Note 6 — Loans and Allowance for Loan Losses

The following is a summary of non-acquired loans:


	March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017
Non-acquired loans:
Commercial non-owner occupied real estate:
Construction and land development	$	871,141	$	830,875	$	646,544
Commercial non-owner occupied		1,050,924		1,008,893		803,998
Total commercial non-owner occupied real estate		1,922,065		1,839,768		1,450,542
Consumer real estate:
Consumer owner occupied		1,612,501		1,530,260		1,252,650
Home equity loans		448,582		437,642		396,806
Total consumer real estate		2,061,083		1,967,902		1,649,456
Commercial owner occupied real estate		1,296,738		1,262,776		1,200,004
Commercial and industrial		872,363		815,187		725,974
Other income producing property		198,684		193,847		182,416
Consumer		390,784		378,985		340,292
Other loans		20,795		33,690		15,623
Total non-acquired loans		6,762,512		6,492,155		5,564,307
Less allowance for loan losses		(45,203)		(43,448)		(38,449)
Non-acquired loans, net	$	6,717,309	$	6,448,707	$	5,525,858

The following is a summary of acquired non-credit impaired loans accounted for under FASB ASC Topic 310-20, net of related discount:


	March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017
FASB ASC Topic 310-20 acquired loans:
Commercial non-owner occupied real estate:
Construction and land development	$	349,532	$	403,357	$	141,897
Commercial non-owner occupied		783,466		817,166		217,850
Total commercial non-owner occupied real estate		1,132,998		1,220,523		359,747
Consumer real estate:
Consumer owner occupied		683,614		710,611		550,578
Home equity loans		295,721		320,591		186,411
Total consumer real estate		979,335		1,031,202		736,989
Commercial owner occupied real estate		498,541		521,818		238,612
Commercial and industrial		344,171		398,696		136,309
Other income producing property		186,091		196,669		92,044
Consumer		133,802		137,710		151,941
Other		—		1,289		—
Total FASB ASC Topic 310-20 acquired loans	$	3,274,938	$	3,507,907	$	1,715,642

The unamortized discount related to the acquired non-credit impaired loans totaled $55.3 million, $65.2 million, and $26.3 million at March 31, 2018, December 31, 2017, and March 31, 2017, respectively.

In accordance with FASB ASC Topic 310-30, the Company aggregated acquired loans that have common risk characteristics into pools of loan categories as described in the table below. The following is a summary of acquired credit impaired loans accounted for under FASB ASC Topic 310-30 (identified as credit impaired at the time of acquisition), net of related discount:


	March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017
FASB ASC Topic 310-30 acquired loans:
Commercial real estate		233,277		234,595		223,156
Commercial real estate—construction and development		46,219		49,649		57,343
Residential real estate		248,766		260,787		266,484
Consumer		48,801		51,453		58,688
Commercial and industrial		24,295		26,946		26,225
Total FASB ASC Topic 310-30 acquired loans		601,358		623,430		631,896
Less allowance for loan losses		(4,084)		(4,627)		(4,556)
FASB ASC Topic 310-30 acquired loans, net	$	597,274	$	618,803	$	627,340

Contractual loan payments receivable, estimates of amounts not expected to be collected, other fair value adjustments and the resulting fair values of FASB ASC Topic 310-30 acquired loans impaired and non-impaired at the acquisition date for PSC (November 30, 2017) are as follows:


	November 30, 2017
	Loans Impaired
(Dollars in thousands)	at Acquisition
Contractual principal and interest	$	92,600
Non-accretable difference		(12,840)
Cash flows expected to be collected		79,760
Accretable difference		(8,829)
Carrying value	$	70,931

The table above excludes $2.2 billion ($2.3 billion in contractual principal less a $50.1 million fair value adjustment) in acquired loans at fair value that were identified as either performing with no discount related to the credit or as revolving lines of credit (commercial or consumer) as of the acquisition date and will be accounted for under FASB ASC Topic 310-20.


	January 3, 2017
	Loans Impaired
(Dollars in thousands)	at Acquisition
Contractual principal and interest	$	73,365
Non-accretable difference		(12,912)
Cash flows expected to be collected		60,453
Accretable difference		(4,603)
Carrying value	$	55,850

The table above excludes $991.5 million ($1.01 billion in contractual principal less a $18.8 million fair value adjustment) in acquired loans at fair value that were identified as either performing with no discount related to the credit or as revolving lines of credit (commercial or consumer) as of the acquisition date and will be accounted for under FASB ASC Topic 310-20.

Contractual loan payments receivable, estimates of amounts not expected to be collected, other fair value adjustments and the resulting carrying values of acquired credit impaired loans as of March 31, 2018, December 31, 2017 and March 31, 2017 are as follows:


	March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017
Contractual principal and interest	$	765,057	$	795,850	$	812,892
Non-accretable difference		(33,841)		(39,324)		(31,273)
Cash flows expected to be collected		731,216		756,526		781,619
Accretable yield		(129,858)		(133,096)		(149,723)
Carrying value	$	601,358	$	623,430	$	631,896
Allowance for acquired loan losses	$	(4,084)	$	(4,627)	$	(4,556)

Income on acquired credit impaired loans that are not impaired at the acquisition date is recognized in the same manner as loans impaired at the acquisition date. A portion of the fair value discount on acquired non-impaired loans has been ascribed as an accretable difference that is accreted into interest income over the estimated remaining life of the loans. The remaining nonaccretable difference represents cash flows not expected to be collected.

