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Allowance for Loan Losses
 6 Months Ended
Jun. 30, 2017
Receivables [Abstract]  
Allowance for Loan Losses
Allowance for Loan Losses
(In Thousands, Except Number of Loans)
The following is a summary of total non purchased and purchased loans as of the dates presented:
 
 
June 30,
2017
 
December 31, 2016
Commercial, financial, agricultural
$
760,582

 
$
717,490

Lease financing
52,347

 
49,250

Real estate – construction
460,807

 
552,679

Real estate – 1-4 family mortgage
1,952,394

 
1,878,177

Real estate – commercial mortgage
3,040,963

 
2,898,895

Installment loans to individuals
107,195

 
108,627

Gross loans
6,374,288

 
6,205,118

Unearned income
(3,281
)
 
(2,409
)
Loans, net of unearned income
6,371,007

 
6,202,709

Allowance for loan losses
(44,149
)
 
(42,737
)
Net loans
$
6,326,858

 
$
6,159,972



Allowance for Loan Losses
The allowance for loan losses is maintained at a level believed adequate by management based on its ongoing analysis of the loan portfolio to absorb probable credit losses inherent in the entire loan portfolio, including collective impairment as recognized under ASC 450, “Contingencies”. Collective impairment is calculated based on loans grouped by grade. Another component of the allowance is losses on loans assessed as impaired under ASC 310. The balance of these loans and their related allowance is included in management’s estimation and analysis of the allowance for loan losses. Management and the internal loan review staff evaluate the adequacy of the allowance for loan losses quarterly. The allowance for loan losses is evaluated based on a continuing assessment of problem loans, the types of loans, historical loss experience, new lending products, emerging credit trends, changes in the size and character of loan categories and other factors, including its risk rating system, regulatory guidance and economic conditions. This evaluation is inherently subjective, as it requires estimates that are susceptible to significant revision as more information becomes available. The allowance for loan losses is established through a provision for loan losses charged to earnings resulting from measurements of inherent credit risk in the loan portfolio and estimates of probable losses or impairments of individual loans. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance.

The following table provides a roll forward of the allowance for loan losses and a breakdown of the ending balance of the allowance based on the Company’s impairment methodology for the periods presented:
 
Commercial
 
Real Estate -
Construction
 
Real Estate -
1-4 Family
Mortgage
 
Real Estate  -
Commercial
Mortgage
 
Installment
and  Other(1)
 
Total
Three Months Ended June 30, 2017
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$
5,112

 
$
2,119

 
$
12,162

 
$
22,073

 
$
1,457

 
$
42,923

Charge-offs
(304
)
 
—

 
(551
)
 
(434
)
 
(125
)
 
(1,414
)
Recoveries
64

 
3

 
64

 
717

 
42

 
890

Net (charge-offs) recoveries
(240
)
 
3

 
(487
)
 
283

 
(83
)
 
(524
)
Provision for loan losses charged to operations (2) 
220

 
458

 
429

 
244

 
399

 
1,750

Ending balance
$
5,092

 
$
2,580

 
$
12,104

 
$
22,600

 
$
1,773

 
$
44,149


 
Commercial
 
Real Estate -
Construction
 
Real Estate -
1-4 Family
Mortgage
 
Real Estate  -
Commercial
Mortgage
 
Installment
and  Other(1)
 
Total
Six Months Ended June 30, 2017
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$
5,486

 
$
2,380

 
$
14,294

 
$
19,059

 
$
1,518

 
$
42,737

Charge-offs
(1,136
)
 
—

 
(826
)
 
(661
)
 
(389
)
 
(3,012
)
Recoveries
121

 
34

 
146

 
812

 
61

 
1,174

Net (charge-offs) recoveries
(1,015
)
 
34

 
(680
)
 
151

 
(328
)
 
(1,838
)
Provision for loan losses charged to operations (2) 
621

 
166

 
(1,510
)
 
3,390

 
583

 
3,250

Ending balance
$
5,092

 
$
2,580

 
$
12,104

 
$
22,600

 
$
1,773

 
$
44,149

Period-End Amount Allocated to:
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
166

 
$
2

 
$
878

 
$
2,159

 
$
3

 
$
3,208

Collectively evaluated for impairment
4,587

 
2,578

 
10,534

 
19,313

 
1,769

 
38,781

Purchased with deteriorated credit quality
339

 
—

 
692

 
1,128

 
1

 
2,160

Ending balance
$
5,092

 
$
2,580

 
$
12,104

 
$
22,600

 
$
1,773

 
$
44,149


 
Commercial
 
Real Estate -
Construction
 
Real Estate -
1-4 Family
Mortgage
 
Real Estate  -
Commercial
Mortgage
 
Installment
and  Other(1)
 
