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Loans (Tables)
 6 Months Ended
Jun. 30, 2020
Non-covered Loans [Line Items]  
Summary of Recorded Investment by Risk Category of Portfolio Loans by Portfolio Class and Category
The following table presents the recorded investment on loans based on payment activity:
 
 
June 30, 2020
(in thousands)
 
Performing
 
Non Performing
 
Total
Commercial and industrial
 
$
11,682

 
$
38

 
$
11,720

Real estate:
 
 
 
 
 
 
Residential
 
941

 
—

 
941

Other
 
2,376

 
21

 
2,397

Total
 
$
14,999

 
$
59

 
$
15,058


The recorded investment by risk category of the loans by class at June 30, 2020, which is based upon the most recent analysis performed is as follows:
 
 
Term Loans by Origination Year
 
 
 
 
 
 
(in thousands)
 
2020
 
2019
 
2018
 
2017
 
2016
 
Prior
 
Revolving Loans Converted to Term Loans
 
Revolving Loans
 
Total
Commercial and industrial
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass (1-6)
 
$
1,239,062

 
$
535,477

 
$
318,046

 
$
180,269

 
$
47,210

 
$
85,529

 
$
14,954

 
$
510,168

 
$
2,930,715

Watch (7)
 
26,347

 
13,354

 
4,850

 
6,468

 
24,044

 
175

 
—

 
62,293

 
137,531

Classified (8-9)
 
3,775

 
15,068

 
8,155

 
3,950

 
5,093

 
3,673

 
295

 
23,222

 
63,231

Total Commercial and industrial
 
$
1,269,184

 
$
563,899

 
$
331,051

 
$
190,687

 
$
76,347

 
$
89,377

 
$
15,249

 
$
595,683

 
$
3,131,477

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate-investor owned
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Pass (1-6)
 
$
246,319

 
$
321,849

 
$
204,242

 
$
126,567

 
$
153,904

 
$
181,761

 
$
3,284

 
$
35,460

 
$
1,273,386

Watch (7)
 
5,136

 
4,220

 
1,192

 
369

 
12,681

 
1,275

 
—

 
—

 
24,873

Classified (8-9)
 
—

 
966

 
8,286

 
455

 
249

 
1,680

 
—

 
—

 
11,636

Total Commercial real estate-investor owned
 
$
251,455

 
$
327,035

 
$
213,720

 
$
127,391

 
$
166,834

 
$
184,716

 
$
3,284

 
$
35,460

 
$
1,309,895

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate-owner occupied
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Pass (1-6)
 
$
147,313

 
$
200,519

 
$
92,624

 
$
79,058

 
$
44,990

 
$
80,172

 
$
2,756

 
$
42,883

 
$
690,315

Watch (7)
 
9,473

 
1,963

 
261

 
9,729

 
8,533

 
5,074

 
—

 
2,500

 
37,533

Classified (8-9)
 
601

 
1,156

 
4,267

 
458

 
—

 
4,219

 
—

 
—

 
10,701

Total Commercial real estate-owner occupied
 
$
157,387

 
$
203,638

 
$
97,152

 
$
89,245

 
$
53,523

 
$
89,465

 
$
2,756

 
$
45,383

 
$
738,549

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Construction real estate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass (1-6)
 
$
75,983

 
$
167,936

 
$
121,909

 
$
37,555

 
$
28,060

 
$
12,906

 
$
—

 
$
20,631

 
$
464,980

Watch (7)
 
2,408

 
722

 
1,254

 
11,047

 
—

 
546

 
—

 
—

 
15,977

Classified (8-9)
 
—

 
227

 
—

 
—

 
—

 
37

 
—

 
—

 
264

Total Construction real estate
 
$
78,391

 
$
168,885

 
$
123,163

 
$
48,602

 
$
28,060

 
$
13,489

 
$
—

 
$
20,631

 
$
481,221

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential real estate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass (1-6)
 
$
26,448

 
$
33,085

 
$
22,074

 
$
19,931

 
$
34,427

 
$
115,036

 
$
591

 
$
63,505

 
$
315,097

Watch (7)
 
181

 
895

 
842

 
—

 
—

 
2,027

 
279

 
802

 
5,026

Classified (8-9)
 
184

 
1,265

 
758

 
13

 
213

 
3,445

 
—

 
50

 
5,928

Total residential real estate
 
$
26,813

 
$
35,245

 
$
23,674

 
$
19,944

 
$
34,640

 
$
120,508

 
$
870

 
$
64,357

 
$
326,051

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass (1-6)
 