The following are changes in the carrying value of acquired credit impaired loans:


	Three Months Ended March 31,
(Dollars in thousands)	2018		2017
Balance at beginning of period	$	618,803	$	602,546
Fair value of acquired loans		—		55,850
Net reductions for payments, foreclosures, and accretion		(22,072)		(29,895)
Change in the allowance for loan losses on acquired loans		543		(1,161)
Balance at end of period, net of allowance for loan losses on acquired loans	$	597,274	$	627,340

The table below reflects refined accretable yield balance for acquired credit impaired loans:


	Three Months Ended March 31,
(Dollars in thousands)	2018		2017
Balance at beginning of period	$	133,096	$	155,379
Addition from the SBFC acquisition		—		4,603
Accretion		(12,366)		(15,214)
Reclass of nonaccretable difference due to improvement in expected cash flows		9,204		5,062
Other changes, net		(76)		(107)
Balance at end of period	$	129,858	$	149,723

In the first quarter of 2018, the accretable yield balance declined by $3.2 million as loan accretion (income) of $12.4 million was recognized. This was partially offset by improved expected cash flows of $9.2 million during the first quarter of 2018.

Our loan loss policy adheres to GAAP as well as interagency guidance. The ALLL is based upon estimates made by management. We maintain an ALLL at a level that we believe is appropriate to cover estimated credit losses on individually evaluated loans that are determined to be impaired as well as estimated credit losses inherent in the remainder of our loan portfolio. Arriving at the allowance involves a high degree of management judgment and results in a range of estimated losses. We regularly evaluate the adequacy of the allowance through our internal risk rating system, outside credit review, and regulatory agency examinations to assess the quality of the loan portfolio and identify problem loans. The evaluation process also includes our analysis of current economic conditions, composition of the loan portfolio, past due and nonaccrual loans, concentrations of credit, lending policies and procedures, and historical loan loss experience. While management uses available information to recognize losses on loans, future additions to the allowance may be necessary based on, among other factors, changes in economic conditions in our markets. In addition, as noted above, regulatory agencies, as an integral part of their examination process, periodically review our allowances for losses on loans. These agencies may require management to recognize additions to the allowances based on their judgments about information available to them at the time of their examination. Because of these and other factors, it is possible that the allowances for losses on loans may change. The provision for loan losses is charged to expense in an amount necessary to maintain the allowance at an appropriate level.

The ALLL on non‑acquired loans consists of general and specific reserves. The general reserves are determined by applying loss percentages to the portfolio that are based on historical loss experience for each class of loans and management’s evaluation and “risk grading” of the loan portfolio. Additionally, the general economic and business conditions affecting key lending areas, credit quality trends, collateral values, loan volumes and concentrations, seasoning of the loan portfolio, the findings of internal and external credit reviews and results from external bank regulatory examinations are included in this evaluation. Currently, these adjustments are applied to the non‑acquired loan portfolio when estimating the level of reserve required. The specific reserves are determined on a loan‑by‑loan basis based on management’s evaluation of our exposure for each credit, given the current payment status of the loan and the value of any underlying collateral. These are loans classified by management as doubtful or substandard. For such loans that are also classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. Generally, the need for specific reserve is evaluated on impaired loans, and once a specific reserve is established for a loan, a charge-off of that amount occurs in the quarter subsequent to the establishment of the specific reserve. Loans that are determined to be impaired are provided a specific reserve, if necessary, and are excluded from the calculation of the general reserves.

Beginning with the First Financial Holdings, Inc. acquisition in 2013, the Company segregates the acquired loan portfolio into performing loans (“non‑credit impaired) and purchased credit impaired loans. The performing loans and revolving type loans are accounted for under FASB ASC 310‑20, with each loan being accounted for individually. The ALLL on these loans will be measured and recorded consistent with non‑acquired loans. The acquired credit impaired loans will follow the description in the next paragraph.

In determining the acquisition date fair value of purchased loans, and in subsequent accounting, the Company generally aggregates purchased loans into pools of loans with common risk characteristics. Expected cash flows at the acquisition date in excess of the fair value of loans are recorded as interest income over the life of the loans using a level yield method if the timing and amount of the future cash flows of the pool is reasonably estimable. Subsequent to the acquisition date, increases in cash flows over those expected at the acquisition date are reclassified from the non‑accretable difference to accretable yield and recognized as interest income prospectively. Decreases in expected cash flows after the acquisition date are recognized by recording an ALLL. Management analyzes the acquired loan pools using various assessments of risk to determine an expected loss. The expected loss is derived based upon a loss given default based upon the collateral type and/or detailed review by loan officers and the probability of default that is determined based upon historical data at the loan level. All acquired loans managed by Special Asset Management are reviewed quarterly and assigned a loss given default. Acquired loans not managed by Special Asset Management are reviewed twice a year in a similar method to the Company’s originated portfolio of loans which follow review thresholds based on risk rating categories. In the fourth quarter of 2015, the Company modified its methodology to a more granular approach in determining loss given default on substandard loans with a net book balance between $100,000 and $500,000 by adjusting the loss given default to 90% of the most current collateral valuation based on appraised value. Substandard loans greater than $500,000 were individually assigned loss given defaults each quarter. Trends are reviewed in terms of accrual status, past due status, and weighted‑average grade of the loans within each of the accounting pools. In addition, the relationship between the change in the unpaid principal balance and change in the mark is assessed to correlate the directional consistency of the expected loss for each pool.

