Loans, Allowance for Credit Losses, and Asset Quality Information (Tables)

12 Months Ended

Dec. 31, 2022

Receivables [Abstract]

Summary of Major Categories of Total Loans Outstanding

The following is a summary of the major categories of total loans outstanding:

	December 31, 2022				December 31, 2021
($ in thousands)	Amount		Percentage		Amount	Percentage
Commercial, financial, and agricultural	$	641,941	9	%	648,997	11	%
Real estate – construction, land development & other land loans	934,176		14	%	828,549	13	%
Real estate mortgage – residential (1-4 family) first mortgages	1,195,785		18	%	1,021,966	17	%
Real estate mortgage – home equity loans/lines of credit	323,726		5	%	331,932	5	%
Real estate mortgage – commercial and other	3,510,261		53	%	3,194,737	53	%
Consumer loans	60,659		1	%	57,238	1	%
Subtotal	6,666,548		100	%	6,083,419	100	%
Unamortized net deferred loan fees	(1,403)				(1,704)
Total loans	$	6,665,145			6,081,715

($ in thousands)	December 31, 2022		December 31, 2021
Guaranteed portions of SBA Loans included in table above	$	31,893	48,377
Unguaranteed portions of SBA Loans included in table above	116,910		122,772
Total SBA loans included in the table above	$	148,803	171,149
Sold portions of SBA loans with servicing retained - not included in table above	$	392,370	414,240

Schedule of Nonperforming Assets and Nonaccrual Loans

Nonperforming assets, defined as nonaccrual loans, troubled debt restructurings, loans past due 90 or more days and still accruing interest, and foreclosed real estate, are summarized as follows:

($ in thousands)	December 31, 2022		December 31, 2021
Nonperforming assets
Nonaccrual loans	$	28,514	34,696
Restructured loans - accruing	9,121		13,866
Accruing loans > 90 days past due	—		1,004
Total nonperforming loans	37,635		49,566
Foreclosed properties	658		3,071
Total nonperforming assets	$	38,293	52,637

The following table is a summary of the Company’s nonaccrual loans by major categories for the year ended December 31, 2022.

($ in thousands)	Nonaccrual Loans with No Allowance		Nonaccrual Loans with an Allowance	Total Nonaccrual Loans
Commercial, financial, and agricultural	$	3,855	6,374	10,229
Real estate – construction, land development & other land loans	—		1,009	1,009
Real estate mortgage – residential (1-4 family) first mortgages	157		3,132	3,289
Real estate mortgage – home equity loans/lines of credit	—		1,397	1,397
Real estate mortgage – commercial and other	5,010		7,495	12,505
Consumer loans	—		85	85
Total	$	9,022	19,492	28,514

The following table is a summary of the Company’s nonaccrual loans by major categories for the year ended December 31, 2021.

($ in thousands)	Nonaccrual Loans with No Allowance		Nonaccrual Loans with an Allowance	Total Nonaccrual Loans
Commercial, financial, and agricultural	$	3,947	8,205	12,152
Real estate – construction, land development & other land loans	495		137	632
Real estate mortgage – residential (1-4 family) first mortgages	858		4,040	4,898
Real estate mortgage – home equity loans/lines of credit	—		694	694
Real estate mortgage – commercial and other	7,648		8,583	16,231
Consumer loans	—		89	89
Total	$	12,948	21,748	34,696

Summary of Accrued Interest Receivables Written Off

The following table represents the accrued interest receivables written off by reversing interest income for the periods indicate.

($ in thousands)	Year Ended December 31, 2022		Year Ended December 31, 2021
Commercial, financial, and agricultural	$	102	195
Real estate – construction, land development & other land loans	16		6
Real estate mortgage – residential (1-4 family) first mortgages	45		31
Real estate mortgage – home equity loans/lines of credit	20		14
Real estate mortgage – commercial and other	139		453
Consumer loans	2		—
Total	$	324	699

Schedule of Analysis of Payment Status

The following table presents an analysis of the payment status of the Company’s loans as of December 31, 2022.

($ in thousands)	Accruing 30-59 Days Past Due		Accruing 60- 89 Days Past Due	Accruing 90 Days or More Past Due	Nonaccrual Loans	Accruing Current	Total Loans Receivable
Commercial, financial, and agricultural	$	438	565	—	10,229	630,709	641,941
Real estate – construction, land development & other land loans	238		1,687	—	1,009	931,242	934,176
Real estate mortgage – residential (1-4 family) first mortgages	3,415		25	—	3,289	1,189,056	1,195,785
Real estate mortgage – home equity loans/lines of credit	457		371	—	1,397	321,501	323,726
Real estate mortgage – commercial and other	620		97	—	12,505	3,497,039	3,510,261
Consumer loans	249		66	—	85	60,259	60,659
Total	$	5,417	2,811	—	28,514	6,629,806	6,666,548
Unamortized net deferred loan fees							(1,403)
Total loans							$	6,665,145

The following table presents an analysis of the payment status of the Company’s loans as of December 31, 2021.

