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EX-10.3 - EXHIBIT 10.3 - PEOPLES BANCORP INCexhibit103changeincontrola.htm
EX-31.1 - EXHIBIT 31.1 - PEOPLES BANCORP INCexhibit311-0331201610xq.htm
EX-31.2 - EXHIBIT 31.2 - PEOPLES BANCORP INCexhibit312-0331201610xq.htm
EX-32 - EXHIBIT 32 - PEOPLES BANCORP INCexhibit32-0331201610xq.htm
10-Q - 10-Q PDF - PEOPLES BANCORP INCpebo0331201610q.pdf



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

FORM 10-Q

(Mark One)
  x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
            For the quarterly period ended March 31, 2016
                                                                                        
OR
  o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
            For the transition period from ____ to ____

Commission File Number: 0-16772
PEOPLES BANCORP INC.
(Exact name of Registrant as specified in its charter)
Ohio
 
 
 
31-0987416
(State or other jurisdiction of incorporation or organization)
 
 
 
(I.R.S. Employer Identification No.)
138 Putnam Street, P. O. Box 738, Marietta, Ohio
 
 
 
45750
(Address of principal executive offices)
 
 
 
(Zip Code)
Registrant’s telephone number, including area code:
 
 
 
(740) 373-3155
 
 
Not Applicable
 
 
 
 
(Former name, former address and former fiscal year, if changed since last report)
 
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x   No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).Yes x No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated
filer o
Accelerated filer x
Non-accelerated filer o
(Do not check if a smaller reporting company)
Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No     x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 18,157,962 common shares, without par value, at April 27, 2016.




Table of Contents
 
 



2


PART I
ITEM 1.  FINANCIAL STATEMENTS
PEOPLES BANCORP INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Unaudited)
 
March 31,
2016
December 31,
2015
(Dollars in thousands)
Assets
 
 
Cash and due from banks
$
54,319

$
53,663

Interest-bearing deposits in other banks
8,977

17,452

Total cash and cash equivalents
63,296

71,115

Available-for-sale investment securities, at fair value (amortized cost of $785,544 at March 31, 2016 and $780,304 at December 31, 2015)
802,194

784,701

Held-to-maturity investment securities, at amortized cost (fair value of $46,202 at March 31, 2016 and $45,853 at December 31, 2015)
44,866

45,728

Other investment securities, at cost
38,402

38,401

Total investment securities
885,462

868,830

Loans, net of deferred fees and costs
2,105,115

2,072,440

Allowance for loan losses
(17,261
)
(16,779
)
Net loans
2,087,854

2,055,661

Loans held for sale
950

1,953

Bank premises and equipment, net
52,156

53,487

Goodwill
132,631

132,631

Other intangible assets
16,366

16,986

Other assets
56,214

58,307

Total assets
$
3,294,929

$
3,258,970

Liabilities
 
 
Non-interest-bearing deposits
$
716,202

$
717,939

Interest-bearing deposits
1,870,881

1,818,005

Total deposits
2,587,083

2,535,944

Short-term borrowings
135,068

160,386

Long-term borrowings
113,188

113,670

Accrued expenses and other liabilities
31,104

29,181

Total liabilities
2,866,443

2,839,181

Stockholders’ equity
 
 
Preferred stock, no par value, 50,000 shares authorized, no shares issued at March 31, 2016 and December 31, 2015


Common stock, no par value, 24,000,000 shares authorized, 18,934,185 shares issued at March 31, 2016 and 18,931,200 shares issued at December 31, 2015, including shares in treasury
343,504

343,948

Retained earnings
96,037

90,790

Accumulated other comprehensive income (loss), net of deferred income taxes
7,592

(359
)
Treasury stock, at cost, 831,018 shares at March 31, 2016 and 586,686 shares at December 31, 2015
(18,647
)
(14,590
)
Total stockholders’ equity
428,486

419,789

Total liabilities and stockholders’ equity
$
3,294,929

$
3,258,970


See Notes to the Unaudited Consolidated Financial Statements


3


PEOPLES BANCORP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

    
 
Three Months Ended
 
March 31,
(Dollars in thousands, except per share data)
2016
2015
Interest income:
 
 
Interest and fees on loans
$
22,966

$
19,160

Interest and dividends on taxable investment securities
4,681

4,363

Interest on tax-exempt investment securities
780

596

Other interest income
16

40

Total interest income
28,443

24,159

Interest expense:
 
 
Interest on deposits
1,601

1,559

Interest on short-term borrowings
87

35

Interest on long-term borrowings
988

1,146

Total interest expense
2,676

2,740

Net interest income
25,767

21,419

Provision for loan losses
955

350

Net interest income after provision for loan losses
24,812

21,069

Other income:
 
 
Insurance income
4,498

4,312

Deposit account service charges
2,603

2,295

Electronic banking income
2,535

1,980

Trust and investment income
2,382

2,047

Mortgage banking income
160

303

Net gain on investment securities
96

600

Net loss on asset disposals and other transactions
(31
)
(1,103
)
Other non-interest income
876

571

Total other income
13,119

11,005

Other expenses:
 
 
Salaries and employee benefit costs
14,247

17,361

Net occupancy and equipment expense
2,884

2,295

Professional fees
1,459

2,447

Electronic banking expense
1,433

1,124

Amortization of other intangible assets
1,008

673

Data processing and software expense
749

735

Communication expense
628

502

FDIC insurance expense
617

424

Franchise tax expense
538

548

Marketing expense
398

645

Foreclosed real estate and other loan expenses
251

321

Other non-interest expense
2,070

5,839

Total other expenses
26,282

32,914

Income (loss) before income taxes
11,649

(840
)
Income tax expense (benefit)
3,654

(151
)
  Net income (loss)
$
7,995

$
(689
)
Earnings (loss) per common share - basic
$
0.44

$
(0.04
)
Earnings (loss) per common share - diluted
$
0.44

$
(0.04
)
Weighted-average number of common shares outstanding - basic
18,071,746

