Loans and Allowance for Loan Losses (Tables)

6 Months Ended

Jun. 30, 2014

Receivables [Abstract]

Loans Held-for-Investment by Class of Financing Receivables

Loans held-for-investment by class of financing receivables are as follows (in thousands):

	June 30,				December 31, 2013
	2014		2013
Commercial	$	617,925	$	608,226	$	596,730
Agricultural		75,133		60,663		75,928
Real estate		1,733,604		1,574,524		1,678,514
Consumer		346,412		317,477		333,113
Total loans held-for-investment	$	2,773,074	$	2,560,890	$	2,684,285

Non-Accrual Loans, Loans Still Accruing and Past Due 90 Days or More and Restructured Loans

The Company’s non-accrual loans, loans still accruing and past due 90 days or more and restructured loans are as follows (in thousands):

	June 30,				December 31, 2013
	2014		2013
Non-accrual loans*	$	23,565	$	26,297	$	27,926
Loans still accruing and past due 90 days or more		123		187		133
Restructured loans**		—		—		—
Total	$	23,688	$	26,484	$	28,059

*Includes $2,519,000, $3,497,000 and $2,707,000 of purchased credit impaired loans as of June 30, 2014 and 2013, and December 31, 2013, respectively.

**Restructured loans of $10,810,000, $16,373,000 and $13,298,000, whose interest collection, after considering economic and business conditions and collection efforts, is doubtful are included in non-accrual loans at June 30, 2014 and 2013, and December 31, 2013, respectively. At this time, all of our restructured loans are included in non-accrual loans.

Recorded Investment in Impaired Loans and Related Valuation Allowance

The Company’s recorded investment in impaired loans and the related valuation allowance are as follows (in thousands):

June 30, 2014				June 30, 2013				December 31, 2013
Recorded Investment		Valuation Allowance		Recorded Investment		Valuation Allowance		Recorded Investment		Valuation Allowance
$	23,565	$	4,883	$	26,297	$	4,872	$	27,926	$	5,338

Schedule of Non-Accrual Loans

Non-accrual loans at June 30, 2014 and 2013, and December 31, 2013, consisted of the following by class of financing receivables (in thousands):

	June 30,				December 31, 2013
	2014		2013
Commercial	$	3,640	$	1,366	$	4,281
Agricultural		109		286		131
Real estate		19,027		24,059		22,548
Consumer		789		586		966
Total	$	23,565	$	26,297	$	27,926

Schedule of Impaired Loans and Related Allowance

The Company’s impaired loans and related allowance as of June 30, 2014 and 2013, and December 31, 2013, are summarized in the following tables by class of financing receivables (in thousands). No interest income was recognized on impaired loans subsequent to their classification as impaired.

June 30, 2014	Unpaid Contractual Principal Balance		Recorded Investment With No Allowance*		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Year-to-Date Average Recorded Investment		Three-month Average Recorded Investment
Commercial	$	4,095	$	271	$	3,369	$	3,640	$	1,161	$	4,083	$	3,224
Agricultural		121		—		109		109		41		118		101
Real Estate		24,619		5,626		13,401		19,027		3,497		21,442		20,920
Consumer		960		442		347		789		184		879		759
Total	$	29,795	$	6,339	$	17,226	$	23,565	$	4,883	$	26,522	$	25,004

*Includes $2,519,000 of purchased credit impaired loans.

June 30, 2013	Unpaid Contractual Principal Balance		Recorded Investment With No Allowance*		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Year-to-Date Average Recorded Investment		Three-month Average Recorded Investment
Commercial	$	1,697	$	265	$	1,101	$	1,366	$	512	$	1,659	$	1,622
Agricultural		286		21		265		286		108		478		467
Real Estate		29,269		5,636		18,423		24,059		4,006		19,083		18,924
Consumer		681		156		430		586		246		1,473		1,437
Total	$	31,933	$	6,078	$	20,219	$	26,297	$	4,872	$	22,693	$	22,450

*Includes $3,497,000 of purchased credit impaired loans.

December 31, 2013	Unpaid Contractual Principal Balance		Recorded Investment With No Allowance*		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
Commercial	$	4,764	$	934	$	3,348	$	4,282	$	1,079	$	5,017
Agricultural		139		17		114		131		41		144
Real Estate		31,704		5,794		16,753		22,547		4,006		25,060
Consumer		1,117		545		421		966		212		1,072
Total	$	37,724	$	7,290	$	20,636	$	27,926	$	5,338	$	31,293

*Includes $2,707,000 of purchased credit impaired loans.