($ in thousands)	Accruing 30-59 Days Past Due		Accruing 60- 89 Days Past Due	Accruing 90 Days or More Past Due	Nonaccrual Loans	Accruing Current	Total Loans Receivable
Commercial, financial, and agricultural	$	377	93	—	12,152	636,375	648,997
Real estate – construction, land development & other land loans	4,046		—	286	632	823,585	828,549
Real estate mortgage – residential (1-4 family) first mortgages	6,571		1,488	—	4,898	1,009,009	1,021,966
Real estate mortgage – home equity loans/lines of credit	489		124	718	694	329,907	331,932
Real estate mortgage – commercial and other	164		1,496	—	16,231	3,176,846	3,194,737
Consumer loans	116		62	—	89	56,971	57,238
Total	$	11,763	3,263	1,004	34,696	6,032,693	6,083,419
Unamortized net deferred loan (fees) costs							(1,704)
Total loans							$	6,081,715

Analysis of Collateral-Dependent Loans

The following table presents an analysis of collateral-dependent loans of the Company as of December 31, 2022.

($ in thousands)	Residential Property		Business Assets	Land	Commercial Property	Total Collateral-Dependent Loans
Commercial, financial, and agricultural	$	—	6,394	—	—	6,394
Real estate mortgage – residential (1-4 family) first mortgages	157		—	—	—	157
Real estate mortgage – commercial and other	—		—	—	6,723	6,723
Total	$	157	6,394	—	6,723	13,274

The following table presents an analysis of collateral-dependent loans of the Company as of December 31, 2021.

($ in thousands)	Residential Property		Business Assets	Land	Commercial Property	Total Collateral-Dependent Loans
Commercial, financial, and agricultural	$	—	7,886	—	—	7,886
Real estate – construction, land development & other land loans	—		—	533	—	533
Real estate mortgage – residential (1-4 family) first mortgages	871		—	—	—	871
Real estate mortgage – commercial and other	—		—	—	10,743	10,743
Total	$	871	7,886	533	10,743	20,033

Schedule of Allowance for Loan Losses

The following tables presents the activity in the ACL on loans for the periods indicated. The increase in ACL at December 31, 2022 as compared to the prior year was related to a combination of the allowance required for loan growth during the year, and updated economic forecasts and loss driver inputs to the CECL model. Throughout 2022, the economic forecasts have projected general weakening of the economy demonstrated by higher projected unemployment rates, lower GDP, and declining price indices for both commercial real estate and residential mortgages. These worsening economic projections translated to higher forecasted life of loan losses in our portfolio and a higher estimated ACL.

($ in thousands)	Commercial, Financial, and Agricultural		Real Estate - Construction, Land Development & Other Land Loans	Real Estate Mortgage - Residential (1-4 Family) First Mortgages	Real Estate Mortgage - Home Equity Loans/Lines of Credit	Real Estate Mortgage - Commercial and Other	Consumer Loans	Total
As of and for the year ended December 31, 2022
Beginning balance	$	16,249	16,519	8,686	4,337	30,342	2,656	78,789
Charge-offs	(2,519)		—	—	(43)	(1,063)	(840)	(4,465)
Recoveries	756		480	17	600	1,983	207	4,043
Provisions/(Reversals)	3,232		(1,871)	2,651	(1,736)	9,447	877	12,600
Ending balance	$	17,718	15,128	11,354	3,158	40,709	2,900	90,967

($ in thousands)	Commercial, Financial, and Agricultural		Real Estate - Construction, Land Development & Other Land Loans	Real Estate Mortgage - Residential (1-4 Family) First Mortgages	Real Estate Mortgage - Home Equity Loans/Lines of Credit	Real Estate Mortgage - Commercial and Other	Consumer loans	Unallocated	Total
As of and for the year ended December 31, 2021
Beginning balance	$	11,316	5,355	8,048	2,375	23,603	1,478	213	52,388
Adjustment for implementation of CECL	3,067		6,140	2,584	2,580	(257)	674	(213)	14,575
Allowance for Select PCD loans	2,917		165	222	92	1,489	10	—	4,895
Charge-offs	(3,722)		(245)	(273)	(400)	(2,295)	(667)	—	(7,602)
Recoveries	1,744		948	761	578	533	358	—	4,922
Provisions/ (Reversals)	927		4,156	(2,656)	(888)	7,269	803	—	9,611
Ending balance	$	16,249	16,519	8,686	4,337	30,342	2,656	—	78,789

The following table presents the activity in the allowance for loan losses for the year ended December 31, 2020 under the Incurred Loss methodology.