15,802,334

Weighted-average number of common shares outstanding - diluted
18,194,990

15,930,235

Cash dividends declared
$
2,748

$
2,272

Cash dividends declared per common share
$
0.15

$
0.15


See Notes to the Unaudited Consolidated Financial Statements


4


PEOPLES BANCORP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
    
 
Three Months Ended
 
March 31,
(Dollars in thousands)
2016
2015
Net income (loss)
$
7,995

$
(689
)
Other comprehensive income:
 
 
Available-for-sale investment securities:
 
 
Gross unrealized holding gain arising in the period
12,329

8,886

Related tax expense
(4,316
)
(3,111
)
Less: reclassification adjustment for net gain included in net income
96

600

Related tax expense
(34
)
(210
)
Net effect on other comprehensive income
7,951

5,385

Defined benefit plans:
 
 
Net loss arising during the period

(26
)
  Related tax benefit

9

Amortization of unrecognized loss and service cost on benefit plans

32

Related tax expense

(12
)
Recognition of loss due to settlement and curtailment

269

Related tax expense

(94
)
Net effect on other comprehensive income

178

Total other comprehensive income, net of tax expense
7,951

5,563

Total comprehensive income
$
15,946

$
4,874




CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (Unaudited)
 
 
 
Accumulated Other Comprehensive (Loss) Income
 
Total Stockholders' Equity
 
Common Shares
Retained Earnings
Treasury Stock
(Dollars in thousands)
Balance, December 31, 2015
$
343,948

$
90,790

$
(359
)
$
(14,590
)
$
419,789

Net income

7,995



7,995

Other comprehensive income, net of tax


7,951


7,951

Cash dividends declared

(2,748
)


(2,748
)
Reissuance of treasury stock for common share awards
(849
)


849


Tax expense from exercise of stock options
(3
)



(3
)
Reissuance of treasury stock for deferred compensation plan for Boards of Directors



165

165

Repurchase of common shares in connection with employee incentive and director compensation plans



(292
)
(292
)
Common shares repurchased under the share repurchase program



(4,965
)
(4,965
)
Common shares issued under dividend reinvestment plan
102




102

Common shares issued under compensation plan for Board of Directors
(18
)


76

58

Common shares issued under employee stock purchase plan
(14
)


110

96

Stock-based compensation expense
338




338

Balance, March 31, 2016
$
343,504

$
96,037

$
7,592

$
(18,647
)
$
428,486

 
See Notes to the Unaudited Consolidated Financial Statements


5


PEOPLES BANCORP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
 
Three Months Ended
 
March 31,
(Dollars in thousands)
2016
2015
Net cash provided by (used in) operating activities
$
16,826

$
(5,884
)
Investing activities:
 
 
Available-for-sale investment securities:
 
 
Purchases
(35,810
)
(33,787
)
Proceeds from sales
981

42,803

Proceeds from principal payments, calls and prepayments
26,627

21,646

Held-to-maturity investment securities:
 
 
Proceeds from principal payments
750

316

Net (increase) decrease in loans
(31,933
)
15,384

Net expenditures for premises and equipment
(2,660
)
(2,152
)
Proceeds from sales of other real estate owned
141

55

Business acquisitions, net of cash received
(244
)
103,597

Investment in limited partnership and tax credit funds
12


Net cash (used in) provided by investing activities
(42,136
)
147,862

Financing activities:
 
 
Net (decrease) increase in non-interest-bearing deposits
(1,737
)
76,533

Net increase (decrease) in interest-bearing deposits
52,905

(57,900
)
Net (decrease) increase in short-term borrowings
(25,318
)
2,824

Payments on long-term borrowings
(460
)
(55,867
)
Cash dividends paid
(2,645
)
(2,149
)
Purchase of treasury stock under the share repurchase program
(4,965
)

Repurchase of common shares in connection with employee incentive and director compensation plans to be held as treasury stock
(292
)
(534
)
Proceeds from issuance of common shares
6


Excess tax (expense) benefit from share-based payments
(3
)
63

Net cash provided by (used in) financing activities
17,491

(37,030
)
Net (decrease) increase in cash and cash equivalents
(7,819
)
104,948

Cash and cash equivalents at beginning of period
71,115

61,454

Cash and cash equivalents at end of period
$
63,296

$
166,402

 

 See Notes to the Unaudited Consolidated Financial Statements



6


PEOPLES BANCORP INC. AND SUBSIDIARIES
NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
Note 1.   Summary of Significant Accounting Policies 

Basis of Presentation: The accompanying Unaudited Consolidated Financial Statements of Peoples Bancorp Inc. and its subsidiaries ("Peoples" refers to Peoples Bancorp Inc. and its consolidated subsidiaries collectively, except where the context indicates the reference relates solely to Peoples Bancorp Inc.) have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) for interim financial information and the instructions for Form 10-Q and Article 10 of Regulation S-X.  Accordingly, these financial statements do not contain all of the information and footnotes required by US GAAP for annual financial statements and should be read in conjunction with Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2015 (“2015 Form 10-K”).
The accounting and reporting policies followed in the presentation of the accompanying Unaudited Consolidated Financial Statements are consistent with those described in Note 1 of the Notes to the Consolidated Financial Statements included in Peoples’ 2015 Form 10-K, as updated by the information contained in this Form 10-Q.  Management has evaluated all significant events and transactions that occurred after March 31, 2016 for potential recognition or disclosure in these consolidated financial statements.  In the opinion of management, these consolidated financial statements reflect all adjustments necessary to present fairly such information for the periods and dates indicated.  Such adjustments are normal and recurring in nature.  All significant intercompany accounts and transactions have been eliminated.  The Consolidated Balance Sheet at December 31, 2015, contained herein, has been derived from the audited Consolidated Balance Sheet included in Peoples’ 2015 Form 10-K. 
The preparation of the consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.  Results of operations for interim periods are not necessarily indicative of the results to be expected for the full year, due in part to seasonal variations and unusual or infrequently occurring items. Peoples’ insurance income includes performance-based insurance commissions that are recognized by Peoples when received, which typically occurs, for the most part, during the first quarter of each year. For the three months ended March 31, 2016 and 2015, the amount of performance-based insurance commissions recognized totaled $1.6 million and $1.5 million, respectively.
New Accounting Pronouncements: From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting bodies that are adopted by Peoples as of the required effective dates. Unless otherwise discussed, management believes the impact of any recently issued standards, including those issued but not yet effective, will not have a material impact on Peoples' financial statements taken as a whole.
In March 2016, the FASB issued Accounting Standards Update ("ASU") 2016-09 - Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The objective of the simplification initiative is to identify, evaluate, and improve areas of US GAAP for which cost and complexity can be reduced while maintaining or improving the usefulness of the information provided to users of financial statements. The areas for simplification involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. Amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. For public entities, the amendments are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Peoples will adopt this new guidance as required, and it is not expected to have a material impact on Peoples' results of operations.
In March 2016, the FASB issued ASU 2016-08 - Revenue from Contracts with Customers (Topic 606) which amended the accounting guidance issued by the FASB in May 2014 that revised the criteria for determining when to recognize revenue from contracts with customers and expanded disclosure requirements. The amendment defers the effective date by one year (reflected below). This accounting guidance can be implemented using either a retrospective method or a cumulative-effect approach. This new guidance will be effective for interim and annual reporting periods beginning after December 15, 2018 (effective January 1, 2019, for Peoples). Early adoption is permitted but only for interim and annual reporting periods beginning after December 15, 2016. Peoples has elected to implement the new accounting guidance using a cumulative-effect approach and will adopt this new guidance as required. Management's preliminary analysis suggests that the adoption of the new accounting guidance is not expected to have a material effect on Peoples' financial condition or results of operations. There are many aspects of the new accounting guidance that are still being interpreted, and the FASB has recently issued and