An aggregated analysis of the changes in allowance for loan losses is as follows:


	Non-acquired		Acquired Non-Credit		Acquired Credit
(Dollars in thousands)	Loans		Impaired Loans		Impaired Loans		Total
Three Months Ended March 31, 2018:
Balance at beginning of period	$	43,448	$	—	$	4,627	$	48,075
Loans charged-off		(1,169)		(334)		—		(1,503)
Recoveries of loans previously charged off (1)		802		165		—		967
Net charge-offs		(367)		(169)		—		(536)
Provision for loan losses charged to operations		2,122		169		163		2,454
Reduction due to loan removals		—		—		(706)		(706)
Balance at end of period	$	45,203	$	—	$	4,084	$	49,287
Three Months Ended March 31, 2017:
Balance at beginning of period	$	36,960	$	—	$	3,395	$	40,355
Loans charged-off		(1,297)		(389)		—		(1,686)
Recoveries of loans previously charged off (1)		669		63		—		732
Net charge-offs		(628)		(326)		—		(954)
Provision for loan losses charged to operations		2,117		326		1,264		3,707
Reduction due to loan removals		—		—		(103)		(103)
Balance at end of period	$	38,449	$	—	$	4,556	$	43,005

(1)

– Recoveries related to acquired credit impaired loans are recorded through other noninterest income on the consolidated statement of income and do not run through the ALLL.

The following tables present a disaggregated analysis of activity in the allowance for loan losses and loan balances for non-acquired loans:


	Construction		Commercial		Commercial		Consumer						Other Income
	& Land		Non-owner		Owner		Owner		Home		Commercial		Producing				Other
(Dollars in thousands)	Development		Occupied		Occupied		Occupied		Equity		& Industrial		Property		Consumer		Loans		Total
Three Months Ended March 31, 2018
Allowance for loan losses:
Balance, December 31, 2017	$	5,921	$	6,525	$	8,128	$	9,668	$	3,250	$	5,488	$	1,375	$	2,788	$	305	$	43,448
Charge-offs		(35)		—		—		(4)		(66)		(85)		—		(979)		—		(1,169)
Recoveries		442		2		8		23		101		15		8		203		—		802
Provision (benefit)		(481)		271		210		506		(48)		915		10		887		(148)		2,122
Balance, March 31, 2018	$	5,847	$	6,798	$	8,346	$	10,193	$	3,237	$	6,333	$	1,393	$	2,899	$	157	$	45,203
Loans individually evaluated for impairment	$	767	$	110	$	63	$	35	$	73	$	489	$	166	$	9	$	—	$	1,712
Loans collectively evaluated for impairment	$	5,080	$	6,688	$	8,283	$	10,158	$	3,164	$	5,844	$	1,227	$	2,890	$	157	$	43,491
Loans:
Loans individually evaluated for impairment	$	46,198	$	1,181	$	5,578	$	5,493	$	3,168	$	1,677	$	3,086	$	315	$	—	$	66,696
Loans collectively evaluated for impairment		824,943		1,049,743		1,291,160		1,607,008		445,414		870,686		195,598		390,469		20,795		6,695,816
Total non-acquired loans	$	871,141	$	1,050,924	$	1,296,738	$	1,612,501	$	448,582	$	872,363	$	198,684	$	390,784	$	20,795	$	6,762,512
Three Months Ended March 31, 2017
Allowance for loan losses:
Balance , December 31, 2016	$	4,091	$	4,980	$	8,022	$	7,820	$	3,211	$	4,842	$	1,542	$	2,350	$	102	$	36,960
Charge-offs		(405)		—		—		(123)		(34)		(22)		—		(713)		—		(1,297)
Recoveries		154		41		7		49		74		90		43		211		—		669
Provision (benefit)		809		443		(135)		362		205		214		(240)		595		(136)		2,117
Balance, March 31, 2017	$	4,649	$	5,464	$	7,894	$	8,108	$	3,456	$	5,124	$	1,345	$	2,443	$	(34)	$	38,449
Loans individually evaluated for impairment	$	459	$	158	$	60	$	68	$	297	$	387	$	224	$	5	$	—	$	1,658
Loans collectively evaluated for impairment	$	4,190	$	5,306	$	7,834	$	8,040	$	3,159	$	4,737	$	1,121	$	2,438	$	(34)	$	36,791
Loans:
Loans individually evaluated for impairment	$	9,286	$	775	$	6,251	$	4,712	$	2,432	$	1,270	$	2,408	$	189	$	—	$	27,323
Loans collectively evaluated for impairment		637,258		803,223		1,193,753		1,247,938		394,374		724,704		180,008		340,103		15,623		5,536,984
Total non-acquired loans	$	646,544	$	803,998	$	1,200,004	$	1,252,650	$	396,806	$	725,974	$	182,416	$	340,292	$	15,623	$	5,564,307

The following tables present a disaggregated analysis of activity in the allowance for loan losses and loan balances for acquired non-credit impaired loans:


	Construction		Commercial		Commercial		Consumer						Other Income
	& Land		Non-owner		Owner		Owner		Home		Commercial		Producing
(Dollars in thousands)	Development		Occupied		Occupied		Occupied		Equity		& Industrial		Property		Consumer		Other		Total
Three Months Ended March 31, 2018
Allowance for loan losses:
Balance at beginning of period	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Charge-offs		(1)		—		—		(70)		(82)		(43)		—		(138)		—		(334)
Recoveries		1		—		—		57		51		53		—		3		—		165
Provision (benefit)		—		—		—		13		31		(10)		—		135		—		169
Balance, March 31, 2018	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Loans collectively evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Loans:
Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Loans collectively evaluated for impairment		349,532		783,466		498,541		683,614		295,721		344,171		186,091		133,802		—		3,274,938
Total acquired non-credit impaired loans	$	349,532	$	783,466	$	498,541	$	683,614	$	295,721	$	344,171	$	186,091	$	133,802	$	—	$	3,274,938

Three Months Ended March 31, 2017
Allowance for loan losses:
Balance at beginning of period	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Charge-offs		—		—		—		(313)		—		(2)		—		(74)		—		(389)
Recoveries		1		—		—		39		9		1		1		12		—		63
Provision (benefit)		(1)		—		—		274		(9)		1		(1)		62		—		326
Balance, March 31, 2017	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Loans collectively evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Loans:
Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Loans collectively evaluated for impairment		141,897		217,850		238,612		550,578		186,411		136,309		92,044		151,941		—		1,715,642
Total acquired non-credit impaired loans	$	141,897	$	217,850	$	238,612	$	550,578	$	186,411	$	136,309	$	92,044	$	151,941	$	—	$	1,715,642

The following tables present a disaggregated analysis of activity in the allowance for loan losses and loan balances for acquired credit impaired loans:


			Commercial
			Real Estate-
	Commercial		Construction and		Residential				Commercial
(Dollars in thousands)	Real Estate		Development		Real Estate		Consumer		and Industrial		Total
Three Months Ended March 31, 2018
Allowance for loan losses:
Balance, December 31, 2017	$	288	$	180	$	3,553	$	461	$	145	$	4,627
Provision (benefit) for loan losses		(14)		88		(944)		133		900		163
Reduction due to loan removals		(13)		(53)		(100)		—		(540)		(706)
Balance, March 31, 2018	$	261	$	215	$	2,509	$	594	$	505	$	4,084
Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—
Loans collectively evaluated for impairment	$	261	$	215	$	2,509	$	594	$	505	$	4,084
Loans:*
Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—
Loans collectively evaluated for impairment		233,277		46,219		248,766		48,801		24,295		601,358
Total acquired credit impaired loans	$	233,277	$	46,219	$	248,766	$	48,801	$	24,295	$	601,358

Three Months Ended March 31, 2017
Allowance for loan losses:
Balance , December 31, 2016	$	41	$	139	$	2,419	$	558	$	238	$	3,395
Provision for loan losses		291		(3)		752		37		187		1,264
Reduction due to loan removals		2		(6)		(63)		(6)		(30)		(103)
Balance, March 31, 2017	$	334	$	130	$	3,108	$	589	$	395	$	4,556
Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—
Loans collectively evaluated for impairment	$	334	$	130	$	3,108	$	589	$	395	$	4,556
Loans:*
Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—
Loans collectively evaluated for impairment		223,156		57,343		266,484		58,688		26,225		631,896
Total acquired credit impaired loans	$	223,156	$	57,343	$	266,484	$	58,688	$	26,225	$	631,896

*— The carrying value of acquired credit impaired loans includes a non accretable difference which is primarily associated with the assessment of credit quality of acquired loans.

As part of the ongoing monitoring of the credit quality of the Company’s loan portfolio, management tracks certain credit quality indicators, including trends related to (i) the level of classified loans, (ii) net charge-offs, (iii) non-performing loans (see details below), and (iv) the general economic conditions of the markets that we serve.

The Company utilizes a risk grading matrix to assign a risk grade to each of its loans. A description of the general characteristics of the risk grades is as follows:

Pass—These loans range from minimal credit risk to average, however, still acceptable credit risk.

Special mention—A special mention loan has potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or the institution’s credit position at some future date.

Substandard—A substandard loan is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness, or weaknesses, that may jeopardize the liquidation of the debt. A substandard loan is characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.

Doubtful—A doubtful loan has all of the weaknesses inherent in one classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of the currently existing facts, conditions and values, highly questionable and improbable.

The following table presents the credit risk profile by risk grade of commercial loans for non-acquired loans:


	Construction & Development						Commercial Non-owner Occupied						Commercial Owner Occupied
	March 31,		December 31,		March 31,		March 31,		December 31,		March 31,		March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017		2018		2017		2017		2018		2017		2017
Pass	$	857,307	$	818,240	$	633,953	$	1,040,669	$	999,049	$	790,687	$	1,267,759	$	1,232,927	$	1,167,531
Special mention		10,499		8,758		8,868		8,497		7,864		11,233		22,619		23,575		20,277
Substandard		3,335		3,877		3,723		1,758		1,980		2,078		6,360		6,274		12,196
Doubtful		—		—		—		—		—		—		—		—		—
	$	871,141	$	830,875	$	646,544	$	1,050,924	$	1,008,893	$	803,998	$	1,296,738	$	1,262,776	$	1,200,004


