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LOANS AND LEASES
6 Months Ended
Jun. 30, 2013
LOANS AND LEASES [Abstract]  
LOANS AND LEASES

NOTE 2 – 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 real estate.  A summary of gross loans and leases by segment and class as of the dates indicated follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

December 31,

 

 

2013

 

2012

 

2012

 

 

 

 

 

 

 

 

(In thousands)

 

 

 

 

 

 

 

Commercial and industrial

 

$    1,559,597

 

$    1,507,382

 

$     1,484,788

Real estate

 

 

 

 

 

 

Consumer mortgages

 

1,880,338 

 

1,904,420 

 

1,873,875 

Home equity

 

482,068 

 

496,245 

 

486,074 

Agricultural

 

237,914 

 

251,975 

 

256,196 

Commercial and industrial-owner occupied

 

1,375,711 

 

1,288,887 

 

1,333,103 

Construction, acquisition and development

 

709,499 

 

835,022 

 

735,808 

Commercial real estate

 

1,754,841 

 

1,748,748 

 

1,748,881 

Credit cards

 

103,251 

 

101,085 

 

104,884 

All other

 

607,804 

 

637,878 

 

649,143 

Total

 

$    8,711,023

 

$    8,771,642

 

$     8,672,752

 

 

 

 

The following table shows the Company’s  loans and leases, net of unearned income, as of June 30, 2013 by segment, class and geographical location:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alabama

 

 

 

 

 

 

 

Greater

 

 

 

 

 

Corporate

 

 

 

 

and Florida

 

 

 

 

 

 

 

Memphis

 

 

 

Texas and

 

Banking

 

 

 

 

Panhandle

 

Arkansas*

 

Mississippi*

 

Missouri

 

Area

 

Tennessee*

 

Louisiana

 

and Other

 

Total

 

 

(In thousands)

 

 

Commercial and industrial

 

$         74,206 

 

$        162,329 

 

$        299,752 

 

$       39,482 

 

$       22,287 

 

$       80,889 

 

$         249,640 

 

$        624,177 

 

$     1,552,762 

Real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

109,591 

 

252,400 

 

697,450 

 

45,578 

 

98,699 

 

154,150 

 

465,992 

 

56,478 

 

1,880,338 

Home equity

 

61,802 

 

37,920 

 

161,195 

 

21,196 

 

68,133 

 

67,750 

 

61,292 

 

2,780 

 

482,068 

Agricultural

 

7,906 

 

74,970 

 

55,706 

 

3,226 

 

15,558 

 

12,291 

 

62,785 

 

5,472 

 

237,914 

Commercial and industrial-owner occupied

 

140,843 

 

171,035 

 

462,805 

 

63,546 

 

95,645 

 

86,590 

 

272,879 

 

82,368 

 

1,375,711 

Construction, acquisition and development

 

97,522 

 

67,579 

 

175,817 

 

32,995 

 

76,679 

 

101,142 

 

147,135 

 

10,630 

 

709,499 

Commercial real estate

 

237,154 

 

301,709 

 

285,156 

 

186,444 

 

104,652 

 

91,941 

 

401,372 

 

146,413 

 

1,754,841 

Credit cards

 

 -

 

 -

 

 -

 

 -

 

 -

 

 -

 

 -

 

103,251 

 

103,251 

All other

 

30,494 

 

75,129 

 

156,745 

 

2,708 

 

52,646 

 

40,683 

 

94,513 

 

129,412 

 

582,330 

Total

 

$       759,518 

 

$     1,143,071 

 

$     2,294,626 

 

$     395,175 

 

$     534,299 

 

$     635,436 

 

$      1,755,608 

 

$     1,160,981 

 

$     8,678,714 

*  Excludes the Greater Memphis Area.