7


proposed updates to certain aspects of the guidance. Therefore, the results of Peoples' preliminary analysis of the materiality of the adoption of the new accounting guidance may change based on the conclusions reached as to the application of the new accounting guidance.
In March 2016, the FASB issued ASU 2016-06 - Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments. The amendment is intended to resolve the diversity in practice by assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to the debt instrument hosts, which is one of the criteria for bifurcating an embedded derivative. When a call (put) option is contingently exercisable, an entity does not have to assess whether the event that triggers the ability to exercise the call (put) option is related to interest rates or credit risks. For public entities, the amendments are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Peoples is currently evaluating the impact of adopting the new guidance on Peoples' consolidated financial statements, but it is not expected to have a material impact.
In February 2016, the FASB issued ASU 2016-02 - Leases (Topic 842). The amendment was issued to improve the financial reporting of leasing activities and provide a faithful representation of leasing transactions and improve understanding and comparability of a lessee's financial statements. Under the new guidance, a lessee will be required to recognize assets and liabilities for leases with lease terms of more than 12 months. The ASU will require both finance and operating leases to be recognized on the balance sheet. The ASU will affect all companies and organizations that lease real estate. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018 (effective January 1, 2019, for Peoples). Peoples will adopt this new guidance as required, but it is not expected to have a material impact on Peoples' consolidated financial statements.
In January 2016, the FASB issued ASU 2016-01 - Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The amendment is intended to enhance the reporting model for financial instruments to provide users of financial statements with more useful information. The new ASU requires equity investments to be measured at fair value with changes in fair value recognized in net income. However, a reporting organization may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment (if any), from observable price changes in orderly transactions for similar investments of the same issuer. The ASU is effective for fiscal years beginning after December 15, 2019 (effective January 1, 2020, for Peoples). Peoples is currently evaluating the impact of adopting the new guidance on Peoples' consolidated financial statements which may result in an impact to the income statement on a quarterly and annual basis, as market rates fluctuate. Peoples will adopt this guidance as required.
On January 1, 2016, the multi-year phase-in of capital buffer requirements under the Basel III Final Rule began. Banking organizations are required to maintain a minimum Common Equity Tier 1 ("CET1") risk-based capital ratio of 4.50%, a Tier 1 risk-based capital ratio of 6.00%, and a Total risk-based capital ratio of 8.00% to be considered "adequately capitalized." In addition, the Basel III Final Rule introduces a new “capital conservation buffer”, on top of these minimum risk-weighted asset ratios. The capital conservation buffer is designed to absorb losses during periods of economic stress. Banking institutions with a ratio above the minimum, but below any of the three required ratios including the capital conservation buffer, will face constraints on dividends, equity repurchases and compensation based on the amount of the shortfall. This buffer was implemented beginning January 1, 2016 at the 0.625% level and increases by 0.625% on each subsequent January 1, until it reaches 2.50% on January 1, 2019.
The regulatory capital standards are defined by the following key measurements:
(a) The “Leverage Ratio” is defined as Tier 1 capital to average assets. To be considered “adequately capitalized” under this measurement, a bank must maintain a leverage ratio greater than or equal to 4.00%. For a bank to be considered “well capitalized,” it must maintain a leverage ratio greater than or equal to 5.00%.
(b) The “CET1 Ratio” is defined as Common Equity Tier 1 capital to total risk-weighted assets. To be considered “adequately capitalized” under this measurement, a bank must maintain a CET1 ratio greater than or equal to 4.50%. For a bank to be considered “well capitalized,” it must maintain a CET1 ratio greater than or equal to 6.50%.
(c) The “Core Capital Ratio” is defined as Tier 1 capital to total risk-weighted assets. To be considered “adequately capitalized” under this measurement, a bank must maintain a core capital ratio greater than or equal to 6.00%. For a bank to be considered “well capitalized,” it must maintain a core capital ratio greater than or equal to 8.00%.
(d) The “Total Capital Ratio” is defined as total capital to total risk-weighted assets. To be considered “adequately capitalized” under this measurement, a bank must maintain a total capital ratio greater than or equal to 8.00%. For a bank to be considered “well capitalized,” it must maintain a total capital ratio greater than or equal to 10.00%.


