
December 31, 2014 (dollars in thousands)	Loans	Investment		Loans	Investment		Loans	Investment

Residential real estate	74	$	7,166	250	$	31,966	324	$	39,132
Commercial real estate	8	5,030		30	14,502		38	19,532
Construction & land development	2	1,990		6	637		8	2,627
Commercial & industrial	—	—		8	3,975		8	3,975

Total troubled debt restructurings	84	$	14,186	294	$	51,080	378	$	65,266

The Bank considers a TDR to be performing to its modified terms if the loan is in accrual status and not past due 30 days or more as of the reporting date. A summary of the categories of TDR loan modifications outstanding and respective performance under modified terms at March 31, 2015 and December 31, 2014 follows:

	Troubled Debt			Troubled Debt
	Restructurings			Restructurings			Total
	Performing to			Not Performing to			Troubled Debt
	Modified Terms			Modified Terms			Restructurings
	Number of	Recorded		Number of	Recorded		Number of	Recorded
March 31, 2015 (dollars in thousands)	Loans	Investment		Loans	Investment		Loans	Investment

Residential real estate loans (including home equity loans):

Interest only payments	3	$	838	5	$	422	8	$	1,260
Rate reduction	186	25,685		46	5,709		232	31,394
Principal deferral	10	936		7	811		17	1,747
Legal modifications	34	2,706		31	1,604		65	4,310
Total residential TDRs	233	30,165		89	8,546		322	38,711

Commercial related and construction/land development loans:
Interest only payments	9	3,290		2	899		11	4,189
Rate reduction	12	6,396		6	3,711		18	10,107
Principal deferral	13	5,605		6	4,204		19	9,809
Total commercial TDRs	34	15,291		14	8,814		48	24,105
Total troubled debt restructurings	267	$	45,456	103	$	17,360	370	$	62,816

	Troubled Debt			Troubled Debt
	Restructurings			Restructurings			Total
	Performing to			Not Performing to			Troubled Debt
	Modified Terms			Modified Terms			Restructurings
	Number of	Recorded		Number of	Recorded		Number of	Recorded
December 31, 2014 (dollars in thousands)	Loans	Investment		Loans	Investment		Loans	Investment

Residential real estate loans (including home equity loans):

Interest only payments	2	$	218	4	$	389	6	$	607
Rate reduction	173	25,080		61	7,376		234	32,456
Principal deferral	12	1,408		5	349		17	1,757
Legal modifications	33	2,675		34	1,637		67	4,312
Total residential TDRs	220	29,381		104	9,751		324	39,132

Commercial related and construction/land development loans:
Interest only payments	10	4,170		2	926		12	5,096
Rate reduction	19	9,043		3	1,915		22	10,958
Principal deferral	14	5,820		6	4,260		20	10,080
Total commercial TDRs	43	19,033		11	7,101		54	26,134
Total troubled debt restructurings	263	$	48,414	115	$	16,852	378	$	65,266

As of March 31, 2015 and December 31, 2014, 72% and 74% of the Bank’s TDRs were performing according to their modified terms. The Bank had provided $4 million and $4 million of specific reserve allocations to customers whose loan terms have been modified in TDRs as of March 31, 2015 and December 31, 2014. Specific reserve allocations are generally assessed prior to loans being modified as a TDR, as most of these loans migrate from the Bank’s internal “watch list” and have been specifically provided for or reserved for as part of the Bank’s normal loan and lease provisioning methodology. The Bank has not committed to lend any additional material amounts to its existing TDR relationships at March 31, 2015 or December 31, 2014.

A summary of the categories of TDR loan modifications and respective performance as of March 31, 2015 and 2014 that were modified during the three months ended March 31, 2015 and 2014 follows:

	Troubled Debt			Troubled Debt
	Restructurings			Restructurings			Total
	Performing to			Not Performing to			Troubled Debt
	Modified Terms			Modified Terms			Restructurings
	Number of	Recorded		Number of	Recorded		Number of	Recorded
March 31, 2015 (dollars in thousands)	Loans	Investment		Loans	Investment		Loans	Investment

Residential real estate loans (including home equity loans):
Interest only payments	1	$	621	—	$	—	1	$	621
Rate reduction	4	408		3	160		7	568
Principal deferral	—	—		1	25		1	25
Legal modifications	—	—		1	140		1	140
Total residential TDRs	5	1,029		5	325		10	1,354

