Loans

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



	September 30, 2015		December 31, 2014
Real estate loans:
Commercial	$	1,750,797	$	1,639,422
Construction:
Land acquisition & development	212,990		220,443
Residential	112,495		96,580
Commercial	93,775		101,246
Total construction loans	419,260		418,269
Residential	1,020,445		999,903
Agricultural	163,116		167,659
Total real estate loans	3,353,618		3,225,253
Consumer:
Indirect consumer	616,142		552,863
Other consumer	150,170		144,141
Credit card	65,649		65,467
Total consumer loans	831,961		762,471
Commercial	778,648		740,073
Agricultural	154,855		124,859
Other, including overdrafts	1,712		3,959
Loans held for investment	5,120,794		4,856,615
Mortgage loans held for sale	55,686		40,828
Total loans	$	5,176,480	$	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 September 30, 2015 and 2014:



As of September 30,	2015		2014

Outstanding balance	$	35,265	$	42,627

Carrying value
Loans on accrual status	22,867		32,350
Loans on non-accrual status	—		—
Total carrying value	$	22,867	$	32,350

The following table summarizes changes in the accretable yield for loans acquired credit impaired for the three and nine months ended September 30, 2015 and 2014:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014

Beginning balance	$	7,482		$	—		$	5,781		$	—
Additions	624			5,233			1,073			5,233
Accretion income	(845		)	(289		)	(2,200		)	(289		)
Reductions due to exit events	(143		)	(16		)	(539		)	(16		)
Reclassifications from nonaccretable differences	347			—			3,350			—
Ending balance	$	7,465		$	4,928		$	7,465		$	4,928

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 September 30, 2015	Past Due		Past Due		Past Due		Past Due		Loans		Loans		Loans
Real estate
Commercial	$	5,968	$	664	$	398	$	7,030	$	1,720,928	$	22,839	$	1,750,797
Construction:
Land acquisition & development	4,495		6,530		44		11,069		192,819		9,102		212,990
Residential	1,011		134		—		1,145		111,021		329		112,495
Commercial	—		—		—		—		92,792		983		93,775
Total construction loans	5,506		6,664		44		12,214		396,632		10,414		419,260
Residential	5,639		2,355		761		8,755		1,009,119		2,571		1,020,445
Agricultural	881		—		—		881		155,443		6,792		163,116
Total real estate loans	17,994		9,683		1,203		28,880		3,282,122		42,616		3,353,618
Consumer:
Indirect consumer	3,991		683		91		4,765		610,641		736		616,142
Other consumer	1,012		264		25		1,301		148,119		750		150,170
Credit card	402		325		518		1,245		64,391		13		65,649
Total consumer loans	5,405		1,272		634		7,311		823,151		1,499		831,961
Commercial	3,440		717		1,083		5,240		751,769		21,639		778,648
Agricultural	281		—		126		407		153,843		605		154,855
Other, including overdrafts	—		—		311		311		1,401		—		1,712
Loans held for investment	27,120		11,672		3,357		42,149		5,012,286		66,359		5,120,794
Mortgage loans originated for sale	—		—		—		—		55,686		—		55,686
Total loans	$	27,120	$	11,672	$	3,357	$	42,149	$	5,067,972	$	66,359	$	5,176,480



							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 acquisition were considered performing upon acquisition. If interest on non-accrual loans had been accrued, such income would have been approximately $828 and $992 for the three months ended September 30, 2015 and 2014, respectively, and approximately $2,331 and $3,176 for the nine months ended September 30, 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 September 30, 2015	Unpaid Total Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance
Real estate:
Commercial	$	55,910	$	26,265	$	17,131	$	43,396	$	1,451
Construction:
Land acquisition & development	19,349		9,509		1,212		10,721		254
Residential	1,037		329		—		329		—
Commercial	1,290		369		740		1,109		740
Total construction loans	21,676		10,207		1,952		12,159		994
Residential	3,664		2,186		645		2,831		148
Agricultural	9,043		6,407		2,191		8,598		708
Total real estate loans	90,293		45,065		21,919		66,984		3,301
Commercial	28,653		10,315		13,461		23,776		5,154
Agricultural	2,043		367		1,106		1,473		462
Total	$	120,989	$	55,747	$	36,486	$	92,233	$	8,917