8


Peoples will be required to maintain risk-based capital ratios beginning January 1, 2019 as follows:
 
Effective January 1, 2019
 
As of March 31, 2016
 
Stated Minimum Ratios
Fully Implemented Capital Conservation Buffer
Effective Minimum Ratios
 
Peoples
Peoples Bank
CET1
4.50
%
2.50
%
7.00
%
 
13.10
%
11.62
%
Tier 1 capital
6.00
%
2.50
%
8.50
%
 
13.41
%
12.53
%
Total capital
8.00
%
2.50
%
10.50
%
 
14.29
%
13.32
%

Note 2.  Fair Value of Financial Instruments 

Available-for-sale securities measured at fair value on a recurring basis comprised the following:
 
 
Fair Value Measurements at Reporting Date Using
(Dollars in thousands)
 
Quoted Prices in Active Markets for Identical Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant Unobservable Inputs
(Level 3)
Fair Value
March 31, 2016
 
 
 
 
Obligations of:
 
 
 
 
U.S. government sponsored agencies
$
2,004

$

$
2,004

$

States and political subdivisions
114,328


114,328


Residential mortgage-backed securities
650,674


650,674


Commercial mortgage-backed securities
24,258


24,258


Bank-issued trust preferred securities
4,330


4,330


Equity securities
6,600

6,386

214


Total available-for-sale securities
$
802,194

$
6,386

$
795,808

$

December 31, 2015
 
 
 
 
Obligations of:
 
 
 
 
U.S. government sponsored agencies
$
2,966

$

$
2,966

$

States and political subdivisions
114,726


114,726


Residential mortgage-backed securities
632,293


632,293


Commercial mortgage-backed securities
23,845


23,845


Bank-issued trust preferred securities
4,635


4,635


Equity securities
6,236

6,024

212


Total available-for-sale securities
$
784,701

$
6,024

$
778,677

$



9


Held-to-maturity securities reported at fair value comprised the following:
 
 
Fair Value at Reporting Date Using
(Dollars in thousands)
 
Quoted Prices in Active Markets for Identical Assets
Significant
Other
Observable
 Inputs
Significant Unobservable Inputs
Fair Value
(Level 1)
(Level 2)
(Level 3)
March 31, 2016
 
 
 
 
Obligations of:
 
 
 
 
States and political subdivisions
$
4,250

$

$
4,250

$

Residential mortgage-backed securities
35,921


35,921


Commercial mortgage-backed securities
6,031


6,031


Total held-to-maturity securities
$
46,202

$

$
46,202

$

December 31, 2015
 
 
 
 
Obligations of:
 
 
 
 
States and political subdivisions
$
4,221

$

$
4,221

$

Residential mortgage-backed securities
35,196


35,196


Commercial mortgage-backed securities
6,436


6,436


Total held-to-maturity securities
$
45,853

$

$
45,853

$

The fair values used by Peoples are obtained from an independent pricing service and represent either quoted market prices for the identical securities (Level 1 inputs) or fair values determined by pricing models using a market approach that considers observable market data, such as interest rate volatility, LIBOR yield curves, credit spreads and prices from market makers and live trading systems (Level 2). Management reviews the valuation methodology and quality controls utilized by the pricing services in management's overall assessment of the reasonableness of the fair values provided, and challenges prices when management believes a material discrepancy in pricing exists.
Certain financial assets and financial liabilities are measured at fair value on a non-recurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment).  Financial assets measured at fair value on a non-recurring basis included the following:
Impaired Loans: Impaired loans are measured and reported at fair value when the amounts to be received are less than the carrying value of the loans. One of the allowable methods for determining the amount of impairment is estimating fair value using the fair value of the collateral for collateral-dependent loans. Management’s determination of the fair value for these loans uses a market approach representing the estimated net proceeds to be received from the sale of the collateral based on observable market prices or market value provided by independent, licensed or certified appraisers (Level 2 inputs).  At March 31, 2016, impaired loans with an aggregate outstanding principal balance of $52.3 million were measured and reported at a fair value of $44.9 million.  For the three months ended March 31, 2016, Peoples recognized $0.6 million of losses on impaired loans through the allowance for loan losses.
The following table presents the fair values of financial assets and liabilities carried on Peoples’ Unaudited Consolidated Balance Sheets, including those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis:
 
 
March 31, 2016
 
December 31, 2015
(Dollars in thousands)
Carrying Amount
Fair Value
 
Carrying Amount
Fair Value
Financial assets:
 
 
 
 
 
Cash and cash equivalents
$
63,296

$
63,296

 
$
71,115

$
71,115

Investment securities
885,462

886,798

 
868,830

868,955

Loans (1)
2,088,804

2,057,998

 
2,057,614

2,018,482

Financial liabilities:
 
 
 
 
 
Deposits
$
2,587,083

$
2,591,488

 
$
2,535,944

$
2,540,131

Short-term borrowings
135,068

135,068

 
160,386

160,386

Long-term borrowings
113,188

118,190

 
113,670

117,299

(1) Includes loans held for sale


10


The methodologies for estimating the fair value of financial assets and liabilities that are measured at fair value on a recurring or non-recurring basis are discussed above.  For certain financial assets and liabilities, carrying value approximates fair value due to the nature of the financial instrument.  These instruments include cash and cash equivalents, demand and other non-maturity deposits, and overnight borrowings.  Peoples used the following methods and assumptions in estimating the fair value of the following financial instruments:
Loans: The fair value of portfolio loans assumes sale of the notes to a third-party financial investor.  Accordingly, this value is not necessarily the value to Peoples if the notes were held to maturity.  Peoples considered interest rate, credit and market factors in estimating the fair value of loans (Level 3 inputs).  In the current whole loan market, financial investors are generally requiring a much higher rate of return than the return inherent in loans if held to maturity given the lack of market liquidity.  This divergence accounts for the majority of the difference in carrying amount over fair value. 
Deposits: The fair value of fixed maturity certificates of deposit is estimated using a discounted cash flow calculation based on current rates offered for deposits of similar remaining maturities (Level 2 inputs).
Long-term Borrowings: The fair value of long-term borrowings is estimated using a discounted cash flow analysis based on rates currently available to Peoples for borrowings with similar terms (Level 2 inputs). 
Bank premises and equipment, customer relationships, deposit base, banking center networks, and other information required to compute Peoples’ aggregate fair value are not included in the above information.  Accordingly, the above fair values are not intended to represent the aggregate fair value of Peoples.