 

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.  The Company’s loan policy generally prohibits the use of interest reserves on loans originated after March 2010.  Certain of the construction, acquisition and development loans were 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 (“OREO”) are susceptible to changes in real estate values in the corresponding market areas.  Continued economic distress could negatively impact additional borrowers’ and guarantors’ ability to repay their debt which would make more of the Company’s loans collateral dependent.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The following tables provide details regarding the aging of the Company’s loan and lease portfolio, net of unearned income, by segment and class at June 30, 2013 and December 31, 2012:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$        1,482 

 

$            144 

 

$      1,994 

 

$      3,620 

 

$    1,549,142 

 

$    1,552,762 

 

$                 - 

Real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

12,808 

 

3,750 

 

13,210 

 

29,768 

 

1,850,570 

 

1,880,338 

 

1,107 

Home equity

 

1,062 

 

329 

 

1,059 

 

2,450 

 

479,618 

 

482,068 

 

 -

Agricultural

 

550 

 

135 

 

3,255 

 

3,940 

 

233,974 

 

237,914 

 

 -

Commercial and industrial-owner occupied

 

2,337 

 

299 

 

1,753 

 

4,389 

 

1,371,322 

 

1,375,711 

 

 -

Construction, acquisition and development

 

2,458 

 

251 

 

12,651 

 

15,360 

 

694,139 

 

709,499 

 

 -

Commercial real estate

 

5,582 

 

2,055 

 

9,334 

 

16,971 

 

1,737,870 

 

1,754,841 

 

120 

Credit cards

 

466 

 

311 

 

425 

 

1,202 

 

102,049 

 

103,251 

 

213 

All other

 

1,534 

 

310 

 

613 

 

2,457 

 

579,873 

 

582,330 

 

 -

Total

 

$      28,279 

 

$         7,584 

 

$    44,294 

 

$    80,157 

 

$    8,598,557 

 

$    8,678,714 

 

$         1,440 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2012

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$        3,531 

 

$            476 

 

$      4,118 

 

$      8,125 

 

$    1,468,486 

 

$    1,476,611 

 

$             414 

Real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

11,308 

 

3,643 

 

13,821 

 

28,772 

 

1,845,103 

 

1,873,875 

 

512 

Home equity

 

1,337 

 

371 

 

350 

 

2,058 

 

484,016 

 

486,074 

 

 -

Agricultural

 

400 

 

287 

 

3,946 

 

4,633 

 

251,563 

 

256,196 

 

10 

Commercial and industrial-owner occupied

 

2,629 

 

3,587 

 

2,933 

 

9,149 

 

1,323,954 

 

1,333,103 

 

19 

Construction, acquisition and development

 

2,547 

 

2,472 

 

14,790 

 

19,809 

 

715,999 

 

735,808 

 

 -

Commercial real estate

 

4,673 

 

56 

 

10,469 

 

15,198 

 

1,733,683 

 

1,748,881 

 

 -

Credit cards

 

536 

 

379 

 

473 

 

1,388 

 

103,496 

 

104,884 

 

228 

All other

 

2,354 

 

253 

 

445 

 

3,052 

 

618,505 

 

621,557 

 

27 

Total

 

$      29,315 

 

$       11,524 

 

$    51,345 

 

$    92,184 

 

$    8,544,805 

 

$    8,636,989 

 

$          1,210 

 

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 Federal Deposit Insurance Corporation, 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 loans show sufficient cash flow, capital and collateral to repay the loan as agreed. 

 

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 tables provide details of the Company’s loan and lease portfolio, net of unearned income, by segment, class and internally assigned grade at June 30, 2013 and December 31, 2012:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2013

 

 

 

 

Special

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

Mention

 

Substandard

 

Doubtful

 

Loss

 

Impaired

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Commercial and industrial

 

$    1,504,523 

 

$     14,918 

 

$        29,648 

 

$      531 

 

$       - 

 

$       3,142 

 

$    1,552,762 

Real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

1,701,566 

 

40,526 

 

121,497 

 

2,979 

 

134 

 

13,636 

 

1,880,338 

Home equity

 

458,379 

 

5,391 

 

15,752 

 

698 

 

68 

 

1,780 

 

482,068 

Agricultural

 

210,989 

 

9,568 

 

13,599 

 

 -

 

 -

 

3,758 

 

237,914 

Commercial and industrial-owner occupied

 

1,275,037 

 

28,413 

 

59,568 

 

222 

 

 -

 

12,471 

 

1,375,711 

Construction, acquisition and development

 

594,175 

 

28,727 

 

51,041 

 

1,025 

 

 -

 

34,531 

 

709,499 

Commercial real estate

 

1,537,671 

 

63,791 

 

117,579 

 

245 

 

30 

 

35,525 

 

1,754,841 

Credit cards

 

103,251 

 

 -

 

 -

 

 -

 

