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Credit Quality of Loans and Allowance for Loan Losses (Tables)
 9 Months Ended
Sep. 30, 2016
Receivables [Abstract]  
Components of Loans Receivable
The loan portfolio consisted of the following (in thousands):
 
 
September 30, 2016
 
December 31, 2015
Commercial, financial and agricultural
 
$
463,031

 
$
454,028

Real estate – construction
 
96,365

 
74,952

Real estate – commercial
 
464,853

 
471,141

Real estate – residential
 
155,653

 
149,064

Installment loans to individuals
 
88,537

 
111,009

Lease financing receivable
 
1,449

 
1,968

Other
 
2,912

 
1,483

 
 
1,272,800

 
1,263,645

Less allowance for loan losses
 
(23,268
)
 
(19,011
)
 
 
$
1,249,532

 
$
1,244,634
Roll Forward of Activity in Allowance for Loan Losses
A rollforward of the activity within the allowance for loan losses by loan type and recorded investment in loans for the nine months ended September 30, 2016 and 2015 is as follows (in thousands):
 
 
 
September 30, 2016
 
 
 
 
Real Estate
 
 
 
 
 
 
 
 
 
 
Coml, Fin,
and Agric
 
Constru-ction
 
Commercial
 
Residential
 
Installment
loans to
individuals
 
Lease
financing
receivable
 
Other
 
Total
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
 
$
11,268

 
$
819

 
$
4,614

 
$
816

 
$
1,468

 
$
14

 
$
12

 
$
19,011

Charge-offs
 
(2,957
)
 
—

 
(208
)
 
(24
)
 
(991
)
 
—

 
—

 
(4,180
)
Recoveries
 
193

 
—

 
115

 
4

 
125

 
—

 
—

 
437

Provision
 
6,747

 
(478
)
 
1,042

 
(97
)
 
781

 
(5
)
 
10

 
8,000

Ending balance
 
$
15,251

 
$
341

 
$
5,563

 
$
699

 
$
1,383

 
$
9

 
$
22

 
$
23,268

Ending balance: individually evaluated for impairment
 
$
1,105

 
$
—

 
$
2,270

 
$
194

 
$
268

 
$
—

 
$
—

 
$
3,837

Ending balance: collectively evaluated for impairment
 
$
14,146

 
$
341

 
$
3,293

 
$
505

 
$
1,115

 
$
9

 
$
22

 
$
19,431

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Ending balance
 
$
463,031

 
$
96,365

 
$
464,853

 
$
155,653

 
$
88,537

 
$
1,449

 
$
2,912

 
$
1,272,800

Ending balance: individually evaluated for impairment
 
$
29,887

 
$
10

 
$
28,285

 
$
1,831

 
$
464

 
$
—

 
$
—

 
$
60,477

Ending balance: collectively evaluated for impairment
 
$
433,144

 
$
96,355

 
$
435,985

 
$
153,747

 
$
88,073

 
$
1,449

 
$
2,912

 
$
1,211,665

Ending balance: loans acquired with deteriorated credit quality
 
$
—

 
$
—

 
$
583

 
$
75

 
$
—

 
$
—

 
$
—

 
$
658

 
 
September 30, 2015
 
 
 
 
Real Estate
 
 
 
 
 
 
 
 
 
 
Coml, Fin,
and Agric
 
Constr-uction
 
Commercial
 
Residential
 
Installment
loans to
individuals
 
Lease
financing
receivable
 
Other
 
Total
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
 
$
5,729

 
$
954

 
$
2,402

 
$
810

 
$
1,311

 
$
16

 
$
4

 
$
11,226

Charge-offs
 
(2,310
)
 
(76
)
 
(169
)
 
(45
)
 
(883
)
 
—

 
—

 
(3,483
)
Recoveries
 
185

 
1

 
20

 
10

 
80

 
—

 
—

 
296

Provision
 
8,016

 
(62
)
 
2,107

 
(104
)
 
