Loans

The following table presents loans by class as of the dates indicated:



	March 31, 2015		December 31, 2014
Real estate loans:
Commercial	$	1,670,829	$	1,639,422
Construction:
Land acquisition & development	209,033		220,443
Residential	101,689		96,580
Commercial	95,583		101,246
Total construction loans	406,305		418,269
Residential	997,123		999,903
Agricultural	156,734		167,659
Total real estate loans	3,230,991		3,225,253
Consumer:
Indirect consumer	566,225		552,863
Other consumer	140,529		144,141
Credit card	61,708		65,467
Total consumer loans	768,462		762,471
Commercial	754,149		740,073
Agricultural	117,569		124,859
Other, including overdrafts	377		3,959
Loans held for investment	4,871,548		4,856,615
Mortgage loans held for sale	55,758		40,828
Total loans	$	4,927,306	$	4,897,443

Loans from business combinations included in the table above include certain loans that had evidence of deterioration in credit quality since origination and for which it was probable, at acquisition, that all contractually required payments would not be collected.

The following table displays the outstanding unpaid principal balance, accrued interest receivable and accrual status of loans acquired with credit impairment as of March 31, 2015 and 2014:



As of March 31,	2015		2014

Outstanding balance	$	32,445	$	—

Carrying value
Loans on accrual status	23,909		—
Loans on non-accrual status	—		—
Total carrying value	$	23,909	$	—

The following table summarizes changes in the accretable yield for loans acquired credit impaired for the three months ended March 31, 2015 and 2014:



Three Months Ended March 31,	2015			2014

Beginning balance	$	5,781		$	—
Accretion income	(548		)	—
Reductions due to exit events	(396		)	—
Reclassifications from (to) nonaccretable differences	2,143			—
Ending balance	$	6,980		$	—

Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. The following tables present the contractual aging of the Company’s recorded investment in past due loans by class as of the dates indicated:



							Total Loans
	30 - 59		60 - 89		> 90		30 or More
	Days		Days		Days		Days		Current		Non-accrual		Total
As of March 31, 2015	Past Due		Past Due		Past Due		Past Due		Loans		Loans		Loans
Real estate
Commercial	$	17,049	$	550	$	859	$	18,458	$	1,622,470	$	29,901	$	1,670,829
Construction:
Land acquisition & development	4,756		207		45		5,008		195,864		8,161		209,033
Residential	500		—		325		825		100,520		344		101,689
Commercial	165		—		—		165		92,134		3,284		95,583
Total construction loans	5,421		207		370		5,998		388,518		11,789		406,305
Residential	3,876		830		2,363		7,069		986,670		3,384		997,123
Agricultural	2,630		—		883		3,513		146,498		6,723		156,734
Total real estate loans	28,976		1,587		4,475		35,038		3,144,156		51,797		3,230,991
Consumer:
Indirect consumer	2,460		336		9		2,805		563,049		371		566,225
Other consumer	659		51		1		711		139,378		440		140,529
Credit card	312		207		322		841		60,853		14		61,708
Total consumer loans	3,431		594		332		4,357		763,280		825		768,462
Commercial	4,049		567		388		5,004		728,564		20,581		754,149
Agricultural	1,508		32		—		1,540		115,291		738		117,569
Other, including overdrafts	—		—		2		2		375		—		377
Loans held for investment	37,964		2,780		5,197		45,941		4,751,666		73,941		4,871,548
Mortgage loans originated for sale	—		—		—		—		55,758		—		55,758
Total loans	$	37,964	$	2,780	$	5,197	$	45,941	$	4,807,424	$	73,941	$	4,927,306



