LOANS AND ALLOWANCE FOR CREDIT LOSSES

9 Months Ended

Sep. 30, 2024

Receivables [Abstract]

LOANS AND ALLOWANCE FOR CREDIT LOSSES

NOTE 3 – LOANS AND ALLOWANCE FOR CREDIT LOSSES

Loans are stated at amortized cost. Balances within the major loans receivable categories are presented in the following table:

(dollars in thousands)	September 30, 2024		December 31, 2023
Commercial, financial and agricultural	$	2,949,957	$	2,688,929
Consumer	210,310		241,552
Indirect automobile	10,891		34,257
Mortgage warehouse	985,910		818,728
Municipal	449,561		492,668
Premium finance	1,246,452		946,562
Real estate – construction and development	2,232,114		2,129,187
Real estate – commercial and farmland	8,249,981		8,059,754
Real estate – residential	4,629,805		4,857,666
	$	20,964,981	$	20,269,303

Accrued interest receivable on loans is reported in other assets on the consolidated balance sheets totaling $78.2 million and $79.2 million and at September 30, 2024 and December 31, 2023, respectively. The Company had no recorded allowance for credit losses related to accrued interest on loans at both September 30, 2024 and December 31, 2023.

Nonaccrual and Past-Due Loans

A loan is placed on nonaccrual status when, in management’s judgment, the collection of the interest income appears doubtful. Interest receivable that has been accrued and is subsequently determined to have doubtful collectability is charged to interest income. Interest on loans that are classified as nonaccrual is subsequently applied to principal until the loans are returned to accrual status. The Company’s loan policy states that a nonaccrual loan may be returned to accrual status when (i) none of its principal and interest is due and unpaid, and the Company expects repayment of the remaining contractual principal and interest, or (ii) it otherwise becomes well secured and in the process of collection. Restoration to accrual status on any given loan must be supported by a well-documented credit evaluation of the borrower’s financial condition and the prospects for full repayment, approved by the Company’s Chief Credit Officer. Past-due loans are loans whose principal or interest is past due 30 days or more. In some cases, where borrowers are experiencing financial difficulties, loans may be restructured to provide terms significantly different from the original contractual terms.

The following table presents an analysis of loans accounted for on a nonaccrual basis:

(dollars in thousands)	September 30, 2024		December 31, 2023
Commercial, financial and agricultural	$	13,869	$	8,059
Consumer	743		1,153
Indirect automobile	186		299
Real estate – construction and development	3,908		282
Real estate – commercial and farmland	13,020		11,295
Real estate – residential(1)	63,781		130,029
	$	95,507	$	151,117

(1) Included in real estate - residential were $8.2 million and $90.2 million of serviced GNMA-guaranteed nonaccrual loans at September 30, 2024 and December 31, 2023, respectively.

Interest income recognized on nonaccrual loans during the nine months ended September 30, 2024 and 2023 was not material.

The following table presents an analysis of nonaccrual loans with no related allowance for credit losses:

(dollars in thousands)	September 30, 2024		December 31, 2023
Commercial, financial and agricultural	$	3,660	$	2,049
Real estate – construction and development	2,945		—
Real estate – commercial and farmland	9,836		9,109
Real estate – residential	30,277		75,419
	$	46,718	$	86,577

The following table presents an analysis of past-due loans as of September 30, 2024 and December 31, 2023:

(dollars in thousands)	Loans 30-59 Days Past Due		Loans 60-89 Days Past Due		Loans 90 or More Days Past Due		Total Loans Past Due		Current Loans		Total Loans		Loans 90 Days or More Past Due and Still Accruing
September 30, 2024
Commercial, financial and agricultural	$	20,313	$	6,299	$	8,907	$	35,519	$	2,914,438	$	2,949,957	$	4,732
Consumer	1,911		512		366		2,789		207,521		210,310		—
Indirect automobile	51		24		51		126		10,765		10,891		—
Mortgage warehouse	—		—		—		—		985,910		985,910		—
Municipal	—		—		—		—		449,561		449,561		—
Premium finance	13,246		5,880		7,502		26,628		1,219,824		1,246,452		7,502
Real estate – construction and development	10,411		3,687		584		14,682		2,217,432		2,232,114		—
Real estate – commercial and farmland	4,514		3,133		7,562		15,209		8,234,772		8,249,981		—
Real estate – residential	46,039		14,823		60,788		121,650		4,508,155		4,629,805		—
Total	$	96,485	$	34,358	$	85,760	$	216,603	$	20,748,378	$	20,964,981	$	12,234
December 31, 2023
Commercial, financial and agricultural	$	11,023	$	5,439	$	9,733	$	26,195	$	2,662,734	$	2,688,929	$	5,310
Consumer	2,155		1,037		498		3,690		237,862		241,552		—
Indirect automobile	153		17		78		248		34,009		34,257		—
Mortgage warehouse	—		—		—		—		818,728		818,728		—
Municipal	—		—		—		—		492,668		492,668		—
Premium finance	12,379		6,832		11,678		30,889		915,673		946,562		11,678
Real estate – construction and development	2,094		—		282		2,376		2,126,811		2,129,187		—
Real estate – commercial and farmland	5,070		1,656		6,352		13,078		8,046,676		8,059,754		—
Real estate – residential	49,976		19,300		127,087		196,363		4,661,303		4,857,666		—
Total	$	82,850	$	34,281	$	155,708	$	272,839	$	19,996,464	$	20,269,303	$	16,988

Collateral-Dependent Loans

Collateral-dependent loans are loans where repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty. If the Company determines that foreclosure is probable, these loans are written down to the lower of cost or fair value of the collateral less estimated costs to sell. When repayment is expected to be from the operation of the collateral, the allowance for credit losses is calculated as the amount by which the amortized cost basis of the financial asset exceeds the present value of expected cash flows from the operation of the collateral. The Company may, in the alternative, measure the allowance for credit loss as the amount by which the amortized cost basis of the financial asset exceeds the estimated fair value of the collateral.

The following table presents an analysis of individually evaluated collateral-dependent financial assets and related allowance for credit losses:

	September 30, 2024				December 31, 2023
(dollars in thousands)	Balance		Allowance for Credit Losses		Balance		Allowance for Credit Losses
Commercial, financial and agricultural	$	19,940	$	3,130	$	5,889	$	567
Premium finance	—		—		1,990		45
Real estate – construction and development	—		—		280		23
Real estate – commercial and farmland	14,665		218		11,114		108
Real estate – residential	16,283		2,008		21,102		2,654
	$	50,888	$	5,356	$	40,375	$	3,397

Credit Quality Indicators

The Company uses a five category risk grading system to assign a risk grade to each loan in the portfolio. The following is a description of the general characteristics of the grades:

Pass – These loans range from minimal to acceptable credit risk to the Company based on factors including creditworthiness of the borrower, current performance and nature of the collateral.

Other Assets Especially Mentioned ("Special Mention") – This grade includes loans that exhibit potential weaknesses that deserve management’s close attention. If left uncorrected, these weaknesses may result in deterioration of the repayment prospects for the asset or in the Company’s credit position at some future date.

Substandard – This grade represents loans which are inadequately protected by the current credit worthiness and paying capacity of the borrower or of the collateral pledged, if any. These assets exhibit a well-defined weakness or are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. These weaknesses may be characterized by past due performance, operating losses or questionable collateral values.

Doubtful – This grade includes loans which exhibit all of the characteristics of a substandard loan with the added provision that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable or improbable.

Loss – This grade is assigned to loans which are considered uncollectible and of such little value that their continuance as active assets of the Bank is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing it off.

The following tables present the loan portfolio's amortized cost by class of financing receivable, risk grade and year of origination (in thousands) as of September 30, 2024 and December 31, 2023. Generally, current period renewals of credit are underwritten again at the point of renewal and considered current period originations for purposes of the tables below. The Company had an immaterial amount of revolving loans which converted to term loans and the amortized cost basis of those loans is included in the applicable origination year. There were no loans risk graded doubtful or loss at September 30, 2024 or December 31, 2023.

