Loans Held for Investment (LHFI) and Allowance for Loan Losses, LHFI (Tables)

9 Months Ended

Sep. 30, 2018

Accounts Notes Loans And Financing Receivable Gross Allowance And Net [Abstract]

At September 30, 2018 and December 31, 2017, LHFI consisted of the following ($ in thousands):

	September 30, 2018			December 31, 2017
Loans secured by real estate:
Construction, land development and other land	$	1,031,491		$	987,624
Secured by 1-4 family residential properties		1,801,029			1,675,311
Secured by nonfarm, nonresidential properties		2,294,289			2,193,823
Other real estate secured		453,687			517,956
Commercial and industrial loans		1,565,922			1,570,345
Consumer loans		182,709			171,918
State and other political subdivision loans		929,178			952,483
Other loans		488,725			500,507
LHFI		8,747,030			8,569,967
Allowance for loan losses, LHFI		(88,874	)		(76,733	)
Net LHFI	$	8,658,156		$	8,493,234

Aging Analysis of Past Due and Nonaccrual LHFI by Loan Type

The following tables provide an aging analysis of past due and nonaccrual LHFI by loan type at September 30, 2018 and December 31, 2017 ($ in thousands):

	September 30, 2018
	Past Due
	30-59 Days		60-89 Days		90 Days or More (1)		Total		Nonaccrual		Current Loans		Total LHFI
Loans secured by real estate:
Construction, land development and other land	$	203	$	5	$	—	$	208	$	2,262	$	1,029,021	$	1,031,491
Secured by 1-4 family residential properties		5,626		1,304		447		7,377		15,164		1,778,488		1,801,029
Secured by nonfarm, nonresidential properties		256		280		—		536		5,389		2,288,364		2,294,289
Other real estate secured		5		—		—		5		742		452,940		453,687
Commercial and industrial loans		1,727		9		21		1,757		33,870		1,530,295		1,565,922
Consumer loans		1,480		241		258		1,979		228		180,502		182,709
State and other political subdivision loans		—		—		—		—		8,762		920,416		929,178
Other loans		419		33		—		452		1,419		486,854		488,725
Total	$	9,716	$	1,872	$	726	$	12,314	$	67,836	$	8,666,880	$	8,747,030

(1)	Past due 90 days or more but still accruing interest.

	December 31, 2017
	Past Due
	30-59 Days		60-89 Days		90 Days or More (1)		Total		Nonaccrual		Current Loans		Total LHFI
Loans secured by real estate:
Construction, land development and other land	$	391	$	1	$	—	$	392	$	2,105	$	985,127	$	987,624
Secured by 1-4 family residential properties		6,412		2,084		1,917		10,413		19,022		1,645,876		1,675,311
Secured by nonfarm, nonresidential properties		2,319		256		—		2,575		12,608		2,178,640		2,193,823
Other real estate secured		—		—		—		—		212		517,744		517,956
Commercial and industrial loans		759		1,233		12		2,004		33,338		1,535,003		1,570,345
Consumer loans		2,141		255		242		2,638		135		169,145		171,918
State and other political subdivision loans		350		39		—		389		—		952,094		952,483
Other loans		18		4		—		22		155		500,330		500,507
Total	$	12,390	$	3,872	$	2,171	$	18,433	$	67,575	$	8,483,959	$	8,569,967

(1)	Past due 90 days or more but still accruing interest.

Impaired Financing Receivables

At September 30, 2018 and December 31, 2017, individually evaluated impaired LHFI consisted of the following ($ in thousands):

	September 30, 2018
	LHFI
	Unpaid Principal Balance		With No Related Allowance Recorded		With an Allowance Recorded		Total Carrying Amount		Related Allowance		Average Recorded Investment
Loans secured by real estate:
Construction, land development and other land	$	1,801	$	1,546	$	26	$	1,572	$	—	$	1,747
Secured by 1-4 family residential properties		4,771		126		3,614		3,740		43		4,217
Secured by nonfarm, nonresidential properties		3,585		3,010		360		3,370		78		5,845
Other real estate secured		—		—		—		—		—		—
Commercial and industrial loans		39,845		14,657		19,045		33,702		13,869		28,218
Consumer loans		3		—		3		3		—		6
State and other political subdivision loans		8,765		4,079		4,683		8,762		683		4,381
Other loans		1,432		230		1,076		1,306		1,076		816
Total	$	60,202	$	23,648	$	28,807	$	52,455	$	15,749	$	45,230