Note 3.  Investment Securities 

Available-for-sale
The following table summarizes Peoples’ available-for-sale investment securities:
(Dollars in thousands)
Amortized Cost
Gross Unrealized Gains
Gross Unrealized Losses
Fair Value
March 31, 2016
 
 
 
 
Obligations of:
 
 
 
 
U.S. government sponsored agencies
$
1,944

$
60

$

$
2,004

States and political subdivisions
110,139

4,192

(3
)
114,328

Residential mortgage-backed securities
642,835

10,293

(2,454
)
650,674

Commercial mortgage-backed securities
23,668

590


24,258

Bank-issued trust preferred securities
5,152


(822
)
4,330

Equity securities
1,806

4,866

(72
)
6,600

Total available-for-sale securities
$
785,544

$
20,001

$
(3,351
)
$
802,194

December 31, 2015
 
 
 
 
Obligations of:
 
 
 
 
U.S. government sponsored agencies
$
2,908

$
58

$

$
2,966

States and political subdivisions
111,283

3,487

(44
)
114,726

Residential mortgage-backed securities
635,504

4,905

(8,116
)
632,293

Commercial mortgage-backed securities
23,770

119

(44
)
23,845

Bank-issued trust preferred securities
5,146


(511
)
4,635

Equity securities
1,693

4,627

(84
)
6,236

Total available-for-sale securities
$
780,304

$
13,196

$
(8,799
)
$
784,701

Peoples’ investment in equity securities was comprised largely of common stocks issued by various unrelated bank holding companies at both March 31, 2016 and December 31, 2015.  At March 31, 2016, there were no securities of a single issuer that exceeded 10% of stockholders' equity.


11


The gross gains and gross losses realized by Peoples from sales of available-for-sale securities for the periods ended March 31 were as follows:
 
 
Three Months Ended
 
March 31,
(Dollars in thousands)
2016
2015
Gross gains realized
$
96

$
600

Gross losses realized


Net gain realized
$
96

$
600

The cost of investment securities sold, and any resulting gain or loss, was based on the specific identification method and recognized as of the trade date.
The following table presents a summary of available-for-sale investment securities that had an unrealized loss:
 
Less than 12 Months
 
12 Months or More
 
Total
(Dollars in thousands)
Fair
Value
Unrealized Loss
No. of Securities
 
Fair
Value
Unrealized Loss
No. of Securities
 
Fair
Value
Unrealized Loss
March 31, 2016
 
 
 
 
 
 
 
 
 
 
Obligations of:
 
 
 
 
 
 
 
 
 
 
States and political subdivisions
$

$


 
$
215

$
3

1

 
$
215

$
3

Residential mortgage-backed securities
69,140

415

17

 
116,130

2,039

36

 
185,270

2,454

Bank-issued trust preferred securities
1,991

163

1

 
2,339

659

3

 
4,330

822

Equity securities
20

2

1

 
106

70

1

 
126

72

Total
$
71,151

$
580

19

 
$
118,790

$
2,771

41

 
$
189,941

$
3,351

December 31, 2015
 
 
 
 
 
 
 
 
 
 
Obligations of:
 
 
 
 
 
 
 
 
 
 
States and political subdivisions
$
7,662

$
38

8

 
$
213

$
6

1

 
$
7,875

$
44

Residential mortgage-backed securities
303,549

3,902

76

 
102,090

4,214

33

 
405,639

8,116

Commercial mortgage-backed securities
6,682

44

3

 



 
6,682

44

Bank-issued trust preferred securities
2,129

19

1

 
2,506

492

3

 
4,635

511

Equity securities
438

15

2

 
106

69

1

 
544

84

Total
$
320,460

$
4,018

90

 
$
104,915

$
4,781

38

 
$
425,375

$
8,799

Management systematically evaluates available-for-sale investment securities for other-than-temporary declines in fair value on a quarterly basis. At March 31, 2016, management concluded no individual securities were other-than-temporarily impaired since Peoples did not have the intent to sell, nor was it more likely than not that Peoples would be required to sell any of the securities with an unrealized loss prior to recovery. Further, the unrealized losses at both March 31, 2016 and December 31, 2015, were largely attributable to changes in market interest rates and spreads since the securities were purchased.
At March 31, 2016, approximately 97% of the mortgage-backed securities that had been at an unrealized loss position for twelve months or more were issued by U.S. government sponsored agencies. The remaining 3%, or three positions, consisted of privately issued mortgage-backed securities with all of the underlying mortgages originated prior to 2004. Two of the three positions had a fair value less than 100% of their book value, with an aggregate book and fair value of $0.7 million and $0.5 million, respectively. Management analyzed the underlying credit quality of these securities and concluded the unrealized losses were primarily attributable to the floating rate nature of these investments and the low number of loans remaining in these securities.
Furthermore, the three bank-issued trust preferred securities that had been in an unrealized loss position for twelve months or more at March 31, 2016 were primarily attributable to the floating-rate nature of those investments, the current interest rate environment and spreads within that sector.


12


The table below presents the amortized cost, fair value and total weighted-average yield of available-for-sale securities by contractual maturity at March 31, 2016.  The weighted-average yields are based on the amortized cost.  In some cases, the issuers may have the right to call or prepay obligations without call or prepayment penalties prior to the contractual maturity date.  Rates are calculated on a fully tax-equivalent basis using a 35% federal income tax rate.
 