As of September 30, 2024	Term Loans by Origination Year												Revolving Loans Amortized Cost Basis
	2024		2023		2022		2021		2020		Prior				Total
Commercial, Financial and Agricultural
Risk Grade:
Pass	$	771,180	$	653,260	$	599,054	$	284,292	$	85,784	$	56,473	$	460,002	$	2,910,045
Special mention	5		127		1,825		1,315		725		3,241		2,784		10,022
Substandard	231		2,302		3,600		8,907		824		5,337		8,689		29,890
Total commercial, financial and agricultural	$	771,416	$	655,689	$	604,479	$	294,514	$	87,333	$	65,051	$	471,475	$	2,949,957
Current-period gross charge offs	286		15,849		15,380		6,699		1,178		758		—		40,150
Consumer
Risk Grade:
Pass	$	44,222	$	21,803	$	10,610	$	3,046	$	19,194	$	27,710	$	82,381	$	208,966
Special mention	5		—		15		—		—		39		—		59
Substandard	137		253		105		34		190		439		127		1,285
Total consumer	$	44,364	$	22,056	$	10,730	$	3,080	$	19,384	$	28,188	$	82,508	$	210,310
Current-period gross charge offs	113		514		210		38		682		1,081		198		2,836
Indirect Automobile
Risk Grade:
Pass	$	—	$	—	$	—	$	—	$	—	$	10,625	$	—	$	10,625
Special mention	—		—		—		—		—		26		—		26
Substandard	—		—		—		—		—		240		—		240
Total indirect automobile	$	—	$	—	$	—	$	—	$	—	$	10,891	$	—	$	10,891
Current-period gross charge offs	—		—		—		—		—		138		—		138
Mortgage Warehouse
Risk Grade:
Pass	$	—	$	—	$	—	$	—	$	—	$	—	$	976,092	$	976,092
Special mention	—		—		—		—		—		—		9,818		9,818
Total mortgage warehouse	$	—	$	—	$	—	$	—	$	—	$	—	$	985,910	$	985,910
Current-period gross charge offs	—		—		—		—		—		—		—		—
Municipal
Risk Grade:
Pass	$	20,566	$	9,227	$	44,890	$	36,746	$	140,694	$	196,616	$	822	$	449,561
Total municipal	$	20,566	$	9,227	$	44,890	$	36,746	$	140,694	$	196,616	$	822	$	449,561
Current-period gross charge offs	—		—		—		—		—		—		—		—
Premium Finance
Risk Grade:
Pass	$	1,217,918	$	20,616	$	213	$	203	$	—	$	—	$	—	$	1,238,950
Substandard	5,245		2,257		—		—		—		—		—		7,502
Total premium finance	$	1,223,163	$	22,873	$	213	$	203	$	—	$	—	$	—	$	1,246,452
Current-period gross charge offs	742		5,923		245		—		—		—		—		6,910

As of September 30, 2024	Term Loans by Origination Year												Revolving Loans Amortized Cost Basis
	2024		2023		2022		2021		2020		Prior				Total
Real Estate – Construction and Development
Risk Grade:
Pass	$	413,449	$	289,316	$	1,025,891	$	323,413	$	4,550	$	91,834	$	74,078	$	2,222,531
Special mention	3,159		1,643		—		66		—		317		—		5,185
Substandard	50		79		3,374		367		—		528		—		4,398
Total real estate – construction and development	$	416,658	$	291,038	$	1,029,265	$	323,846	$	4,550	$	92,679	$	74,078	$	2,232,114
Current-period gross charge offs	—		—		—		—		—		—		—		—
Real Estate – Commercial and Farmland
Risk Grade:
Pass	$	166,867	$	457,998	$	2,191,571	$	2,197,460	$	1,062,050	$	1,935,670	$	94,477	$	8,106,093
Special mention	—		1,360		35		756		15,471		76,613		—		94,235
Substandard	—		1,122		17,322		13,878		3,402		13,929		—		49,653
Total real estate – commercial and farmland	$	166,867	$	460,480	$	2,208,928	$	2,212,094	$	1,080,923	$	2,026,212	$	94,477	$	8,249,981
Current-period gross charge offs	—		513		—		—		—		58		—		571
Real Estate - Residential
Risk Grade:
Pass	$	164,123	$	649,299	$	1,320,707	$	1,071,834	$	473,748	$	587,155	$	286,613	$	4,553,479
Special mention	—		11		53		763		596		1,962		1,749		5,134
Substandard	1,299		5,576		13,312		11,056		9,110		23,432		7,407		71,192
Total real estate - residential	$	165,422	$	654,886	$	1,334,072	$	1,083,653	$	483,454	$	612,549	$	295,769	$	4,629,805
Current-period gross charge offs	—		24		20		—		—		5		—		49
Total Loans
Risk Grade:
Pass	$	2,798,325	$	2,101,519	$	5,192,936	$	3,916,994	$	1,786,020	$	2,906,083	$	1,974,465	$	20,676,342
Special mention	3,169		3,141		1,928		2,900		16,792		82,198		14,351		124,479
Substandard	6,962		11,589		37,713		34,242		13,526		43,905		16,223		164,160
Total loans	$	2,808,456	$	2,116,249	$	5,232,577	$	3,954,136	$	1,816,338	$	3,032,186	$	2,005,039	$	20,964,981
Total current-period gross charge offs	1,141		22,823		15,855		6,737		1,860		2,040		198		50,654