$
8,758

 
$
25,567

 
$
20,615

 
$
682

 
$
3,705

 
$
34,455

 
$
—

 
$
43,971

 
$
137,753

Watch (7)
 
—

 
2

 
—

 
—

 
—

 
—

 
—

 
1

 
3

Classified (8-9)
 
—

 
1

 
3

 
4

 
—

 
19

 
10

 
7

 
44

Total Other
 
$
8,758

 
$
25,570

 
$
20,618

 
$
686

 
$
3,705

 
$
34,474

 
$
10

 
$
43,979

 
$
137,800
Portfolio loans, net  
Non-covered Loans [Line Items]  
Summary of Portfolio Loans by Category

Below is a summary of loans by category at June 30, 2020 and December 31, 2019:
 
(in thousands)
June 30, 2020
 
December 31, 2019
Commercial and industrial
$
3,165,611

 
$
2,361,157

Real estate:
 
 
 
Commercial - investor owned
1,309,895

 
1,299,884

Commercial - owner occupied
738,549

 
697,437

Construction and land development
481,221

 
457,273

Residential
326,992

 
366,261

Total real estate loans
2,856,657

 
2,820,855

Other
142,224

 
134,941

Loans, before unearned loan fees
6,164,492

 
5,316,953

Unearned loan fees, net
(24,441
)
 
(2,616
)
Loans, including unearned loan fees
$
6,140,051

 
$
5,314,337
Summary of Allowance for Loan Losses and the Recorded Investment in Portfolio Loans by Class and Category Based on Impairment Method
A summary of the activity in the ACLL by category for the three and six months ended June 30, 2020 is as follows:
(in thousands)
Commercial and industrial
 
CRE - investor owned
 
CRE -
owner occupied
 
Construction and land development
 
Residential real estate
 
Other
 
Total
Allowance for credit losses on loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at March 31, 2020
$
45,981

 
$
19,892


$
9,477


$
9,895


$
5,395


$
1,547


$
92,187

Provision for credit losses
7,168

 
2,599

 
1,600

 
6,038

 
744

 
242

 
18,391

Charge-offs
(3,303
)
 
(224
)
 
—

 
—

 
(32
)
 
(105
)
 
(3,664
)
Recoveries
293

 
2,752

 
11

 
29

 
226

 
45

 
3,356

Balance at June 30, 2020
$
50,139

 
$
25,019


$
11,088


$
15,962


$
6,333


$
1,729


$
110,270



(in thousands)
Commercial and industrial
 
CRE - investor owned
 
CRE -
owner occupied
 
Construction and land development
 
Residential real estate
 
Other
 
Total
Allowance for credit losses on loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at December 31, 2019
$
27,455

 
$
5,935

 
$
4,873

 
$
2,611

 
$
1,280

 
$
1,134

 
$
43,288

CECL adoption
6,494

 
10,726

 
2,598

 
5,183

 
3,470

 
(84
)
 
28,387

PCD loans immediately charged off
—

 
(5
)
 
(57
)
 
(217
)
 
(1,401
)
 
—

 
(1,680
)
Balance at January 1, 2020
$
33,949

 
$
16,656

 
$
7,414

 
$
7,577

 
$
3,349

 
$
1,050

 
$
69,995

Provision for credit losses
18,759

 
5,823

 
3,594

 
8,347

 
2,755

 
808

 
40,086

Charge-offs
(3,366
)
 
(226
)
 
—

 
(31
)
 
(154
)
 
(191
)
 
(3,968
)
Recoveries
797

 
2,766

 
80

 
69

 
383

 
62

 
4,157

Balance at June 30, 2020
$
50,139

 
$
25,019

 
$
11,088

 
$
15,962

 
$
6,333

 
$
1,729

 
$
110,270


Reserves on enterprise value lending and agricultural lending, which are included in the categories above, represented $15.8 million and $2.4 million, respectively.
Financing Receivable, Noncurrent, Allowance for Credit Loss
A summary of the activity in the ACLL by category for the three and six months ended June 30, 2020 is as follows:
(in thousands)
Commercial and industrial
 
CRE - investor owned
 
CRE -
owner occupied
 
Construction and land development
 
Residential real estate
 
Other
 
Total
Allowance for credit losses on loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at March 31, 2020
$
45,981