Schedule of Internal Ratings of Loans

The following summarizes the Company’s internal ratings of its loans held-for-investment by class of financing receivables and portfolio segments, which are the same, at June 30, 2014 and December 31, 2013 (in thousands):

June 30, 2014	Pass		Special Mention		Substandard		Doubtful		Total
Commercial	$	605,163	$	3,678	$	9,084	$	—	$	617,925
Agricultural		74,734		102		296		1		75,133
Real Estate		1,668,844		16,628		48,001		131		1,733,604
Consumer		344,403		522		1,483		4		346,412
Total	$	2,693,144	$	20,930	$	58,864	$	136	$	2,773,074

December 31, 2013	Pass		Special Mention		Substandard		Doubtful		Total
Commercial	$	584,547	$	3,032	$	9,151	$	—	$	596,730
Agricultural		75,382		245		298		3		75,928
Real Estate		1,609,242		20,773		48,352		147		1,678,514
Consumer		330,870		639		1,595		9		333,113
Total	$	2,600,041	$	24,689	$	59,396	$	159	$	2,684,285

Schedule of Past Due Loans

At June 30, 2014 and December 31, 2013, the Company’s past due loans are as follows (in thousands):

June 30, 2014	15-59 Days Past Due*		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Current		Total Loans		90 Days Past Due Still Accruing
Commercial	$	7,290	$	51	$	248	$	7,589	$	610,336	$	617,925	$	23
Agricultural		134		14		—		148		74,985		75,133		—
Real Estate		16,781		823		1,973		19,577		1,714,027		1,733,604		83
Consumer		1,470		443		153		2,066		344,346		346,412		17
Total	$	25,675	$	1,331	$	2,374	$	29,380	$	2,743,694	$	2,773,074	$	123

December 31, 2013	15-59 Days Past Due*		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Current		Total Loans		90 Days Past Due Still Accruing
Commercial	$	5,303	$	287	$	420	$	6,010	$	590,720	$	596,730	$	—
Agricultural		355		—		—		355		75,573		75,928		—
Real Estate		13,787		2,489		1,876		18,152		1,660,362		1,678,514		55
Consumer		2,708		582		277		3,567		329,546		333,113		78
Total	$	22,153	$	3,358	$	2,573	$	28,084	$	2,656,201	$	2,684,285	$	133

Allowance for Loan Losses by Estimating Losses in Various Categories of Loan Portfolio

The allowance for loan losses as of June 30, 2014 and 2013, and December 31, 2013, is presented below. Management has evaluated the appropriateness of the allowance for loan losses by estimating the probable losses in various categories of the loan portfolio, which are identified below (in thousands):

	June 30,				December 31, 2013
	2014		2013
Allowance for loan losses provided for:
Loans specifically evaluated as impaired	$	4,883	$	4,872	$	5,338
Remaining portfolio		31,009		29,227		28,562
Total allowance for loan losses	$	35,892	$	34,099	$	33,900

Schedule of Allowance for Loan Losses by Portfolio Segment

The following table details the allowance for loan losses at June 30, 2014 and December 31, 2013 by portfolio segment (in thousands). There were no allowances for purchased credit impaired loans at June 30, 2014 or December 31, 2013. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.

June 30, 2014	Commercial		Agricultural		Real Estate		Consumer		Total
Loans individually evaluated for impairment	$	2,594	$	134	$	7,340	$	348	$	10,416
Loans collectively evaluated for impairment		4,267		230		19,221		1,758		25,476
Total	$	6,861	$	364	$	26,561	$	2,106	$	35,892

December 31, 2013	Commercial		Agricultural		Real Estate		Consumer		Total
Loans individually evaluated for impairment	$	2,755	$	125	$	7,215	$	378	$	10,473
Loans collectively evaluated for impairment		3,685		258		17,725		1,759		23,427
Total	$	6,440	$	383	$	24,940	$	2,137	$	33,900

Changes in Allowance for Loan Losses

Changes in the allowance for loan losses for the three and six months ended June 30, 2014 and 2013 are summarized as follows by portfolio segment (in thousands):

Three months ended June 30, 2014	Commercial			Agricultural		Real Estate			Consumer			Total
Beginning balance	$	6,645		$	285	$	25,629		$	2,134		$	34,693
Provision for loan losses		219			78		835			(8	)		1,124
Recoveries		65			1		132			178			376
Charge-offs		(68	)		—		(35	)		(198	)		(301	)
Ending balance	$	6,861		$	364	$	26,561		$	2,106		$	35,892

Three months ended June 30, 2013	Commercial			Agricultural			Real Estate			Consumer			Total
Beginning balance	$	6,504		$	1,466		$	24,861		$	1,841		$	34,672
Provision for loan losses		240			29			271			292			832
Recoveries		68			8			23			66			165
Charge-offs		(76	)		(10	)		(1,253	)		(231	)		(1,570	)
Ending balance	$	6,736		$	1,493		$	23,902		$	1,968		$	34,099

Six months ended June 30, 2014	Commercial			Agricultural			Real Estate			Consumer			Total
Beginning balance	$	6,440		$	383		$	24,940		$	2,137		$	33,900
Provision for loan losses		554			(21	)		2,068			213			2,814
Recoveries		154			3			319			300			776
Charge-offs		(287	)		(1	)		(766	)		(544	)		(1,598	)
Ending balance	$	6,861		$	364		$	26,561		$	2,106		$	35,892

