Loans

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



	March 31, 2016		December 31, 2015
Real estate loans:
Commercial	$	1,764,492	$	1,793,258
Construction:
Land acquisition & development	219,450		224,066
Residential	113,317		111,763
Commercial	102,382		94,890
Total construction loans	435,149		430,719
Residential	1,021,443		1,032,851
Agricultural	153,054		156,234
Total real estate loans	3,374,138		3,413,062
Consumer:
Indirect consumer	651,057		622,529
Other consumer	150,774		153,717
Credit card	63,624		68,107
Total consumer loans	865,455		844,353
Commercial	825,043		792,416
Agricultural	126,290		142,151
Other, including overdrafts	543		1,339
Loans held for investment	5,191,469		5,193,321
Mortgage loans held for sale	52,989		52,875
Total loans	$	5,244,458	$	5,246,196

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, 2016 and 2015:



As of March 31,	2016		2015

Outstanding balance	$	33,175	$	32,445

Carrying value
Loans on accrual status	21,064		23,909
Loans on non-accrual status	—		—
Total carrying value	$	21,064	$	23,909

The following table summarizes changes in the accretable yield for loans acquired credit impaired for the three months ended March 31, 2016 and 2015:



	Three Months Ended March 31,
	2016			2015

Beginning balance	$	6,713		$	5,781
Accretion income	(614		)	(548		)
Reductions due to exit events	(147		)	(396		)
Reclassifications from nonaccretable differences	726			2,143
Ending balance	$	6,678		$	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, 2016	Past Due		Past Due		Past Due		Past Due		Loans		Loans		Loans
Real estate
Commercial	$	2,302	$	2,975	$	5	$	5,282	$	1,736,374	$	22,836	$	1,764,492
Construction:
Land acquisition & development	951		351		857		2,159		210,994		6,297		219,450
Residential	96		—		—		96		112,166		1,055		113,317
Commercial	184		—		—		184		101,915		283		102,382
Total construction loans	1,231		351		857		2,439		425,075		7,635		435,149
Residential	4,804		985		1,750		7,539		1,010,803		3,101		1,021,443
Agricultural	27		—		—		27		147,423		5,604		153,054
Total real estate loans	8,364		4,311		2,612		15,287		3,319,675		39,176		3,374,138
Consumer:
Indirect consumer	4,448		1,075		188		5,711		644,517		829		651,057
Other consumer	613		226		38		877		149,419		478		150,774
Credit card	412		346		529		1,287		62,325		12		63,624
Total consumer loans	5,473		1,647		755		7,875		856,261		1,319		865,455
Commercial	2,144		763		232		3,139		799,325		22,579		825,043
Agricultural	1,972		322		451		2,745		122,782		763		126,290
Other, including overdrafts	—		5		312		317		226		—		543
Loans held for investment	17,953		7,048		4,362		29,363		5,098,269		63,837		5,191,469
Mortgage loans originated for sale	—		—		—		—		52,989		—		52,989
Total loans	$	17,953	$	7,048	$	4,362	$	29,363	$	5,151,258	$	63,837	$	5,244,458



							Total Loans
	30 - 59		60 - 89		> 90		30 or More
	Days		Days		Days		Days		Current		Non-accrual		Total
As of December 31, 2015	Past Due		Past Due		Past Due		Past Due		Loans		Loans		Loans
Real estate
Commercial	$	6,051	$	724	$	418	$	7,193	$	1,762,294	$	23,771	$	1,793,258
Construction:
Land acquisition & development	3,190		163		1,325		4,678		212,757		6,631		224,066
Residential	1,288		—		—		1,288		110,182		293		111,763
Commercial	3,232		—		—		3,232		90,703		955		94,890
Total construction loans	7,710		163		1,325		9,198		413,642		7,879		430,719
Residential	5,991		1,196		2,063		9,250		1,018,359		5,242		1,032,851
Agricultural	176		17		—		193		150,686		5,355		156,234
Total real estate loans	19,928		2,100		3,806		25,834		3,344,981		42,247		3,413,062
Consumer:
Indirect consumer	6,675		1,089		210		7,974		614,029		526		622,529
Other consumer	1,312		331		34		1,677		151,381		659		153,717
Credit card	533		317		477		1,327		66,768		12		68,107
Total consumer loans	8,520		1,737		721		10,978		832,178		1,197		844,353
Commercial	8,493		1,060		699		10,252		759,851		22,313		792,416
Agricultural	879		152		62		1,093		140,430		628		142,151
Other, including overdrafts	—		—		314		314		1,025		—		1,339
Loans held for investment	37,820		5,049		5,602		48,471		5,078,465		66,385		5,193,321
Mortgage loans originated for sale	—		—		—		—		52,875		—		52,875
Total loans	$	37,820	$	5,049	$	5,602	$	48,471	$	5,131,340	$	66,385	$	5,246,196

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 $790 and $832 for the three months ended March 31, 2016 and 2015.