 
$
19,892


$
9,477


$
9,895


$
5,395


$
1,547


$
92,187

Provision for credit losses
7,168

 
2,599

 
1,600

 
6,038

 
744

 
242

 
18,391

Charge-offs
(3,303
)
 
(224
)
 
—

 
—

 
(32
)
 
(105
)
 
(3,664
)
Recoveries
293

 
2,752

 
11

 
29

 
226

 
45

 
3,356

Balance at June 30, 2020
$
50,139

 
$
25,019


$
11,088


$
15,962


$
6,333


$
1,729


$
110,270



(in thousands)
Commercial and industrial
 
CRE - investor owned
 
CRE -
owner occupied
 
Construction and land development
 
Residential real estate
 
Other
 
Total
Allowance for credit losses on loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at December 31, 2019
$
27,455

 
$
5,935

 
$
4,873

 
$
2,611

 
$
1,280

 
$
1,134

 
$
43,288

CECL adoption
6,494

 
10,726

 
2,598

 
5,183

 
3,470

 
(84
)
 
28,387

PCD loans immediately charged off
—

 
(5
)
 
(57
)
 
(217
)
 
(1,401
)
 
—

 
(1,680
)
Balance at January 1, 2020
$
33,949

 
$
16,656

 
$
7,414

 
$
7,577

 
$
3,349

 
$
1,050

 
$
69,995

Provision for credit losses
18,759

 
5,823

 
3,594

 
8,347

 
2,755

 
808

 
40,086

Charge-offs
(3,366
)
 
(226
)
 
—

 
(31
)
 
(154
)
 
(191
)
 
(3,968
)
Recoveries
797

 
2,766

 
80

 
69

 
383

 
62

 
4,157

Balance at June 30, 2020
$
50,139

 
$
25,019

 
$
11,088

 
$
15,962

 
$
6,333

 
$
1,729

 
$
110,270


Reserves on enterprise value lending and agricultural lending, which are included in the categories above, represented $15.8 million and $2.4 million, respectively.
Summary of Portfolio Loans Individually Evaluated for Impairment and Recorded Investment in Impaired Non-Covered Loans by Category
The recorded investment in nonperforming loans by category at June 30, 2020 and December 31, 2019, is as follows: 
 
June 30, 2020
(in thousands)
Nonaccrual
 
Restructured, accruing
 
Loans over 90 days past due and still accruing interest
 
Total nonperforming loans
 
Nonaccrual loans with no allowance
Commercial and industrial
$
27,431

 
$
3,642

 
$
865

 
$
31,938

 
$
20,553

Real estate:
 
 
 
 
 
 
 
 
 
    Commercial - investor owned
2,389

 
—

 
—

 
2,389

 
1,677

    Commercial - owner occupied
2,400

 
—

 
—

 
2,400

 
1,403

    Construction and land development
207

 
—

 
—

 
207

 
207

    Residential
4,421

 
78

 
—

 
4,499

 
3,444

Other
19

 
—

 
21

 
40

 
—

       Total
$
36,867

 
$
3,720


$
886


$
41,473

 
$
27,284


There was no interest income recognized on nonaccrual loans during the six months ended June 30, 2020.

 
December 31, 2019
(in thousands)
Nonaccrual
 
Restructured, accruing
 
Loans over 90 days past due and still accruing interest
 
Total nonperforming loans
Commercial and industrial
$
22,328

 
$
—

 
$
250

 
$
22,578

Real estate:
 
 
 
 
 
 
 
    Commercial - investor owned
2,303

 
—

 
—

 
2,303

    Commercial - owner occupied
213

 
—

 
—

 
213

    Residential
1,251

 
79

 
—

 
1,330

Other
1

 
—

 
—

 
1

       Total
$
26,096

 
$
79

 
$
250

 
$
26,425



The following table presents the amortized cost basis of collateral-dependent nonperforming loans by class of loan at June 30, 2020:
 
Type of Collateral
(in thousands)
Commercial Real Estate
 
Residential Real Estate
 
Blanket Lien
Commercial and industrial
$
13,124

 
$
—

 
$
4,872

Real estate:
 
 
 
 
 
Commercial - investor owned
2,389

 
—

 
—

Commercial - owner occupied
1,811

 
—

 
—

Construction and land development
—

 
207

 
—

Residential
—

 
4,271

 
—

Total
$
17,324

 
$
4,478

 
$
4,872
Summary of Recorded Investment by Category for Portfolio Loans Restructured

The following table presents the amortized cost basis of collateral-dependent nonperforming loans by class of loan at June 30, 2020:
 