	Commercial & Industrial						Other Income Producing Property						Commercial Total
	March 31,		December 31,		March 31,		March 31,		December 31,		March 31,		March 31,		December 31,		March 31,
	2018		2017		2017		2018		2017		2017		2018		2017		2017
Pass	$	857,567	$	801,885	$	703,747	$	191,856	$	186,158	$	174,321	$	4,215,158	$	4,038,259	$	3,470,239
Special mention		12,286		11,130		16,746		5,321		6,034		6,176		59,222		57,361		63,300
Substandard		2,510		2,172		5,481		1,507		1,655		1,919		15,470		15,958		25,397
Doubtful		—		—		—		—		—		—		—		—		—
	$	872,363	$	815,187	$	725,974	$	198,684	$	193,847	$	182,416	$	4,289,850	$	4,111,578	$	3,558,936

The following table presents the credit risk profile by risk grade of consumer loans for non-acquired loans:


	Consumer Owner Occupied						Home Equity						Consumer
	March 31,		December 31,		March 31,		March 31,		December 31,		March 31,		March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017		2018		2017		2017		2018		2017		2017
Pass	$	1,584,427	$	1,502,016	$	1,225,556	$	435,282	$	424,369	$	382,387	$	389,386	$	377,425	$	338,473
Special mention		13,329		13,902		13,903		6,767		6,749		7,597		301		313		625
Substandard		14,745		14,342		13,191		6,533		6,524		6,822		1,097		1,247		1,194
Doubtful		—		—		—		—		—		—		—		—		—
	$	1,612,501	$	1,530,260	$	1,252,650	$	448,582	$	437,642	$	396,806	$	390,784	$	378,985	$	340,292


	Other						Consumer Total
	March 31, 2018		December 31, 2017		March 31, 2017		March 31, 2018		December 31, 2017		March 31, 2017
Pass	$	20,795	$	33,690	$	15,623	$	2,429,890	$	2,337,500	$	1,962,039
Special mention		—		—		—		20,397		20,964		22,125
Substandard		—		—		—		22,375		22,113		21,207
Doubtful		—		—		—		—		—		—
	$	20,795	$	33,690	$	15,623	$	2,472,662	$	2,380,577	$	2,005,371

The following table presents the credit risk profile by risk grade of total non-acquired loans:


	Total Non-acquired Loans
	March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017
Pass	$	6,645,048	$	6,375,759	$	5,432,278
Special mention		79,619		78,325		85,425
Substandard		37,845		38,071		46,604
Doubtful		—		—		—
	$	6,762,512	$	6,492,155	$	5,564,307

The following table presents the credit risk profile by risk grade of commercial loans for acquired non-credit impaired loans:


							Commercial Non-owner
	Construction & Development						Occupied						Commercial Owner Occupied
	March 31,		December 31,		March 31,		March 31,		December 31,		March 31,		March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017		2018		2017		2017		2018		2017		2017
Pass	$	345,635	$	394,139	$	139,748	$	775,924	$	809,241	$	213,827	$	490,089	$	513,861	$	233,397
Special mention		2,892		4,602		1,316		7,533		7,913		3,937		8,254		7,740		5,057
Substandard		1,005		4,616		833		9		12		86		198		217		158
Doubtful		—		—		—		—		—		—		—		—		—
	$	349,532	$	403,357	$	141,897	$	783,466	$	817,166	$	217,850	$	498,541	$	521,818	$	238,612


							Other Income Producing
	Commercial & Industrial						Property						Commercial Total
	March 31,		December 31,		March 31,		March 31,		December 31,		March 31,		March 31,		December 31,		March 31,
	2018		2017		2017		2018		2017		2017		2018		2017		2017
Pass	$	327,409	$	388,342	$	132,474	$	180,825	$	191,229	$	89,596	$	2,119,882	$	2,296,812	$	809,042
Special mention		8,049		9,883		3,787		4,369		4,547		1,741		31,097		34,685		15,838
Substandard		8,713		471		48		897		893		707		10,822		6,209		1,832
Doubtful		—		—		—		—		—		—		—		—		—
	$	344,171	$	398,696	$	136,309	$	186,091	$	196,669	$	92,044	$	2,161,801	$	2,337,706	$	826,712

The following table presents the credit risk profile by risk grade of consumer loans for acquired non-credit impaired loans:


	Consumer Owner Occupied						Home Equity						Consumer
	March 31,		December 31,		March 31,		March 31,		December 31,		March 31,		March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017		2018		2017		2017		2018		2017		2017
Pass	$	676,981	$	703,557	$	546,049	$	279,487	$	301,842	$	176,678	$	130,915	$	134,530	$	148,798
Special mention		4,484		4,165		2,623		8,942		10,477		4,700		520		541		1,243
Substandard		2,149		2,889		1,906		7,292		8,272		5,033		2,367		2,639		1,900
Doubtful		—		—		—		—		—		—		—		—		—
	$	683,614	$	710,611	$	550,578	$	295,721	$	320,591	$	186,411	$	133,802	$	137,710	$	151,941