 -

 

 -

 

103,251 

All other

 

566,554 

 

5,613 

 

8,991 

 

523 

 

 -

 

649 

 

582,330 

Total

 

$    7,952,145 

 

$   196,947 

 

$      417,675 

 

$   6,223 

 

$  232 

 

$   105,492 

 

$    8,678,714 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2012

 

 

 

 

Special

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

Mention

 

Substandard

 

Doubtful

 

Loss

 

Impaired

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Commercial and industrial

 

$    1,426,498 

 

$     14,663 

 

$        29,876 

 

$      729 

 

$       - 

 

$       4,845 

 

$    1,476,611 

Real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

1,691,682 

 

32,840 

 

131,141 

 

2,907 

 

198 

 

15,107 

 

1,873,875 

Home equity

 

461,151 

 

4,791 

 

17,619 

 

1,057 

 

76 

 

1,380 

 

486,074 

Agricultural

 

227,138 

 

5,729 

 

17,947 

 

 -

 

 -

 

5,382 

 

256,196 

Commercial and industrial-owner occupied

 

1,202,111 

 

31,087 

 

82,816 

 

369 

 

 -

 

16,720 

 

1,333,103 

Construction, acquisition and development

 

567,881 

 

30,846 

 

75,031 

 

715 

 

 -

 

61,335 

 

735,808 

Commercial real estate

 

1,524,262 

 

53,455 

 

120,591 

 

160 

 

 -

 

50,413 

 

1,748,881 

Credit cards

 

104,884 

 

 -

 

 -

 

 -

 

 -

 

 -

 

104,884 

All other

 

600,807 

 

8,397 

 

10,196 

 

601 

 

10 

 

1,546 

 

621,557 

Total

 

$    7,806,414 

 

$   181,808 

 

$      485,217 

 

$   6,538 

 

$  284 

 

$   156,728 

 

$    8,636,989 

The following tables provide details regarding impaired loans and leases, net of unearned income, by segment and class as of and for the three and six months ended June 30, 2013 and as of and for the year ended December 31, 2012:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2013

 

 

 

 

Unpaid

 

 

 

Average Recorded Investment

 

Interest Income Recognized

 

 

Recorded

 

Principal

 

Related

 

Three months

 

Six months

 

Three months

 

Six months

 

 

Investment

 

Balance of

 

Allowance

 

ended

 

ended

 

ended

 

ended

 

 

in Impaired

 

Impaired

 

for Credit

 

June 30,

 

June 30,

 

June 30,

 

June 30,

 

 

Loans

 

Loans

 

Losses

 

2013

 

2013

 

2013

 

2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

With no related allowance:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

 

$        3,142 

 

$       3,739 

 

$             - 

 

$            3,331 

 

$            2,988 

 

$                   3 

 

$                   4 

Real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

11,361 

 

15,142 

 

 -

 

9,884 

 

11,101 

 

16 

 

32 

Home equity

 

843 

 

987 

 

 -

 

1,011 

 

1,242 

 

 

Agricultural

 

3,642 

 

4,239 

 

 -

 

3,428 

 

3,995 

 

 

Commercial and industrial-owner occupied

 

7,758 

 

9,929 

 

 -

 

6,993 

 

9,503 

 

16 

 

50 

Construction, acquisition and development

 

29,753 

 

44,825 

 

 -

 

31,672 

 

37,112 

 

29 

 

83 

Commercial

 

19,389 

 

25,682 

 

 -

 

26,971 

 

33,354 

 

49 

 

120 

All other

 

649 

 

942 

 

 -

 

631 

 

937 

 

 

   Total

 

$      76,537 

 

$   105,485 

 

$             - 

 

$          83,921 

 

$        100,232 

 

$               117 

 

$               302 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

With an allowance:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

 

$                - 

 

$               - 

 

$        284 

 

$               324 

 

$               892 

 

$                    - 

 

$                    - 

Real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

2,275 

 

2,691 

 

525 

 

4,103 

 

3,606 

 

 

Home equity

 

937 

 

937 

 

32 

 

1,001 

 

648 

 

 

Agricultural

 

116 

 

116 

 

116 

 

725 

 

547 

 

 -

 

 -

Commercial and industrial-owner occupied

 

4,713 

 

5,339 

 

1,268 

 

5,715 

 