							Total Loans
	30 - 59		60 - 89		> 90		30 or More
	Days		Days		Days		Days		Current		Non-accrual		Total
As of December 31, 2014	Past Due		Past Due		Past Due		Past Due		Loans		Loans		Loans
Real estate
Commercial	$	4,692	$	1,609	$	331	$	6,632	$	1,605,421	$	27,369	$	1,639,422
Construction:
Land acquisition & development	839		383		—		1,222		210,969		8,252		220,443
Residential	—		475		—		475		95,833		272		96,580
Commercial	100		—		—		100		98,582		2,564		101,246
Total construction loans	939		858		—		1,797		405,384		11,088		418,269
Residential	6,969		645		1,762		9,376		987,735		2,792		999,903
Agricultural	1,624		236		—		1,860		158,957		6,842		167,659
Total real estate loans	14,224		3,348		2,093		19,665		3,157,497		48,091		3,225,253
Consumer:
Indirect consumer	3,235		482		6		3,723		548,757		383		552,863
Other consumer	988		140		32		1,160		142,432		549		144,141
Credit card	369		284		315		968		64,484		15		65,467
Total consumer loans	4,592		906		353		5,851		755,673		947		762,471
Commercial	3,659		994		147		4,800		722,575		12,698		740,073
Agricultural	1,125		—		—		1,125		123,288		446		124,859
Other, including overdrafts	—		—		—		—		3,959		—		3,959
Loans held for investment	23,600		5,248		2,593		31,441		4,762,992		62,182		4,856,615
Mortgage loans originated for sale	—		—		—		—		40,828		—		40,828
Total loans	$	23,600	$	5,248	$	2,593	$	31,441	$	4,803,820	$	62,182	$	4,897,443

Acquired loans that met the criteria for nonaccrual of interest prior to the acquisition were considered performing upon acquisition. If interest on non-accrual loans had been accrued, such income would have been approximately $832 and $1,121 for the three months ended March 31, 2015 and 2014, respectively.

The Company considers impaired loans to include all loans, except consumer loans, that are risk rated as doubtful, or have been placed on non-accrual status or renegotiated in troubled debt restructurings. The following tables present information on the Company’s recorded investment in impaired loans as of dates indicated:



As of March 31, 2015	Unpaid Total Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance
Real estate:
Commercial	$	40,258	$	33,591	$	4,748	$	38,339	$	1,641
Construction:
Land acquisition & development	12,400		6,854		1,882		8,736		569
Residential	387		344		—		344		—
Commercial	3,447		250		3,165		3,415		902
Total construction loans	16,234		7,448		5,047		12,495		1,471
Residential	3,495		3,230		154		3,384		127
Agricultural	8,562		7,949		613		8,562		719
Total real estate loans	68,549		52,218		10,562		62,780		3,958
Commercial	23,570		10,486		10,706		21,192		2,905
Agricultural	1,113		326		735		1,061		605
Total	$	93,232	$	63,030	$	22,003	$	85,033	$	7,468



As of December 31, 2014	Unpaid Total Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance
Real estate:
Commercial	$	41,603	$	28,143	$	11,246	$	39,389	$	1,608
Construction:
Land acquisition & development	12,511		7,262		1,615		8,877		574
Residential	459		272		—		272		—
Commercial	2,729		253		2,442		2,695		904
Total construction loans	15,699		7,787		4,057		11,844		1,478
Residential	2,959		2,452		341		2,793		143
Agricultural	8,844		6,444		2,305		8,749		732
Total real estate loans	69,105		44,826		17,949		62,775		3,961
Commercial	16,904		11,882		2,644		14,526		1,190
Agricultural	1,231		342		837		1,179		641
Total	$	87,240	$	57,050	$	21,430	$	78,480	$	5,792

The following table presents the average recorded investment in and income recognized on impaired loans for the periods indicated:



	Three Months Ended March 31,
	2015				2014
	Average Recorded Investment		Income Recognized		Average Recorded Investment		Income Recognized