Type of Collateral
(in thousands)
Commercial Real Estate
 
Residential Real Estate
 
Blanket Lien
Commercial and industrial
$
13,124

 
$
—

 
$
4,872

Real estate:
 
 
 
 
 
Commercial - investor owned
2,389

 
—

 
—

Commercial - owner occupied
1,811

 
—

 
—

Construction and land development
—

 
207

 
—

Residential
—

 
4,271

 
—

Total
$
17,324

 
$
4,478

 
$
4,872


 
 
 
 
 
 
There were no troubled debt restructurings that occurred during the three months ended June 30, 2020. The recorded investment by category for troubled debt restructurings that occurred during the six months ended June 30, 2020 and the three and six months ended June 30, 2019 are as follows:
 
June 30, 2020
 
June 30, 2019
(in thousands, except for number of loans)
Number of loans
 
Pre-Modification Outstanding Recorded Balance
 
Post-Modification Outstanding Recorded Balance
 
Number of loans
 
Pre-Modification Outstanding Recorded Balance
 
Post-Modification Outstanding Recorded Balance
Commercial and industrial
1

 
$
3,731

 
$
3,731

 
—

 
$
—

 
$
—

Real estate:
 
 
 
 
 
 
 
 
 
 
 
Commercial - owner occupied
—

 
—

 
—

 
1

 
188

 
188

Residential
2

 
155

 
155

 
2

 
332

 
332

Total
3

 
$
3,886

 
$
3,886

 
3

 
$
520

 
$
520
Summary of Recorded Investment by Category for Portfolio Loans Restructured and Subsequently Defaulted
There were no troubled debt restructured loans that subsequently defaulted during the three or six months ended June 30, 2020 or 2019.
Summary of Aging of Recorded Investment in Past Due Portfolio Loans by Portfolio Class and Category
The aging of the recorded investment in past due loans by class at June 30, 2020 is shown below.

 
June 30, 2020
(in thousands)
30-89 Days
 Past Due
 
90 or More
Days
Past Due
 
Total
Past Due
 
Current
 
Total
Commercial and industrial
$
6,684

 
$
22,623

 
$
29,307

 
$
3,113,890

 
$
3,143,197

Real estate:
 
 
 
 
 
 
 
 
 
Commercial - investor owned
116

 
2,095

 
2,211

 
1,307,684

 
1,309,895

Commercial - owner occupied
2,723

 
1,208

 
3,931

 
734,618

 
738,549

Construction and land development
58

 
—

 
58

 
481,163

 
481,221

Residential
951

 
1,738

 
2,689

 
324,303

 
326,992

Other
100

 
21

 
121

 
140,076

 
140,197

Total
$
10,632

 
$
27,685


$
38,317


$
6,101,734


$
6,140,051

 
 
 
 
 
 
 
 
 
 
Summary of Recorded Investment by Risk Category of Portfolio Loans by Portfolio Class and Category
The recorded investment by risk category of the loans by class at June 30, 2020, which is based upon the most recent analysis performed is as follows:
 
 
Term Loans by Origination Year
 
 
 
 
 
 
(in thousands)
 
2020
 
2019
 
2018
 
2017
 
2016
 
Prior
 
Revolving Loans Converted to Term Loans
 
Revolving Loans
 
Total
Commercial and industrial
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass (1-6)
 
$
1,239,062

 
$
535,477

 
$
318,046

 
$
180,269

 
$
47,210

 
$
85,529

 
$
14,954

 
$
510,168

 
$
2,930,715

Watch (7)
 
26,347

 
13,354

 
4,850

 
6,468

 
24,044

 
175

 
—

 
62,293

 
137,531

Classified (8-9)
 
3,775

 
15,068

 
8,155

 
3,950

 
5,093

 
3,673

 
295

 
23,222

 
63,231

Total Commercial and industrial
 
$
1,269,184

 
$
563,899

 
$
331,051

 
$
190,687

 
$
76,347

 
$
89,377

 
$
15,249

 
$
595,683

 
$
3,131,477

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate-investor owned
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Pass (1-6)
 
$
246,319

 
$
321,849

 
$
204,242

 
$
126,567

 
$
153,904

 
$
181,761

 
$
3,284

 
$
35,460

 
$
1,273,386

Watch (7)
 
5,136

 
4,220

 
1,192

 
369

 
12,681

 
1,275

 
—

 
—

 
24,873

Classified (8-9)
 