Six months ended June 30, 2013	Commercial			Agricultural			Real Estate			Consumer			Total
Beginning balance	$	7,343		$	1,541		$	24,063		$	1,892		$	34,839
Provision for loan losses		(431	)		(57	)		1,391			330			1,233
Recoveries		188			19			53			162			422
Charge-offs		(364	)		(10	)		(1,605	)		(416	)		(2,395	)
Ending balance	$	6,736		$	1,493		$	23,902		$	1,968		$	34,099

Schedule of Investment in Loans Related to Balance in Allowance for Loan Losses on Basis of Company's Impairment Methodology

The Company’s recorded investment in loans as of June 30, 2014 and December 31, 2013 related to the balance in the allowance for loan losses on the basis of the Company’s impairment methodology was as follows (in thousands). Purchased credit impaired loans of $2,519,000 and $2,707,000 at June 30, 2014 and December 31, 2013, respectively, are included in loans individually evaluated for impairment.

June 30, 2014	Commercial		Agricultural		Real Estate		Consumer		Total
Loans individually evaluated for impairment	$	12,762	$	399	$	64,760	$	2,009	$	79,930
Loans collectively evaluated for impairment		605,163		74,734		1,668,844		344,403		2,693,144
Total	$	617,925	$	75,133	$	1,733,604	$	346,412	$	2,773,074

December 31, 2013	Commercial		Agricultural		Real Estate		Consumer		Total
Loans individually evaluated for impairment	$	12,183	$	546	$	69,272	$	2,243	$	84,244
Loans collectively evaluated for impairment		584,547		75,382		1,609,242		330,870		2,600,041
Total	$	596,730	$	75,928	$	1,678,514	$	333,113	$	2,684,285

Schedule of Loans Modified and Considered Troubled Debt Restructuring

The Company’s loans that were modified in the three and six months ended June 30, 2014 and 2013 and considered troubled debt restructurings are as follows (in thousands):

	Three Months Ended June 30, 2014						Six Months Ended June 30, 2014
	Number		Pre-Modification Recorded Investment		Post- Modification Recorded Investment		Number		Pre-Modification Recorded Investment		Post- Modification Recorded Investment
Commercial		1	$	302	$	302		5	$	399	$	399
Agricultural		1		39		39		1		39		39
Real Estate		3		514		514		4		590		590
Consumer		—		—		—		3		11		11
Total		5	$	855	$	855		13	$	1,039	$	1,039
	Three Months Ended June 30, 2013						Six Months Ended June 30, 2013
	Number		Pre-Modification Recorded Investment		Post- Modification Recorded Investment		Number		Pre-Modification Recorded Investment		Post- Modification Recorded Investment
Commercial		1	$	98	$	98		3	$	218	$	218
Agricultural		—		—		—		1		24		24
Real Estate		4		2,982		2,982		8		3,779		3,779
Consumer		1		37		37		1		37		37
Total		6	$	3,117	$	3,117		13	$	4,058	$	4,058

Schedule of How Loans Were Modified as Troubled Debt Restructured Loans

The balances below provide information as to how the loans were modified as troubled debt restructured loans during the three and six months ended June 30, 2014 and 2013 (in thousands):

	Three Months Ended June 30, 2014						Six Months Ended June 30, 2014
	Adjusted Interest Rate		Extended Maturity		Combined Rate and Maturity		Adjusted Interest Rate		Extended Maturity		Combined Rate and Maturity
Commercial	$	—	$	—	$	302	$	—	$	97	$	302
Agricultural		—		—		39		—		—		39
Real Estate		—		42		472		—		118		472
Consumer		—		—		—		—		8		3
Total	$	—	$	42	$	813	$	—	$	223	$	816

	Three Months Ended June 30, 2013						Six Months Ended June 30, 2013
	Adjusted Interest Rate		Extended Maturity		Combined Rate and Maturity		Adjusted Interest Rate		Extended Maturity		Combined Rate and Maturity
Commercial	$	—	$	98	$	—	$	—	$	218	$	—
Agricultural		—		—		—		—		24		—
Real Estate		147		—		2,835		420		350		3,009
Consumer		—		37		—		—		37		—
Total	$	147	$	135	$	2,835	$	420	$	629	$	3,009

Schedule of Troubled Debt Restructuring

The loans are as follows (dollars in thousands):

	Three Months Ended June 30, 2014				Six Months Ended June 30, 2014
	Number		Balance		Number		Balance
Commercial		—	$	—		—	$	—
Agriculture		—		—		—		—
Real Estate		—		—		—		—
Consumer		1		32		1		32
Total		1	$	32		1	$	32

	Three Months Ended June 30, 2013				Six Months Ended June 30, 2013
	Number		Balance		Number		Balance
Commercial		1	$	58		5	$	245
Agriculture		—		—		—		—
Real Estate		—		—		—		—
Consumer		—		—		—		—
Total		1	$	58		5	$	245