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 September 30,
	2015				2014
	Average Recorded Investment		Income Recognized		Average Recorded Investment		Income Recognized


Real estate:
Commercial	$	36,075	$	226	$	53,492	$	211
Construction:
Land acquisition & development	9,325		29		11,611		11
Residential	330		—		304		—
Commercial	2,339		4		2,709		2
Total construction loans	11,994		33		14,624		13
Residential	2,607		4		4,773		1
Agricultural	8,578		27		9,031		25
Total real estate loans	59,254		290		81,920		250
Commercial	22,483		2		14,252		14
Agricultural	937		13		906		6
Total	$	82,674	$	305	$	97,078	$	270



	Nine Months Ended September 30,
	2015				2014
	Average Recorded Investment		Income Recognized		Average Recorded Investment		Income Recognized


Real estate:
Commercial	$	38,639	$	587	$	57,743	$	668
Construction:
Land acquisition & development	9,591		51		13,529		33
Residential	300		—		799		—
Commercial	1,902		6		1,520		6
Total construction loans	11,793		57		15,848		39
Residential	2,720		6		5,537		4
Agricultural	8,661		62		10,223		54
Total real estate loans	61,813		712		89,351		765
Commercial	18,175		122		14,001		42
Agricultural	848		26		707		18
Total	$	80,836	$	860	$	104,059	$	825

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 $998 and $1,246 for the three months ended September 30, 2015 and 2014, respectively, and approximately $2,932 and $3,927 for the nine months ended September 30, 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 $42,547 as of September 30, 2015, of which $25,845 were included in non-accrual loans and $16,702 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 and nine months ended September 30, 2015.



	Number of Notes	Type of Concession								Principal Balance at Restructure Date
Three Months Ended September 30, 2015	Number of Notes	Interest only period		Extension of terms or maturity		Interest rate adjustment		Other (1)		Principal Balance at Restructure Date
Residential Construction	1	$	—	$	—	$	—	$	67	$	67
Indirect consumer	2	—		—		—		31		31
Commercial	8	—		8,744		2,959		463		12,166
Total loans restructured during period	11	$	—	$	8,744	$	2,959	$	561	$	12,264
(1) Other includes concessions that reduce or defer payments for a specified period of time and/or do not fit into other designated categories.



	Number of Notes	Type of Concession								Principal Balance at Restructure Date
Nine Months Ended September 30, 2015	Number of Notes	Interest only period		Extension of terms or maturity		Interest rate adjustment		Other		Principal Balance at Restructure Date
Residential Construction	1	$	—	$	—	$	—	$	67	$	67
Indirect Consumer	2	—		—		—		31		31
Commercial	9	—		8,754		2,959		463		12,176
Total loans restructured during period	12	$	—	$	8,754	$	2,959	$	561	$	12,274
(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 or nine months ended September 30, 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 September 30, 2015			Nine Months Ended September 30, 2015
	Number of Notes	Balance		Number of Notes	Balance
Commercial Real Estate	—	$	—	1	$	1,745
Commercial	3	264		3	264
Total	3	$	264	4	$	2,009

At September 30, 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 September 30, 2015	Other Assets Especially Mentioned		Substandard		Doubtful		Total Criticized Loans
Real estate:
Commercial	$	76,483	$	86,047	$	5,095	$	167,625
Construction:
Land acquisition & development	14,928		16,137		630		31,695
Residential	1,230		2,219		27		3,476
Commercial	—		352		757		1,109
Total construction loans	16,158		18,708		1,414		36,280
Residential	6,016		12,117		645		18,778
Agricultural	8,549		16,095		612		25,256
Total real estate loans	107,206		132,967		7,766		247,939
Consumer:
Indirect consumer	774		1,180		164		2,118
Other consumer	687		928		307		1,922
Credit card	—		—		—		—
Total consumer loans	1,461		2,108		471		4,040
Commercial	43,384		21,213		15,638		80,235
Agricultural	3,106		7,558		672		11,336
Total	$	155,157	$	163,846	$	24,547	$	343,550



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.