(5) LOANS AND LEASES

The Company's loan and lease portfolio is disaggregated into the following segments: commercial and industrial; real estate; credit card; and all other loans and leases. The real estate segment is further disaggregated into the following classes: consumer mortgage; home equity; agricultural; commercial and industrial-owner occupied; construction, acquisition and development and commercial. A summary of gross loans and leases by segment and class at December 31, 2011 and 2010 follows:

	2011		2010
	(In thousands)
Commercial and industrial	$	1,484,967	$	1,505,471
Real estate
Consumer mortgage		1,945,190		1,951,563
Home equity		514,362		543,272
Agricultural		239,487		252,292
Commercial and industrial-owner occupied		1,301,575		1,331,473
Construction, acquisition and development		908,362		1,174,743
Commercial		1,754,022		1,816,951
Credit Cards		106,281		106,345
All other		657,012		694,241
Total	$	8,911,258	$	9,376,351

The following table shows the Company's loans and leases, net of unearned income, as of December 31, 2011 by geographical location:

	Alabama and Florida Panhandle		Arkansas*		Mississippi*		Missouri		Greater Memphis Area		Tennessee*		Texas and Louisiana		Other		Total
	(In thousands)
Commercial and industrial	$	63,583	$	188,329	$	312,364	$	51,291	$	23,745	$	80,094	$	258,225	$	496,097	$	1,473,728
Real estate
Consumer mortgages		111,455		272,857		756,389		56,808		86,576		162,604		427,955		70,546		1,945,190
Home equity		58,991		42,250		174,632		26,930		70,034		76,361		63,298		1,866		514,362
Agricultural		6,354		71,592		71,787		4,047		9,601		13,163		57,836		5,107		239,487
Commercial and industrial-owner occupied		115,133		167,935		455,700		67,055		99,394		98,860		248,107		49,391		1,301,575
Construction, acquisition and development		103,594		80,121		259,551		51,432		98,948		98,865		196,490		19,361		908,362
Commercial		199,844		346,534		352,754		223,849		115,783		101,068		359,989		54,201		1,754,022
Credit cards**		-		-		-		-		-		-		-		106,281		106,281
All other		29,846		90,905		201,067		4,443		54,846		47,412		89,417		109,368		627,304
Total	$	688,800	$	1,260,523	$	2,584,244	$	485,855	$	558,927	$	678,427	$	1,701,317	$	912,218	$	8,870,311

* Excludes the Greater Memphis Area
** Credit card receivables are spread across all geographic regions but are not viewed by the Company's management as part of the geographic breakdown.

The Company's loan concentrations which exceed 10% of total loans are reflected in the preceding tables. A substantial portion of construction, acquisition and development loans are secured by real estate in markets in which the Company is located. Prior to March 2010, some of these loans were structured with interest reserves to fund interest costs during the construction and development period. The Company's general loan policy was changed in March 2010 to prohibit the use of interest reserves on loans made after that time. Additionally, certain of these loans are structured with interest-only terms. A portion of the consumer mortgage and commercial real estate portfolios originated through the permanent financing of construction, acquisition and development loans. The prolonged economic downturn has negatively impacted many borrowers' and guarantors' ability to make payments under the terms of the loans as their liquidity has been depleted. Accordingly, the ultimate collectability of a substantial portion of these loans and the recovery of a substantial portion of the carrying amount of other real estate owned are susceptible to changes in real estate values in these areas. Continued economic distress could negatively impact additional borrowers' and guarantors' ability to repay their debt which will make more of the Company's loans collateral dependent.

The following table provides details regarding the aging of the Company's loan and lease portfolio, net of unearned income, at December 31, 2011:

	2011
													90+ Days
	30-59 Days		60-89 Days		90+ Days		Total				Total		Past Due still
	Past Due		Past Due		Past Due		Past Due		Current		Outstanding		Accruing
	(In thousands)
Commercial and industrial	$	5,571	$	4,209	$	4,193	$	13,973	$	1,459,755	$	1,473,728	$	12
Real estate
Consumer mortgages		15,740		6,485		14,569		36,794		1,908,396		1,945,190		2,974
Home equity		1,837		265		594		2,696		511,666		514,362		-
Agricultural		666		54		719		1,439		238,048		239,487		-
Commercial and industrial-owner occupied		2,199		844		12,977		16,020		1,285,555		1,301,575		-
Construction, acquisition and development		4,826		4,955		33,584		43,365		864,997		908,362		-
Commercial		3,778		2,702		9,397		15,877		1,738,145		1,754,022		-
Credit cards		595		303		697		1,595		104,686		106,281		299
All other		2,124		390		1,579		4,093		623,211		627,304		149
Total	$	37,336	$	20,207	$	78,309	$	135,852	$	8,734,459	$	8,870,311	$	3,434

	2010
													90+ Days
	30-59 Days		60-89 Days		90+ Days		Total				Total		Past Due still
	Past Due		Past Due		Past Due		Past Due		Current		Outstanding		Accruing
	(In thousands)
Commercial and industrial	$	13,037	$	848	$	12,000	$	25,885	$	1,465,298	$	1,491,183	$	675
Real estate
Consumer mortgages		16,937		4,481		20,640		42,058		1,909,505		1,951,563		6,521
Home equity		1,258		800		755		2,813		540,459		543,272		173
Agricultural		1,140		3,450		3,527		8,117		244,175		252,292		123
Commercial and industrial-owner occupied		9,260		1,290		7,323		17,873		1,313,600		1,331,473		20
Construction, acquisition and development		22,436		9,837		94,264		126,537		1,048,206		1,174,743		197
Commercial		4,409		4,712		10,507		19,628		1,797,323		1,816,951		-
Credit cards		793		373		780		1,946		104,399		106,345		330
All other		2,058		1,117		847		4,022		661,263		665,285		461
Total	$	71,328	$	26,908	$	150,643	$	248,879	$	9,084,228	$	9,333,107	$	8,500

The Company utilizes an internal loan classification system to grade loans according to certain credit quality indicators. These credit quality indicators include, but are not limited to, recent credit performance, delinquency, liquidity, cash flows, debt coverage ratios, collateral type and loan-to-value ratio. The Company's internal loan classification system is compatible with classifications used by the FDIC, as well as other regulatory agencies. Loans may be classified as follows:

Pass: Loans which are performing as agreed with few or no signs of weakness. These loan show sufficient cash flow, capital and collateral to repay the loan as agreed. Borrowers for these loans include well capitalized public corporations.

Special Mention: Loans where potential weaknesses have developed which could cause a more serious problem if not corrected.

Substandard: Loans where well-defined weaknesses exist that require corrective action to prevent further deterioration.

Doubtful: Loans having all the characteristics of Substandard and which have deteriorated to a point where collection and liquidation in full is highly questionable.

Loss: Loans that are considered uncollectible or with limited possible recovery.

Impaired: Loans for which it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement and for which a specific impairment reserve has been considered.

The following table provides details of the Company's loan and lease portfolio, net of unearned income, by segment, class and internally assigned grade at December 31, 2011 and 2010:

	December 31, 2011
			Special
	Pass		Mention		Substandard		Doubtful		Loss		Impaired		Total
	(In thousands)
Commercial and industrial	$	1,415,731	$	4,947	$	43,549	$	1,263	$	405	$	7,833	$	1,473,728
Real estate
Consumer mortgage		1,742,593		17,914		148,267		4,434		189		31,793		1,945,190
Home equity		492,235		2,775		17,050		1,134		493		675		514,362
Agricultural		213,280		3,795		19,296		20		-		3,096		239,487
Commercial and industrial-owner occupied		1,167,220		18,280		90,778		496		-		24,801		1,301,575
Construction, acquisition and development		619,497		23,429		136,412		845		-		128,179		908,362
Commercial		1,501,196		37,409		179,295		-		-		36,122		1,754,022
Credit Cards		105,867		41		175		188		10		-		106,281
All other		587,970		16,104		20,263		470		73		2,424		627,304
Total	$	7,845,589	$	124,694	$	655,085	$	8,850	$	1,170	$	234,923	$	8,870,311