($ in thousands)	Commercial, Financial, and Agricultural		Real Estate - Construction, Land Development & Other Land Loans	Real Estate Mortgage - Residential (1-4 Family) First Mortgages	Real Estate Mortgage - Home Equity Loans/Lines of Credit	Real Estate Mortgage - Commercial and Other	Consumer loans	Unallo- cated	Total
As of and for the year ended December 31, 2020
Beginning balance	$	4,553	1,976	3,832	1,127	8,938	972	—	21,398
Charge-offs	(5,608)		(51)	(478)	(524)	(968)	(873)	—	(8,502)
Recoveries	745		1,552	754	487	621	294	—	4,453
Provisions	11,626		1,878	3,940	1,285	15,012	1,085	213	35,039
Ending balance	$	11,316	5,355	8,048	2,375	23,603	1,478	213	52,388
Ending balances as of December 31, 2020: Allowance for loan losses
Individually evaluated for impairment	$	3,546	30	800	—	2,175	—	—	6,551
Collectively evaluated for impairment	7,742		5,325	7,141	2,375	21,428	1,475	213	45,699
Purchased credit impaired	28		—	107	—	—	3	—	138
Loans receivable as of December 31, 2020:
Ending balance – total	$	782,549	570,672	972,378	306,256	2,049,203	53,955	—	4,735,013
Unamortized net deferred loan fees									(3,698)
Total loans									4,731,315
Ending balances as of December 31, 2020: Loans
Individually evaluated for impairment	$	7,700	677	9,303	15	18,582	4	—	36,281
Collectively evaluated for impairment	774,712		569,845	958,848	306,141	2,026,682	53,913	—	4,690,141
Purchased credit impaired	137		150	4,227	100	3,939	38	—	8,591

The following table presents the balance and activity in the allowance for credit losses for unfunded loan commitments for each period indicated.

($ in thousands)	December 31, 2022		December 31, 2021
Beginning balance	$	13,506	$	582
Adjustments for implementation of CECL on January 1, 2021	—		7,504
Day 2 provision for credit losses on unfunded commitments acquired from Select	—		3,982
(Reversal of) provision for credit losses on changes in unfunded commitments	(200)		1,438
Ending balance	$	13,306	$	13,506

Schedule of Recorded Investment in Loans by Credit Quality Indicators

The following describes the Company’s internal risk grades in ascending order of likelihood of loss:

	Risk Grade	Description
Pass:
	1	Loans with virtually no risk, including cash secured loans.
	2	Loans with documented significant overall financial strength.  These loans have minimum chance of loss due to the presence of multiple sources of repayment – each clearly sufficient to satisfy the obligation.
	3	Loans with documented satisfactory overall financial strength.  These loans have a low loss potential due to presence of at least two clearly identified sources of repayment – each of which is sufficient to satisfy the obligation under the present circumstances.
	4	Loans to borrowers with acceptable financial condition.  These loans could have signs of minor operational weaknesses, lack of adequate financial information, or loans supported by collateral with questionable value or marketability.
	5	Loans that represent above average risk due to minor weaknesses and warrant closer scrutiny by management.  Collateral is generally available and felt to provide reasonable coverage with realizable liquidation values in normal circumstances.  Repayment performance is satisfactory.
	P (Pass)	Consumer loans that are of satisfactory credit quality with borrowers who exhibit good personal credit history, average personal financial strength and moderate debt levels.  These loans generally conform to Bank policy, but may include approved mitigated exceptions to the guidelines.
Special Mention:
	6	Existing loans with defined weaknesses in primary source of repayment that, if not corrected, could cause a loss to the Company.
Classified:
	7	An existing loan inadequately protected by the current sound net worth and paying capacity of the obligor or the collateral pledged, if any.  These loans have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt.
	8	Loans that have a well-defined weakness that make the collection or liquidation in full highly questionable and improbable.  Loss appears imminent, but the exact amount and timing is uncertain.
	9	Loans that are considered uncollectible and are in the process of being charged-off.  This grade is a temporary grade assigned for administrative purposes until the charge-off is completed.
	F (Fail)	Consumer loans with a well-defined weakness, such as exceptions of any kind with no mitigating factors, history of paying outside the terms of the note, insufficient income to support the current level of debt, etc.