923

 
13

 
7

 
10,900

Ending balance
 
$
11,620

 
$
817

 
$
4,360

 
$
671

 
$
1,431

 
$
29

 
$
11

 
$
18,939

Ending balance: individually evaluated for impairment
 
$
2,569

 
$
26

 
$
1,739

 
$
147

 
$
216

 
$
—

 
$
—

 
$
4,697

Ending balance: collectively evaluated for impairment
 
$
9,051

 
$
791

 
$
2,621

 
$
524

 
$
1,215

 
$
29

 
$
11

 
$
14,242

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Ending balance
 
$
482,452

 
$
74,279

 
$
473,319

 
$
151,667

 
$
113,199

 
$
4,790

 
$
1,746

 
$
1,301,452

Ending balance: individually evaluated for impairment
 
$
29,185

 
$
212

 
$
19,928

 
$
1,796

 
$
386

 
$
—

 
$
—

 
$
51,507

Ending balance: collectively evaluated for impairment
 
$
453,267

 
$
74,067

 
$
452,758

 
$
149,788

 
$
112,813

 
$
4,790

 
$
1,746

 
$
1,249,229

Ending balance: loans acquired with deteriorated credit quality
 
$
—

 
$
—

 
$
633

 
$
83

 
$
—

 
$
—

 
$
—

 
$
716
Age Analysis of Past Due Loans by Class of Loans
An age analysis of past due loans (including both accruing and non-accruing loans) is as follows (in thousands):
 
 
September 30, 2016
 
 
30-59
Days
Past Due
 
60-89
Days
Past
Due
 
Greater
than 90
Days
Past Due
 
Total
Past
Due
 
Current
 
Total Loans
 
Recorded
Investment
> 90 days
 and
Accruing
Commercial, financial, and agricultural
 
$
3,213

 
$
1,255

 
$
29,710

 
$
34,178

 
$
428,853

 
$
463,031

 
$
42

Real estate - construction
 
206

 
—

 
829

 
1,035

 
95,330

 
96,365

 
819

Real estate - commercial
 
3,539

 
—

 
26,219

 
29,758

 
435,095

 
464,853

 
—

Real estate - residential
 
853

 
457

 
1,587

 
2,897

 
152,756

 
155,653

 
82

Installment loans to individuals
 
397

 
370

 
489

 
1,256

 
87,281

 
88,537

 
25

Lease financing receivable
 
—

 
—

 
—

 
—

 
1,449

 
1,449

 
—

Other loans
 
83

 
11

 
—

 
94

 
2,818

 
2,912

 
—

 
 
$
8,291

 
$
2,093

 
$
58,834

 
$
69,218

 
$
1,203,582

 
$
1,272,800

 
$
968

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2015
 
 
30-59
Days
Past Due
 
60-89
Days
Past
Due
 
Greater
than 90
Days
Past Due
 
Total
Past
Due
 
Current
 
Total Loans
 
Recorded
Investment
> 90 days
and
Accruing
Commercial, financial, and agricultural
 
$
1,362

 
$
2,317

 
$
25,696

 
$
29,375

 
$
424,653

 
$
454,028

 
$
59

Real estate - construction
 
1,047

 
—

 
12

 
1,059

 
73,893

 
74,952

 
—

Real estate - commercial
 
1,164

 
514

 
19,512

 
21,190

 
449,951

 
471,141

 
—

Real estate - residential
 
1,703

 
367

 
1,563

 
3,633

 
145,431

 
149,064

 
19

Installment loans to individuals
 
1,022

 
244

 
409

 
1,675

 
109,334

 
111,009

 
69

Lease financing receivable
 
—

 
—

 
—

 
—

 
1,968

 
1,968

 
—

Other loans
 
101

 
4

 
—

 
105

 
1,378

 
1,483

 
—

 
 
$
6,399

 
$
3,446

 
$
47,192

 
$
57,037

 
$
1,206,608

 
$
1,263,645

 
$
147
Schedule of Loans on Nonaccrual Status
Non-accrual loans are as follows (in thousands):
 
 
 
September 30, 2016
 
December 31, 2015
Commercial, financial, and agricultural
 
$
29,874

 
$
27,705

Real estate - construction
 
10

 
37

Real estate - commercial
 
28,285

 
19,907

Real estate - residential
 
1,889

 
1,998

Installment loans to individuals
 
464

 
404

Lease financing receivable
 
—

 
—

Other
 
—

 
—

 
 
$
60,522

 
$
50,051
Schedule of Loans Evaluated for Impairment
Loans that are individually evaluated for impairment are as follows (in thousands):
 
 
September 30, 2016
 
 
Recorded
Investment
 
Unpaid Principal Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest Income
Recognized
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
$
26,802