5,156 

 

19 

 

22 

Construction, acquisition and development

 

4,778 

 

5,804 

 

3,373 

 

8,700 

 

8,963 

 

18 

 

42 

Commercial

 

16,136 

 

24,036 

 

2,367 

 

13,132 

 

12,091 

 

18 

 

34 

All other

 

 -

 

 -

 

 -

 

 -

 

 -

 

 -

 

 -

   Total

 

$      28,954 

 

$     38,923 

 

$     7,965 

 

$          33,700 

 

$          31,903 

 

$                 63 

 

$               109 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

 

$        3,142 

 

$       3,739 

 

$        284 

 

$            3,655 

 

$            3,880 

 

$                   3 

 

$                   4 

Real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

13,636 

 

17,833 

 

525 

 

13,987 

 

14,707 

 

23 

 

41 

Home equity

 

1,780 

 

1,924 

 

32 

 

2,012 

 

1,890 

 

 

Agricultural

 

3,758 

 

4,355 

 

116 

 

4,153 

 

4,542 

 

 

Commercial and industrial-owner occupied

 

12,471 

 

15,268 

 

1,268 

 

12,708 

 

14,659 

 

35 

 

72 

Construction, acquisition and development

 

34,531 

 

50,629 

 

3,373 

 

40,372 

 

46,075 

 

47 

 

125 

Commercial

 

35,525 

 

49,718 

 

2,367 

 

40,103 

 

45,445 

 

67 

 

154 

All other

 

649 

 

942 

 

 -

 

631 

 

937 

 

 

   Total

 

$    105,492 

 

$   144,408 

 

$     7,965 

 

$        117,621 

 

$        132,135 

 

$               180 

 

$               411 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2012

 

 

 

 

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

 

$              2,557

 

$              4,169

 

$                  -

 

$            2,779

 

$                 12

Real estate

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

11,307 

 

15,464 

 

 -

 

11,762 

 

77 

Home equity

 

934 

 

1,078 

 

 -

 

858 

 

Agricultural

 

4,435 

 

6,292 

 

 -

 

3,527 

 

Commercial and industrial-owner occupied

 

13,018 

 

16,551 

 

 -

 

12,674 

 

123 

Construction, acquisition and development

 

47,982 

 

69,331 

 

 -

 

54,085 

 

324 

Commercial real estate

 

33,952 

 

45,722 

 

 -

 

19,824 

 

199 

All other

 

1,544 

 

2,165 

 

 -

 

848 

 

   Total

 

$          115,729

 

$          160,772

 

$                  -

 

$        106,357

 

$               758

 

 

 

 

 

 

 

 

 

 

 

With an allowance:

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

 

$              2,288

 

$              2,288

 

$          1,241

 

$            5,368

 

$                 38

Real estate

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

3,800 

 

3,914 

 

1,103 

 

10,323 

 

88 

Home equity

 

446 

 

446 

 

111 

 

569 

 

Agricultural

 

947 

 

947 

 

92 

 

1,468 

 

12 

Commercial and industrial-owner occupied

 

3,702 

 

4,737 

 

864 

 

9,977 

 

65 

Construction, acquisition and development

 

13,353 

 

16,257 

 

4,350 

 

45,582 

 

377 

Commercial real estate

 

16,461 

 

16,709 

 

2,720 

 

16,953 

 

204 

All other

 

 

 

60 

 

324 

 

   Total

 

$            40,999

 

$            45,300

 

$        10,541

 

$          90,564

 

$               792

 

 

 

 

 

 

 

 

 

 

 

Total:

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

 

$              4,845

 

$              6,457

 

$          1,241

 

$            8,147

 

$                 50

Real estate

 

 

 

 

 

 

 

 

 

 

Consumer mortgages

 

15,107 

 

19,378 

 

1,103 

 

22,085 

 

165 

Home equity

 

1,380 

 

1,524 

 

111 

 

1,427 

 

11 

Agricultural

 

5,382 

 

7,239 

 

92 

 

4,995 

 

20 

Commercial and industrial-owner occupied

 

16,720 

 

21,288 

 

864 

 

22,651 

 

188 

Construction, acquisition and development

 

61,335 

 

85,588 

 

4,350 

 

99,667 

 

701 

Commercial real estate

 

50,413 

 

62,431 

 

