The Company generally makes loans in its market areas of south Mississippi, southern and central Alabama, south Louisiana, the Houston, Texas area, the northern, central, and panhandle regions of Florida, and Nashville, Tennessee. Loans, net of unearned income, by portfolio are presented in the table below.

Commercial and industrial loans are made available to businesses for working capital (including financing of inventory and receivables), business expansion, to facilitate the acquisition of a business, and the purchase of equipment and machinery, including equipment leasing. These loans are primarily made based on the identified cash flows of the borrower and, when secured, have the added strength of the underlying collateral.

Commercial non-real estate loans may be secured by the assets being financed or other tangible or intangible business assets such as accounts receivable, inventory, ownership, enterprise value or commodity interests, and may incorporate a personal or corporate guarantee; however, some short-term loans may be made on an unsecured basis, including a small portfolio of corporate credit cards, generally issued as a part of overall customer relationships.

Commercial real estate – owner occupied loans consist of commercial mortgages on properties where repayment is generally dependent on the cash flow from the ongoing operations and activities of the borrower. Like commercial non-real estate, these loans are primarily made based on the identified cash flows of the borrower, but also have the added strength of the value of underlying real estate collateral.

Commercial real estate – income producing loans consist of loans secured by commercial mortgages on properties where the loan is made to real estate developers or investors and repayment is dependent on the sale, refinance, or income generated from the operation of the property. Properties financed include retail, office, multifamily, senior housing, hotel/motel, skilled nursing facilities and other commercial properties.

Construction and land development loans are made to facilitate the acquisition, development, improvement and construction of both commercial and residential-purpose properties. Such loans are made to builders and investors where repayment is expected to be made from the sale, refinance or operation of the property or to businesses to be used in their business operations. This portfolio also includes a small amount of residential construction loans and loans secured by raw land not yet under development.

Residential mortgages consist of closed-end loans secured by first liens on 1- 4 family residential properties. The portfolio includes both fixed and adjustable rate loans, although most longer term, fixed rate loans originated are sold in the secondary mortgage market.

Consumer loans include second lien mortgage home loans, home equity lines of credit and nonresidential consumer purpose loans. Nonresidential consumer loans include both direct and indirect loans. Direct nonresidential consumer loans are made to finance the purchase of personal property, including automobiles, recreational vehicles and boats, and for other personal purposes (secured and unsecured), and deposit account secured loans. Indirect nonresidential consumer loans include automobile financing provided to the consumer through an agreement with automobile dealerships. Consumer loans also include a small portfolio of credit card receivables issued on the basis of applications received through referrals from the Bank’s branches, online and other marketing efforts.

The following tables show activity in the allowance for loan losses by portfolio class for the six months ended June 30, 2019 and 2018, as well as the corresponding recorded investment in loans at the end of each period.

				Commercial			Total			Commercial
	Commercial			real estate-			commercial			real estate-			Construction
	non-real			owner			and			income			and land			Residential
(in thousands)	estate			occupied			industrial			producing			development			mortgages			Consumer			Total
	Six Months Ended June 30, 2019
Allowance for loan losses:
Beginning balance	$	97,752		$	13,757		$	111,509		$	17,638		$	15,647		$	23,782		$	25,938		$	194,514
Charge-offs		(21,653	)		(71	)		(21,724	)		(10	)		—			(439	)		(8,167	)		(30,340	)
Recoveries		2,730			221			2,951			2			97			266			2,004			5,320
Net provision for loan losses		17,698			328			18,026			7,781			(4,079	)		(551	)		4,954			26,131
Ending balance	$	96,527		$	14,235		$	110,762		$	25,411		$	11,665		$	23,058		$	24,729		$	195,625
Ending balance:
Allowance:
Individually evaluated for impairment	$	8,486		$	142		$	8,628		$	93		$	1		$	146		$	253		$	9,121
Amounts related to purchased credit impaired loans		138			172			310			105			151			8,695			313			9,574
Collectively evaluated for impairment		87,903			13,921			101,824			25,213			11,513			14,217			24,163			176,930
Total allowance	$	96,527		$	14,235		$	110,762		$	25,411		$	11,665		$	23,058		$	24,729		$	195,625
Loans:
Individually evaluated for impairment	$	224,603		$	17,769		$	242,372		$	1,880		$	19		$	4,089		$	1,521		$	249,881
Purchased credit impaired loans		6,313			5,581			11,894			4,702			1,482			98,472			3,444			119,994
Collectively evaluated for impairment		8,328,202			2,496,620			10,824,822			2,888,886			1,142,561			2,865,710			2,083,958			19,805,937
Total loans	$	8,559,118		$	2,519,970		$	11,079,088		$	2,895,468		$	1,144,062		$	2,968,271		$	2,088,923		$	20,175,812