	Other						Consumer Total
	March 31,		December 31,		March 31,		March 31,		December 31,		March 31,
	2018		2017		2017		2018		2017		2017
Pass	$	—	$	1,289	$	—	$	1,087,383	$	1,141,218	$	871,525
Special mention		—		—		—		13,946		15,183		8,566
Substandard		—		—		—		11,808		13,800		8,839
Doubtful		—		—		—		—		—		—
	$	—	$	1,289	$	—	$	1,113,137	$	1,170,201	$	888,930

The following table presents the credit risk profile by risk grade of total acquired non-credit impaired loans:


	Total Acquired
	Non-credit Impaired Loans
	March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017
Pass	$	3,207,265	$	3,438,030	$	1,680,567
Special mention		45,043		49,868		24,404
Substandard		22,630		20,009		10,671
Doubtful		—		—		—
	$	3,274,938	$	3,507,907	$	1,715,642

The following table presents the credit risk profile by risk grade of acquired credit impaired loans (identified as credit-impaired at the time of acquisition), net of the related discount (this table should be read in conjunction with the allowance for acquired credit impaired loan losses table found on page 26):


							Commercial Real Estate—
							Construction and
	Commercial Real Estate						Development
	March 31,		December 31,		March 31,		March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017		2018		2017		2017
Pass	$	171,585	$	177,231	$	170,623	$	28,501	$	29,620	$	28,157
Special mention		24,550		28,708		24,412		4,654		5,132		15,117
Substandard		37,142		28,656		28,121		13,064		14,897		14,069
Doubtful		—		—		—		—		—		—
	$	233,277	$	234,595	$	223,156	$	46,219	$	49,649	$	57,343


	Residential Real Estate						Consumer						Commercial & Industrial
	March 31,		December 31,		March 31,		March 31,		December 31,		March 31,		March 31,		December 31,		March 31,
	2018		2017		2017		2018		2017		2017		2018		2017		2017
Pass	$	129,952	$	135,974	$	142,847	$	7,247	$	8,001	$	9,704	$	17,163	$	18,522	$	16,869
Special mention		50,845		54,500		53,539		16,329		17,214		19,124		1,132		1,169		4,645
Substandard		67,969		70,313		70,098		25,225		26,238		29,860		6,000		7,255		4,711
Doubtful		—		—		—		—		—		—		—		—		—
	$	248,766	$	260,787	$	266,484	$	48,801	$	51,453	$	58,688	$	24,295	$	26,946	$	26,225


	Total Acquired
	Credit Impaired Loans
	March 31,		December 31,		March 31,
	2018		2017		2017
Pass	$	354,448	$	369,348	$	368,200
Special mention		97,510		106,723		116,837
Substandard		149,400		147,359		146,859
Doubtful		—		—		—
	$	601,358	$	623,430	$	631,896

The risk grading of acquired credit impaired loans is determined utilizing a loan’s contractual balance, while the amount recorded in the financial statements and reflected above is the carrying value.

The following table presents an aging analysis of past due loans, segregated by class for non-acquired loans:


	30 - 59 Days		60 - 89 Days		90+ Days		Total				Total
(Dollars in thousands)	Past Due		Past Due		Past Due		Past Due		Current		Loans
March 31, 2018
Commercial real estate:
Construction and land development	$	673	$	4	$	133	$	810	$	870,331	$	871,141
Commercial non-owner occupied		89		20		707		816		1,050,108		1,050,924
Commercial owner occupied		573		1,218		1,702		3,493		1,293,245		1,296,738
Consumer real estate:
Consumer owner occupied		1,274		601		1,598		3,473		1,609,028		1,612,501
Home equity loans		1,452		65		1,423		2,940		445,642		448,582
Commercial and industrial		983		476		899		2,358		870,005		872,363
Other income producing property		360		108		125		593		198,091		198,684
Consumer		134		160		496		790		389,994		390,784
Other loans		—		—		—		—		20,795		20,795
	$	5,538	$	2,652	$	7,083	$	15,273	$	6,747,239	$	6,762,512
December 31, 2017
Commercial real estate:
Construction and land development	$	391	$	63	$	401	$	855	$	830,020	$	830,875
Commercial non-owner occupied		297		398		51		746		1,008,147		1,008,893
Commercial owner occupied		2,227		382		1,721		4,330		1,258,446		1,262,776
Consumer real estate:
Consumer owner occupied		1,291		140		1,943		3,374		1,526,886		1,530,260
Home equity loans		1,209		372		1,684		3,265		434,377		437,642
Commercial and industrial		477		57		915		1,449		813,738		815,187
Other income producing property		223		255		198		676		193,171		193,847
Consumer		525		196		623		1,344		377,641		378,985
Other loans		—		—		—		—		33,690		33,690
	$	6,640	$	1,863	$	7,536	$	16,039	$	6,476,116	$	6,492,155
March 31, 2017
Commercial real estate:
Construction and land development	$	345	$	100	$	471	$	916	$	645,628	$	646,544
Commercial non-owner occupied		759		664		304		1,727		802,271		803,998
Commercial owner occupied		1,811		1,988		1,375		5,174		1,194,830		1,200,004
Consumer real estate:
Consumer owner occupied		1,076		31		993		2,100		1,250,550		1,252,650
Home equity loans		434		341		1,404		2,179		394,627		396,806
Commercial and industrial		366		159		174		699		725,275		725,974
Other income producing property		310		104		190		604		181,812		182,416
Consumer		273		114		527		914		339,378		340,292
Other loans		—		—		—		—		15,623		15,623
	$	5,374	$	3,501	$	5,438	$	14,313	$	5,549,994	$	5,564,307