 
$
27,383

 
$
—

 
$
13,401

 
$
131

Real estate - construction
 
10

 
10

 
—

 
23

 
—

Real estate - commercial
 
13,254

 
13,254

 
—

 
9,341

 
56

Real estate - residential
 
1,062

 
1,062

 
—

 
1,115

 
3

Installment loans to individuals
 
20

 
20

 
—

 
10

 
—

Subtotal:
 
41,148

 
41,729

 
—

 
23,890

 
190

With an allowance recorded:
 
 

 
 

 
 

 
 

 
 

Commercial, financial, and agricultural
 
3,085

 
3,182

 
1,105

 
4,137

 
25

Real estate - commercial
 
15,031

 
15,031

 
2,270

 
14,518

 
28

Real estate - residential
 
769

 
769

 
194

 
653

 
—

Installment loans to individuals
 
444

 
469

 
268

 
407

 
8

Subtotal:
 
19,329

 
19,451

 
3,837

 
19,715

 
61

Totals:
 
 

 
 

 
 

 
 

 
 

Commercial
 
58,172

 
58,850

 
3,375

 
41,397

 
240

Construction
 
10

 
10

 
—

 
23

 
—

Residential
 
1,831

 
1,831

 
194

 
1,768

 
3

Consumer
 
464

 
489

 
268

 
417

 
8

Grand total:
 
$
60,477

 
$
61,180

 
$
3,837

 
$
43,605

 
$
251

 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2015
 
 
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest Income
Recognized
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
$
22,529

 
$
22,793

 
$
—

 
$
11,484

 
$
745

Real estate - construction
 
37

 
37

 
—

 
45

 
—

Real estate - commercial
 
5,886

 
5,886

 
—

 
3,903

 
97

Real estate - residential
 
1,365

 
1,385

 
—

 
954

 
17

Installment loans to individuals
 
34

 
34

 
—

 
56

 
—

Subtotal:
 
29,851

 
30,135

 
—

 
16,442

 
859

With an allowance recorded:
 
 

 
 

 
 

 
 

 
 

Commercial, financial, and agricultural
 
5,189

 
6,373

 
961

 
3,704

 
138

Real estate - commercial
 
14,004

 
14,004

 
1,585

 
9,236

 
161

Real estate - residential
 
538

 
538

 
160

 
533

 
7

Installment loans to individuals
 
370

 
384

 
221

 
334

 
8

Subtotal:
 
20,101

 
21,299

 
2,927

 
13,807

 
314

Totals:
 
 

 
 

 
 

 
 

 
 

Commercial
 
47,608

 
49,056

 
2,546

 
28,327

 
1,141

Construction
 
37

 
37

 
—

 
45

 
—

Residential
 
1,903

 
1,923

 
160

 
1,487

 
24

Consumer
 
404

 
418

 
221

 
390

 
8

Grand total:
 
$
49,952

 
$
51,434

 
$
2,927

 
$
30,249

 
$
1,173
Credit Quality Indicators by Class of Loans
The following tables present the classes of loans by risk rating (in thousands):
 
 
 
  
 
September 30, 2016
Commercial Credit Exposure
 
 
 
 
 
 
 
 
 
 
 
 
Credit Risk Profile by
Creditworthiness Category
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial,
financial, and
agricultural
 
Real estate - commercial
 
Total
 
% of Total
Pass
 
 
 
 
 
$
358,670

 
$
403,961

 
$
762,631

 
82.20
%
Special mention
 
 
 
 
 
28,270

 
25,173

 
53,443

 
5.76
%
Substandard
 
 
 
 
 
75,923

 
35,719

 
111,642

 
12.03
%
Doubtful
 
 
 
 
 
168

 
—

 
168

 
0.02
%
 
 
 
 
 
 
$
463,031

 
$
464,853

 
$
927,884

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Construction Credit Exposure
 
 
 
 
 
 
 
 
 
 
 
 
Credit Risk Profile by
Creditworthiness Category
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Real estate - construction
 
% of Total
Pass
 
 
 
 
 
 
 
 
 
$
96,178

 
99.81
%
Special mention
 
 
 
 
 
 
 
 
 
—

 
—
%
Substandard
 
 
 
 
 
 
 
 
 
187

 
0.19
%
 
 
 
 
 
 
 
 
 
 
$
96,365

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential Credit Exposure
 
 
 
 

 
 

 
 

 
 

 
 

Credit Risk Profile by
Creditworthiness Category
 
 
 
 

 
 

 
 

 
 

 
 

 
 
 
 
 

 
 
 
 
 
Real estate - residential
 
% of Total
Pass
 
 
 