As of December 31, 2023	Term Loans by Origination Year												Revolving Loans Amortized Cost Basis
	2023		2022		2021		2020		2019		Prior				Total
Commercial, Financial and Agricultural
Risk Grade:
Pass	$	892,951	$	758,471	$	384,830	$	95,055	$	56,447	$	41,095	$	432,472	$	2,661,321
Special mention	—		335		5,722		92		109		451		803		7,512
Substandard	1,512		3,595		3,222		1,140		3,533		5,748		1,346		20,096
Total commercial, financial and agricultural	$	894,463	$	762,401	$	393,774	$	96,287	$	60,089	$	47,294	$	434,621	$	2,688,929
Consumer
Risk Grade:
Pass	$	44,736	$	17,661	$	5,878	$	25,654	$	15,838	$	20,937	$	109,214	$	239,918
Special mention	—		5		—		—		—		26		—		31
Substandard	154		181		41		334		197		531		165		1,603
Total consumer	$	44,890	$	17,847	$	5,919	$	25,988	$	16,035	$	21,494	$	109,379	$	241,552
Indirect Automobile
Risk Grade:
Pass	$	—	$	—	$	—	$	—	$	6,086	$	27,646	$	—	$	33,732
Substandard	—		—		—		—		55		470		—		525
Total indirect automobile	$	—	$	—	$	—	$	—	$	6,141	$	28,116	$	—	$	34,257
Mortgage Warehouse
Risk Grade:
Pass	$	—	$	—	$	—	$	—	$	—	$	—	$	772,366	$	772,366
Special mention	—		—		—		—		—		—		46,362		46,362
Total mortgage warehouse	$	—	$	—	$	—	$	—	$	—	$	—	$	818,728	$	818,728
Municipal
Risk Grade:
Pass	$	14,216	$	27,346	$	48,941	$	177,156	$	14,655	$	208,236	$	2,118	$	492,668
Total municipal	$	14,216	$	27,346	$	48,941	$	177,156	$	14,655	$	208,236	$	2,118	$	492,668
Premium Finance
Risk Grade:
Pass	$	928,930	$	4,038	$	1,916	$	—	$	—	$	—	$	—	$	934,884
Substandard	10,777		901		—		—		—		—		—		11,678
Total premium finance	$	939,707	$	4,939	$	1,916	$	—	$	—	$	—	$	—	$	946,562