Total
Three Months Ended June 30, 2016
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$
4,171

 
$
1,943

 
$
14,542

 
$
20,775

 
$
1,428

 
$
42,859

Charge-offs
(48
)
 
—

 
(387
)
 
(186
)
 
(192
)
 
(813
)
Recoveries
105

 
5

 
170

 
309

 
33

 
622

Net (charge-offs) recoveries
57

 
5

 
(217
)
 
123

 
(159
)
 
(191
)
Provision for loan losses
265

 
315

 
(186
)
 
624

 
146

 
1,164

Benefit attributable to FDIC loss-share agreements
15

 
—

 
(78
)
 
117

 
—

 
54

Recoveries payable to FDIC
4

 
6

 
158

 
44

 
—

 
212

Provision for loan losses charged to operations
284

 
321

 
(106
)
 
785

 
146

 
1,430

Ending balance
$
4,512

 
$
2,269

 
$
14,219

 
$
21,683

 
$
1,415

 
$
44,098


 
Commercial
 
Real Estate -
Construction
 
Real Estate -
1-4 Family
Mortgage
 
Real Estate  -
Commercial
Mortgage
 
Installment
and  Other(1)
 
Total
Six Months Ended June 30, 2016
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$
4,186

 
$
1,852

 
$
13,908

 
$
21,111

 
$
1,380

 
$
42,437

Charge-offs
(705
)
 
—

 
(503
)
 
(1,187
)
 
(372
)
 
(2,767
)
Recoveries
158

 
11

 
565

 
401

 
63

 
1,198

Net (charge-offs) recoveries
(547
)
 
11

 
62

 
(786
)
 
(309
)
 
(1,569
)
Provision for loan losses
866

 
400

 
179

 
1,154

 
344

 
2,943

Benefit attributable to FDIC loss-share agreements
—

 
—

 
(115
)
 
(1
)
 
—

 
(116
)
Recoveries payable to FDIC
7

 
6

 
185

 
205

 
—

 
403

Provision for loan losses charged to operations
873

 
406

 
249

 
1,358

 
344

 
3,230

Ending balance
$
4,512

 
$
2,269

 
$
14,219

 
$
21,683

 
$
1,415

 
$
44,098

Period-End Amount Allocated to:
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
164

 
$
—

 
$
4,924

 
$
2,531

 
$
—

 
$
7,619

Collectively evaluated for impairment
3,947

 
2,269

 
8,951

 
17,726

 
1,414

 
34,307

Purchased with deteriorated credit quality
401

 
—

 
344

 
1,426

 
1

 
2,172

Ending balance
$
4,512

 
$
2,269

 
$
14,219

 
$
21,683

 
$
1,415

 
$
44,098


(1)
Includes lease financing receivables.
(2)
Due to the termination of the loss-share agreements on December 8, 2016, there was no loss-share impact to the provision for loan losses in 2017.
The following table provides the recorded investment in loans, net of unearned income, based on the Company’s impairment methodology as of the dates presented:
 
 
Commercial
 
Real Estate  -
Construction
 
Real Estate -
1-4 Family
Mortgage
 
Real Estate  -
Commercial
Mortgage
 
Installment
and  Other(1)
 
Total
June 30, 2017
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
2,401

 
$
314

 
$
13,299

 
$
16,840

 
$
161

 
$
33,015

Collectively evaluated for impairment
746,175

 
460,493

 
1,875,939

 
2,864,272

 
154,317

 
6,101,196

Purchased with deteriorated credit quality
12,006

 
—

 
63,156

 
159,851

 
1,783

 
236,796

Ending balance
$
760,582

 
$
460,807

 
$
1,952,394

 
$
3,040,963

 
$
156,261

 
$
6,371,007

December 31, 2016
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
1,886

 
$
662

 
$
12,088

 
$
13,079

 
$
277

 
$
27,992

Collectively evaluated for impairment
703,610

 
551,177

 
1,794,137

 
2,700,829

 
153,206

 
5,902,959

Purchased with deteriorated credit quality
11,994

 
840

 
71,952

 
184,987

 
1,985

 
271,758

Ending balance
$
717,490

 
$
552,679

 
$
1,878,177

 
$
2,898,895

 
$
155,468

 
$
6,202,709

 
(1)
Includes lease financing receivables.