
(In thousands)	June 30, 2024		December 31, 2023
Secured by real estate:
Residential properties	$	1,617,519	$	1,551,777
Construction and land development	687,695		731,449
Farmland	312,038		309,840
Other commercial	2,722,113		2,666,956
Total real estate	5,339,365		5,260,022
Commercial and industrial loans	617,730		631,528
Agricultural production and other loans to farmers	111,422		91,976
Consumer and other loans	103,120		98,485
Total loans before allowance for credit losses	$	6,171,637	$	6,082,011

Loans are stated at the amount of unpaid principal net of discounts and premiums on acquired loans, before allowance for credit losses. Interest on loans is calculated using the simple interest method on daily balances of the principal amount outstanding.

Loan Origination/Risk Management/Credit Concentration – The Company has certain lending policies and procedures in place that are designed to maximize loan income within an acceptable level of risk. The Company’s Board of Directors reviews and approves these policies and procedures on a regular basis. Although the Company has a diversified loan portfolio, the Company has concentrations of credit risks related to the real estate market, including residential, commercial, and construction and land development lending. Most of the Company’s lending activity occurs within Mississippi, Alabama, Louisiana, and Florida.

Residential Real Estate Loans – The residential real estate loan portfolio consists of residential loans for single and multifamily properties. Residential loans are generally secured by owner occupied 1–4 family residences. Repayment of these loans is primarily dependent on the personal income and credit rating of the borrowers and can be impacted by economic conditions within their market area. Risk is mitigated by the fact that the loans are of smaller individual amounts and spread over a large number of borrowers.

Construction and land development loans are usually based upon estimates of costs and estimated value of the completed project and include independent appraisal reviews and a financial analysis of the developers and property owners. Sources of repayment of these loans may include permanent loans, sales of developed property or an interim loan commitment from the Company until permanent financing is obtained. These loans are considered to be higher risk than other real estate loans due to their ultimate repayment being sensitive to interest rate changes, general economic conditions and the availability of long-term financing.

Farmland loans are generally made for the purpose of acquiring land devoted to crop production or livestock, the propagation of timber or the operation of a similar type of business on the secured property. Sources of repayment for these loans generally include income generated from operations of a business on the property, rental income, or sales of timber. Repayment may be impacted by changes in economic conditions which affect underlying collateral values.

Commercial real estate loans typically involve larger principal amounts and repayment of these loans is generally dependent on the successful operations of the property securing the loan or the business conducted on the property securing the loan. These loans are viewed primarily as cash flow loans and secondarily as loans secured by real estate. Management monitors and evaluates commercial real estate loans based on collateral and risk grade criteria.

Commercial and Industrial Loans – The commercial and industrial loan portfolio consists of loans to commercial customers for use in normal business operations to finance working capital needs, equipment purchase or other expansion projects. Commercial loan underwriting standards are designed to promote relationship banking rather than transactional banking and are underwritten based on the borrower’s expected ability to profitably operate its business. The cash flows of borrowers, however, may not be as expected and collateral securing these loans may fluctuate in value. Most commercial loans are secured by assets being financed or other business assets such as accounts receivable or inventory and may incorporate a personal guarantee. In the case of loans secured by accounts receivable, the availability of funds for repayment of these loans may be substantially dependent on the ability of the borrower to collect amounts due from its customers.

Agricultural production and other loans to farmers - The agricultural production and other loans to farmers portfolio consists of loans for the purpose of financing agricultural production, the growing and storing of crops, the marketing, and the carrying of agricultural products. This portfolio also includes loans for the purposes of breeding, raising, fattening, or marketing livestock, fish production, and forest and timber production as well as any other loans to made to farmers not secured by real estate. Sources of repayment for these loans generally include income generated from the operations of the business.

Consumer and Other Loans – The consumer and other loan portfolio consists of various term and line of credit loans such as automobile loans and loans for other personal purposes. Repayment for these types of loans will come from a borrower’s income sources that are typically independent of the loan purpose. Credit risk is driven by consumer economic factors (such as unemployment and general economic conditions in the Company’s market area) and the creditworthiness of a borrower.

Loans that are 30 days or more past due based on payments received and applied to the loan are considered delinquent. Accrual of interest is discontinued on a loan when management believes, after considering economic and business conditions and collection efforts, that a borrower's financial condition is such that collection of interest, but not necessarily principal, is doubtful. A loan is typically placed on non-accrual when the contractual payment of principal or interest becomes 90 days past due unless the loan is

well-secured and in the process of collection. Loans may be placed on non-accrual status regardless of whether or not such loans are considered past due. When a loan is placed on non-accrual status, any interest that is accrued, but not collected, is reversed against interest income.

Payments subsequently received on non-accrual loans are applied to principal. Interest income is recognized to the extent that cash payments are received in excess of principal due. A loan may return to accrual status when principal and interest payments are no longer past due and collectability is reasonably assured.


