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

9 Months Ended

Sep. 30, 2019

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

At September 30, 2019 and December 31, 2018, LHFI consisted of the following ($ in thousands):

	September 30, 2019		December 31, 2018
Loans secured by real estate:
Construction, land development and other land	$	1,135,999	$	1,056,601
Secured by 1-4 family residential properties		1,820,455		1,825,492
Secured by nonfarm, nonresidential properties		2,442,308		2,220,914
Other real estate secured		668,667		543,820
Commercial and industrial loans		1,491,367		1,538,715
Consumer loans		176,894		182,448
State and other political subdivision loans		978,456		973,818
Other loans		509,522		494,060
LHFI		9,223,668		8,835,868
Less allowance for loan losses, LHFI		83,226		79,290
Net LHFI	$	9,140,442	$	8,756,578

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, 2019 and December 31, 2018 ($ in thousands):

	September 30, 2019
	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	$	240	$	39	$	—	$	279	$	1,144	$	1,134,576	$	1,135,999
Secured by 1-4 family residential properties		3,928		715		540		5,183		18,598		1,796,674		1,820,455
Secured by nonfarm, nonresidential properties		1,453		765		—		2,218		7,757		2,432,333		2,442,308
Other real estate secured		177		—		—		177		1,067		667,423		668,667
Commercial and industrial loans		973		181		40		1,194		25,313		1,464,860		1,491,367
Consumer loans		1,554		227		298		2,079		110		174,705		176,894
State and other political subdivision loans		—		—		—		—		4,078		974,378		978,456
Other loans		161		36		—		197		963		508,362		509,522
Total	$	8,486	$	1,963	$	878	$	11,327	$	59,030	$	9,153,311	$	9,223,668

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

	December 31, 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	$	284	$	—	$	—	$	284	$	2,218	$	1,054,099	$	1,056,601
Secured by 1-4 family residential properties		8,600		1,700		569		10,869		14,718		1,799,905		1,825,492
Secured by nonfarm, nonresidential properties		1,887		—		—		1,887		9,621		2,209,406		2,220,914
Other real estate secured		197		99		—		296		927		542,597		543,820
Commercial and industrial loans		1,346		300		—		1,646		23,938		1,513,131		1,538,715
Consumer loans		1,800		353		287		2,440		205		179,803		182,448
State and other political subdivision loans		186		—		—		186		8,595		965,037		973,818
Other loans		83		—		—		83		1,402		492,575		494,060
Total	$	14,383	$	2,452	$	856	$	17,691	$	61,624	$	8,756,553	$	8,835,868

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

Impaired Financing Receivables

At September 30, 2019 and December 31, 2018, individually evaluated impaired LHFI consisted of the following ($ in thousands):

	September 30, 2019
	LHFI
	Unpaid Principal Balance		With No Related Allowance Recorded		With an Allowance Recorded		Total Recorded Investment		Related Allowance		Average Recorded Investment
Loans secured by real estate:
Construction, land development and other land	$	937	$	631	$	18	$	649	$	—	$	1,100
Secured by 1-4 family residential properties		6,079		2,244		2,880		5,124		29		4,543
Secured by nonfarm, nonresidential properties		6,892		6,087		329		6,416		228		7,946
Other real estate secured		69		69		—		69		—		159
Commercial and industrial loans		26,786		11,898		12,543		24,441		3,435		27,579
Consumer loans		24		—		23		23		—		12
State and other political subdivision loans		4,079		4,079		—		4,079		—		6,337
Other loans		1,330		230		685		915		685		1,099
Total	$	46,196	$	25,238	$	16,478	$	41,716	$	4,377	$	48,775

	December 31, 2018
	LHFI
	Unpaid Principal Balance		With No Related Allowance Recorded		With an Allowance Recorded		Total Recorded Investment		Related Allowance		Average Recorded Investment
Loans secured by real estate:
Construction, land development and other land	$	1,794	$	1,528	$	24	$	1,552	$	—	$	1,738
Secured by 1-4 family residential properties		4,951		95		3,868		3,963		39		4,328
Secured by nonfarm, nonresidential properties		8,282		6,728		2,748		9,476		413		8,898
Other real estate secured		—		—		248		248		—		124
Commercial and industrial loans		37,786		12,893		17,824		30,717		4,334		26,725
Consumer loans		2		—		2		2		—		6
State and other political subdivision loans		8,688		4,079		4,516		8,595		516		4,297
Other loans		1,418		230		1,052		1,282		1,052		804
Total	$	62,921	$	25,553	$	30,282	$	55,835	$	6,354	$	46,920

Impact of Modifications Classified as Troubled Debt Restructurings

The following tables illustrate the impact of modifications classified as TDRs for the periods presented ($ in thousands):