	December 31, 2010
			Special
	Pass		Mention		Substandard		Doubtful		Loss		Impaired		Total
	(In thousands)
Commercial and industrial	$	1,429,443	$	5,764	$	51,562	$	1,577	$	701	$	2,136	$	1,491,183
Real estate
Consumer mortgage		1,813,740		1,867		104,504		3,106		123		28,223		1,951,563
Home equity		527,047		1,231		13,169		613		361		851		543,272
Agricultural		226,054		309		21,614		-		20		4,295		252,292
Commercial and industrial-owner occupied		1,250,265		1,422		62,783		900		30		16,073		1,331,473
Construction, acquisition and development		845,725		1,882		138,929		2,243		1,046		184,918		1,174,743
Commercial		1,688,228		5,565		86,358		98		495		36,207		1,816,951
Credit Cards		106,181		11		146		7		-		-		106,345
All other		641,292		35		22,735		477		44		702		665,285
Total	$	8,527,975	$	18,086	$	501,800	$	9,021	$	2,820	$	273,405	$	9,333,107

The following tables provide details regarding impaired loans and leases, net of unearned income, by segment and class at December 31, 2011 and 2010:

	December 31, 2011
			Unpaid
	Recorded		Principal		Related
	Investment		Balance of		Allowance		Average		Interest
	in Impaired		Impaired		for Credit		Recorded		Income
	Loans		Loans		Losses		Investment		Recognized
	(In thousands)
With no related allowance:
Commercial and industrial	$	4,874	$	6,854	$	-	$	3,879	$	78
Real estate
Consumer mortgage		16,883		19,538		-		19,628		397
Home equity		627		771		-		541		1
Agricultural		1,549		2,676		-		2,502		20
Commercial and industrial-owner occupied		6,973		9,191		-		11,598		185
Construction, acquisition and development		69,843		89,782		-		107,596		941
Commercial		15,184		24,198		-		20,702		311
All other		1,284		1,668		-		1,169		67
Total	$	117,217	$	154,678	$	-	$	167,615	$	2,000

With an allowance:
Commercial and industrial	$	2,959	$	3,301	$	4,071	$	3,558	$	49
Real estate
Consumer mortgage		14,910		16,224		4,386		14,960		323
Home equity		48		276		48		504		3
Agricultural		1,547		1,547		380		3,164		18
Commercial and industrial-owner occupied		17,828		21,085		3,601		10,329		146
Construction, acquisition and development		58,336		67,426		21,581		80,957		1,651
Commercial		20,938		21,422		5,324		27,210		851
All other		1,140		1,140		317		1,307		8
Total	$	117,706	$	132,421	$	39,708	$	141,989	$	3,049

Total:
Commercial and industrial	$	7,833	$	10,155	$	4,071	$	7,437	$	127
Real estate
Consumer mortgage		31,793		35,762		4,386		34,588		720
Home equity		675		1,047		48		1,045		4
Agricultural		3,096		4,223		380		5,666		38
Commercial and industrial-owner occupied		24,801		30,276		3,601		21,927		331
Construction, acquisition and development		128,179		157,208		21,581		188,553		2,592
Commercial		36,122		45,620		5,324		47,912		1,162
All other		2,424		2,808		317		2,476		75
Total	$	234,923	$	287,099	$	39,708	$	309,604	$	5,049

	December 31, 2010
			Unpaid
	Recorded		Principal		Related
	Investment in		Balance of		Allowance for
	Impaired Loans		Impaired Loans		Credit Losses
	(In thousands)
With no related allowance:
Commercial and industrial	$	1,457	$	2,600	$	-
Real estate
Consumer mortgage		11,228		14,273		-
Home equity		290		629		-
Agricultural		1,439		1,981		-
Commercial and industrial-owner occupied		10,920		12,371		-
Construction, acquisition and development		80,204		120,938		-
Commercial		15,795		20,478		-
All other		702		931		-
Total	$	122,035	$	174,201	$	-

With an allowance:
Commercial and industrial	$	679	$	977	$	125
Real estate
Consumer mortgage		16,995		16,644		4,226
Home equity		561		561		41
Agricultural		2,856		3,132		544
Commercial and industrial-owner occupied		5,153		5,298		1,361
Construction, acquisition and development		104,714		123,538		29,195
Commercial		20,412		21,026		5,227
All other		-		-		-
Total	$	151,370	$	171,176	$	40,719