(Dollars in thousands)
Within 1 Year
1 to 5 Years
5 to 10 Years
Over 10 Years
Total
Amortized cost
 
 
 
 
 
Obligations of:
 
 
 
 
 
U.S. government sponsored agencies
$
993

$

$

$
951

$
1,944

States and political subdivisions
239

12,322

30,930

66,648

110,139

Residential mortgage-backed securities
1

13,866

51,865

577,103

642,835

Commercial mortgage-backed securities

3,278

16,656

3,734

23,668

Bank-issued trust preferred securities



5,152

5,152

Equity securities
 
 
 
 
1,806

Total available-for-sale securities
$
1,233

$
29,466

$
99,451

$
653,588

$
785,544

Fair value
 
 
 
 
 
Obligations of:
 
 
 
 
 
U.S. government sponsored agencies
$
1,000

$

$

$
1,004

$
2,004

States and political subdivisions
245

12,728

31,981

69,374

114,328

Residential mortgage-backed securities
1

13,837

52,809

584,027

650,674

Commercial mortgage-backed securities

3,400

17,075

3,783

24,258

Bank-issued trust preferred securities



4,330

4,330

Equity securities
 
 
 
 
6,600

Total available-for-sale securities
$
1,246

$
29,965

$
101,865

$
662,518

$
802,194

Total weighted-average yield
1.96
%
3.12
%
3.34
%
2.74
%
2.83
%
Held-to-Maturity
The following table summarizes Peoples’ held-to-maturity investment securities:
(Dollars in thousands)
Amortized Cost
Gross Unrealized Gains
Gross Unrealized Losses
Fair Value
March 31, 2016
 
 
 
 
Obligations of:
 
 
 
 
States and political subdivisions
$
3,828

$
422

$

$
4,250

Residential mortgage-backed securities
35,005

990

(74
)
35,921

Commercial mortgage-backed securities
6,033

1

(3
)
6,031

Total held-to-maturity securities
$
44,866

$
1,413

$
(77
)
$
46,202

December 31, 2015
 
 
 
 
Obligations of:
 
 
 
 
States and political subdivisions
$
3,831

$
394

$
(4
)
$
4,221

Residential mortgage-backed securities
35,367

363

(534
)
35,196

Commercial mortgage-backed securities
6,530


(94
)
6,436

Total held-to-maturity securities
$
45,728

$
757

$
(632
)
$
45,853

There were no gross gains or gross losses realized by Peoples from sales of held-to-maturity securities for the three months ended March 31, 2016 and 2015.


13


The following table presents a summary of held-to-maturity investment securities that had an unrealized loss:
 
Less than 12 Months
 
12 Months or More
 
Total
(Dollars in thousands)
Fair
Value
Unrealized Loss
No. of Securities
 
Fair
Value
Unrealized Loss
No. of Securities
 
Fair
Value
Unrealized Loss
March 31, 2016
 
 
 
 
 
 
 
 
 
 
Residential mortgage-backed securities
$

$


 
$
10,313

$
74

2

 
$
10,313

$
74

Commercial mortgage-backed securities
127

3

1

 



 
127

3

Total
$
127

$
3

1

 
$
10,313

$
74

2

 
$
10,440

$
77

December 31, 2015
 
 
 
 
 
 
 
 
 
 
Obligations of:
 
 
 
 
 
 
 
 
 
 
States and political subdivisions
$

$


 
$
319

$
4

1

 
$
319

$
4

Residential mortgage-backed securities
3,706

89

2

 
10,040

445

2

 
13,746

534

Commercial mortgage-backed securities
540

4

1

 
5,895

90

1

 
6,435

94

Total
$
4,246

$
93

3

 
$
16,254

$
539

4

 
$
20,500

$
632

The table below presents the amortized cost, fair value and total weighted-average yield of held-to-maturity securities by contractual maturity at March 31, 2016.  The weighted-average yields are based on the amortized cost.  In some cases, the issuers may have the right to call or prepay obligations without call or prepayment penalties prior to the contractual maturity date.  Rates are calculated on a fully tax-equivalent basis using a 35% federal income tax rate.
 
(Dollars in thousands)
Within 1 Year
1 to 5 Years
5 to 10 Years
Over 10 Years
Total
Amortized cost
 
 
 
 
 
Obligations of:
 
 
 
 
 
States and political subdivisions
$

$
323

$
976

$
2,529

$
3,828

Residential mortgage-backed securities


482

34,523

35,005

Commercial mortgage-backed securities



6,033

6,033

Total held-to-maturity securities
$

$
323

$
1,458

$
43,085

$
44,866

Fair value
 
 
 
 
 
Obligations of:
 
 
 
 
 
States and political subdivisions
$

$
332

$
1,116

$
2,802

$
4,250

Residential mortgage-backed securities


492

35,429

35,921

Commercial mortgage-backed securities



6,031

6,031

Total held-to-maturity securities
$

$
332

$
1,608

$
44,262

$
46,202

Total weighted-average yield
%
3.03
%
2.85
%
3.32
%
3.30
%
Other Securities
Peoples' other investment securities on the Unaudited Consolidated Balance Sheets consist largely of shares of the Federal Home Loan Bank of Cincinnati (the “FHLB”) and the Federal Reserve Bank of Cleveland (the "FRB").
Pledged Securities
Peoples had pledged available-for-sale investment securities with carrying values of $561.7 million and $495.5 million at March 31, 2016 and December 31, 2015, respectively, and held-to-maturity investment securities with carrying values of $20.8 million and $21.4 million at March 31, 2016 and December 31, 2015, respectively, to secure public and trust department deposits, and repurchase agreements in accordance with federal and state requirements.  Peoples also pledged available-for-sale investment securities with carrying values of $10.8 million and $11.1 million at March 31, 2016 and December 31, 2015, respectively, and held-to-maturity securities with carrying values of $23.1 million and $23.3 million at March 31, 2016 and December 31, 2015, respectively, to secure additional borrowing capacity at the FHLB and the FRB.


14


Note 4.  Loans

Peoples' loan portfolio consists of various types of loans originated primarily as a result of lending opportunities within Peoples' primary market areas of northeastern, central, southwestern and southeastern Ohio, west central West Virginia, and northeastern Kentucky. Acquired loans consist of loans purchased in 2012 or thereafter in a business combination. The major classifications of loan balances, excluding loans held for sale, were as follows:
(Dollars in thousands)
March 31,
2016
December 31, 2015
Originated loans:
 
 
Commercial real estate, construction
$
69,499

$
63,785

Commercial real estate, other
471,998

471,184

    Commercial real estate
541,497

534,969

Commercial and industrial
308,649

288,130

Residential real estate
302,512

288,783

Home equity lines of credit
76,959

74,176

Consumer
245,596

227,133

Deposit account overdrafts
2,083

1,448

Total originated loans
$
1,477,296

$
1,414,639

Acquired loans:
 
