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Allowance for Credit Losses
 6 Months Ended
Jun. 30, 2022
Receivables [Abstract]  
Allowance for Credit Losses Allowance for Credit Losses
(In Thousands)
The following is a summary of total non purchased and purchased loans as of the dates presented:
 
June 30,
2022		December 31, 2021
Commercial, financial, agricultural (1)
$1,497,272 $1,423,270 
Lease financing106,510 80,192 
Real estate – construction:
Residential320,541 302,275 
Commercial805,822 802,621 
Total real estate – construction1,126,363 1,104,896 
Real estate – 1-4 family mortgage:
Primary2,085,078 1,816,120 
Home equity488,048 474,604 
Rental/investment297,536 288,474 
Land development159,421 145,048 
Total real estate – 1-4 family mortgage3,030,083 2,724,246 
Real estate – commercial mortgage:
Owner-occupied1,533,192 1,563,351 
Non-owner occupied3,057,526 2,856,947 
Land development126,795 128,739 
Total real estate – commercial mortgage4,717,513 4,549,037 
Installment loans to individuals131,163 143,340 
Gross loans10,608,904 10,024,981 
Unearned income(5,160)(4,067)
Loans, net of unearned income10,603,744 10,020,914 
Allowance for credit losses on loans(166,131)(164,171)
Net loans$10,437,613 $9,856,743 
(1)Includes Paycheck Protection Program (“PPP”) loans of $7,383 and $58,391 as of June 30, 2022 and December 31, 2021, respectively.