	December 31, 2017
	LHFI
	Unpaid Principal Balance		With No Related Allowance Recorded		With an Allowance Recorded		Total Carrying Amount		Related Allowance		Average Recorded Investment
Loans secured by real estate:
Construction, land development and other land	$	1,704	$	1,206	$	199	$	1,405	$	75	$	1,923
Secured by 1-4 family residential properties		6,031		160		4,576		4,736		1,331		4,693
Secured by nonfarm, nonresidential properties		15,205		10,027		396		10,423		165		8,321
Other real estate secured		—		—		—		—		—		—
Commercial and industrial loans		36,874		31,281		518		31,799		131		22,734
Consumer loans		17		—		17		17		—		9
State and other political subdivision loans		—		—		—		—		—		—
Other loans		556		—		556		556		41		325
Total	$	60,387	$	42,674	$	6,262	$	48,936	$	1,743	$	38,005

Impact of Modifications Classified as Troubled Debt Restructurings

The following tables illustrate the impact of modifications classified as TDRs as well as those TDRs modified within the last 12 months for which there was a payment default during the period for the periods presented ($ in thousands):

	Three Months Ended September 30,
	2018						2017
Troubled Debt Restructurings	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Loans secured by 1-4 family residential properties		3	$	121	$	121		1	$	112	$	113
Loans secured by nonfarm, nonresidential properties		—		—		—		1		426		426
Commercial and industrial loans		9		11,153		10,062		6		12,500		12,500
Total		12	$	11,274	$	10,183		8	$	13,038	$	13,039

	Nine Months Ended September 30,
	2018						2017
Troubled Debt Restructurings	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Construction, land development and other land loans		1	$	22	$	22		1	$	341	$	325
Loans secured by 1-4 family residential properties		19		1,873		1,432		17		1,280		1,290
Loans secured by nonfarm, nonresidential properties		—		—		—		1		426		426
Commercial and industrial loans		15		22,899		21,791		7		12,744		12,744
Consumer loans		3		4		4		—		—		—
Total		38	$	24,798	$	23,249		26	$	14,791	$	14,785

Troubled Debt Restructuring Subsequently Defaulted

	Nine Months Ended September 30,
	2018				2017
TDRs that Subsequently Defaulted	Number of Contracts		Recorded Investment		Number of Contracts		Recorded Investment
Construction, land development and other land loans		1	$	21		—	$	—
Loans secured by 1-4 family residential properties		6		321		4		64
Commercial and industrial loans		6		13,985		2		—
Total		13	$	14,327		6	$	64

Troubled Debt Restructuring Related to Loans Held for Investment by Loan Type

The following tables detail LHFI classified as TDRs by loan type at September 30, 2018 and 2017 ($ in thousands):

	September 30, 2018
	Accruing		Nonaccrual		Total
Loans secured by real estate:
Construction, land development and other land	$	—	$	26	$	26
Secured by 1-4 family residential properties		563		3,052		3,615
Secured by nonfarm, nonresidential properties		—		360		360
Commercial and industrial loans		1,783		29,636		31,419
Consumer loans		—		3		3
Other loans		—		540		540
Total TDRs	$	2,346	$	33,617	$	35,963

	September 30, 2017
	Accruing		Nonaccrual		Total
Loans secured by real estate:
Construction, land development and other land	$	—	$	272	$	272
Secured by 1-4 family residential properties		14		3,077		3,091
Secured by nonfarm, nonresidential properties		426		436		862
Commercial and industrial loans		—		20,153		20,153
Consumer loans		—		1		1
Total TDRs	$	440	$	23,939	$	24,379

Carrying Amount of Loans by Credit Quality Indicator

The tables below present LHFI by loan type and credit quality indicator at September 30, 2018 and December 31, 2017 ($ in thousands):

	September 30, 2018
		Commercial LHFI
		Pass - Categories 1-6		Special Mention - Category 7		Substandard - Category 8		Doubtful - Category 9		Subtotal
Loans secured by real estate:
Construction, land development and other land		$	961,316	$	78	$	4,512	$	208	$	966,114
Secured by 1-4 family residential properties			125,998		175		2,960		60		129,193
Secured by nonfarm, nonresidential properties			2,259,388		3,052		31,302		484		2,294,226
Other real estate secured			452,095		454		515		—		453,064
Commercial and industrial loans			1,490,431		9,721		63,936		1,834		1,565,922
Consumer loans			—		—		—		—		—
State and other political subdivision loans			913,286		5,250		10,642		—		929,178
Other loans			458,118		15,597		10,469		77		484,261
Total		$	6,660,632	$	34,327	$	124,336	$	2,663	$	6,821,958