As of December 31, 2023	Term Loans by Origination Year												Revolving Loans Amortized Cost Basis
	2023		2022		2021		2020		2019		Prior				Total
Real Estate – Construction and Development
Risk Grade:
Pass	$	457,077	$	938,909	$	505,254	$	58,840	$	54,646	$	30,042	$	81,662	$	2,126,430
Special mention	—		—		—		—		—		479		—		479
Substandard	—		266		1,512		—		—		500		—		2,278
Total real estate – construction and development	$	457,077	$	939,175	$	506,766	$	58,840	$	54,646	$	31,021	$	81,662	$	2,129,187
Real Estate – Commercial and Farmland
Risk Grade:
Pass	$	450,315	$	1,890,498	$	2,133,833	$	1,090,735	$	765,640	$	1,437,323	$	100,206	$	7,868,550
Special mention	—		17,131		53,329		—		30,200		46,370		—		147,030
Substandard	428		418		15,578		2,660		6,106		18,984		—		44,174
Total real estate – commercial and farmland	$	450,743	$	1,908,047	$	2,202,740	$	1,093,395	$	801,946	$	1,502,677	$	100,206	$	8,059,754
Real Estate - Residential
Risk Grade:
Pass	$	714,684	$	1,425,186	$	1,148,092	$	506,137	$	236,147	$	423,648	$	262,968	$	4,716,862
Special mention	13		—		72		201		234		1,411		380		2,311
Substandard	5,057		26,171		28,459		30,566		19,357		25,263		3,620		138,493
Total real estate - residential	$	719,754	$	1,451,357	$	1,176,623	$	536,904	$	255,738	$	450,322	$	266,968	$	4,857,666
Total Loans
Risk Grade:
Pass	$	3,502,909	$	5,062,109	$	4,228,744	$	1,953,577	$	1,149,459	$	2,188,927	$	1,761,006	$	19,846,731
Special mention	13		17,471		59,123		293		30,543		48,737		47,545		203,725
Substandard	17,928		31,532		48,812		34,700		29,248		51,496		5,131		218,847
Total loans	$	3,520,850	$	5,111,112	$	4,336,679	$	1,988,570	$	1,209,250	$	2,289,160	$	1,813,682	$	20,269,303

Allowance for Credit Losses on Loans

The allowance for credit losses represents an allowance for expected losses over the remaining contractual life of the assets. The contractual term does not consider extensions, renewals or modifications. The Company segregates the loan portfolio by type of loan and utilizes this segregation in evaluating exposure to risks within the portfolio.

Loan losses are charged against the allowance when management believes the collection of a loan’s principal is unlikely. Subsequent recoveries are credited to the allowance. Consumer loans are charged off in accordance with the Federal Financial Institutions Examination Council’s (the “FFIEC”) Uniform Retail Credit Classification and Account Management Policy. Commercial loans are charged off when they are deemed uncollectible, which usually involves a triggering event within the collection effort. If the loan is collateral dependent, the loss is more easily identified and is charged off when it is identified, usually based upon receipt of an appraisal. However, when a loan has guarantor support, the Company may carry the estimated loss as a reserve against the loan while collection efforts with the guarantor are pursued. If, after collection efforts with the guarantor are complete, the deficiency is still considered uncollectible, the loss is charged off and any further collections are treated as recoveries. In all situations, when a loan is downgraded to an Asset Quality Rating of Loss, the uncollectible portion is charged off.

The Company’s methodologies for estimating the allowance for credit losses consider available relevant information about the collectability of cash flows, including information about past events, current conditions, and reasonable and supportable forecasts. The methodologies apply historical loss information, adjusted for asset-specific characteristics, economic conditions at the measurement date, and forecasts about future economic conditions expected to exist through the contractual lives of the financial assets that are reasonable and supportable, to the identified pools of loans with similar risk characteristics for which

the historical loss experience was observed. The Company utilizes a one year reasonable and supportable forecast period. The Company’s methodologies revert back to historical loss information on a straight-line basis over four quarters after the reasonable and supportable forecast period.

During the nine months ended September 30, 2024, the allowance for credit losses increased due to the current economic forecast and organic loan growth during the period. The allowance for credit losses was determined at September 30, 2024 using a weighting of two economic forecasts from Moody's in order to align with management's best estimate over the reasonable and supportable forecast period. The Moody's baseline scenario was weighted at 65% and the downside 75th percentile S-2 scenario was weighted at 35%. The allowance for credit losses was determined at December 31, 2023 solely using the Moody's baseline scenario economic forecast. The current forecast reflects, among other things, an increase in forecast levels of multifamily rental vacancies and unemployment, partially offset by a decrease in the severity of commercial real estate price index decline compared with the forecast at December 31, 2023.

The following tables detail activity and end of period balances in the allowance for credit losses by portfolio segment for the periods indicated. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.

