CHFC 2017 Annual Report

The following schedule presents the recorded investment of loans in the commercial loan portfolio by credit risk categories at December 31, 2017 and 2016: (Dollars in thousands) Pass Special Mention Substandard Doubtful Total December 31, 2017 Originated Portfolio: Commercial $ 2,316,464 $ 41,059 $ 50,083 $ — $ 2,407,606 Commercial real estate 2,677,579 24,204 49,642 — 2,751,425 Real estate construction and land development 494,528 837 2,790 — 498,155 Subtotal 5,488,571 66,100 102,515 — 5,657,186 Acquired Portfolio: Commercial 873,861 68,418 35,539 218 978,036 Commercial real estate 1,603,685 67,970 76,803 787 1,749,245 Real estate construction and land development 72,346 2,218 1,496 — 76,060 Subtotal 2,549,892 138,606 113,838 1,005 2,803,341 Total $ 8,038,463 $ 204,706 $ 216,353 $ 1,005 $ 8,460,527 December 31, 2016 Originated Portfolio: Commercial $ 1,803,750 $ 44,809 $ 51,898 $ 1,069 $ 1,901,526 Commercial real estate 1,849,315 36,981 35,502 1 1,921,799 Real estate construction and land development 280,968 157 599 — 281,724 Subtotal 3,934,033 81,947 87,999 1,070 4,105,049 Acquired Portfolio: Commercial 1,218,848 46,643 50,283 — 1,315,774 Commercial real estate 1,897,011 61,441 92,636 253 2,051,341 Real estate construction and land development 117,505 1,982 2,561 — 122,048 Subtotal 3,233,364 110,066 145,480 253 3,489,163 Total $ 7,167,397 $ 192,013 $ 233,479 $ 1,323 $ 7,594,212 Consumer Loan Portfolio The Corporation evaluates the credit quality of loans in the consumer loan portfolio based on the performing or nonperforming status of the loan. Loans in the consumer loan portfolio that are performing in accordance with original contractual terms and are less than 90 days past due and accruing interest are considered to be in a performing status, while those that are in nonaccrual status, contractually past due 90 days or more as to interest or principal payments are considered to be in a nonperforming status. Loans accounted for under ASC 310-30, "Acquired loans", that are not performing in accordance with contractual terms are not reported as nonperforming because these loans are recorded in pools at their net realizable value based on the principal and interest the Corporation expects to collect on these loans. Chemical Financial Corporation Notes to Consolidated Financial Statements December 31, 2017 116