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Loans Acquired (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Carrying Value of All Loans Acquired

At December 31, 2019, the Company’s loan portfolio was $14.43 billion, compared to $11.72 billion at December 31, 2018. The various categories of loans are summarized as follows:



(In thousands)	2019		2018
Consumer:
Credit cards	$	204,802	$	204,173
Other consumer	191,946		201,297
Total consumer	396,748		405,470
Real estate:
Construction and development	1,760,894		1,300,723
Single family residential	1,444,620		1,440,443
Other commercial	3,678,908		3,225,287
Total real estate	6,884,422		5,966,453
Commercial:
Commercial	1,909,796		1,774,909
Agricultural	163,396		164,514
Total commercial	2,073,192		1,939,423
Other	275,714		119,042
Loans	9,630,076		8,430,388
Loans acquired, net of discount and allowance ⁽¹⁾	4,795,184		3,292,783
Total loans	$	14,425,260	$	11,723,171

_________________________

(1) See Note 6, Loans Acquired, for segregation of loans acquired by loan class.

The following table reflects the carrying value of all loans acquired as of December 31, 2019 and 2018:



	Loans Acquired At December 31,
(In thousands)	2019		2018
Consumer:
Other consumer	$	57,748	$	15,658
Real estate:
Construction and development	475,967		429,605
Single family residential	997,444		566,188
Other commercial	2,526,247		1,848,679
Total real estate	3,999,658		2,844,472
Commercial:
Commercial	585,720		430,914
Agricultural	152,058		1,739
Total commercial	737,778		432,653
Total loans acquired ⁽¹⁾	$	4,795,184	$	3,292,783

_________________________

(1) Loans acquired are reported net of a $444,000 and $95,000 allowance as of December 31, 2019 and 2018, respectively.

Schedule of Nonaccrual Loans, Excluding Loans Acquired

Nonaccrual loans, excluding loans acquired, at December 31, 2019 and 2018, segregated by class of loans, are as follows:



(In thousands)	2019		2018
Consumer:
Credit cards	$	382	$	296
Other consumer	1,378		2,159
Total consumer	1,760		2,455
Real estate:
Construction and development	4,538		1,269
Single family residential	18,102		11,939
Other commercial	9,361		7,205
Total real estate	32,001		20,413
Commercial:
Commercial	36,575		10,049
Agricultural	500		1,284
Total commercial	37,075		11,333
Total	$	70,836	$	34,201

Nonaccrual loans acquired, excluding purchased credit impaired loans accounted for under ASC Topic 310-30, segregated by class of loans, are as follows (see Note 5, Loans and Allowance for Loan Losses, for discussion of nonaccrual loans):



(In thousands)	December 31, 2019		December 31, 2018
Consumer:
Other consumer	$	327	$	140
Real estate:
Construction and development	751		114
Single family residential	9,593		6,603
Other commercial	7,221		1,167
Total real estate	17,565		7,884
Commercial:
Commercial	4,349		13,578
Agricultural	253		38
Total commercial	4,602		13,616
Total	$	22,494	$	21,640

Schedule of Aging Analysis of Past Due Loans, Excluding Loans Acquired

An age analysis of past due loans, excluding loans acquired, segregated by class of loans, is as follows:



(In thousands)	Gross 30-89 Days Past Due		90 Days or More Past Due		Total Past Due		Current		Total Loans		90 Days Past Due & Accruing
December 31, 2019
Consumer:
Credit cards	$	848	$	641	$	1,489	$	203,313	$	204,802	$	259
Other consumer	4,057		595		4,652		187,294		191,946		—
Total consumer	4,905		1,236		6,141		390,607		396,748		259
Real estate:
Construction and development	4,968		605		5,573		1,755,321		1,760,894		—
Single family residential	13,414		8,769		22,183		1,422,437		1,444,620		—
Other commercial	4,302		3,969		8,271		3,670,637		3,678,908		—
Total real estate	22,684		13,343		36,027		6,848,395		6,884,422		—
Commercial:
Commercial	6,253		12,174		18,427		1,891,369		1,909,796		—
Agricultural	207		450		657		162,739		163,396		—
Total commercial	6,460		12,624		19,084		2,054,108		2,073,192		—
Other	—		—		—		275,714		275,714		—
Total	$	34,049	$	27,203	$	61,252	$	9,568,824	$	9,630,076	$	259