2,720 

 

36,777 

 

403 

All other

 

1,546 

 

2,167 

 

60 

 

1,172 

 

12 

   Total

 

$          156,728

 

$          206,072

 

$        10,541

 

$        196,921

 

$            1,550

 

 

 

The following tables provide details regarding impaired real estate construction, acquisition and development loans and leases, net of unearned income, by collateral type as of and for the three months and six months ended June 30, 2013 and as of and for the year ended December 31, 2012:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2013

 

 

 

 

Unpaid

 

 

 

Average Recorded Investment

 

Interest Income Recognized

 

 

Recorded

 

Principal

 

Related

 

Three months

 

Six months

 

Three months

 

Six months

 

 

Investment

 

Balance of

 

Allowance

 

ended

 

ended

 

ended

 

ended

 

 

in Impaired

 

Impaired

 

for Credit

 

June 30,

 

June 30,

 

June 30,

 

June 30,

 

 

Loans

 

Loans

 

Losses

 

2013

 

2013

 

2013

 

2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

With no related allowance:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Multi-family construction

 

$                    - 

 

$                   - 

 

$                 - 

 

$                  - 

 

$                   - 

 

$                 - 

 

$               - 

One-to-four family construction

 

5,135 

 

8,360 

 

 -

 

6,074 

 

6,610 

 

 

20 

Recreation and all other loans

 

761 

 

806 

 

 -

 

818 

 

934 

 

 -

 

Commercial construction

 

2,737 

 

3,075 

 

 -

 

2,877 

 

3,042 

 

 -

 

Commercial acquisition and development

 

10,902 

 

12,281 

 

 -

 

10,673 

 

11,185 

 

16 

 

31 

Residential acquisition and development

 

10,218 

 

20,303 

 

 -

 

11,230 

 

15,341 

 

 

30 

Total

 

$          29,753 

 

$         44,825 

 

$                 - 

 

$        31,672 

 

$         37,112 

 

$               29 

 

$            83 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

With an allowance:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Multi-family construction

 

$                    - 

 

$                   - 

 

$                 - 

 

$                  - 

 

$                   - 

 

$                 - 

 

$               - 

One-to-four family construction

 

328 

 

328 

 

93 

 

660 

 

581 

 

 

Recreation and all other loans

 

 -

 

 -

 

 -

 

 -

 

 -

 

 -

 

 -

Commercial construction

 

 -

 

 -

 

 -

 

 -

 

772 

 

 -

 

Commercial acquisition and development

 

1,206 

 

1,206 

 

225 

 

1,427 

 

1,381 

 

 

Residential acquisition and development

 

3,244 

 

4,270 

 

3,055 

 

6,613 

 

6,229 

 

11 

 

25 

Total

 

$            4,778 

 

$           5,804 

 

$         3,373 

 

$          8,700 

 

$           8,963 

 

$               18 

 

$            42 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Multi-family construction

 

$                    - 

 

$                   - 

 

$                 - 

 

$                  - 

 

$                   - 

 

$                 - 

 

$               - 

One-to-four family construction

 

5,463 

 

8,688 

 

93 

 

6,734 

 

7,191 

 

12 

 

23 

Recreation and all other loans

 

761 

 

806 

 

 -

 

818 

 

934 

 

 -

 

Commercial construction

 

2,737 

 

3,075 

 

 -

 

2,877 

 

3,814 

 

 -

 

10 

Commercial acquisition and development

 

12,108 

 

13,487 

 

225 

 

12,100 

 

12,566 

 

20 

 

36 

Residential acquisition and development

 

13,462 

 

24,573 

 

3,055 

 

17,843 

 

21,570 

 

15 

 

55 

Total

 

$          34,531 

 

$         50,629 

 

$         3,373 

 

$        40,372 

 

$         46,075 

 

$               47 

 

$          125 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2012

 

 

 

 

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

 

$                    -

 

$                    -

 

$                  -

 

$                  -

 

$                   -

One-to-four family construction

 

8,475 

 

13,586 

 

 -

 

8,070 

 

53 

Recreation and all other loans

 

1,117 

 

1,335 

 

 -

 

623 

 

Commercial construction

 

5,714 

 

6,646 

 

 -

 

3,585 

 

51 

Commercial acquisition and development

 

13,753 

 

15,786 

 

 -

 