Three Months Ended September 30, 2024
(dollars in thousands)	Commercial, Financial and Agricultural		Consumer		Indirect Automobile		Mortgage Warehouse		Municipal		Premium Finance
Balance, June 30, 2024	$	66,542	$	3,451	$	28	$	2,142	$	60	$	702
Provision for loan losses	8,463		1,287		(65)		30		137		180
Loans charged off	(12,316)		(819)		(34)		—		—		(2,102)
Recoveries of loans previously charged off	4,979		208		101		—		—		1,860
Balance, September 30, 2024	$	67,668	$	4,127	$	30	$	2,172	$	197	$	640
	Real Estate – Construction and Development		Real Estate – Commercial and Farmland		Real Estate – Residential		Total
Balance, June 30, 2024	$	77,482	$	121,963	$	63,848	$	336,218
Provision for loan losses	(2,506)		(1,885)		672		6,313
Loans charged off	—		(58)		(23)		(15,352)
Recoveries of loans previously charged off	6		61		63		7,278
Balance, September 30, 2024	$	74,982	$	120,081	$	64,560	$	334,457
Nine Months Ended September 30, 2024
(dollars in thousands)	Commercial, Financial and Agricultural		Consumer		Indirect Automobile		Mortgage Warehouse		Municipal		Premium Finance
Balance, December 31, 2023	$	64,053	$	3,902	$	50	$	1,678	$	345	$	602
Provision for loan losses	31,479		2,450		(348)		494		(148)		343
Loans charged off	(40,150)		(2,836)		(138)		—		—		(6,910)
Recoveries of loans previously charged off	12,286		611		466		—		—		6,605
Balance, September 30, 2024	$	67,668	$	4,127	$	30	$	2,172	$	197	$	640
	Real Estate – Construction and Development		Real Estate – Commercial and Farmland		Real Estate – Residential		Total
Balance, December 31, 2023	$	61,017	$	110,097	$	65,356	$	307,100
Provision for loan losses	13,911		9,900		(897)		57,184
Loans charged off	—		(571)		(49)		(50,654)
Recoveries of loans previously charged off	54		655		150		20,827
Balance, September 30, 2024	$	74,982	$	120,081	$	64,560	$	334,457

Three Months Ended September 30, 2023
(dollars in thousands)	Commercial, Financial and Agricultural		Consumer		Indirect Automobile		Mortgage Warehouse		Municipal		Premium Finance
Balance, June 30, 2023	$	50,789	$	4,548	$	98	$	2,335	$	357	$	776
Provision for loan losses	14,650		310		(149)		(589)		(9)		183
Loans charged off	(16,519)		(948)		(36)		—		—		(1,951)
Recoveries of loans previously charged off	4,745		203		158		—		—		1,639
Balance, September 30, 2023	$	53,665	$	4,113	$	71	$	1,746	$	348	$	647
	Real Estate – Construction and Development		Real Estate – Commercial and Farmland		Real Estate – Residential		Total
Balance, June 30, 2023	$	54,589	$	96,140	$	62,439	$	272,071
Provision for loan losses	8,525		5,453		1,721		30,095
Loans charged off	—		—		(34)		(19,488)
Recoveries of loans previously charged off	74		371		236		7,426
Balance, September 30, 2023	$	63,188	$	101,964	$	64,362	$	290,104
Nine Months Ended September 30, 2023
(dollars in thousands)	Commercial, Financial and Agricultural		Consumer		Indirect Automobile		Mortgage Warehouse		Municipal		Premium Finance
Balance, December 31, 2022	$	39,455	$	5,413	$	174	$	2,118	$	357	$	1,025
Adjustment to allowance for adoption of ASU 2022-02	(105)		—		—		—		—		—
Provision for loan losses	46,050		2,146		(567)		(372)		(9)		141
Loans charged off	(42,068)		(4,140)		(135)		—		—		(5,220)
Recoveries of loans previously charged off	10,333		694		599		—		—		4,701
Balance, September 30, 2023	$	53,665	$	4,113	$	71	$	1,746	$	348	$	647
	Real Estate – Construction and Development		Real Estate – Commercial and Farmland		Real Estate – Residential		Total
Balance, December 31, 2022	$	32,659	$	67,433	$	57,043	$	205,677
Adjustment to allowance for adoption of ASU 2022-02	(37)		(722)		(847)		(1,711)
Provision for loan losses	29,920		38,097		7,708		123,114
Loans charged off	—		(3,320)		(231)		(55,114)
Recoveries of loans previously charged off	646		476		689		18,138
Balance, September 30, 2023	$	63,188	$	101,964	$	64,362	$	290,104