The following table presents an aging analysis of past due loans, segregated by class for acquired non-credit impaired loans:


	30 - 59 Days		60 - 89 Days		90+ Days		Total				Total
(Dollars in thousands)	Past Due		Past Due		Past Due		Past Due		Current		Loans
March 31, 2018
Commercial real estate:
Construction and land development	$	1,788	$	115	$	288	$	2,191	$	347,341	$	349,532
Commercial non-owner occupied		242		—		134		376		783,090		783,466
Commercial owner occupied		1,142		—		—		1,142		497,399		498,541
Consumer real estate:
Consumer owner occupied		1,304		76		786		2,166		681,448		683,614
Home equity loans		1,881		833		2,125		4,839		290,882		295,721
Commercial and industrial		1,998		27		87		2,112		342,059		344,171
Other income producing property		101		69		195		365		185,726		186,091
Consumer		287		138		1,118		1,543		132,259		133,802
	$	8,743	$	1,258	$	4,733	$	14,734	$	3,260,204	$	3,274,938
December 31, 2017
Commercial real estate:
Construction and land development	$	675	$	113	$	101	$	889	$	402,468	$	403,357
Commercial non-owner occupied		12		321		—		333		816,833		817,166
Commercial owner occupied		642		—		189		831		520,987		521,818
Consumer real estate:
Consumer owner occupied		673		204		867		1,744		708,867		710,611
Home equity loans		3,639		609		1,704		5,952		314,639		320,591
Commercial and industrial		5,996		1,278		143		7,417		391,279		398,696
Other income producing property		327		—		250		577		196,092		196,669
Consumer		400		114		1,351		1,865		135,845		137,710
Other		—		—		—		—		1,289		1,289
	$	12,364	$	2,639	$	4,605	$	19,608	$	3,488,299	$	3,507,907
March 31, 2017
Commercial real estate:
Construction and land development	$	386	$	32	$	160	$	578	$	141,319	$	141,897
Commercial non-owner occupied		26		—		—		26		217,824		217,850
Commercial owner occupied		1,069		143		—		1,212		237,400		238,612
Consumer real estate:
Consumer owner occupied		1,293		482		438		2,213		548,365		550,578
Home equity loans		823		318		1,133		2,274		184,137		186,411
Commercial and industrial		3,484		—		—		3,484		132,825		136,309
Other income producing property		192		—		35		227		91,817		92,044
Consumer		168		74		528		770		151,171		151,941
	$	7,441	$	1,049	$	2,294	$	10,784	$	1,704,858	$	1,715,642

The following table presents an aging analysis of past due loans, segregated by class for acquired credit impaired loans:


	30 - 59 Days		60 - 89 Days		90+ Days		Total				Total
(Dollars in thousands)	Past Due		Past Due		Past Due		Past Due		Current		Loans
March 31, 2018
Commercial real estate	$	6,043	$	5,293	$	6,239	$	17,575	$	215,702	$	233,277
Commercial real estate—construction and development		53		321		3,438		3,812		42,407		46,219
Residential real estate		4,497		3,063		8,598		16,158		232,608		248,766
Consumer		800		275		1,028		2,103		46,698		48,801
Commercial and industrial		55		—		820		875		23,420		24,295
	$	11,448	$	8,952	$	20,123	$	40,523	$	560,835	$	601,358
December 31, 2017
Commercial real estate	$	2,519	$	3,669	$	2,825	$	9,013	$	225,582	$	234,595
Commercial real estate—construction and development		811		427		3,761		4,999		44,650		49,649
Residential real estate		5,895		4,283		8,824		19,002		241,785		260,787
Consumer		989		452		889		2,330		49,123		51,453
Commercial and industrial		596		167		406		1,169		25,777		26,946
	$	10,810	$	8,998	$	16,705	$	36,513	$	586,917	$	623,430
March 31, 2017
Commercial real estate		1,482		1,733		3,984		7,199		215,957		223,156
Commercial real estate—construction and development		877		17		4,305		5,199		52,144		57,343
Residential real estate		4,226		1,809		8,577		14,612		251,872		266,484
Consumer		759		224		1,104		2,087		56,601		58,688
Commercial and industrial		504		—		2,849		3,353		22,872		26,225
	$	7,848	$	3,783	$	20,819	$	32,450	$	599,446	$	631,896

The following is a summary of certain information pertaining to impaired non-acquired loans:


	Unpaid		Recorded		Gross
	Contractual		Investment		Recorded		Total
	Principal		With No		Investment		Recorded		Related
(Dollars in thousands)	Balance		Allowance		With Allowance		Investment		Allowance
March 31, 2018
Commercial real estate:
Construction and land development	$	50,399	$	476	$	45,722	$	46,198	$	767
Commercial non-owner occupied		2,916		659		522		1,181		110
Commercial owner occupied		8,972		3,273		2,305		5,578		63
Consumer real estate:
Consumer owner occupied		7,245		4,332		1,161		5,493		35
Home equity loans		3,855		1,105		2,063		3,168		73
Commercial and industrial		2,679		634		1,043		1,677		489
Other income producing property		3,793		112		2,974		3,086		166
Consumer		787		—		315		315		9
Total	$	80,646	$	10,591	$	56,105	$	66,696	$	1,712
December 31, 2017
Commercial real estate:
Construction and land development	$	47,553	$	649	$	42,581	$	43,230	$	1,063
Commercial non-owner occupied		3,106		860		515		1,375		125
Commercial owner occupied		9,212		3,553		2,089		5,642		64
Consumer real estate:
Consumer owner occupied		7,382		4,392		1,240		5,632		37
Home equity loans		3,602		896		2,115		3,011		135
Commercial and industrial		2,246		635		521		1,156		15
Other income producing property		3,893		—		3,138		3,138		178
Consumer		654		—		239		239		7
Total	$	77,648	$	10,985	$	52,438	$	63,423	$	1,624
March 31, 2017
Commercial real estate:
Construction and land development	$	13,674	$	1,344	$	7,942	$	9,286	$	459
Commercial non-owner occupied		2,393		218		557		775		158
Commercial owner occupied		10,082		4,191		2,060		6,251		60
Consumer real estate:
Consumer owner occupied		6,084		1,483		3,229		4,712		68
Home equity loans		2,962		252		2,180		2,432		297
Commercial and industrial		2,419		—		1,270		1,270		387
Other income producing property		3,153		97		2,311		2,408		224
Consumer		475		—		189		189		5
Total	$	41,242	$	7,585	$	19,738	$	27,323	$	1,658

Acquired credit impaired loans are accounted for in pools as shown on page 22 rather than being individually evaluated for impairment; therefore, the table above excludes acquired credit impaired loans.

The following summarizes the average investment in impaired non-acquired loans, and interest income recognized on these loans:


	Three Months Ended March 31,
	2018				2017
	Average				Average
	Investment in		Interest Income		Investment in		Interest Income
(Dollars in thousands)	Impaired Loans		Recognized		Impaired Loans		Recognized
Commercial real estate:
Construction and land development	$	44,714	$	513	$	6,160	$	47
Commercial non-owner occupied		1,278		5		791		6
Commercial owner occupied		5,610		75		6,248		76
Consumer real estate:
Consumer owner occupied		5,563		43		5,192		39
Home equity loans		3,090		29		2,053		20
Commercial and industrial		1,417		17		1,266		18
Other income producing property		3,112		46		2,390		35
Consumer		277		—		167		—
Total Impaired Loans	$	65,061	$	728	$	24,267	$	241

The following is a summary of information pertaining to non-acquired nonaccrual loans by class, including restructured loans:


	March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017
Commercial non-owner occupied real estate:
Construction and land development	$	500	$	251	$	195
Commercial non-owner occupied		1,174		2,635		2,078
Total commercial non-owner occupied real estate		1,674		2,886		2,273
Consumer real estate:
Consumer owner occupied		5,541		4,888		3,902
Home equity loans		2,593		269		11
Total consumer real estate		8,134		5,157		3,913
Commercial owner occupied real estate		1,647		1,144		2,905
Commercial and industrial		799		1,662		473
Other income producing property		170		764		1,316
Consumer		903		1,802		1,029
Restructured loans		782		925		1,049
Total loans on nonaccrual status	$	14,109	$	14,340	$	12,958

The following is a summary of information pertaining to acquired non-credit impaired nonaccrual loans by class, including restructured loans:


	March 31,		December 31,		March 31,
(Dollars in thousands)	2018		2017		2017
Commercial non-owner occupied real estate:
Construction and land development	$	426	$	108	$	229
Commercial non-owner occupied		—		—		—
Total commercial non-owner occupied real estate		426		108		229
Consumer real estate:
Consumer owner occupied		1,427		2,156		1,453
Home equity loans		3,931		4,589		1,784
Total consumer real estate		5,358		6,745		3,237
Commercial owner occupied real estate		178		189		158
Commercial and industrial		138		133		—
Other income producing property		325		316		83
Consumer		1,651		1,906		1,208
Total loans on nonaccrual status	$	8,076	$	9,397	$	4,915

In the course of resolving delinquent loans, the Bank may choose to restructure the contractual terms of certain loans. Any loans that are modified are reviewed by the Bank to determine if a troubled debt restructuring (“TDR” or “restructured loan”) has occurred. The Bank designates loan modifications as TDRs when it grants a concession to a borrower that it would not otherwise consider due to the borrower experiencing financial difficulty (FASB ASC Topic 310-40). The concessions granted on TDRs generally include terms to reduce the interest rate, extend the term of the debt obligation, or modify the payment structure on the debt obligation.

Loans on nonaccrual status at the date of modification are initially classified as nonaccrual TDRs. Loans on accruing status at the date of concession are initially classified as accruing TDRs if the note is reasonably assured of repayment and performance is expected in accordance with its modified terms. Such loans may be designated as nonaccrual loans subsequent to the concession date if reasonable doubt exists as to the collection of interest or principal under the restructuring agreement. Nonaccrual TDRs are returned to accruing status when there is economic substance to the restructuring, there is documented credit evaluation of the borrower’s financial condition, the remaining balance is reasonably assured of repayment in accordance with its modified terms, and the borrower has demonstrated sustained repayment performance in accordance with the modified terms for a reasonable period of time (generally a minimum of six months). For the three months ended March 31, 2018 and 2017, the Company’s TDRs were not material.