Total:
Commercial and industrial	$	2,136	$	3,577	$	125
Real estate
Consumer mortgage		28,223		30,917		4,226
Home equity		851		1,190		41
Agricultural		4,295		5,113		544
Commercial and industrial-owner occupied		16,073		17,669		1,361
Construction, acquisition and development		184,918		244,476		29,195
Commercial		36,207		41,504		5,227
All other		702		931		-
Total	$	273,405	$	345,377	$	40,719

The following tables provide details regarding impaired real estate construction, acquisition and development loans and leases, net of unearned income, by collateral type at December 31, 2011 and 2010:

	December 31, 2011
			Unpaid
	Recorded		Principal		Related
	Investment		Balance of		Allowance		Average		Interest
	in Impaired		Impaired		for Credit		Recorded		Income
	Loans		Loans		Losses		Investment		Recognized
	(In thousands)
With no related allowance:
Multi-family construction	$	1,067	$	2,259	$	-	$	5,474	$	18
One-to-four family construction		7,931		9,313		-		9,269		94
Recreation and all other loans		372		545		-		491		9
Commercial construction		633		917		-		9,663		83
Commercial acquisition and development		17,130		19,855		-		20,640		99
Residential acquisition and development		42,710		56,893		-		62,059		638
Total	$	69,843	$	89,782	$	-	$	107,596	$	941

With an allowance:
Multi-family construction	$	-	$	-	$	-	$	571	$	-
One-to-four family construction		5,313		6,083		1,589		5,334		108
Recreation and all other loans		-		-		-		271		2
Commercial construction		4,387		5,128		886		7,289		126
Commercial acquisition and development		5,091		7,728		1,418		12,965		429
Residential acquisition and development		43,545		48,487		17,688		54,527		986
Total	$	58,336	$	67,426	$	21,581	$	80,957	$	1,651

Total:
Multi-family construction	$	1,067	$	2,259	$	-	$	6,045	$	18
One-to-four family construction		13,244		15,396		1,589		14,603		202
Recreation and all other loans		372		545		-		762		11
Commercial construction		5,020		6,045		886		16,952		209
Commercial acquisition and development		22,221		27,583		1,418		33,605		528
Residential acquisition and development		86,255		105,380		17,688		116,586		1,624
Total	$	128,179	$	157,208	$	21,581	$	188,553	$	2,592

`	December 31, 2010
			Unpaid
	Recorded		Principal		Related
	Investment in		Balance of		Allowance for
	Impaired Loans		Impaired Loans		Credit Losses
	(In thousands)
With no related allowance:
Multi-family construction	$	8,293	$	9,975	$	-
One-to-four family construction		6,511		11,749		-
Recreation and all other loans		392		580		-
Commercial construction		11,171		13,062		-
Commercial acquisition and development		7,897		12,501		-
Residential acquisition and development		45,940		73,071		-
Total	$	80,204	$	120,938	$	-

With an allowance:
Multi-family construction	$	1,904	$	6,978	$	4
One-to-four family construction		11,939		14,846		932
Recreation and all other loans		498		498		148
Commercial construction		12,459		12,612		5,246
Commercial acquisition and development		21,575		21,575		8,424
Residential acquisition and development		56,339		67,029		14,441
Total	$	104,714	$	123,538	$	29,195

Total:
Multi-family construction	$	10,197	$	16,953	$	4
One-to-four family construction		18,450		26,595		932
Recreation and all other loans		890		1,078		148
Commercial construction		23,630		25,674		5,246
Commercial acquisition and development		29,472		34,076		8,424
Residential acquisition and development		102,279		140,100		14,441
Total	$	184,918	$	244,476	$	29,195

Loans considered impaired under FASB ASC 310 are loans for which, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. The Company's recorded investment in loans considered impaired at December 31, 2011 and 2010 was $234.9 million and $273.4 million, respectively. At December 31, 2011 and 2010, $117.7 million and $151.4 million, respectively, of those impaired loans had a valuation allowance of $39.7 million and $40.7 million, respectively. The remaining balance of impaired loans of $117.2 million and $122.0 million at December 31, 2011 and 2010, respectively, were charged down to fair value, less estimated selling costs, which approximated net realizable value. Therefore, such loans did not have an associated valuation allowance. Impaired loans that were characterized as TDRs totaled $58.0 million and $63.7 million at December 31, 2011 and 2010, respectively. The average recorded investment in impaired loans during 2011 and 2010 was $309.6 million and $218.8 million, respectively.