				Commercial			Total			Commercial
	Commercial			real estate-			commercial			real estate-			Construction
	non-real			owner			and			income			and land			Residential
(in thousands)	estate			occupied			industrial			producing			development			mortgages			Consumer			Total
	Six Months Ended June 30, 2018
Allowance for loan losses:
Beginning balance	$	127,918		$	12,962		$	140,880		$	13,709		$	7,372		$	24,844		$	30,503		$	217,308
Charge-offs		(11,845	)		(6,804	)		(18,649	)		(1,604	)		(220	)		(498	)		(12,964	)		(33,935	)
Recoveries		12,476			275			12,751			65			38			712			3,095			16,661
Net provision for loan losses		(1,981	)		7,727			5,746			1,975			3,121			(862	)		11,164			21,144
Reduction as a result of sale of subsidiary		—			—			—			—			—			—			(6,648	)		(6,648	)
Ending balance	$	126,568		$	14,160		$	140,728		$	14,145		$	10,311		$	24,196		$	25,150		$	214,530
Ending balance:
Allowance:
Individually evaluated for impairment	$	19,369		$	824		$	20,193		$	407		$	1		$	99		$	130		$	20,830
Amounts related to purchased credit impaired loans		427			420			847			46			115			10,873			497			12,378
Collectively evaluated for impairment		106,772			12,916			119,688			13,692			10,195			13,224			24,523			181,322
Total allowance	$	126,568		$	14,160		$	140,728		$	14,145		$	10,311		$	24,196		$	25,150		$	214,530
Loans:
Individually evaluated for impairment	$	291,071		$	26,967		$	318,038		$	8,820		$	113		$	3,733		$	599		$	331,303
Purchased credit impaired loans		8,221			6,630			14,851			3,800			4,769			111,805			5,381			140,606
Collectively evaluated for impairment		8,111,669			2,200,197			10,311,866			2,329,572			1,510,351			2,664,821			2,082,398			18,899,008
Total loans	$	8,410,961		$	2,233,794		$	10,644,755		$	2,342,192		$	1,515,233		$	2,780,359		$	2,088,378		$	19,370,917

The following table shows the composition of nonaccrual loans by portfolio class. Purchased credit impaired loans accounted for in pools with an accretable yield are considered to be performing and are excluded from the table.

Nonaccrual loans include nonaccruing loans modified in troubled debt restructurings (“TDRs”) of $99.1 million and $85.5 million at June 30, 2019 and December 31, 2018, respectively. Total TDRs, both accruing and nonaccruing, were $200.3 million at June 30, 2019 and $224.6 million at December 31, 2018. All TDRs are individually evaluated for impairment. At June 30, 2019 and December 31, 2018, the Company had unfunded commitments of $3.6 million and $2.1 million, respectively, to borrowers whose loan terms have been modified in a TDR.

The tables below detail by portfolio class TDRs that were modified during the three and six months ended June 30, 2019 and 2018:

	Three Months Ended
($ in thousands)	June 30, 2019						June 30, 2018
			Pre- Modification		Post- Modification				Pre- Modification		Post- Modification
	Number		Outstanding		Outstanding		Number		Outstanding		Outstanding
	of		Recorded		Recorded		of		Recorded		Recorded
Troubled Debt Restructurings:	Contracts		Investment		Investment		Contracts		Investment		Investment
Commercial non-real estate		1	$	334	$	334		5	$	6,477	$	6,477
Commercial real estate - owner occupied		—		—		—		—		—		—
Total commercial and industrial		1		334		334		5		6,477		6,477
Commercial real estate - income producing		—		—		—		—		—		—
Construction and land development		—		—		—		—		—		—
Residential mortgages		2		638		638		2		75		75
Consumer		—		—		—		—		—		—
Total loans		3	$	972	$	972		7	$	6,552	$	6,552