December 31, 2018
Consumer:
Credit cards	$	1,033	$	506	$	1,539	$	202,634	$	204,173	$	209
Other consumer	4,264		896		5,160		196,137		201,297		4
Total consumer	5,297		1,402		6,699		398,771		405,470		213
Real estate:
Construction and development	533		308		841		1,299,882		1,300,723		—
Single family residential	7,769		4,127		11,896		1,428,547		1,440,443		—
Other commercial	3,379		2,773		6,152		3,219,135		3,225,287		—
Total real estate	11,681		7,208		18,889		5,947,564		5,966,453		—
Commercial:
Commercial	4,472		5,105		9,577		1,765,332		1,774,909		11
Agricultural	467		1,055		1,522		162,992		164,514		—
Total commercial	4,939		6,160		11,099		1,928,324		1,939,423		11
Other	—		—		—		119,042		119,042		—
Total	$	21,917	$	14,770	$	36,687	$	8,393,701	$	8,430,388	$	224

An age analysis of past due loans acquired segregated by class of loans, is as follows (see Note 5, Loans and Allowance for Loan Losses, for discussion of past due loans):



(In thousands)	Gross 30-89 Days Past Due		90 Days or More Past Due		Total Past Due		Current		Total Loans		90 Days Past Due & Accruing
December 31, 2019
Consumer:
Other consumer	$	827	$	140	$	967	$	56,781	$	57,748	$	—
Real estate:
Construction and development	824		473		1,297		474,670		475,967		—
Single family residential	12,904		5,020		17,924		979,520		997,444		597
Other commercial	3,343		2,481		5,824		2,520,423		2,526,247		—
Total real estate	17,071		7,974		25,045		3,974,613		3,999,658		597
Commercial:
Commercial	4,326		1,377		5,703		580,017		585,720		—
Agricultural	1,016		6		1,022		151,036		152,058		—
Total commercial	5,342		1,383		6,725		731,053		737,778		—

Total	$	23,240	$	9,497	$	32,737	$	4,762,447	$	4,795,184	$	597



December 31, 2018
Consumer:
Other consumer	$	337	$	49	$	386	$	15,272	$	15,658	$	2
Real estate:
Construction and development	8,283		27		8,310		421,295		429,605		—
Single family residential	4,706		3,049		7,755		558,433		566,188		—
Other commercial	168		577		745		1,847,934		1,848,679		—
Total real estate	13,157		3,653		16,810		2,827,662		2,844,472		—
Commercial:
Commercial	1,302		9,542		10,844		420,070		430,914		—
Agricultural	31		5		36		1,703		1,739		—
Total commercial	1,333		9,547		10,880		421,773		432,653		—

Total	$	14,827	$	13,249	$	28,076	$	3,264,707	$	3,292,783	$	2

Summary of Loans by Credit Risk Rating

The following table presents a summary of loans by credit risk rating, segregated by class of loans.



(In thousands)	Risk Rate 1-4		Risk Rate 5		Risk Rate 6		Risk Rate 7		Risk Rate 8		Total
December 31, 2019
Consumer:
Credit cards	$	204,161	$	—	$	641	$	—	$	—	$	204,802
Other consumer	190,350		—		1,596		—		—		191,946
Total consumer	394,511		—		2,237		—		—		396,748
Real estate:
Construction and development	1,754,269		49		6,576		—		—		1,760,894
Single family residential	1,415,603		4,868		24,146		3		—		1,444,620
Other commercial	3,621,296		28,873		28,739		—		—		3,678,908
Total real estate	6,791,168		33,790		59,461		3		—		6,884,422
Commercial:
Commercial	1,835,335		25,185		49,276		—		—		1,909,796
Agricultural	162,808		41		547		—		—		163,396
Total commercial	1,998,143		25,226		49,823		—		—		2,073,192
Other	275,714		—		—		—		—		275,714
Loans acquired	4,653,295		43,602		97,900		170		217		4,795,184
Total	$	14,112,831	$	102,618	$	209,421	$	173	$	217	$	14,425,260