The following table presents the Company’s recorded investment in loans by credit quality indicators by year of origination or renewal as of December 31, 2022. Acquired loans are presented in the year originated, not in the year of acquisition.

	Term Loans by Year of Origination
($ in thousands)	2022		2021	2020	2019	2018	Prior	Revolving	Total
Commercial, financial, and agricultural
Pass	$	185,167	107,747	85,110	51,274	590	76,588	120,590	627,066
Special Mention	342		166	648	1,312	—	990	332	3,790
Classified	734		1,909	808	1,384	—	5,762	488	11,085
Total commercial, financial, and agricultural	186,243		109,822	86,566	53,970	590	83,340	121,410	641,941
Real estate – construction, land development & other land loans
Pass	550,752		267,096	42,421	30,973	—	12,722	19,519	923,483
Special Mention	5,128		5	3,679	—	—	100	13	8,925
Classified	656		107	38	899	—	44	24	1,768
Total real estate – construction, development & other land loans	556,536		267,208	46,138	31,872	—	12,866	19,556	934,176
Real estate mortgage – residential (1-4 family) first mortgages
Pass	317,282		274,756	186,102	98,559	185	301,885	1,379	1,180,148
Special Mention	1,189		127	110	470	—	2,416	—	4,312
Classified	763		251	221	359	—	9,072	659	11,325
Total real estate mortgage – residential (1-4 family) first mortgages	319,234		275,134	186,433	99,388	185	313,373	2,038	1,195,785
Real estate mortgage – home equity loans/lines of credit
Pass	869		1,091	349	237	—	2,020	309,786	314,352
Special Mention	175		—	—	—	—	18	1,072	1,265
Classified	106		156	94	87	—	213	7,453	8,109
Total real estate mortgage – home equity loans/lines of credit	1,150		1,247	443	324	—	2,251	318,311	323,726
Real estate mortgage – commercial and other
Pass	1,096,643		1,186,678	569,624	247,448	179	324,361	48,882	3,473,815
Special Mention	1,715		1,114	4,436	8,289	—	4,457	665	20,676
Classified	3,480		1,265	84	2,456	—	8,118	367	15,770
Total real estate mortgage – commercial and other	1,101,838		1,189,057	574,144	258,193	179	336,936	49,914	3,510,261
Consumer loans
Pass	35,406		7,946	3,610	1,056	3	1,250	10,953	60,224
Special Mention	—		—	—	—	—	—	—	—
Classified	320		31	3	1	—	25	55	435
Total consumer loans	35,726		7,977	3,613	1,057	3	1,275	11,008	60,659
Total	$	2,200,727	1,850,445	897,337	444,804	957	750,041	522,237	6,666,548
Unamortized net deferred loan fees									(1,403)
Total loans									$	6,665,145

At December 31, 2022, as derived from the table above, the Company had $39.0 million in loans graded as Special Mention and $48.5 million in loans graded as Classified, which includes all nonaccrual loans.

In the table above, substantially all of the "Classified Loans" have grades of 7 or Fail, with those categories having similar levels of risk. Revolving lines of credit that converted to term loans during the year ended December 31, 2022 amounted to $3.3 million.

The following table presents the Company’s recorded investment in loans by credit quality indicators by year of origination or renewal as of December 31, 2021. Acquired loans are presented in the year originated, not in the year of acquisition.