	Six Months Ended
($ in thousands)	June 30, 2019						June 30, 2018
Troubled Debt Restructurings:	Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
Commercial non-real estate		8	$	14,137	$	14,137		18	$	61,959	$	61,959
Commercial real estate - owner occupied		1		167		167		1		5,909		5,909
Total commercial and industrial		9		14,304		14,304		19		67,868		67,868
Commercial real estate - income producing		—		—		—		1		1,564		1,564
Construction and land development		—		—		—		—		—		—
Residential mortgages		7		1,902		1,902		3		118		118
Consumer		2		46		46		1		222		222
Total loans		18	$	16,252	$	16,252		24	$	69,772	$	69,772

The TDRs modified during the six months ended June 30, 2019 reflected in the table above include $0.1 million of loans with extended amortization terms or other payment concessions, $9.1 million with significant covenant waivers and $7.0 million with other modifications. The TDRs modified during the six months ended June 30, 2018 include $49.6 million of loans with extended amortization terms or other payment concessions, $14.6 million with significant covenant waivers and $5.6 million with other modifications.

There were no defaults on loans during the three and six months ended June 30, 2019 or 2018 that had been modified in a TDR during the prior twelve months.

The tables below present loans that are individually evaluated for impairment disaggregated by portfolio class at June 30, 2019 and December 31, 2018. Loans individually evaluated for impairment include TDRs and loans that are determined to be impaired and have aggregate relationship balances of $1 million or more.

	June 30, 2019
(in thousands)	Recorded investment without an allowance		Recorded investment with an allowance		Unpaid principal balance		Related allowance
Commercial non-real estate	$	149,605	$	74,998	$	260,833	$	8,486
Commercial real estate - owner occupied		10,971		6,798		22,352		142
Total commercial and industrial		160,576		81,796		283,185		8,628
Commercial real estate - income producing		385		1,495		1,932		93
Construction and land development		—		19		19		1
Residential mortgages		2,669		1,420		4,619		146
Consumer		494		1,027		1,802		253
Total loans	$	164,124	$	85,757	$	291,557	$	9,121

	December 31, 2018
(in thousands)	Recorded investment without an allowance		Recorded investment with an allowance		Unpaid principal balance		Related allowance
Commercial non-real estate	$	144,625	$	94,759	$	273,290	$	3,636
Commercial real estate - owner occupied		13,027		8,639		25,888		607
Total commercial and industrial		157,652		103,398		299,178		4,243
Commercial real estate - income producing		1,138		1,563		3,428		210
Construction and land development		100		21		121		1
Residential mortgages		2,058		1,818		4,421		444
Consumer		279		728		1,253		216
Total loans	$	161,227	$	107,528	$	308,401	$	5,114

The tables below present the average balances and interest income for total impaired loans for the three and six months ended June 30, 2019 and 2018. Interest income recognized represents interest on accruing loans modified in a TDR.

	Three Months Ended
	June 30, 2019				June 30, 2018
(in thousands)	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Commercial non-real estate	$	228,055	$	1,444	$	307,492	$	2,002
Commercial real estate - owner occupied		17,371		71		28,643		102
Total commercial and industrial		245,426		1,515		336,135		2,104
Commercial real estate - income producing		2,274		7		11,446		24
Construction and land development		19		—		113		—
Residential mortgages		4,743		2		6,036		5
Consumer		1,515		18		608		9
Total loans	$	253,977	$	1,542	$	354,338	$	2,142

	Six Months Ended
	June 30, 2019				June 30, 2018
(in thousands)	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Commercial non-real estate	$	231,750	$	3,140	$	301,695	$	3,588
Commercial real estate - owner occupied		18,346		151		27,274		168
Total commercial and industrial		250,096		3,291		328,969		3,756
Commercial real estate - income producing		2,480		14		13,123		49
Construction and land development		45		—		176		—
Residential mortgages		4,690		7		7,762		10
Consumer		1,386		34		781		18
Total loans	$	258,697	$	3,346	$	350,811	$	3,833

The tables below present the age analysis of past due loans by portfolio class at June 30, 2019 and December 31, 2018. Purchased credit impaired loans accounted for in pools with an accretable yield are considered to be current.