Real estate:
Commercial	$	42,077	$	150	$	62,312	$	216
Construction:
Land acquisition & development	8,930		10		15,553		11
Residential	308		—		1,320		—
Commercial	3,055		2		360		2
Total construction loans	12,293		12		17,233		13
Residential	3,127		1		6,128		2
Agricultural	8,655		22		9,233		4
Total real estate loans	66,152		185		94,906		235
Commercial	17,533		8		14,268		14
Agricultural	914		5		288		6
Total	$	84,599	$	198	$	109,462	$	255

The amount of interest income recognized by the Company within the period that the loans were impaired was primarily related to loans modified in a troubled debt restructuring that remained on accrual status. Interest payments received on non-accrual impaired loans are applied to principal. Interest income is subsequently recognized only to the extent cash payments are received in excess of principal due. If interest on impaired loans had been accrued, interest income on impaired loans would have been approximately $1,035 and $1,111 for the three months ended March 31, 2015 and 2014, respectively.

Collateralized impaired loans are generally recorded at the fair value of the underlying collateral using discounted cash flows, independent appraisals and management estimates based upon current market conditions. For loans measured under the present value of cash flows method, the change in present value attributable to the passage of time, if applicable, is recognized in the provision for loan losses and thus no interest income is recognized.

Modifications of performing loans are made in the ordinary course of business and are completed on a case-by-case basis as negotiated with the borrower. Loan modifications typically include interest rate concessions, interest only periods of less than twelve months, short-term payment deferrals and extension of amortization periods to provide payment relief. A loan modification is considered a troubled debt restructuring if the borrower is experiencing financial difficulties and the Company, for economic or legal reasons, grants a concession to the borrower that it would not otherwise consider. Certain troubled debt restructurings are on non-accrual status at the time of restructuring and are typically returned to accrual status after considering the borrower's sustained repayment performance in accordance with the restructuring agreement for a period of at least six months and management is reasonably assured of future performance. If the troubled debt restructuring meets these performance criteria and the interest rate granted at the modification is equal to or greater than the rate that the Company was willing to accept at the time of the restructuring for a new loan with comparable risk, then the loan will return to performing status and the accrual of interest will resume.

The Company had loans renegotiated in troubled debt restructurings of $39,645 as of March 31, 2015, of which $23,575 were included in non-accrual loans and $16,070 were on accrual status. The Company had loans renegotiated in troubled debt restructurings of $44,227 as of December 31, 2014, of which $23,275 were included in non-accrual loans and $20,952 were on accrual status.

The following table presents information on the Company's troubled debt restructurings that occurred during the three months ended March 31, 2015:



	Number of Notes	Type of Concession								Principal Balance at Restructure Date
Three Months Ended March 31, 2015	Number of Notes	Interest only period		Extension of terms or maturity		Interest rate adjustment		Other (1)		Principal Balance at Restructure Date
Commercial	1	$	—	$	10	$	—	$	—	$	10
Total loans restructured during period	1	$	—	$	10	$	—	$	—	$	10
(1) Other includes concessions that reduce or defer payments for a specified period of time and/or do not fit into other designated categories.

For troubled debt restructurings that were on non-accrual status or otherwise deemed impaired before the modification, a specific reserve may already be recorded. In periods subsequent to modification, the Company continues to evaluate all troubled debt restructurings for possible impairment and recognizes impairment through the allowance. Additionally these loans continue to work their way through the credit cycle through charge-off, pay-off or foreclosure. Financial effects of modifications of troubled debt restructurings may include principal loan forgiveness or other charge-offs directly related to the restructuring. The Company had no charge-offs directly related to modifying troubled debt restructurings during the three months ended March 31, 2015 or 2014.

The following table presents information on the Company's troubled debt restructurings during the previous 12 months for which there was a payment default during the periods indicated. The Company considers a payment default to occur on troubled debt restructurings when the loan is 90 days or more past due or was placed on non-accrual status after the modification.



	Three Months Ended March 31, 2015
	Number of Notes	Balance
Commercial Real Estate	1	$	1,822

At March 31, 2015, there were no material commitments to lend additional funds to borrowers whose existing loans have been renegotiated or are classified as non-accrual.

