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Allowance for Credit Losses
 9 Months Ended
Sep. 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:
 
September 30,
2022		December 31, 2021
Commercial, financial, agricultural (1)
$1,513,091 $1,423,270 
Lease financing108,517 80,192 
Real estate – construction:
Residential359,754 302,275 
Commercial855,302 802,621 
Total real estate – construction1,215,056 1,104,896 
Real estate – 1-4 family mortgage:
Primary2,144,119 1,816,120 
Home equity499,626 474,604 
Rental/investment322,844 288,474 
Land development161,300 145,048 
Total real estate – 1-4 family mortgage3,127,889 2,724,246 
Real estate – commercial mortgage:
Owner-occupied1,562,952 1,563,351 
Non-owner occupied3,320,116 2,856,947 
Land development133,597 128,739 
Total real estate – commercial mortgage5,016,665 4,549,037 
Installment loans to individuals128,946 143,340 
Gross loans11,110,164 10,024,981 
Unearned income(5,160)(4,067)
Loans, net of unearned income11,105,004 10,020,914 
Allowance for credit losses on loans(174,356)(164,171)
Net loans$10,930,648 $9,856,743 
(1)Includes Paycheck Protection Program (“PPP”) loans of $5,476 and $58,391 as of September 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 September 30, 2022 and December 31, 2021, the Company had accrued interest receivable for loans of $45,293 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 established in 2020 in response to the COVID-19 pandemic of $1,263 and $1,273, respectively, as of September 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 September 30, 2022
Allowance for credit losses:
Beginning balance$30,193 $17,290 $41,910 $64,373 $1,802 $10,563 $166,131 
Charge-offs(373)— (208)(1,956)— (722)(3,259)
Recoveries415 — 378 50 113 728 1,684 
Net (charge-offs) recoveries42 — 170 (1,906)113 6 (1,575)
(Recovery of) provision for credit losses on loans268 1,454 1,452 6,800 399 (573)9,800 
Ending balance$30,503 $18,744 $43,532 $69,267 $2,314 $9,996 $174,356 
Nine Months Ended September 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(4,714)— (532)(2,670)(7)(2,351)(10,274)
Recoveries1,982 — 725 397 136 2,271 5,511 
Net (charge-offs) recoveries(2,732)— 193 (2,273)129 (80)(4,763)
(Recovery of) provision for credit losses on loans(2,335)2,325 10,983 2,600 699 (972)13,300 
Ending balance$30,503 $18,744 $43,532 $69,267 $2,314 $9,996 $174,356 
Period-End Amount Allocated to:
Individually evaluated$4,064 $— $— $2,649 $— $370 $7,083 
Collectively evaluated 26,439 18,744 43,532 66,618 2,314 9,626 167,273 
Ending balance$30,503 $18,744 $43,532 $69,267 $2,314 $9,996 $174,356 
Loans:
Individually evaluated$9,088 $153 $5,965 $19,043 $— $370 $34,619 
Collectively evaluated 1,504,003 1,214,903 3,121,924 4,997,622 103,357 128,576 11,070,385 
Ending balance$1,513,091 $1,215,056 $3,127,889 $5,016,665 $103,357 $128,946 $11,105,004 
Nonaccruing loans with no allowance for credit losses$429 $153 $5,809 $4,633 $— $2 $11,026 
CommercialReal Estate -
Construction		Real Estate -
1-4 Family
Mortgage		Real Estate  -
Commercial
Mortgage		Lease FinancingInstallment Loans to IndividualsTotal
Three Months Ended September 30, 2021
Allowance for credit losses:
Beginning balance$36,994 $15,729 $31,303 $74,893 $1,511 $11,924 $172,354 
Charge-offs(1,225)— (276)(184)(13)(1,281)(2,979)
Recoveries418 — 193 190 11 1,051 1,863 
Net (charge-offs) recoveries(807)— (83)6 (2)(230)(1,116)
(Recovery of) Provision for credit losses on loans(1,210)440 961 (1,004)61 (448)(1,200)
Ending balance$34,977 $16,169 $32,181 $73,895 $1,570 $11,246 $170,038 
Nine Months Ended September 30, 2021
Allowance for credit losses:
Beginning balance$39,031 $16,047 $32,165 $76,127 $1,624 $11,150 $176,144 
Charge-offs(5,907)(52)(529)(416)(13)(4,286)(11,203)
Recoveries940 13 855 504 36 3,949 6,297 
Net (charge-offs) recoveries(4,967)(39)326 88 23 (337)(4,906)
(Recovery of) Provision for credit losses on loans913 161 (310)(2,320)(77)433 (1,200)
Ending balance$34,977 $16,169 $32,181 $73,895 $1,570 $11,246 $170,038 
Period-End Amount Allocated to:
Individually evaluated$9,717 $— $206 $5,968 $— $607 $16,498 
Collectively evaluated25,260 16,169 31,975 67,927 1,570 10,639 153,540 
Ending balance$34,977 $16,169 $32,181 $73,895 $1,570 $11,246 $170,038 
Loans:
Individually evaluated$15,193 $— $5,311 $19,120 $— $617 $40,241 
Collectively evaluated1,420,826 1,091,296 2,719,432 4,516,610 79,215 149,204 9,976,583 
Ending balance$1,436,019 $1,091,296 $2,724,743 $4,535,730 $79,215 $149,821 $10,016,824 
Nonaccruing loans with no allowance for credit losses$2,658 $— $3,039 $2,865 $— $10 $8,572 
 
The Company recorded a provision for credit losses of $9,800 during the third quarter of 2022, as compared to a negative provision for credit losses $1,200 recorded in the third 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.
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 September 30,20222021
Allowance for credit losses on unfunded loan commitments:
Beginning balance$19,935 $20,535 
Provision for (recovery of provision for) credit losses on unfunded loan commitments (included in other noninterest expense) — (200)
Ending balance$19,935 $20,335 
Nine Months Ended September 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)(200)
Ending balance$19,935 $20,335