June 30, 2019	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 still accruing
(in thousands)
Commercial non-real estate	$	4,289	$	9,159	$	57,760	$	71,208	$	8,487,910	$	8,559,118	$	613
Commercial real estate - owner occupied		2,858		1,732		16,047	$	20,637		2,499,333		2,519,970		4,031
Total commercial and industrial		7,147		10,891		73,807		91,845		10,987,243		11,079,088		4,644
Commercial real estate - income producing		762		—		2,798		3,560		2,891,908		2,895,468		—
Construction and land development		779		2,199		1,322		4,300		1,139,761		1,144,062		612
Residential mortgages		2,865		8,748		20,690		32,303		2,935,968		2,968,271		47
Consumer		15,989		3,960		9,498		29,447		2,059,476		2,088,923		1,190
Total	$	27,542	$	25,798	$	108,115	$	161,455	$	20,014,356	$	20,175,812	$	6,493

December 31, 2018	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 still accruing
(in thousands)
Commercial non-real estate	$	12,257	$	3,895	$	77,551	$	93,703	$	8,526,898		8,620,601	$	10,823
Commercial real estate - owner occupied		2,394		1,570		14,542		18,506		2,439,242		2,457,748		380
Total commercial and industrial		14,651		5,465		92,093		112,209		10,966,140		11,078,349		11,203
Commercial real estate - income producing		2,371		772		5,495		8,638		2,333,141		2,341,779		1,844
Construction and land development		7,397		1,129		2,165		10,691		1,537,644		1,548,335		644
Residential mortgages		32,869		14,706		23,175		70,750		2,839,331		2,910,081		—
Consumer		20,402		4,695		9,665		34,762		2,113,105		2,147,867		618
Total	$	77,690	$	26,767	$	132,593	$	237,050	$	19,789,361	$	20,026,411	$	14,309

The following tables present the credit quality indicators by segments and portfolio class of loans at June 30, 2019 and December 31, 2018.

	June 30, 2019
(in thousands)	Commercial non-real estate		Commercial real estate - owner- occupied		Total commercial and industrial		Commercial real estate - income producing		Construction and land development		Total commercial
Grade:
Pass	$	7,940,853	$	2,320,832	$	10,261,685	$	2,755,518	$	1,122,619	$	14,139,822
Pass-Watch		169,005		122,050		291,055		98,767		16,121	$	405,943
Special Mention		62,545		11,981		74,526		20,927		253	$	95,706
Substandard		386,715		65,107		451,822		20,256		5,069	$	477,147
Doubtful		—		—		—		—		—		—
Total	$	8,559,118	$	2,519,970	$	11,079,088	$	2,895,468	$	1,144,062	$	15,118,618

	December 31, 2018
(in thousands)	Commercial non-real estate		Commercial real estate - owner- occupied		Total commercial and industrial		Commercial real estate - income producing		Construction and land development		Total commercial
Grade:
Pass	$	7,875,588	$	2,274,211	$	10,149,799		2,265,087	$	1,487,599	$	13,902,485
Pass-Watch		260,510		84,271		344,781		46,535		49,099		440,415
Special Mention		75,752		23,149		98,901		5,510		816		105,227
Substandard		408,751		76,117		484,868		24,647		10,821		520,336
Doubtful		—		—		—		—		—		—
Total	$	8,620,601	$	2,457,748	$	11,078,349	$	2,341,779	$	1,548,335	$	14,968,463

Changes in the carrying amount of purchased credit impaired loans and related accretable yield are presented in the following table for the six months ended June 30, 2019 and the year ended December 31, 2018.

Included in loans are $8.7 million and $7.1 million of consumer loans secured by single family residential real estate that are in process of foreclosure as of June 30, 2019 and December 31, 2018, respectively. Loans in process of foreclosure include those for which formal foreclosure proceedings are in process according to local requirements of the applicable jurisdiction. In addition to the single family residential real estate loans in process of foreclosure, the Company also held $2.6 million and $1.8 million of foreclosed single family residential properties in other real estate owned at June 30, 2019 and December 31, 2018, respectively.