As part of the on-going and continuous monitoring of the credit quality of the Company’s loan portfolio, management tracks internally assigned risk classifications of loans. The Company adheres to a Uniform Classification System developed jointly by the various bank regulatory agencies to internally risk rate loans. The Uniform Classification System defines three broad categories of criticized assets, which the Company uses as credit quality indicators:

Other Assets Especially Mentioned — includes loans that exhibit weaknesses in financial condition, loan structure or documentation, which if not promptly corrected, may lead to the development of abnormal risk elements.

Substandard — includes loans that are inadequately protected by the current sound worth and paying capacity of the borrower. Although the primary source of repayment for a Substandard loan is not currently sufficient; collateral or other sources of repayment are sufficient to satisfy the debt. Continuance of a Substandard loan is not warranted unless positive steps are taken to improve the worthiness of the credit.

Doubtful — includes loans that exhibit pronounced weaknesses to a point where collection or liquidation in full, on the basis of currently existing facts, conditions and values, is highly questionable and improbable. Doubtful loans are required to be placed on non-accrual status and are assigned specific loss exposure.

Company management undertakes the same process for assigning risk ratings to acquired loans as it does for originated loans. Acquired loans rated as substandard or lower or that were on non-accrual status or designated as troubled debt restructurings at the time of acquisition are deemed to be acquired credit impaired loans accounted for under ASC Topic 310-30, regardless of whether they are classified as performing or non-performing loans.

The following tables present the Company’s recorded investment in criticized loans by class and credit quality indicator based on the most recent analysis performed as of the dates indicated:



As of March 31, 2015	Other Assets Especially Mentioned		Substandard		Doubtful		Total Criticized Loans
Real estate:
Commercial	$	76,271	$	82,814	$	12,896	$	171,981
Construction:
Land acquisition & development	10,929		14,475		2,417		27,821
Residential	1,245		2,797		—		4,042
Commercial	—		249		3,164		3,413
Total construction loans	12,174		17,521		5,581		35,276
Residential	9,374		8,381		1,027		18,782
Agricultural	10,094		14,712		613		25,419
Total real estate loans	107,913		123,428		20,117		251,458
Consumer:
Indirect consumer	832		1,415		179		2,426
Other consumer	538		877		389		1,804
Credit card	—		416		1,179		1,595
Total consumer loans	1,370		2,708		1,747		5,825
Commercial	28,390		24,008		14,877		67,275
Agricultural	2,819		6,743		735		10,297
Total	$	140,492	$	156,887	$	37,476	$	334,855



As of December 31, 2014	Other Assets Especially Mentioned		Substandard		Doubtful		Total Criticized Loans
Real estate:
Commercial	$	84,533	$	83,448	$	15,246	$	183,227
Construction:
Land acquisition & development	11,826		15,016		2,507		29,349
Residential	2,029		2,666		—		4,695
Commercial	39		253		2,442		2,734
Total construction loans	13,894		17,935		4,949		36,778
Residential	10,473		10,848		1,121		22,442
Agricultural	10,122		12,328		612		23,062
Total real estate loans	119,022		124,559		21,928		265,509
Consumer:
Indirect consumer	916		1,590		121		2,627
Other consumer	553		1,085		432		2,070
Credit card	—		348		1,263		1,611
Total consumer loans	1,469		3,023		1,816		6,308
Commercial	25,766		32,433		10,273		68,472
Agricultural	7,827		3,660		837		12,324
Total	$	154,084	$	163,675	$	34,854	$	352,613

The Company maintains a credit review function, which is independent of the credit approval process, to assess assigned internal risk classifications and monitor compliance with internal lending policies and procedures. Written action plans with firm target dates for resolution of identified problems are maintained and reviewed on a quarterly basis for all categories of criticized loans.