 

 


 
 
 
$
151,053

 
97.04
%
Special mention
 
 
 
 

 


 
 
 
1,227

 
0.79
%
Substandard
 
 
 
 

 
 
 
 
 
3,373

 
2.17
%
 
 
 
 
 

 


 
 
 
$
155,653

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer and Commercial Credit Exposure
 
 
 
 

 
 

 
 

 
 

 
 

Credit Risk Profile Based on
Payment Activity
 
 
 
 

 
 

 
 

 
 

 
 

 
 
 
 
Installment loans to individuals
 
Lease
financing
receivable
 
Other
 
Total
 
% of Total
Performing
 
 
 
$
88,048

 
$
1,449

 
$
2,912

 
$
92,409

 
99.47
%
Nonperforming
 

 
489

 
—

 
—

 
489

 
0.53
%
 
 

 
$
88,537

 
$
1,449

 
$
2,912

 
$
92,898

 
100.00
%
 
 
December 31, 2015
Commercial Credit Exposure
 
 
 
 
 
 
 
 
 
 
 
 
Credit Risk Profile by
Creditworthiness Category
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial,
financial, and
agricultural
 
Real estate - commercial
 
Total
 
%
of Total
Pass
 
 
 
 
 
$
383,897

 
$
412,141

 
$
796,038

 
86.04
%
Special mention
 
 
 
 
 
32,506

 
28,217

 
60,723

 
6.55
%
Substandard
 
 
 
 
 
37,353

 
30,783

 
68,136

 
7.36
%
Doubtful
 
 
 
 
 
272

 
—

 
272

 
0.03
%
 
 
 
 
 
 
$
454,028

 
$
471,141

 
$
925,169

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Construction Credit Exposure
 
 
 
 
 
 
 
 
 
 
 
 
Credit Risk Profile by
Creditworthiness Category
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Real estate - construction
 
%
of Total
Pass
 
 
 
 
 
 
 
 
 
$
74,794

 
99.79
%
Special mention
 
 
 
 
 
 
 
 
 
34

 
0.04
%
Substandard
 
 
 
 
 
 
 
 
 
124

 
0.17
%
 
 
 
 
 
 
 
 
 
 
$
74,952

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential Credit Exposure
 
 
 
 

 
 

 
 

 
 

 
 

Credit Risk Profile by
Creditworthiness Category
 
 
 
 

 
 

 
 

 
 

 
 

 
 
 
 
 

 
 
 
 
 
Real estate - residential
 
%
of Total
Pass
 
 
 
 

 
 
 


 
$
144,704

 
97.08
%
Special mention
 
 
 
 

 
 
 


 
1,225

 
0.82
%
Substandard
 
 
 
 

 
 
 


 
3,135

 
2.10
%
 
 
 
 
 

 
 
 


 
$
149,064

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer and Commercial Credit Exposure
 
 
 
 

 
 

 
 

 
 

 
 

Credit Risk Profile Based on
Payment Activity
 
 
 
 

 
 

 
 

 
 

 
 

 
 
 
 
Installment loans to individuals
 
Lease
financing
receivable
 
Other
 
Total
 
%
of Total
Performing
 

 
$
110,536

 
$
1,968

 
$
1,483

 
$
113,987

 
99.59
%
Nonperforming
 

 
473

 
—

 
—

 
473

 
0.41
%
 
 

 
$
111,009

 
$
1,968

 
$
1,483

 
$
114,460

 
100.00
%
Summary of Troubled Debt Restructurings
Information about the Company’s TDRs is as follows (in thousands):
 
 
 
September 30, 2016
 
 
Current
 
Past Due Greater Than 30 Days
 
Nonaccrual
TDRs
 
Total
TDRs
Commercial, financial and agricultural
 
$
13

 
$
—

 
$
24,568

 
$
24,581

Real estate – commercial
 
—

 
140

 
1,573

 
1,713

 
 
$
13

 
$
140

 
$
26,141

 
$
26,294

 
 
 
 
 
 
 
 
 
 
 
December 31, 2015
 
 
Current
 
Past Due Greater Than 30 Days
 
Nonaccrual
TDRs
 
Total
TDRs
Commercial, financial and agricultural
 
$
16

 
$
—

 
$
20,865

 
$
20,881

Real estate – commercial
 
—

 
148

 
—

 
148

 
 
$
16

 
$
148

 
$
20,865

 
$
21,029