—

 
966

 
8,286

 
455

 
249

 
1,680

 
—

 
—

 
11,636

Total Commercial real estate-investor owned
 
$
251,455

 
$
327,035

 
$
213,720

 
$
127,391

 
$
166,834

 
$
184,716

 
$
3,284

 
$
35,460

 
$
1,309,895

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate-owner occupied
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Pass (1-6)
 
$
147,313

 
$
200,519

 
$
92,624

 
$
79,058

 
$
44,990

 
$
80,172

 
$
2,756

 
$
42,883

 
$
690,315

Watch (7)
 
9,473

 
1,963

 
261

 
9,729

 
8,533

 
5,074

 
—

 
2,500

 
37,533

Classified (8-9)
 
601

 
1,156

 
4,267

 
458

 
—

 
4,219

 
—

 
—

 
10,701

Total Commercial real estate-owner occupied
 
$
157,387

 
$
203,638

 
$
97,152

 
$
89,245

 
$
53,523

 
$
89,465

 
$
2,756

 
$
45,383

 
$
738,549

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Construction real estate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass (1-6)
 
$
75,983

 
$
167,936

 
$
121,909

 
$
37,555

 
$
28,060

 
$
12,906

 
$
—

 
$
20,631

 
$
464,980

Watch (7)
 
2,408

 
722

 
1,254

 
11,047

 
—

 
546

 
—

 
—

 
15,977

Classified (8-9)
 
—

 
227

 
—

 
—

 
—

 
37

 
—

 
—

 
264

Total Construction real estate
 
$
78,391

 
$
168,885

 
$
123,163

 
$
48,602

 
$
28,060

 
$
13,489

 
$
—

 
$
20,631

 
$
481,221

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential real estate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass (1-6)
 
$
26,448

 
$
33,085

 
$
22,074

 
$
19,931

 
$
34,427

 
$
115,036

 
$
591

 
$
63,505

 
$
315,097

Watch (7)
 
181

 
895

 
842

 
—

 
—

 
2,027

 
279

 
802

 
5,026

Classified (8-9)
 
184

 
1,265

 
758

 
13

 
213

 
3,445

 
—

 
50

 
5,928

Total residential real estate
 
$
26,813

 
$
35,245

 
$
23,674

 
$
19,944

 
$
34,640

 
$
120,508

 
$
870

 
$
64,357

 
$
326,051

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass (1-6)
 
$
8,758

 
$
25,567

 
$
20,615

 
$
682

 
$
3,705

 
$
34,455

 
$
—

 
$
43,971

 
$
137,753

Watch (7)
 
—

 
2

 
—

 
—

 
—

 
—

 
—

 
1

 
3

Classified (8-9)
 
—

 
1

 
3

 
4

 
—

 
19

 
10

 
7

 
44

Total Other
 
$
8,758

 
$
25,570

 
$
20,618

 
$
686

 
$
3,705

 
$
34,474

 
$
10

 
$
43,979

 
$
137,800


In the table above, loan originations in 2020 and 2019 with a classification of watch or classified primarily represent renewals or modifications initially underwritten and originated in prior years.
For certain loans, primarily credit cards, the Company evaluates credit quality based on the aging status.
The following table presents the recorded investment on loans based on payment activity:
 
 
June 30, 2020
(in thousands)
 
Performing
 
Non Performing
 
Total
Commercial and industrial
 
$
11,682

 
$
38

 
$
11,720

Real estate:
 
 
 
 
 
 
Residential
 
941

 
—

 
941

Other
 
2,376

 
21

 
2,397

Total
 
$
14,999

 
$
59

 
$
15,058


 
 
 
 
 
 
 
 
The recorded investment by risk category of loans by class at December 31, 2019, was as follows:
 
December 31, 2019
(in thousands)
Pass (1-6)
 
Watch (7)
 
Classified (8 & 9)
 
Total*
Commercial and industrial
$
2,151,084

 
$
124,718

 
$
70,021

 
$
2,345,823

Real estate:
 
 
 
 
 
 
 
Commercial - investor owned
1,242,569

 
17,572

 
2,840

 
1,262,981

Commercial - owner occupied
643,276

 
28,773

 
6,473

 
678,522

Construction and land development
437,134

 
12,140

 
106

 
449,380

Residential
348,246

 
4,450

 
2,496

 
355,192

Other
132,096

 
3

 
51

 
132,150

Total
$
4,954,405

 
$
187,656


$
81,987

 
$
5,224,048

*Excludes $90.3 million of loans accounted for as PCI