	Consumer LHFI
	Current		Past Due 30-89 Days		Past Due 90 Days or More		Nonaccrual		Subtotal		Total LHFI
Loans secured by real estate:
Construction, land development and other land	$	65,028	$	3	$	—	$	346	$	65,377	$	1,031,491
Secured by 1-4 family residential properties		1,651,019		6,566		447		13,804		1,671,836		1,801,029
Secured by nonfarm, nonresidential properties		63		—		—		—		63		2,294,289
Other real estate secured		623		—		—		—		623		453,687
Commercial and industrial loans		—		—		—		—		—		1,565,922
Consumer loans		180,503		1,721		258		227		182,709		182,709
State and other political subdivision loans		—		—		—		—		—		929,178
Other loans		4,464		—		—		—		4,464		488,725
Total	$	1,901,700	$	8,290	$	705	$	14,377	$	1,925,072	$	8,747,030

	December 31, 2017
		Commercial LHFI
		Pass - Categories 1-6		Special Mention - Category 7		Substandard - Category 8		Doubtful - Category 9		Subtotal
Loans secured by real estate:
Construction, land development and other land		$	922,563	$	316	$	3,780	$	222	$	926,881
Secured by 1-4 family residential properties			127,405		134		4,948		76		132,563
Secured by nonfarm, nonresidential properties			2,135,749		6,684		50,785		527		2,193,745
Other real estate secured			517,036		—		517		—		517,553
Commercial and industrial loans			1,437,590		28,780		103,089		886		1,570,345
Consumer loans			—		—		—		—		—
State and other political subdivision loans			936,420		5,850		10,213		—		952,483
Other loans			478,083		—		16,390		108		494,581
Total		$	6,554,846	$	41,764	$	189,722	$	1,819	$	6,788,151

	Consumer LHFI
	Current		Past Due 30-89 Days		Past Due 90 Days or More		Nonaccrual		Subtotal		Total LHFI
Loans secured by real estate:
Construction, land development and other land	$	60,240	$	342	$	—	$	161	$	60,743	$	987,624
Secured by 1-4 family residential properties		1,516,691		7,874		1,809		16,374		1,542,748		1,675,311
Secured by nonfarm, nonresidential properties		78		—		—		—		78		2,193,823
Other real estate secured		403		—		—		—		403		517,956
Commercial and industrial loans		—		—		—		—		—		1,570,345
Consumer loans		169,146		2,396		242		134		171,918		171,918
State and other political subdivision loans		—		—		—		—		—		952,483
Other loans		5,926		—		—		—		5,926		500,507
Total	$	1,752,484	$	10,612	$	2,051	$	16,669	$	1,781,816	$	8,569,967

Change in Allowance for Loan Losses

The following tables detail the balance in the allowance for loan losses, LHFI allocated to each loan type segmented by the impairment evaluation methodology used at September 30, 2018 and December 31, 2017 ($ in thousands):

	September 30, 2018
	Individually		Collectively		Total
Loans secured by real estate:
Construction, land development and other land	$	—	$	8,414	$	8,414
Secured by 1-4 family residential properties		43		9,265		9,308
Secured by nonfarm, nonresidential properties		78		24,781		24,859
Other real estate secured		—		2,949		2,949
Commercial and industrial loans		13,869		19,448		33,317
Consumer loans		—		3,394		3,394
State and other political subdivision loans		683		510		1,193
Other loans		1,076		4,364		5,440
Total allowance for loan losses, LHFI	$	15,749	$	73,125	$	88,874

	December 31, 2017
	Individually		Collectively		Total
Loans secured by real estate:
Construction, land development and other land	$	75	$	7,790	$	7,865
Secured by 1-4 family residential properties		1,331		9,543		10,874
Secured by nonfarm, nonresidential properties		165		23,263		23,428
Other real estate secured		—		2,790		2,790
Commercial and industrial loans		131		22,720		22,851
Consumer loans		—		3,470		3,470
State and other political subdivision loans		—		789		789
Other loans		41		4,625		4,666
Total allowance for loan losses, LHFI	$	1,743	$	74,990	$	76,733

Changes in the allowance for loan losses, LHFI were as follows for the periods presented ($ in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Balance at beginning of period	$	83,566		$	76,184		$	76,733		$	71,265
Transfers (1)		772			—			1,554			—
Loans charged-off		(7,017	)		(2,752	)		(12,980	)		(9,072	)
Recoveries		2,880			3,228			7,766			8,784
Net (charge-offs) recoveries		(4,137	)		476			(5,214	)		(288	)
Provision for loan losses, LHFI		8,673			3,672			15,801			9,355
Balance at end of period	$	88,874		$	80,332		$	88,874		$	80,332

(1)

The allowance for loan losses balance related to the remaining loans acquired in the Bay Bank & Trust Company (Bay Bank) merger on March 16, 2012, which were transferred from acquired impaired loans to LHFI during the second quarter of 2018, and the remaining loans acquired in the Heritage Banking Group (Heritage) acquisition on April 15, 2011 and the Reliance merger on April 7, 2017, which were transferred from acquired impaired loans to LHFI during the third quarter of 2018.