(In thousands)	Total Nonaccrual		Nonaccrual with no Allowance for Credit Loss		Past Due 90 days or more and Accruing
June 30, 2024
Secured by real estate:
Residential properties	$	5,161	$	—	$	1,032
Construction and land development	2,129		—		363
Farmland	269		—		731
Other commercial	4,976		—		—
Total real estate	12,535		—		2,126
Commercial and industrial loans	1,495		—		114
Agricultural production and other loans to farmers	—		—		—
Consumer and other loans	86		—		138
Total	$	14,116	$	—	$	2,378

December 31, 2023
Secured by real estate:
Residential properties	$	3,180	$	—	$	270
Construction and land development	239		—		—
Farmland	642		—		—
Other commercial	1,613		—		124
Total real estate	5,674		—		394
Commercial and industrial loans	1,523		—		339
Agricultural production and other loans to farmers	—		—		—
Consumer and other loans	17		—		28
Total	$	7,214	$	—	$	761

A loan is considered collateral-dependent when the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. During the six months ended June 30, 2024, there were no significant changes to the collateral which secures the collateral-dependent loans, whether due to general deterioration or other reason. The following table presents the amortized cost basis of collateral-dependent loans by class and collateral type as of June 30, 2024 and December 31, 2023.


(In thousands)	Real Estate		Enterprise Value		Accounts Receivable & Inventory		Stock
June 30, 2024
Secured by real estate:
Residential properties	$	—	$	—	$	—	$	—
Construction and land development	—		—		—		—
Farmland	—		—		—		—
Other commercial	2,758		13,865		—		1,375
Total real estate	2,758		13,865		—		1,375
Commercial and industrial loans	—		—		8,414		—
Agricultural production and other loans to farmers	—		—		—		—
Consumer loans	—		—		—		—
Total	$	2,758	$	13,865	$	8,414	$	1,375


(In thousands)	Real Estate		Enterprise Value		Accounts Receivable & Inventory		Stock
December 31, 2023
Secured by real estate:
Residential properties	$	1,276	$	—	$	—	$	—
Construction and land development	—		—		—		—
Farmland	—		—		—		—
Other commercial	3,226		—		—		—
Total real estate	4,502		—		—		—
Commercial and industrial loans	—		1,349		8,706		1,375
Agricultural production and other loans to farmers	—		—		—		—
Consumer loans	—		—		—		—
Total	$	4,502	$	1,349	$	8,706	$	1,375


(In thousands)	Past Due 30-89 Days		Past Due 90 Days or More		Total Past Due		Current		Total Loans
June 30, 2024
Secured by real estate:
Residential properties	$	11,841	$	3,550	$	15,391	$	1,602,128	$	1,617,519
Construction and land development	2,183		2,267		4,450		683,245		687,695
Farmland	1,081		745		1,826		310,212		312,038
Other commercial	2,959		4,520		7,479		2,714,634		2,722,113
Total real estate	18,064		11,082		29,146		5,310,219		5,339,365
Commercial and industrial loans	2,415		280		2,695		615,035		617,730
Agricultural production and other loans to farmers	182		—		182		111,240		111,422
Consumer loans	664		205		869		102,251		103,120
Total	$	21,325	$	11,567	$	32,892	$	6,138,745	$	6,171,637


(In thousands)	Past Due 30-89 Days		Past Due 90 Days or More		Total Past Due		Current		Total Loans
December 31, 2023
Secured by real estate:
Residential properties	$	9,867	$	2,144	$	12,011	$	1,539,766	$	1,551,777
Construction and land development	1,609		—		1,609		729,840		731,449
Farmland	88		380		468		309,372		309,840
Other commercial	4,159		1,320		5,479		2,661,477		2,666,956
Total real estate	15,723		3,844		19,567		5,240,455		5,260,022
Commercial and industrial loans	2,868		441		3,309		628,219		631,528
Agricultural production and other loans to farmers	192		—		192		91,784		91,976
Consumer loans	708		39		747		97,738		98,485
Total	$	19,491	$	4,324	$	23,815	$	6,058,196	$	6,082,011

Modifications to Borrowers Experiencing Financial Difficulty – From time to time, the Company may modify certain loans to borrowers who are experiencing financial difficulty. In some cases, these modifications result in new loans. Loan modifications to borrowers experiencing financial difficulty may be in the form of principal forgiveness, interest rate reduction, term extension, other-than-insignificant payment delay or a combination thereof, among other things. There was one loan modification to borrowers experiencing financial difficulty during the three and six months ended June 30, 2024. There were zero loan modifications to borrowers experiencing financial difficulty during the three and six months ended June 30, 2023.

The following table presents the amortized cost basis of loans at June 30, 2024 that were both experiencing financial difficulty and modified during the three and six months ended June 30, 2024, by class and type of modification.


	Three Months Ended June 30, 2024
	Term Extension
	Amortized Cost		% of Total Loans
(In thousands)
Other commercial	$	1,699	0.03	%
Total	$	1,699	0.03	%


	Six Months Ended June 30, 2024
	Term Extension
	Amortized Cost		% of Total Loans
(In thousands)
Other commercial	$	1,699	0.03	%
Total	$	1,699	0.03	%


	Six Months Ended June 30, 2024
(In thousands)	Current		30-89 Days Past Due		90 Days or More Past Due
Secured by real estate:
Residential properties	$	—	$	—	$	—
Construction and land development	—		—		—
Farmland	—		—		—
Other commercial	1,699		—		—
Total real estate	1,699		—		—
Commercial and industrial loans	—		—		—
Agricultural production and other loans to farmers	—		—		—
Consumer and other loans	—		—		—
Total loans before allowance for loan losses	$	1,699	$	—	$	—