12,145 

 

63 

Residential acquisition and development

 

18,923 

 

31,978 

 

 -

 

29,662 

 

152 

Total

 

$           47,982

 

$           69,331

 

$                  -

 

$         54,085

 

$              324

 

 

 

 

 

 

 

 

 

 

 

With an allowance:

 

 

 

 

 

 

 

 

 

 

Multi-family construction

 

$                    -

 

$                    -

 

$                  -

 

$                  -

 

$                   -

One-to-four family construction

 

1,130 

 

1,475 

 

290 

 

4,094 

 

29 

Recreation and all other loans

 

 -

 

 -

 

 -

 

69 

 

 -

Commercial construction

 

 -

 

 -

 

 -

 

1,255 

 

15 

Commercial acquisition and development

 

1,711 

 

1,960 

 

563 

 

9,206 

 

74 

Residential acquisition and development

 

10,512 

 

12,822 

 

3,497 

 

30,958 

 

259 

Total

 

$           13,353

 

$           16,257

 

$          4,350

 

$         45,582

 

$              377

 

 

 

 

 

 

 

 

 

 

 

Total:

 

 

 

 

 

 

 

 

 

 

Multi-family construction

 

$                    -

 

$                    -

 

$                  -

 

$                  -

 

$                   -

One-to-four family construction

 

9,605 

 

15,061 

 

290 

 

12,164 

 

82 

Recreation and all other loans

 

1,117 

 

1,335 

 

 -

 

692 

 

Commercial construction

 

5,714 

 

6,646 

 

 -

 

4,840 

 

66 

Commercial acquisition and development

 

15,464 

 

17,746 

 

563 

 

21,351 

 

137 

Residential acquisition and development

 

29,435 

 

44,800 

 

3,497 

 

60,620 

 

411 

Total

 

$           61,335

 

$           85,588

 

$          4,350

 

$         99,667

 

$              701

 

Loans considered impaired under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 310, Receivables (“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 June 30, 2013 and December 31, 2012 was  $105.5 million and $156.7 million, respectively.  At June 30, 2013 and December 31, 2012, $29.0 million and $41.0 million, respectively, of those impaired loans had a valuation allowance of $8.0 million and $10.5 million, respectively.  The remaining balance of impaired loans of $76.5 million and $115.7 million at June 30, 2013 and December 31, 2012, 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 troubled debt restructurings (“TDRs”) totaled $27.7 million and $47.3 million at June 30, 2013 and December 31, 2012, respectively.  The average recorded investment in impaired loans was $117.6 million and $132.1 million for the three months and six months ended June 30, 2013, respectively, and $196.9 million for the year ended December 31, 2012.  

Non-performing loans and leases (“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 (primarily in the form of reduced interest rates and modified payment terms) because of the borrower’s weakened financial condition or bankruptcy proceedings.  The following table presents information concerning NPLs as of the dates indicated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

December 31,

 

 

2013

 

2012

 

2012

 

 

 

 

 

 

 

 

(In thousands)

 

 

 

 

 

 

 

Non-accrual loans and leases

 

$      149,542

 

$      240,246

 

$        207,241

Loans and leases 90 days or more past due, still accruing

 

1,440 

 

1,632 

 

1,210 

Restructured loans and leases still accruing

 

16,953 

 

25,071 

 

25,099 

Total non-performing loans and leases

 

$      167,935

 

$      266,949

 

$        233,550

 

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 such loan or lease is both well-secured and in the process of collection.  At June 30, 2013, the Company’s geographic NPL distribution was concentrated primarily in its Alabama, Mississippi 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 as of the dates indicated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

December 31,

 

 

2013

 

2012

 

2012

 

 

 

 

 

 

 

 

 

(In thousands)

Commercial and industrial

 

$        6,225

 

$     13,156

 

$           9,311

Real estate

 

 

 

 

 

 

Consumer mortgages

 

34,226 

 

35,660 

 

36,133 

Home equity

 

3,862 

 

2,995 

 

3,497 

Agricultural

 

5,007 

 

8,390 

 

7,587 

Commercial and industrial-owner occupied

 

17,084 

 

26,957 

 

20,910 

Construction, acquisition and development

 

39,315 

 

104,283 

 

66,635 

Commercial real estate

 

40,940 

 

44,359 

 