The following tables detail changes in the allowance for loan losses, LHFI by loan type for the periods ended September 30, 2018 and 2017 ($ in thousands):

	2018
	Balance January 1,		Transfers (1)		Charge-offs			Recoveries		Provision for Loan Losses			Balance September 30,
Loans secured by real estate:
Construction, land development and other land	$	7,865	$	584	$	(123	)	$	1,039	$	(951	)	$	8,414
Secured by 1-4 family residential properties		10,874		182		(1,435	)		439		(752	)		9,308
Secured by nonfarm, nonresidential properties		23,428		446		(1,117	)		120		1,982			24,859
Other real estate secured		2,790		291		—			17		(149	)		2,949
Commercial and industrial loans		22,851		46		(4,658	)		2,285		12,793			33,317
Consumer loans		3,470		5		(1,585	)		1,545		(41	)		3,394
State and other political subdivision loans		789		—		—			—		404			1,193
Other loans		4,666		—		(4,062	)		2,321		2,515			5,440
Total allowance for loan losses, LHFI	$	76,733	$	1,554	$	(12,980	)	$	7,766	$	15,801		$	88,874

(1)

The allowance for loan losses balance related to the remaining loans acquired in the Bay Bank merger on March 16, 2012, which were transferred from acquired impaired loans to LHFI during the second quarter of 2018, and the remaining loans acquired in the Heritage acquisition on April 15, 2011 and the Reliance merger on April 7, 2017, which were transferred from acquired impaired loans to LHFI during the third quarter of 2018.

	2017
	Balance January 1,		Charge-offs			Recoveries		Provision for Loan Losses			Balance September 30,
Loans secured by real estate:
Construction, land development and other land loans	$	9,085	$	(79	)	$	1,257	$	(1,615	)	$	8,648
Secured by 1-4 family residential properties		10,347		(753	)		1,429		(743	)		10,280
Secured by nonfarm, nonresidential properties		20,967		(50	)		289		7,542			28,748
Other real estate secured		2,263		—			31		1,111			3,405
Commercial and industrial loans		22,011		(2,624	)		1,813		(1,420	)		19,780
Consumer loans		3,241		(1,809	)		1,427		1,597			4,456
State and other political subdivision loans		859		—			—		(48	)		811
Other loans		2,492		(3,757	)		2,538		2,931			4,204
Total allowance for loan losses, LHFI	$	71,265	$	(9,072	)	$	8,784	$	9,355		$	80,332

Summary Of LHFI Evaluated For Impairment

The following tables detail LHFI by loan type related to each balance in the allowance for loan losses, LHFI segregated by the impairment evaluation methodology used at September 30, 2018 and December 31, 2017 ($ in thousands):

	September 30, 2018
	LHFI Evaluated for Impairment
	Individually		Collectively		Total
Loans secured by real estate:
Construction, land development and other land	$	1,572	$	1,029,919	$	1,031,491
Secured by 1-4 family residential properties		3,740		1,797,289		1,801,029
Secured by nonfarm, nonresidential properties		3,370		2,290,919		2,294,289
Other real estate secured		—		453,687		453,687
Commercial and industrial loans		33,702		1,532,220		1,565,922
Consumer loans		3		182,706		182,709
State and other political subdivision loans		8,762		920,416		929,178
Other loans		1,306		487,419		488,725
Total	$	52,455	$	8,694,575	$	8,747,030

	December 31, 2017
	LHFI Evaluated for Impairment
	Individually		Collectively		Total
Loans secured by real estate:
Construction, land development and other land	$	1,405	$	986,219	$	987,624
Secured by 1-4 family residential properties		4,736		1,670,575		1,675,311
Secured by nonfarm, nonresidential properties		10,423		2,183,400		2,193,823
Other real estate secured		—		517,956		517,956
Commercial and industrial loans		31,799		1,538,546		1,570,345
Consumer loans		17		171,901		171,918
State and other political subdivision loans		—		952,483		952,483
Other loans		556		499,951		500,507
Total	$	48,936	$	8,521,031	$	8,569,967