NPLs consist of non-accrual loans and leases, loans and leases 90 days or more past due and still accruing, and loans and leases that have been restructured because of the borrower's weakened financial condition. The following table presents information concerning NPLs at December 31, 2011 and 2010:

	2011		2010
	(In thousands)
Non-accrual loans and leases	$	276,798	$	347,499
Loans and leases 90 days or more past due, still accruing		3,434		8,500
Restructured loans and leases still accruing		42,018		38,376
Total	$	322,250	$	394,375

The Bank's policy for all loan classifications provides that loans and leases are generally placed in non-accrual status if, in management's opinion, payment in full of principal or interest is not expected or payment of principal or interest is more than 90 days past due, unless the loan or lease is both well-secured and in the process of collection. At December 31, 2011, the Company's geographic NPL distribution was concentrated primarily in its Alabama, Missouri and Tennessee markets, including the greater Memphis, Tennessee area, a portion of which is in northwest Mississippi and Arkansas. The following table presents the Company's nonaccrual loans and leases by segment and class at December 31, 2011 and 2010:

	2011		2010
	(In thousands)
Commercial and industrial	$	12,260	$	13,075
Real estate
Consumer mortgages		47,878		34,021
Home equity		2,036		811
Agricultural		4,179		7,589
Commercial and industrial-owner occupied		33,112		20,338
Construction, acquisition and development		133,110		211,547
Commercial		40,616		57,766
Credit cards		594		720
All other		3,013		1,632
Total	$	276,798	$	347,499

The total amount of interest earned on NPLs was $12.6 million, $11.2 million and $4.1 million in 2011, 2010 and 2009, respectively. The gross interest income which would have been recorded under the original terms of those loans and leases amounted to $18.7 million, $21.7 million and $8.4 million in 2011, 2010 and 2009, respectively.

In the normal course of business, management will sometime grant concessions, which normally would not otherwise be considered, to borrowers that are experiencing financial difficulty. Loans identified as meeting the criteria set out in FASB ASC 310 are identified as TDRs. The concessions granted most frequently for TDRs involve reductions or delays in required payments of principal and interest for a specified period, the rescheduling of payments in accordance with a bankruptcy plan or the charge-off of a portion of the loan. In most cases, the conditions of the credit also warrant nonaccrual status, even after the restructure occurs. As part of the credit approval process, the restructured loans are evaluated for adequate collateral protection in determining the appropriate accrual status at the time of restructure. TDR loans recorded as non-accrual may be returned to accrual status in years after the restructure if there has been at least a six-month period of sustained repayment performance by the borrower under the restructured loan terms and the interest rate at the time of restructure was at or above market for a comparable loan. During 2011, the most common concessions that were granted involved rescheduling payments of principal and interest over a longer amortization period, granting a period of reduced principal payment or interest only payment for a limited time period, or the rescheduling of payments in accordance with a bankruptcy plan.

The following tables summarize the financial effect of TDRs for the year ended December 31, 2011:

			Pre-Modification		Post-Modification
	Number		Outstanding		Outstanding
	of		Recorded		Recorded
	Contracts		Investment		Investment
	(Dollars in thousands)
Commercial and industrial		7	$	3,142	$	2,374
Real estate
Consumer mortgages		35		6,901		6,424
Agricultural		4		2,650		1,479
Commercial and industrial-owner occupied		29		13,330		11,740
Construction, acquisition and development		30		23,863		19,228
Commercial		24		16,121		15,046
All other		7		2,957		2,406
Total		136	$	68,964	$	58,697

The following tables summarize TDRs modified during 2011 for which there was a payment default (i.e., 30 days or more past due at any given time during 2011):

	Number of		Recorded
	Contracts		Investment
	(Dollars in thousands)
Commercial and industrial		4	$	1,506
Real estate
Consumer mortgages		4		1,563
Agricultural		3		1,382
Commercial and industrial-owner occupied		6		1,683
Construction, acquisition and development		13		3,622
Commercial		3		2,946
All other		1		302
Total		34	$	13,004