57,656 

Credit cards

 

398 

 

364 

 

415 

All other

 

2,485 

 

4,082 

 

5,097 

    Total

 

$    149,542

 

$   240,246

 

$       207,241

 

 

In the normal course of business, management will sometimes grant concessions, which 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.  Other conditions that warrant a loan being considered a TDR include reductions in interest rates to below market rates due to bankruptcy plans or by the bank in an attempt to assist the borrower in working through liquidity problems.  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.  TDRs recorded as nonaccrual loans may be returned to accrual status in periods after the restructure if there has been at least a six-month period of sustained repayment performance by the borrower in accordance with the terms of the restructured loan and the interest rate at the time of restructure was at or above market for a comparable loan.  During the second quarter of 2013, 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 periods indicated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended June 30, 2013

 

 

 

 

Pre-Modification

 

Post-Modification

 

 

Number

 

Outstanding

 

Outstanding

 

 

of

 

Recorded

 

Recorded

 

 

Contracts

 

Investment

 

Investment

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

Commercial and industrial

 

 

$                    36

 

$                      37

Real estate

 

 

 

 

 

 

  Consumer mortgages

 

 

781 

 

780 

  Commercial and industrial-owner occupied

 

 

555 

 

551 

  Construction, acquisition and development

 

12 

 

2,568 

 

2,546 

    Total

 

21 

 

$               3,940

 

$                 3,914

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six months ended June 30, 2013

 

 

 

 

Pre-Modification

 

Post-Modification

 

 

Number

 

Outstanding

 

Outstanding

 

 

of

 

Recorded

 

Recorded

 

 

Contracts

 

Investment

 

Investment

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

Commercial and industrial

 

 

$                    83

 

$                      84

Real estate

 

 

 

 

 

 

  Consumer mortgages

 

 

781 

 

780 

Home equity

 

 

15 

 

15 

  Commercial and industrial-owner occupied

 

 

1,128 

 

1,127 

  Construction, acquisition and development

 

12 

 

2,568 

 

2,546 

  Commercial

 

 

168 

 

167 

    Total

 

27 

 

$               4,743

 

$                 4,719

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2012

 

 

 

 

Pre-Modification

 

Post-Modification

 

 

Number

 

Outstanding

 

Outstanding

 

 

of

 

Recorded

 

Recorded

 

 

Contracts

 

Investment

 

Investment

 

 

(Dollars in thousands)

Commercial and industrial

 

 

$                1,686

 

$                  1,348

Real estate

 

 

 

 

 

 

Consumer mortgages

 

38 

 

9,875 

 

9,109 

Agricultural

 

 

853 

 

861 

Commercial and industrial-owner occupied

 

30 

 

14,367 

 

13,741 

Construction, acquisition and development

 

37 

 

21,583 

 

21,159 

Commercial

 

12 

 

8,159 

 

8,132 

All other

 

 

1,855 

 

1,692 

Total

 

136 

 

$              58,378

 

$                56,042

 

 

 

 

 

 

 

 

The tables below summarize TDRs within the previous 12 months for which there was a payment default during the period indicated (i.e., 30 days or more past due at any given time during the period indicated). No such payment defaults occurred during the three months ended June 30, 2013.

 

 

 

 

 

 

 

 

 

 

 

 

 

Six months ended June 30, 2013

 

 

Number of

 

Recorded

 

 

Contracts

 

Investment

 

 

 

 

 

 

 

(Dollars in thousands)

Commercial and industrial

 

 

$                      129

Real estate

 

 

 

 

  Consumer mortgages

 

 

451 

  Commercial and industrial-owner occupied

 

 

265 

  Construction, acquisition and development

 

 

1,523 

  Commercial

 

 

3,534 

All other

 

 

    Total

 

17 

 

$                   5,903

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2012

 

 

Number of

 

Recorded

 

 

Contracts

 

Investment

 

 

(Dollars in thousands)

Commercial and industrial

 

 

$                      179

Real estate

 

 

 

 

  Consumer mortgages

 

18 

 

2,096 

  Agricultural

 

 

170 

  Commercial and industrial-owner occupied

 

11 

 

2,659 

  Construction, acquisition and development

 

21 

 

5,503 

  Commercial real estate

 

 

2,525 

All other

 

 

    Total

 

58 

 

$                 13,139