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Allowance for Loan Losses
 9 Months Ended
Sep. 30, 2019
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,
2019
 
December 31, 2018
Commercial, financial, agricultural
$
1,328,560

 
$
1,295,912

Lease financing
73,617

 
64,992

Real estate – construction
816,695

 
740,668

Real estate – 1-4 family mortgage
2,797,633

 
2,795,343

Real estate – commercial mortgage
4,022,375

 
4,051,509

Installment loans to individuals
278,568

 
137,832

Gross loans
9,317,448

 
9,086,256

Unearned income
(3,664
)
 
(3,127
)
Loans, net of unearned income
9,313,784

 
9,083,129

Allowance for loan losses
(50,814
)
 
(49,026
)
Net loans
$
9,262,970

 
$
9,034,103



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 by loan category 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, 2019
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$
9,534

 
$
5,302

 
$
9,616

 
$
24,302

 
$
1,305

 
$
50,059

Charge-offs
(757
)
 
—

 
(268
)
 
(677
)
 
(3,263
)
 
(4,965
)
Recoveries
761

 
—

 
219

 
33

 
3,007

 
4,020

Net recoveries (charge-offs)
4

 
—

 
(49
)
 
(644
)
 
(256
)
 
(945
)
Provision for loan losses charged to operations
750

 
(175
)
 
282

 
381

 
462

 
1,700

Ending balance
$
10,288

 
$
5,127

 
$
9,849

 
$
24,039

 
$
1,511

 
$
50,814

 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial
 
Real Estate -
Construction
 
Real Estate -
1-4 Family
Mortgage
 
Real Estate  -
Commercial
Mortgage
 
Installment
and  Other(1)
 
Total
Nine Months Ended September 30, 2019
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$
8,269

 
$
4,755

 
$
10,139

 
$
24,492

 
$
1,371

 
$
49,026

Charge-offs
(1,709
)
 
—

 
(1,143
)
 
(1,406
)
 
(3,695
)
 
(7,953
)
Recoveries
1,376

 
7

 
531

 
644

 
3,083

 
5,641

Net (charge-offs) recoveries
(333
)
 
7

 
(612
)
 
(762
)
 
(612
)
 
(2,312
)
Provision for loan losses charged to operations
2,352

 
365

 
322

 
309

 
752

 
4,100

Ending balance
$
10,288

 
$
5,127

 
$
9,849

 
$
24,039

 
$
1,511

 
$
50,814

Period-End Amount Allocated to:
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
1,382

 
$
24

 
$
186

 
$
450

 
$
3

 
$
2,045

Collectively evaluated for impairment
8,778

 
5,103

 
9,313

 
21,521

 
1,506

 
46,221

Purchased with deteriorated credit quality
128

 
—

 
350

 
2,068

 
2

 
2,548

Ending balance
$
10,288

 
$
5,127

 
$
9,849

 
$
24,039

 
$
1,511

 
$
50,814

(1)
Includes lease financing receivables.
 
 
 
 
 
 
 
 
 
 
 
 
 
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

(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, 2019
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
8,124

 
$
12,380

 
$
17,332

 
$
11,755

 
$
455

 
$
50,046

Collectively evaluated for impairment
1,289,326

 
803,710

 
2,742,677

 
3,894,838

 
345,073

 
9,075,624

Purchased with deteriorated credit quality
31,110

 
605

 
37,624

 
115,782

 
2,993

 
188,114

Ending balance
$
1,328,560

 
$
816,695

 
$
2,797,633

 
$
4,022,375

 
$
348,521

 
$
9,313,784

December 31, 2018
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
2,445

 
$
10,043

 
$
14,238

 
$
8,059

 
$
493

 
$
35,278

Collectively evaluated for impairment
1,264,324

 
730,625

 
2,732,862

 
3,903,012

 
194,774

 
8,825,597

Purchased with deteriorated credit quality
29,143

 
—

 
48,243

 
140,438

 
4,430

 
222,254

Ending balance
$
1,295,912

 
$
740,668

 
$
2,795,343

 
$
4,051,509

 
$
199,697

 
$
9,083,129

 
(1)
Includes lease financing receivables.