	Three Months Ended September 30,
	2019						2018
	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 real estate:
Secured by 1-4 family residential properties		4	$	113	$	102		3	$	121	$	121
Commercial and industrial loans		—		—		—		9		11,153		10,062
Total		4	$	113	$	102		12	$	11,274	$	10,183

	Nine Months Ended September 30,
	2019						2018
	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 real estate:
Construction, land development and other land		—	$	—	$	—		1	$	22	$	22
Secured by 1-4 family residential properties		11		992		980		19		1,873		1,432
Secured by nonfarm, nonresidential properties		1		5,055		5,055		—		—		—
Commercial and industrial loans		8		9,167		9,054		15		22,899		21,791
Consumer loans		2		30		30		3		4		4
Total		22	$	15,244	$	15,119		38	$	24,798	$	23,249

Troubled Debt Restructuring Subsequently Defaulted

The table below includes the balances at default for TDRs modified within the last 12 months for which there was a payment default during the periods presented ($ in thousands):

	Nine Months Ended September 30,
	2019				2018
	Number of Contracts		Recorded Investment		Number of Contracts		Recorded Investment
Loans secured by real estate:
Construction, land development and other land		—	$	—		1	$	21
Secured by 1-4 family residential properties		1		46		6		321
Commercial and industrial loans		8		254		6		13,985
Consumer loans		1		27		—		—
Total		10	$	327		13	$	14,327

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, 2019 and 2018 ($ in thousands):

	September 30, 2019
	Accruing		Nonaccrual		Total
Loans secured by real estate:
Construction, land development and other land	$	—	$	18	$	18
Secured by 1-4 family residential properties		101		3,373		3,474
Secured by nonfarm, nonresidential properties		—		5,243		5,243
Commercial and industrial loans		1,246		20,262		21,508
Consumer loans		—		23		23
Other loans		—		244		244
Total TDRs	$	1,347	$	29,163	$	30,510

	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

Carrying Amount of Loans by Credit Quality Indicator

The tables below present LHFI by loan type and credit quality indicator at September 30, 2019 and December 31, 2018 ($ in thousands):

	September 30, 2019
		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		$	1,052,274	$	67	$	4,361	$	187	$	1,056,889
Secured by 1-4 family residential properties			115,855		45		3,061		44		119,005
Secured by nonfarm, nonresidential properties			2,397,641		—		44,290		346		2,442,277
Other real estate secured			666,967		—		961		—		667,928
Commercial and industrial loans			1,416,225		948		73,498		671		1,491,342
Consumer loans			—		—		—		—		—
State and other political subdivision loans			968,335		4,650		5,471		—		978,456
Other loans			484,729		3,409		17,302		33		505,473
Total		$	7,102,026	$	9,119	$	148,944	$	1,281	$	7,261,370

	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	$	78,814	$	70	$	—	$	226	$	79,110	$	1,135,999
Secured by 1-4 family residential properties		1,679,502		4,523		539		16,886		1,701,450		1,820,455
Secured by nonfarm, nonresidential properties		31		—		—		—		31		2,442,308
Other real estate secured		739		—		—		—		739		668,667
Commercial and industrial loans		25		—		—		—		25		1,491,367
Consumer loans		174,706		1,781		298		109		176,894		176,894
State and other political subdivision loans		—		—		—		—		—		978,456
Other loans		4,049		—		—		—		4,049		509,522
Total	$	1,937,866	$	6,374	$	837	$	17,221	$	1,962,298	$	9,223,668

	December 31, 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		$	982,305	$	75	$	5,645	$	203	$	988,228
Secured by 1-4 family residential properties			123,191		216		2,731		229		126,367
Secured by nonfarm, nonresidential properties			2,182,106		1,250		37,025		473		2,220,854
Other real estate secured			537,958		323		4,610		—		542,891
Commercial and industrial loans			1,468,262		12,431		55,943		2,079		1,538,715
Consumer loans			—		—		—		—		—
State and other political subdivision loans			958,214		5,250		10,354		—		973,818
Other loans			460,568		17,842		10,323		49		488,782
Total		$	6,712,604	$	37,387	$	126,631	$	3,033	$	6,879,655

	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	$	67,913	$	124	$	—	$	336	$	68,373	$	1,056,601
Secured by 1-4 family residential properties		1,675,455		9,872		569		13,229		1,699,125		1,825,492
Secured by nonfarm, nonresidential properties		60		—		—		—		60		2,220,914
Other real estate secured		929		—		—		—		929		543,820
Commercial and industrial loans		—		—		—		—		—		1,538,715
Consumer loans		179,802		2,153		288		205		182,448		182,448
State and other political subdivision loans		—		—		—		—		—		973,818
Other loans		5,278		—		—		—		5,278		494,060
Total	$	1,929,437	$	12,149	$	857	$	13,770	$	1,956,213	$	8,835,868