	Term Loans by Year of Origination
($ in thousands)	2021		2020	2019	2018	2017	Prior	Revolving	Total
Commercial, financial, and agricultural
Pass	$	204,945	138,540	71,369	66,645	16,009	17,492	112,933	627,933
Special Mention	225		1,255	1,313	2,729	225	9	2,348	8,104
Classified	1,609		793	1,703	7,096	511	96	1,152	12,960
Total commercial, financial, and agricultural	206,779		140,588	74,385	76,470	16,745	17,597	116,433	648,997
Real estate – construction, land development & other land loans
Pass	573,613		133,888	69,066	12,455	9,764	8,190	13,737	820,713
Special Mention	41		737	5,095	110	104	2	9	6,098
Classified	1,541		49	47	83	14	4	—	1,738
Total real estate – construction, development & other land loans	575,195		134,674	74,208	12,648	9,882	8,196	13,746	828,549
Real estate mortgage – residential (1-4 family) first mortgages
Pass	241,619		224,617	120,097	82,531	86,074	234,950	11,051	1,000,939
Special Mention	888		615	516	229	323	3,237	94	5,902
Classified	419		156	535	1,185	653	11,246	931	15,125
Total real estate mortgage – residential (1-4 family) first mortgages	242,926		225,388	121,148	83,945	87,050	249,433	12,076	1,021,966
Real estate mortgage – home equity loans/lines of credit
Pass	3,111		498	439	1,304	245	1,649	317,319	324,565
Special Mention	194		—	15	—	—	19	1,341	1,569
Classified	75		97	71	—	—	607	4,948	5,798
Total real estate mortgage – home equity loans/lines of credit	3,380		595	525	1,304	245	2,275	323,608	331,932
Real estate mortgage – commercial and other
Pass	1,328,156		796,992	355,885	211,118	197,165	197,659	66,104	3,153,079
Special Mention	1,759		4,849	5,801	3,741	2,072	1,801	1,440	21,463
Classified	7,147		413	2,110	6,025	3,897	603	—	20,195
Total real estate mortgage – commercial and other	1,337,062		802,254	363,796	220,884	203,134	200,063	67,544	3,194,737
Consumer loans
Pass	14,960		25,431	2,965	1,722	673	525	10,810	57,086
Special Mention	—		4	—	—	—	—	—	4
Classified	—		73	—	8	—	25	42	148
Total consumer loans	14,960		25,508	2,965	1,730	673	550	10,852	57,238
Total	$	2,380,302	1,329,007	637,027	396,981	317,729	478,114	544,259	6,083,419
Unamortized net deferred loan fees									(1,704)
Total loans									$	6,081,715

At December 31, 2021, as derived from the table above, the Company had $43.1 million in loans graded as Special Mention and $56.0 million in loans graded as Classified, which includes all nonaccrual loans.

In the table above, substantially all of the "Classified Loans" have grades of 7 or Fail, with those categories having similar levels of risk. Revolving lines of credit that converted to term loans during the year ended December 31, 2021 amounted to $1.0 million.

Schedule of Information Related to Loans Modified in a Troubled Debt Restructuring

The following table presents information related to loans modified in a TDR during the year ended December 31, 2022.

	For the year ended December 31, 2022
($ in thousands, except number of contracts)	Number of Contracts	Pre- Modification Restructured Balances		Post- Modification Restructured Balances
TDRs – Accruing
Commercial, financial, and agricultural	2	$	143	143
Real estate – construction, land development & other land loans	1	67		67
Real estate mortgage – residential (1-4 family) first mortgages	2	75		78
TDRs – Nonaccrual
Commercial, financial, and agricultural	5	744		744
Real estate mortgage – residential (1-4 family) first mortgages	1	36		36
Real estate mortgage – commercial and other	1	72		72
Total TDRs arising during period	12	$	1,137	1,140

The following table presents information related to loans modified in a TDR during the year ended December 31, 2021.

	For the year ended December 31, 2021
($ in thousands, except number of contracts)	Number of Contracts	Pre- Modification Restructured Balances		Post- Modification Restructured Balances
TDRs – Accruing
Real estate mortgage – residential (1-4 family) first mortgages	1	$	33	33
TDRs – Nonaccrual
Commercial, financial, and agricultural	5	1,438		1,435
Real estate – construction, land development & other land loans	1	75		75
Real estate mortgage – residential (1-4 family) first mortgages	1	263		263
Real estate mortgage – commercial and other	4	1,729		1,729
Total TDRs arising during period	12	$	3,538	3,535

The following table presents information related to loans modified in a TDR during the year ended December 31, 2020.

	For the year ended December 31, 2020
($ in thousands, except number of contracts)	Number of Contracts	Pre- Modification Restructured Balances		Post- Modification Restructured Balances
TDRs – Accruing
Commercial, financial, and agricultural	2	$	143	143
Real estate – construction, land development & other land loans	1	67		67
Real estate mortgage – residential (1-4 family) first mortgages	2	75		78
Consumer loans	1	4		4
TDRs – Nonaccrual
Commercial, financial, and agricultural	1	72		72
Real estate mortgage – commercial and other	5	5,977		5,977
Total TDRs arising during period	12	$	6,338	6,341

Accruing TDRs that were modified in the previous 12 months and that defaulted during the years ended December 31, 2022, 2021, and 2020 are presented in the table below. The Company considers a loan to have defaulted when it becomes 90 or more days delinquent under the modified terms, has been transferred to nonaccrual status, or has been transferred to foreclosed real estate.

	For the Year Ended December 31, 2022			For the Year Ended December 31, 2021			For the Year Ended December 31, 2020
($ in thousands)	Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment
Accruing TDRs that subsequently defaulted
Real estate mortgage – commercial and other	—	$	—	—	$	—	1	$	274
Total accruing TDRs that subsequently defaulted	—	$	—	—	$	—	1	$	274