Modifications to Borrowers Experiencing Financial Difficulty

The Company periodically provides modifications to borrowers experiencing financial difficulty. These modifications include either payment deferrals, term extensions, interest rate reductions, principal forgiveness or combinations of modification types. The determination of whether the borrower is experiencing financial difficulty is made on the date of the modification. When principal forgiveness is provided, the amount of principal forgiveness is charged off against the allowance for credit losses with a corresponding reduction in the amortized cost basis of the loan.

The following table shows the amortized cost basis of the loans modified to borrowers experiencing financial difficulty, disaggregated by class of financing receivable and type of concession granted during the three and nine months ended September 30, 2024, and 2023:

Three Months Ended September 30, 2024
(dollars in thousands)	Payment Deferral		Term Extension		Interest Rate Reduction		Combination of Term Extension and Rate Reduction		Total		Percentage of Total Class of Financial Receivable
Real estate – residential	$	—	$	3,185	$	835	$	2,833	$	6,853	0.1	%
Total	$	—	$	3,185	$	835	$	2,833	$	6,853	—	%

Nine Months Ended September 30, 2024
(dollars in thousands)	Payment Deferral		Term Extension		Interest Rate Reduction		Combination of Term Extension and Rate Reduction		Total		Percentage of Total Class of Financial Receivable
Commercial, financial and agricultural	$	605	$	—	$	—	$	—	$	605	—	%
Real estate – residential	—		8,671		1,336		4,170		14,177		0.3	%
Total	$	605	$	8,671	$	1,336	$	4,170	$	14,782	0.1	%

Three Months Ended September 30, 2023
(dollars in thousands)	Payment Deferral		Term Extension		Interest Rate Reduction		Total		Percentage of Total Class of Financial Receivable
Commercial, financial and agricultural	$	—	$	520	$	—	$	520	—	%
Real estate – commercial and farmland	—		697		832		1,529		—	%
Real estate – residential	839		1,683		—		2,522		0.1	%
Total	$	839	$	2,900	$	832	$	4,571	—	%

Nine Months Ended September 30, 2023
(dollars in thousands)	Payment Deferral		Term Extension		Interest Rate Reduction		Combination of Term Extension and Rate Reduction		Total		Percentage of Total Class of Financial Receivable
Commercial, financial and agricultural	$	1,180	$	2,502	$	—	$	—	$	3,682	0.1	%
Real estate – construction and development	—		278		—		—		278		—	%
Real estate – commercial and farmland	—		1,197		832		—		2,029		—	%
Real estate – residential	1,033		3,165		—		348		4,546		0.1	%
Total	$	2,213	$	7,142	$	832	$	348	$	10,535	0.1	%

The Company had unfunded commitments to borrowers experiencing financial difficulty for which the Company has modified their loans of $1.4 million at September 30, 2024 and $1.5 million at December 31, 2023, respectively.

The following table describes the financial effect of the modifications made to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2024, and 2023, respectively:

Three Months Ended September 30, 2024

Term Extension
Loan Type	Financial Effect
Real estate - residential	Maturity dates were extended for a weighted average of 94 months.

Interest Rate Reduction
Loan Type	Financial Effect
Real estate - residential	Rate was reduced by 3.63%

Combination of Term Extension and Rate Reduction
Loan Type	Financial Effect
Real estate - residential	Maturity date was extended for a weighted average 101 months and rate was reduced by a weighted average 2.35%

Nine Months Ended September 30, 2024

Payment Deferral
Loan Type	Financial Effect
Commercial, financial and agricultural	Payments were deferred for 16 months.

Term Extension
Loan Type	Financial Effect
Real estate - residential	Maturity dates were extended for a weighted average of 89 months

Interest Rate Reduction
Loan Type	Financial Effect
Real estate - residential	Rate was reduced by a weighted average 2.88%

Combination of Term Extension and Rate Reduction
Loan Type	Financial Effect
Real estate - residential	Maturity date was extended for a weighted average 104 months and rate was reduced by a weighted average 2.51%

Three Months Ended September 30, 2023
Payment Deferral
Loan Type	Financial Effect
Real estate – residential	Payments were deferred for four months

Term Extension
Loan Type	Financial Effect
Commercial, financial and agricultural	Maturity date was extended nine months
Real estate – commercial and farmland	Maturity date was extended 12 months.
Real estate - residential	Maturity dates were extended for a weighted average of 116 months.