Commercial related and construction/land development loans:
Interest only payments	3	468		—	—		3	468
Rate reduction	—	—		1	1,730		1	1,730
Principal deferral	—	—		1	56		1	56
Total commercial TDRs	3	468		2	1,786		5	2,254
Total troubled debt restructurings	8	$	1,497	7	$	2,111	15	$	3,608

	Troubled Debt			Troubled Debt
	Restructurings			Restructurings			Total
	Performing to			Not Performing to			Troubled Debt
	Modified Terms			Modified Terms			Restructurings
	Number of	Recorded		Number of	Recorded		Number of	Recorded
March 31, 2014 (dollars in thousands)	Loans	Investment		Loans	Investment		Loans	Investment

Residential real estate loans (including home equity loans):
Interest only payments	—	$	—	1	$	2	1	$	2
Rate reduction	13	1,102		3	1,134		16	2,236
Principal deferral	3	299		—	—		3	299
Legal modifications	20	2,070		11	664		31	2,734
Total residential TDRs	36	3,471		15	1,800		51	5,271

Commercial related and construction/land development loans:
Interest only payments	3	718		—	—		3	718
Rate reduction	2	2,352		1	1,134		3	3,486
Principal deferral	2	968		1	1,908		3	2,876
Total commercial TDRs	7	4,038		2	3,042		9	7,080
Total troubled debt restructurings	43	$	7,509	17	$	4,842	60	$	12,351

As of March 31, 2015 and 2014, 42% and 61% of the Bank’s TDRs that occurred during the first quarters of 2015 and 2014 were performing according to their modified terms. The Bank provided $476,000 and $358,000 in specific reserve allocations to customers whose loan terms were modified in TDRs during the first quarters of 2015 and 2014. As stated above, specific reserves are generally assessed prior to loans being modified as a TDR, as most of these loans migrate from the Bank’s internal watch list and have been specifically reserved for as part of the Bank’s normal reserving methodology.

There were no significant changes between the pre and post modification loan balances for the three months ending March 31, 2015 and March 31, 2014.

The following tables present loans by class modified as troubled debt restructurings within the previous twelve months of March 31, 2015 and 2014 and for which there was a payment default during the three months ended March 31, 2015 and 2014:

	Number of	Recorded
March 31, 2015 (dollars in thousands)	Loans	Investment

Residential real estate:
Owner occupied	5	$	324
Owner occupied - correspondent	—	—
Non owner occupied	—	—
Commercial real estate	1	56
Commercial real estate - purchased whole loans	—	—
Construction & land development	—	—
Commercial & industrial	—	—
Lease financing receivables	—	—
Warehouse lines of credit	—	—
Home equity	—	—
Consumer:
RPG loans	—	—
Credit cards	—	—
Overdrafts	—	—
Purchased whole loans	—	—
Other consumer	—	—

Total	6	$	380

	Number of	Recorded
March 31, 2014 (dollars in thousands)	Loans	Investment

Residential real estate:
Owner occupied	12	$	1,747
Owner occupied - correspondent	—	—
Non owner occupied	—	—
Commercial real estate	1	1,134
Commercial real estate - purchased whole loans	—	—
Construction & land development	—	—
Commercial & industrial	—	—
Lease financing receivables	—	—
Warehouse lines of credit		—
Home equity	2	28
Consumer:
RPG loans	—	—
Credit cards	—	—
Overdrafts	—	—
Purchased whole loans	—	—
Other consumer	—	—

Total	15	$	2,909

The following table presents the carrying amount of foreclosed properties held at March 31, 2015 and December 31, 2014 as a result of the Bank obtaining physical possession of such properties:

(in thousands)	March 31, 2015		December 31, 2014

Residential real estate	$	1,634	$	3,209
Commercial real estate	1,908		3,324
Construction & land development	3,194		4,710

Total other real estate owned	$	6,736	$	11,243

The following table presents the recorded investment in consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings were in process according to local requirements of the applicable jurisdiction as of March 31, 2015 and December 31, 2014:

(in thousands)	March 31, 2015		December 31, 2014

Recorded investment in consumer residential real estate mortgage loans in the process of foreclosure	$	2,978	$	2,466