The Company considers impaired loans to include all originated and acquired 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, 2016	Unpaid Total Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance
Real estate:
Commercial	$	55,222	$	25,759	$	18,117	$	43,876	$	4,526
Construction:
Land acquisition & development	15,252		7,742		322		8,064		150
Residential	988		282		—		282		—
Commercial	1,370		446		731		1,177		739
Total construction loans	17,610		8,470		1,053		9,523		889
Residential	5,664		3,019		1,152		4,171		160
Agricultural	6,685		5,816		201		6,017		7
Total real estate loans	85,181		43,064		20,523		63,587		5,582
Commercial	28,782		8,113		16,150		24,263		8,176
Agricultural	908		250		544		794		189
Total	$	114,871	$	51,427	$	37,217	$	88,644	$	13,947



As of December 31, 2015	Unpaid Total Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance
Real estate:
Commercial	$	58,179	$	27,882	$	17,614	$	45,496	$	3,401
Construction:
Land acquisition & development	15,503		7,245		778		8,023		282
Residential	992		293		—		293		—
Commercial	1,264		340		739		1,079		739
Total construction loans	17,759		7,878		1,517		9,395		1,021
Residential	7,073		3,547		2,317		5,864		367
Agricultural	6,434		5,563		198		5,761		5
Total real estate loans	89,445		44,870		21,646		66,516		4,794
Commercial	29,593		10,744		13,727		24,471		6,487
Agricultural	1,349		622		356		978		294
Total	$	120,387	$	56,236	$	35,729	$	91,965	$	11,575

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



	Three Months Ended March 31,
	2016				2015
	Average Recorded Investment		Income Recognized		Average Recorded Investment		Income Recognized


Real estate:
Commercial	$	33,483	$	36	$	42,077	$	150
Construction:
Land acquisition & development	7,508		7		8,930		10
Residential	288		—		308		—
Commercial	1,067		—		3,055		2
Total construction loans	8,863		7		12,293		12
Residential	4,206		1		3,127		1
Agricultural	5,748		1		8,655		22
Total real estate loans	52,300		45		66,152		185
Commercial	23,379		15		17,533		8
Agricultural	856		—		914		5
Total	$	76,535	$	60	$	84,599	$	198

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 $929 and $1,035 for the three months ended March 31, 2016 and 2015.

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 $34,344 as of March 31, 2016, of which $22,274 were included in non-accrual loans and $12,070 were on accrual status. The Company had loans renegotiated in troubled debt restructurings of $40,330 as of December 31, 2015, of which $24,911 were included in non-accrual loans and $15,419 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, 2016.



	Number of Notes	Type of Concession				Principal Balance at Restructure Date
Three Months Ended March 31, 2016	Number of Notes	Interest only period		Extension of terms or maturity		Principal Balance at Restructure Date
Commercial Real Estate	3	$	576	$	204	$	780
Total loans restructured during period	3	$	576	$	204	$	780

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, 2016 or 2015.

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 three months ended March 31, 2016. 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, 2016
	Number of Notes	Balance
Commercial Real Estate	1	$	203
Total	1	$	203

At March 31, 2016, 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, 2016	Other Assets Especially Mentioned		Substandard		Doubtful		Total Criticized Loans
Real estate:
Commercial	$	77,147	$	82,536	$	14,311	$	173,994
Construction:
Land acquisition & development	11,854		11,226		1,515		24,595
Residential	2,003		389		—		2,392
Commercial	4,056		429		748		5,233
Total construction loans	17,913		12,044		2,263		32,220
Residential	5,681		10,107		477		16,265
Agricultural	7,519		18,920		—		26,439
Total real estate loans	108,260		123,607		17,051		248,918
Consumer:
Indirect consumer	704		1,446		144		2,294
Other consumer	1,024		914		211		2,149
Total consumer loans	1,728		2,360		355		4,443
Commercial	31,392		34,039		16,629		82,060
Agricultural	3,613		7,820		543		11,976
Total	$	144,993	$	167,826	$	34,578	$	347,397



As of December 31, 2015	Other Assets Especially Mentioned		Substandard		Doubtful		Total Criticized Loans
Real estate:
Commercial	$	61,787	$	84,556	$	10,609	$	156,952
Construction:
Land acquisition & development	16,593		12,482		591		29,666
Residential	1,640		1,886		—		3,526
Commercial	166		323		756		1,245
Total construction loans	18,399		14,691		1,347		34,437
Residential	4,453		9,661		2,540		16,654
Agricultural	6,114		16,529		—		22,643
Total real estate loans	90,753		125,437		14,496		230,686
Consumer:
Indirect consumer	644		1,131		154		1,929
Other consumer	651		1,130		198		1,979
Total consumer loans	1,295		2,261		352		3,908
Commercial	32,975		27,982		15,085		76,042
Agricultural	2,247		7,105		417		9,769
Total	$	127,270	$	162,785	$	30,350	$	320,405

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.