Allowance for Credit Losses on Loans

The allowance for credit losses is an estimate of expected losses inherent within the Company’s loans held for investment portfolio and is maintained at a level believed adequate by management to absorb credit losses inherent in the entire loan portfolio. Management evaluates the adequacy of the allowance for credit losses on a quarterly basis. Expected credit loss inherent in non-cancellable off-balance-sheet credit exposures is accounted for as a separate liability in the Consolidated Balance Sheets. The allowance for credit losses on loans held for investment, as reported in the Company’s Consolidated Balance Sheets, is adjusted by a provision for credit losses, which is reported in earnings, and reduced by net charge-offs. Loan losses are charged against the allowance for credit losses when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. For more information about the Company’s policies and procedures for determining the amount of the allowance for credit losses, please refer to the discussion in Note 1, “Significant Accounting Policies,” in the Notes to the Consolidated Financial Statements in Item 8, Financial Statements and Supplementary Data, in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.
The Company has made an accounting policy election to exclude accrued interest from the measurement of the allowance for credit losses in the Company’s loan portfolio. As of June 30, 2022 and December 31, 2021, the Company had accrued interest receivable for loans of $41,936 and $41,692, respectively, which is recorded in the “Other assets” line item on the Consolidated Balance Sheets. Although the Company made the election to exclude accrued interest from the measurement of the allowance for credit losses, the Company did have an allowance for credit losses on interest deferred as part of the loan deferral program
initiated in response to the COVID-19 pandemic in 2020 of $1,263 and $1,273, respectively, as of June 30, 2022 and December 31, 2021.
The following tables provide a roll-forward of the allowance for credit losses by loan category and a breakdown of the ending balance of the allowance based on the Company’s credit loss methodology for the periods presented:
CommercialReal Estate -
Construction		Real Estate -
1-4 Family
Mortgage		Real Estate  -
Commercial
Mortgage		Lease FinancingInstallment
Loans to Individuals		Total
Three Months Ended June 30, 2022
Allowance for credit losses:
Beginning balance$33,606 $18,411 $36,848 $65,231 $1,582 $10,790 $166,468 
Charge-offs(2,239)— (161)(708)— (850)(3,958)
Recoveries431 — 169 192 11 818 1,621 
Net (charge-offs) recoveries(1,808)— 8 (516)11 (32)(2,337)
(Recovery of) provision for credit losses on loans(1,605)(1,121)5,054 (342)209 (195)2,000 
Ending balance$30,193 $17,290 $41,910 $64,373 $1,802 $10,563 $166,131 
Six Months Ended June 30, 2022
Allowance for credit losses:
Beginning balance$33,922 $16,419 $32,356 $68,940 $1,486 $11,048 $164,171 
Impact of PCD loans acquired during the period1,648 — — — — — 1,648 
Charge-offs(4,341)— (324)(714)(7)(1,629)(7,015)
Recoveries1,567 — 347 347 23 1,543 3,827 
Net (charge-offs) recoveries(2,774)— 23 (367)16 (86)(3,188)
(Recovery of) provision for credit losses on loans(2,603)871 9,531 (4,200)300 (399)3,500 
Ending balance$30,193 $17,290 $41,910 $64,373 $1,802 $10,563 $166,131 
Period-End Amount Allocated to:
Individually evaluated$4,567 $— $85 $1,674 $— $570 $6,896 
Collectively evaluated 25,626 17,290 41,825 62,699 1,802 9,993 159,235 
Ending balance$30,193 $17,290 $41,910 $64,373 $1,802 $10,563 $166,131 
Loans:
Individually evaluated$9,534 $— $4,127 $11,716 $— $570 $25,947 
Collectively evaluated 1,487,738 1,126,363 3,025,956 4,705,797 101,350 130,593 10,577,797 
Ending balance$1,497,272 $1,126,363 $3,030,083 $4,717,513 $101,350 $131,163 $10,603,744 
Nonaccruing loans with no allowance for credit losses$849 $— $3,594 $3,492 $— $— $7,935 
CommercialReal Estate -
Construction		Real Estate -
1-4 Family
Mortgage		Real Estate  -
Commercial
Mortgage		Lease FinancingInstallment Loans to IndividualsTotal
Three Months Ended June 30, 2021
Allowance for credit losses:
Beginning balance$37,592 $14,977 $31,694 $76,225 $1,546 $11,072 $173,106 
Charge-offs(1,184)— (152)(171)— (1,347)(2,854)
Recoveries233 — 401 143 14 1,311 2,102 
Net (charge-offs) recoveries(951)— 249 (28)14 (36)(752)
Provision for credit losses on loans353 752 (640)(1,304)(49)888 — 
Ending balance$36,994 $15,729 $31,303 $74,893 $1,511 $11,924 $172,354 
Six Months Ended June 30, 2021
Allowance for credit losses:
Beginning balance$39,031 $16,047 $32,165 $76,127 $1,624 $11,150 $176,144 
Charge-offs(4,682)(52)(253)(232)— (3,005)(8,224)
Recoveries522 13 662 314 25 2,898 4,434 
Net (charge-offs) recoveries(4,160)(39)409 82 25 (107)(3,790)
Provision for credit losses on loans2,123 (279)(1,271)(1,316)(138)881 — 
Ending balance$36,994 $15,729 $31,303 $74,893 $1,511 $11,924 $172,354 
Period-End Amount Allocated to:
Individually evaluated$9,121 $— $228 $4,207 $— $612 $14,168 
Collectively evaluated27,873 15,729 31,075 70,686 1,511 11,312 158,186 
Ending balance$36,994 $15,729 $31,303 $74,893 $1,511 $11,924 $172,354 
Loans:
Individually evaluated$14,409 $— $5,017 $20,810 $— $636 $40,872 
Collectively evaluated1,620,224 1,051,359 2,697,074 4,509,359 74,003 156,351 10,108,370 
Ending balance$1,634,633 $1,051,359 $2,702,091 $4,530,169 $74,003 $156,987 $10,149,242 
Nonaccruing loans with no allowance for credit losses$2,826 $— $2,841 $4,953 $— $10 $10,630 
 
The Company recorded a provision for credit losses of $2,000 during the second quarter of 2022, as compared to no provision for credit losses recorded in the second quarter of 2021. The Company’s allowance for credit losses model considers economic projections, primarily the national unemployment rate and GDP, over a reasonable and supportable period of two years. The provision activity during the current quarter was primarily driven by strong loan growth and slight deterioration in the economic forecast during the quarter.
Allowance for Credit Losses on Unfunded Loan Commitments
The Company maintains a separate allowance for credit losses on unfunded loan commitments, which is included in the “Other liabilities” line item on the Consolidated Balance Sheets. For more information about the Company’s policies and procedures for determining the amount of the allowance for credit losses on unfunded loan commitments, please refer to the discussion in Note 1, “Significant Accounting Policies,” in the Notes to the Consolidated Financial Statements in Item 8, Financial Statements and Supplementary Data, in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.
The following table provides a roll-forward of the allowance for credit losses on unfunded loan commitments for the periods presented.
Three Months Ended June 30,20222021
Allowance for credit losses on unfunded loan commitments:
Beginning balance$19,485 $20,535 
Provision for credit losses on unfunded loan commitments (included in other noninterest expense) 450 — 
Ending balance$19,935 $20,535 
Six Months Ended June 30,20222021
Allowance for credit losses on unfunded loan commitments:
Beginning balance$20,035 $20,535 
(Recovery of) provision for credit losses on unfunded loan commitments (included in other noninterest expense)(100)— 
Ending balance$19,935 $20,535