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, 2019 and December 31, 2018 ($ in thousands):

	September 30, 2019
	Individually		Collectively		Total
Loans secured by real estate:
Construction, land development and other land	$	—	$	7,701	$	7,701
Secured by 1-4 family residential properties		29		8,415		8,444
Secured by nonfarm, nonresidential properties		228		24,974		25,202
Other real estate secured		—		3,554		3,554
Commercial and industrial loans		3,435		25,432		28,867
Consumer loans		—		3,312		3,312
State and other political subdivision loans		—		472		472
Other loans		685		4,989		5,674
Total allowance for loan losses, LHFI	$	4,377	$	78,849	$	83,226

	December 31, 2018
	Individually		Collectively		Total
Loans secured by real estate:
Construction, land development and other land	$	—	$	7,390	$	7,390
Secured by 1-4 family residential properties		39		8,602		8,641
Secured by nonfarm, nonresidential properties		413		21,963		22,376
Other real estate secured		—		3,450		3,450
Commercial and industrial loans		4,334		23,025		27,359
Consumer loans		—		2,890		2,890
State and other political subdivision loans		516		474		990
Other loans		1,052		5,142		6,194
Total allowance for loan losses, LHFI	$	6,354	$	72,936	$	79,290

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,
	2019			2018			2019			2018
Balance at beginning of period	$	80,399		$	83,566		$	79,290		$	76,733
Transfers (1)		—			772			—			1,554
Loans charged-off		(2,892	)		(7,017	)		(9,862	)		(12,980	)
Recoveries		2,680			2,880			6,662			7,766
Net (charge-offs) recoveries		(212	)		(4,137	)		(3,200	)		(5,214	)
Provision for loan losses, LHFI		3,039			8,673			7,136			15,801
Balance at end of period	$	83,226		$	88,874		$	83,226		$	88,874

(1)

The allowance for loan losses balance related to the remaining loans acquired in the Bay Bank merger, which were transferred from acquired loans to LHFI during the second quarter of 2018, and the remaining loans acquired in the Heritage and Reliance mergers, which were transferred from acquired 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 presented ($ in thousands):

	2019
	Balance January 1,		Charge-offs			Recoveries		Provision for Loan Losses			Balance September 30,
Loans secured by real estate:
Construction, land development and other land	$	7,390	$	(35	)	$	807	$	(461	)	$	7,701
Secured by 1-4 family residential properties		8,641		(310	)		530		(417	)		8,444
Secured by nonfarm, nonresidential properties		22,376		(261	)		285		2,802			25,202
Other real estate secured		3,450		—			22		82			3,554
Commercial and industrial loans		27,359		(3,090	)		980		3,618			28,867
Consumer loans		2,890		(1,712	)		1,432		702			3,312
State and other political subdivision loans		990		—			—		(518	)		472
Other loans		6,194		(4,454	)		2,606		1,328			5,674
Total allowance for loan losses, LHFI	$	79,290	$	(9,862	)	$	6,662	$	7,136		$	83,226

	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 loans	$	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)

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, 2019 and December 31, 2018 ($ in thousands):

	September 30, 2019
	LHFI Evaluated for Impairment
	Individually		Collectively		Total
Loans secured by real estate:
Construction, land development and other land	$	649	$	1,135,350	$	1,135,999
Secured by 1-4 family residential properties		5,124		1,815,331		1,820,455
Secured by nonfarm, nonresidential properties		6,416		2,435,892		2,442,308
Other real estate secured		69		668,598		668,667
Commercial and industrial loans		24,441		1,466,926		1,491,367
Consumer loans		23		176,871		176,894
State and other political subdivision loans		4,079		974,377		978,456
Other loans		915		508,607		509,522
Total	$	41,716	$	9,181,952	$	9,223,668

	December 31, 2018
	LHFI Evaluated for Impairment
	Individually		Collectively		Total
Loans secured by real estate:
Construction, land development and other land	$	1,552	$	1,055,049	$	1,056,601
Secured by 1-4 family residential properties		3,963		1,821,529		1,825,492
Secured by nonfarm, nonresidential properties		9,476		2,211,438		2,220,914
Other real estate secured		248		543,572		543,820
Commercial and industrial loans		30,717		1,507,998		1,538,715
Consumer loans		2		182,446		182,448
State and other political subdivision loans		8,595		965,223		973,818
Other loans		1,282		492,778		494,060
Total	$	55,835	$	8,780,033	$	8,835,868