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Allowance for Loan Losses
 9 Months Ended
Sep. 30, 2018
Receivables [Abstract]  
Allowance for Loan Losses
Allowance for Loan Losses
(In Thousands)
The following is a summary of total non purchased and purchased loans as of the dates presented:
 
 
September 30,
2018
 
December 31, 2017
Commercial, financial, agricultural
$
1,313,344

 
$
1,039,393

Lease financing
57,576

 
57,354

Real estate – construction
736,985

 
633,389

Real estate – 1-4 family mortgage
2,762,683

 
2,343,721

Real estate – commercial mortgage
4,112,585

 
3,427,530

Installment loans to individuals
143,038

 
122,276

Gross loans
9,126,211

 
7,623,663

Unearned income
(3,304
)
 
(3,341
)
Loans, net of unearned income
9,122,907

 
7,620,322

Allowance for loan losses
(48,610
)
 
(46,211
)
Net loans
$
9,074,297

 
$
7,574,111



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 September 30, 2018
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$
7,146

 
$
4,702

 
$
11,657

 
$
22,450

 
$
1,400

 
$
47,355

Charge-offs
(511
)
 
—

 
(211
)
 
(216
)
 
(402
)
 
(1,340
)
Recoveries
24

 
3

 
119

 
152

 
47

 
345

Net (charge-offs) recoveries
(487
)
 
3

 
(92
)
 
(64
)
 
(355
)
 
(995
)
Provision for loan losses charged to operations
1,448

 
8

 
(1,497
)
 
2,041

 
250

 
2,250

Ending balance
$
8,107

 
$
4,713

 
$
10,068

 
$
24,427

 
$
1,295

 
$
48,610

 
Commercial
 
Real Estate -
Construction
 
Real Estate -
1-4 Family
Mortgage
 
Real Estate  -
Commercial
Mortgage
 
Installment
and  Other(1)
 
Total
Nine Months Ended September 30, 2018
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$
5,542

 
$
3,428

 
$
12,009

 
$
23,384

 
$
1,848

 
$
46,211

Charge-offs
(1,627
)
 
—

 
(1,861
)
 
(875
)
 
(623
)
 
(4,986
)
Recoveries
373

 
10

 
335

 
756

 
101

 
1,575

Net (charge-offs) recoveries
(1,254
)
 
10

 
(1,526
)
 
(119
)
 
(522
)
 
(3,411
)
Provision for loan losses charged to operations
3,819

 
1,275

 
(415
)
 
1,162

 
(31
)
 
5,810

Ending balance
$
8,107

 
$
4,713

 
$
10,068

 
$
24,427

 
$
1,295

 
$
48,610

Period-End Amount Allocated to:
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
421

 
$
70

 
$
70

 
$
715

 
$
4

 
$
1,280

Collectively evaluated for impairment
7,326

 
4,643

 
9,493

 
21,751

 
1,289

 
44,502

Purchased with deteriorated credit quality
360

 
—

 
505

 
1,961

 
2

 
2,828

Ending balance
$
8,107

 
$
4,713

 
$
10,068

 
$
24,427

 
$
1,295

 
$
48,610


 
Commercial
 
Real Estate -
Construction
 
Real Estate -
1-4 Family
Mortgage
 
Real Estate  -
Commercial
Mortgage
 
Installment
and  Other(1)
 
Total
Three Months Ended September 30, 2017
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$
5,092

 
$
2,580

 
$
12,104

 
$
22,600

 
$
1,773

 
$
44,149

Charge-offs
(974
)
 
—

 
(575
)
 
(543
)
 
(124
)
 
(2,216
)
Recoveries
137

 
67

 
145

 
72

 
27

 
448

Net (charge-offs) recoveries
(837
)
 
67

 
(430
)
 
(471
)
 
(97
)
 
(1,768
)
Provision for loan losses charged to operations
938

 
161

 
439

 
481

 
131

 
2,150

Ending balance
$
5,193

 
$
2,808

 
$
12,113

 
$
22,610

 
$
1,807

 
$
44,531

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

 
$
2,380

 
$
14,294

 
$
19,059

 
$
1,518

 
$
42,737

Charge-offs
(2,110
)
 
—

 
(1,401
)
 
(1,204
)
 
(513
)
 
(5,228
)
Recoveries
258

 
101

 
291

 
884

 
88

 
1,622

Net (charge-offs) recoveries
(1,852
)
 
101

 
(1,110
)
 
(320
)
 
(425
)
 
(3,606
)
Provision for loan losses charged to operations
1,559

 
327

 
(1,071
)
 
3,871

 
714

 
5,400

Ending balance
$
5,193

 
$
2,808

 
$
12,113

 
$
22,610

 
$
1,807

 
$
44,531

Period-End Amount Allocated to:
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
96

 
$
9

 
$
855

 
$
1,963

 
$
5

 
$
2,928

Collectively evaluated for impairment
4,772

 
2,799

 
10,644

 
19,662

 
1,801

 
39,678

Purchased with deteriorated credit quality
325

 
—

 
614

 
985

 
1

 
1,925

Ending balance
$
5,193

 
$
2,808

 
$
12,113

 
$
22,610

 
$
1,807

 
$
44,531

(1)
Includes lease financing receivables.

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
September 30, 2018
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
2,282

 
$
10,245

 
$
12,445

 
$
7,720

 
$
356

 
$
33,048

Collectively evaluated for impairment
1,278,423

 
726,740

 
2,701,045

 
3,959,612

 
191,976

 
8,857,796

Purchased with deteriorated credit quality
32,639

 
—

 
49,193

 
145,253

 
4,978

 
232,063

Ending balance
$
1,313,344

 
$
736,985

 
$
2,762,683

 
$
4,112,585

 
$
197,310

 
$
9,122,907

December 31, 2017
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
3,064

 
$
1,777

 
$
14,482

 
$
10,545

 
$
439

 
$
30,307

Collectively evaluated for impairment
1,021,014

 
631,612

 
2,275,270

 
3,260,648

 
174,211

 
7,362,755

Purchased with deteriorated credit quality
15,315

 
—

 
53,969

 
156,337

 
1,639

 
227,260

Ending balance
$
1,039,393

 
$
633,389

 
$
2,343,721

 
$
3,427,530

 
$
176,289

 
$
7,620,322

 
(1)
Includes lease financing receivables.