Interest Rate Reduction
Loan Type	Financial Effect
Real estate – commercial and farmland	Interest rate was reduced by 4.75%.

Nine Months Ended September 30, 2023
Payment Deferral
Loan Type	Financial Effect
Commercial, financial and agricultural	Payments were reduced approximately 32% for three months before returning to a fully amortizing payment structure thereafter.
Commercial, financial and agricultural	Payments were reduced approximately 73% for four months before requiring full repayment.
Real estate – residential	Payments were deferred for a weighted average of four months

Term Extension
Loan Type	Financial Effect
Commercial, financial and agricultural	Maturity dates were extended for a weighted average of ten months.
Real estate – construction and development	Maturity date was extended for 11 months.
Real estate – commercial and farmland	Maturity dates were extended for a weighted average of 12 months.
Real estate - residential	Maturity dates were extended for a weighted average of 92 months

Interest Rate Reduction
Loan Type	Financial Effect
Real estate – commercial and farmland	Interest rate was reduced by 4.75%

Combination of Term Extension and Rate Reduction
Loan Type	Financial Effect
Real estate - residential	Maturity date was extended 58 months and rate was reduced by 1.375%

The Company monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table depicts the performance of loans that have been modified in the last 12 months:

As of September 30, 2024
(dollars in thousands)	Current		30-59 Days Past Due		60-89 Days Past Due		90 or More Days Past Due		Total
Commercial, financial and agricultural	$	2,343	$	959	$	—	$	—	$	3,302
Real estate – commercial and farmland	2,544		—		—		—		2,544
Real estate – residential	11,189		2,872		615		2,572		17,248
Total	$	16,076	$	3,831	$	615	$	2,572	$	23,094

As of December 31, 2023
(dollars in thousands)	Current		30-59 Days Past Due		60-89 Days Past Due		90 or More Days Past Due		Total
Commercial, financial and agricultural	$	4,018	$	355	$	—	$	799	$	5,172
Real estate – commercial and farmland	6,692		1,129		—		—		7,821
Real estate – residential	5,113		711		442		1,106		7,372
Total	$	15,823	$	2,195	$	442	$	1,905	$	20,365

The following table provides the amortized cost basis of financing receivables that had a payment default during the three months ended September 30, 2024 and were modified in the 12 months before default to borrowers experiencing financial difficulty.

(dollars in thousands)	Interest Rate Reduction		Term Extension		Payment Deferral		Combination of Term Extension and Rate Reduction		Total
Commercial, financial and agricultural	$	—	$	—	$	959	$	—	$	959
Real estate – commercial and farmland	815		—		—		—		815
Real estate – residential	—		5,793		—		2,233		8,026
Total	$	815	$	5,793	$	959	$	2,233	$	9,800

The following table provides the amortized cost basis of financing receivables that had a payment default during the nine months ended September 30, 2024 and were modified in the 12 months before default to borrowers experiencing financial difficulty.

(dollars in thousands)	Interest Rate Reduction		Term Extension		Payment Deferral		Combination of Term Extension and Rate Reduction		Total
Commercial, financial and agricultural	$	—	$	—	$	1,056	$	—	$	1,056
Real estate – commercial and farmland	815		—		—		—		815
Real estate – residential	—		6,400		—		2,233		8,633
Total	$	815	$	6,400	$	1,056	$	2,233	$	10,504

The following table provides the amortized cost basis of financing receivables that had a payment default during both the three and nine months ended September 30, 2023 and were modified in the 12 months before default to borrowers experiencing financial difficulty.

(dollars in thousands)	Term Extension		Payment Deferral		Total
Commercial, financial and agricultural	$	482	$	815	$	1,297
Real estate – construction and development	278		—		278
Real estate – commercial and farmland	500		—		500
Real estate – residential	1,090		194		1,284
Total	$	2,350	$	1,009	$	3,359