 
Commercial real estate, construction
$
11,882

$
12,114

Commercial real estate, other
256,201

265,092

    Commercial real estate
268,083

277,206

Commercial and industrial
59,161

63,589

Residential real estate
263,237

276,772

Home equity lines of credit
30,742

32,253

Consumer
6,596

7,981

Deposit account overdrafts


Total acquired loans
$
627,819

$
657,801

Loans, net of deferred fees and costs
$
2,105,115

$
2,072,440

Peoples has acquired various loans through business combinations for which there was, at acquisition, evidence of deterioration of credit quality since origination, and for which it was probable that all contractually required payments would not be collected. The carrying amounts of these loans included in the loan balances above are summarized as follows:
(Dollars in thousands)
March 31,
2016
December 31,
2015
Commercial real estate, other
$
16,636

$
16,893

Commercial and industrial
2,866

3,040

Residential real estate
26,210

27,155

Consumer
168

193

Total outstanding balance
$
45,880

$
47,281

Net carrying amount
$
33,637

$
35,064

Changes in the accretable yield for purchased credit impaired loans for the three months ended March 31, 2016 were as follows:
(Dollars in thousands)
Accretable Yield
Balance, December 31, 2015
$
7,042

Reclassification from nonaccretable to accretable
1,916

Accretion
(491
)
Balance, March 31, 2016
$
8,467



15


The reclassification from nonaccretable to accretable related to the re-estimation of cash flows on the acquired purchased credit impaired loan portfolios completed during the first quarter of 2016, coupled with the loans performing better than expected. The majority of the reclassification related to prepayment speeds decreasing in the residential portfolio, resulting in higher total expected cash flows.
Cash flows expected to be collected on purchased credit impaired loans are estimated semi-annually by incorporating several key assumptions similar to the initial estimate of fair value. These key assumptions include probability of default, and the amount of actual prepayments after the acquisition date. Prepayments affect the estimated life of the loans and could change the amount of interest income, and possibly principal expected to be collected. In reforecasting future estimated cash flows, credit loss expectations are adjusted as necessary.
Peoples pledges certain loans secured by 1-4 family and multifamily residential mortgages under a blanket collateral agreement to secure borrowings from the FHLB. The amount of such pledged loans totaled $553.8 million and $554.8 million at March 31, 2016 and December 31, 2015, respectively. Peoples also pledges commercial loans to secure borrowings with the FRB. The outstanding balances of these loans totaled $183.5 million and $195.5 million at March 31, 2016 and December 31, 2015, respectively.
Nonaccrual and Past Due Loans
A loan is considered past due if any required principal and interest payments have not been received as of the date such payments were required to be made under the terms of the loan agreement. A loan may be placed on nonaccrual status regardless of whether or not such loan is considered past due.
The recorded investments in loans on nonaccrual status and loans delinquent for 90 days or more and accruing were as follows:
 
Nonaccrual Loans
 
Loans 90+ Days Past Due and Accruing
(Dollars in thousands)
March 31,
2016
December 31,
2015
 
March 31,
2016
December 31,
2015
Originated loans:
 
 
 
 
 
Commercial real estate, construction
$
891

$
921

 
$

$

Commercial real estate, other
6,754

7,041

 
277


    Commercial real estate
7,645

7,962

 
277


Commercial and industrial
461

480

 
1,401

680

Residential real estate
3,082

3,057

 
104

169

Home equity lines of credit
223

321

 


Consumer
120

92

 
16

1

Total originated loans
$
11,531

$
11,912

 
$
1,798

$
850

Acquired loans:
 
 
 
 
 
Commercial real estate, construction
$

$

 
$

$

Commercial real estate, other
573

469

 
2,486

2,425

    Commercial real estate
573

469

 
2,486

2,425

Commercial and industrial
413

247

 
673

1,306

Residential real estate
906

798

 
1,603

1,353

Home equity lines of credit
150

98

 
184

35

Consumer
6

7

 
2


Total acquired loans
$
2,048

$
1,619

 
$
4,948

$
5,119

Total loans
$
13,579

$
13,531

 
$
6,746

$
5,969



16


The following table presents the aging of the recorded investment in past due loans:
 
Loans Past Due
 
Current
Loans
Total
Loans
(Dollars in thousands)
30 - 59 days
60 - 89 days
90 + Days
Total
 
March 31, 2016
 
 
 
 
 
 
 
Originated loans:
 
 
 
 
 
 
 
Commercial real estate, construction
$
891

$

$

$
891

 
$
68,608

$
69,499

Commercial real estate, other
789

7,065

631

8,485

 
463,513

471,998

    Commercial real estate
1,680

7,065

631

9,376

 
532,121

541,497

Commercial and industrial
852

275

1,490

2,617

 
306,032

308,649

Residential real estate
2,975

1,063

1,094

5,132

 
297,380

302,512

Home equity lines of credit
84

147

58

289

 
76,670

76,959

Consumer
943

204

46

1,193

 
244,403

245,596

Deposit account overdrafts




 
2,083

2,083

Total originated loans
$
6,534

$
8,754

$
3,319

$
18,607

 
$
1,458,689

$
1,477,296

Acquired loans:
 
 
 
 
 
 
 
Commercial real estate, construction
$
95

$

$
40

$
135

 
$
11,747

$
11,882

Commercial real estate, other
618

206

2,961

3,785

 
252,416

256,201

    Commercial real estate
713

206

3,001

3,920

 
264,163

268,083

Commercial and industrial
70

115

954

1,139

 
58,022

59,161

Residential real estate
6,278

699

2,080

9,057

 
254,180

263,237

Home equity lines of credit
81


296

377

 
30,365

30,742

Consumer
31

9

2

42

 
6,554

6,596

Deposit account overdrafts




 


Total acquired loans
$
7,173

$
1,029

$
6,333

$
14,535

 
$
613,284

$
627,819

Total loans
$
13,707

$
9,783

$
9,652

$
33,142

 
$
2,071,973

$
2,105,115

December 31, 2015
 
 
 
 
 
 
 
Originated loans:
 
 
 
 
 
 
 
Commercial real estate, construction
$
913

$

$
8

$
921

 
$
62,864

$
63,785

Commercial real estate, other
7,260

1,258

379

8,897

 
462,287

471,184

    Commercial real estate
8,173

1,258

387

9,818

 
525,151

534,969

Commercial and industrial
1,437

215

767

2,419

 
285,711

288,130

Residential real estate
3,124

1,105

1,263

5,492

 
283,291

288,783

Home equity lines of credit
161

7

104

272

 
73,904

74,176

Consumer
1,387

250

32

1,669

 
225,464

227,133

Deposit account overdrafts




 
1,448

1,448

Total originated loans
$
14,282

$
2,835

$
2,553

$
19,670

 
$
1,394,969

$
1,414,639

Acquired loans:
 
 
 
 
 
 
 
Commercial real estate, construction
$

$

$
40

$
40

 
$
12,074

$
12,114

Commercial real estate, other
1,592

352

2,730

4,674

 
260,418

265,092

    Commercial real estate
1,592

352

2,770

4,714

 
272,492

277,206

Commercial and industrial
177

232

1,553

1,962

 
61,627

63,589

Residential real estate
4,910

2,480

1,745

9,135

 
267,637

276,772

Home equity lines of credit
318

20

95

433

 
31,820

32,253

Consumer
90

31


121

 
7,860

7,981

Deposit account overdrafts




 


Total acquired loans
$
7,087

$
3,115

$
6,163

$
16,365

 
$
641,436

$
657,801

Total loans
$
21,369

$
5,950

$
8,716

$
36,035

 
$
2,036,405

$
2,072,440



17


Credit Quality Indicators
As discussed in Note 1 of the Notes to the Consolidated Financial Statements included in Peoples' 2015 Form 10-K, Peoples categorizes the majority of its loans into risk categories based upon an established risk grading matrix using a scale of 1 to 8. A description of the general characteristics of the risk grades used by Peoples is as follows:
“Pass” (grades 1 through 4): Loans in this risk category involve borrowers of acceptable-to-strong credit quality and risk who have the apparent ability to satisfy their loan obligations. Loans in this risk grade would possess sufficient mitigating factors, such as adequate collateral or strong guarantors possessing the capacity to repay the loan if required, for any weakness that may exist.
“Watch” (grade 5): Loans in this risk grade are the equivalent of the regulatory definition of “Other Assets Especially Mentioned” classification. Loans in this category possess some credit deficiency or potential weakness, which requires a high level of management attention. Potential weaknesses include declining trends in operating earnings and cash flows and/or reliance on the secondary source of repayment. If left uncorrected, these potential weaknesses may result in noticeable deterioration of the repayment prospects for the loan or in Peoples' credit position.
“Substandard” (grade 6): Loans in this risk grade are inadequately protected by the borrower's current financial condition and payment capability or of the collateral pledged, if any. Loans so classified have one or more well-defined weaknesses that jeopardize the orderly repayment of the loan. They are characterized by the distinct possibility that Peoples will sustain some loss if the deficiencies are not corrected.
“Doubtful” (grade 7): Loans in this risk grade have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or orderly repayment in full, on the basis of current existing facts, conditions and values, highly questionable and improbable. Possibility of loss is extremely high, but because of certain important and reasonably specific factors that may work to the advantage and strengthening of the exposure, its classification as an estimated loss is deferred until its more exact status may be determined.
“Loss” (grade 8): Loans in this risk grade are considered to be non-collectible and of such little value that their continuance as bankable assets is not warranted. This does not mean the loan has absolutely no recovery value, but rather it is neither practical nor desirable to defer writing off the loan, even though partial recovery may be obtained in the future. Charge-offs against the allowance for loan losses are taken in the period in which the loan becomes uncollectible. Consequently, Peoples typically does not maintain a recorded investment in loans within this category.
Consumer loans and other smaller-balance loans are evaluated and categorized as “substandard”, “doubtful” or “loss” based upon the regulatory definition of these classes and consistent with regulatory requirements. All other loans not evaluated individually, nor meeting the regulatory conditions to be categorized as described above, would be considered as being “not rated”.


18


The following table summarizes the risk category of Peoples' loan portfolio based upon the most recent analysis performed:
 
Pass Rated
(Grades 1 - 4)
Watch
(Grade 5)
Substandard
(Grade 6)
Doubtful (Grade 7)
Not
Rated
Total
Loans
(Dollars in thousands)
March 31, 2016
 
 
 
 
 
 
Originated loans:
 
 
 
 
 
 
Commercial real estate, construction
$
67,813

$

$
891

$

$
795

$
69,499

Commercial real estate, other
442,631

13,209

16,158



471,998

    Commercial real estate
510,444

13,209

17,049


795

541,497

Commercial and industrial
269,170

32,857

6,618


4

308,649

Residential real estate
21,766

1,176

12,184

200

267,186

302,512

Home equity lines of credit
780


170


76,009

76,959

Consumer
215


2


245,379

245,596

Deposit account overdrafts




2,083

2,083

Total originated loans
$
802,375

$
47,242

$
36,023

$
200

$
591,456

$
1,477,296

Acquired loans:
 
 
 
 
 
 
Commercial real estate, construction
$
11,882

$

$

$

$

$
11,882

Commercial real estate, other
224,941

13,924

17,262

74


256,201

    Commercial real estate
236,823

13,924

17,262

74


268,083

Commercial and industrial
56,978

123

1,732

328


59,161

Residential real estate
18,596

670

1,790


242,181

263,237

Home equity lines of credit
322




30,420

30,742

Consumer
236




6,360

6,596

Deposit account overdrafts






Total acquired loans
$
312,955

$
14,717

$
20,784

$
402

$
278,961

$
627,819

Total loans
$
1,115,330

$
61,959

$
56,807

$
602

$
870,417

$
2,105,115

December 31, 2015
 
 
 
 
 
 
Originated loans:
 
 
 
 
 
 
Commercial real estate, construction
$
62,225

$

$
913

$

$
647

$
63,785

Commercial real estate, other
434,868

18,710

17,595


11

471,184

    Commercial real estate
497,093

18,710

18,508


658

534,969

Commercial and industrial
259,183

23,601

5,344