(In thousands)	Risk Rate 1-4		Risk Rate 5		Risk Rate 6		Risk Rate 7		Risk Rate 8		Total
December 31, 2018
Consumer:
Credit cards	$	203,667	$	—	$	506	$	—	$	—	$	204,173
Other consumer	198,840		—		2,457		—		—		201,297
Total consumer	402,507		—		2,963		—		—		405,470
Real estate:
Construction and development	1,296,988		1,910		1,825		—		—		1,300,723
Single family residential	1,420,052		1,628		18,528		235		—		1,440,443
Other commercial	3,193,289		17,169		14,829		—		—		3,225,287
Total real estate	5,910,329		20,707		35,182		235		—		5,966,453
Commercial:
Commercial	1,742,002		8,357		24,550		—		—		1,774,909
Agricultural	162,824		75		1,615		—		—		164,514
Total commercial	1,904,826		8,432		26,165		—		—		1,939,423
Other	119,042		—		—		—		—		119,042
Loans acquired	3,187,083		51,255		54,097		348		—		3,292,783
Total	$	11,523,787	$	80,394	$	118,407	$	583	$	—	$	11,723,171

The following table presents a summary of loans acquired by credit risk rating, segregated by class of loans (see Note 5, Loans and Allowance for Loan Losses, for discussion of loan risk rating). Loans accounted for under ASC Topic 310-30 are all included in Risk Rate 1-4 in this table.



(In thousands)	Risk Rate 1-4		Risk Rate 5		Risk Rate 6		Risk Rate 7		Risk Rate 8		Total
December 31, 2019
Consumer:
Other consumer	$	57,318	$	—	$	430	$	—	$	—	$	57,748
Real estate:
Construction and development	474,750		21		1,159		—		37		475,967
Single family residential	978,681		1,181		17,455		127		—		997,444
Other commercial	2,446,685		40,872		38,690		—		—		2,526,247
Total real estate	3,900,116		42,074		57,304		127		37		3,999,658
Commercial:
Commercial	548,928		1,528		35,041		43		180		585,720
Agricultural	146,933		—		5,125		—		—		152,058
Total commercial	695,861		1,528		40,166		43		180		737,778

Total	$	4,653,295	$	43,602	$	97,900	$	170	$	217	$	4,795,184

December 31, 2018
Consumer:
Other consumer	$	15,380	$	—	$	278	$	—	$	—	$	15,658
Real estate:
Construction and development	393,122		27,621		8,862		—		—		429,605
Single family residential	553,460		2,081		10,299		348		—		566,188
Other commercial	1,822,179		9,137		17,363		—		—		1,848,679
Total real estate	2,768,761		38,839		36,524		348		—		2,844,472
Commercial:
Commercial	401,300		12,416		17,198		—		—		430,914
Agricultural	1,642		—		97		—		—		1,739
Total commercial	402,942		12,416		17,295		—		—		432,653

Total	$	3,187,083	$	51,255	$	54,097	$	348	$	—	$	3,292,783

Certain Loans Acquired in Transfer

The following is a summary of the loans acquired in the OKSB acquisition on October 19, 2017, as of the date of acquisition.



(In thousands)	Not Impaired			Impaired
Contractually required principal and interest at acquisition	$	2,021,388		$	18,136
Non-accretable difference (expected losses and foregone interest)	—			(6,731		)
Cash flows expected to be collected at acquisition	2,021,388			11,405
Accretable yield	(36,340		)	—
Basis in acquired loans at acquisition	$	1,985,048		$	11,405

The following is a summary of the loans acquired in the Reliance acquisition on April 12, 2019, as of the date of acquisition.



(In thousands)	Not Impaired			Impaired
Contractually required principal and interest at acquisition	$	1,138,142		$	385
Non-accretable difference (expected losses and foregone interest)	—			(210		)
Cash flows expected to be collected at acquisition	1,138,142			175
Accretable yield	(41,447		)
Basis in acquired loans at acquisition	$	1,096,695		$	175

The following is a summary of the loans acquired in the First Texas acquisition on October 19, 2017, as of the date of acquisition.



(In thousands)	Not Impaired			Impaired
Contractually required principal and interest at acquisition	$	2,246,212		$	—
Non-accretable difference (expected losses and foregone interest)	—			—
Cash flows expected to be collected at acquisition	2,246,212			—
Accretable yield	(37,834		)	—
Basis in acquired loans at acquisition	$	2,208,378		$	—

The following is a summary of the loans acquired in the Landrum acquisition on October 31, 2019, as of the date of acquisition.



(In thousands)	Not Impaired			Impaired
Contractually required principal and interest at acquisition	$	2,033,315		$	15,822
Non-accretable difference (expected losses and foregone interest)	—			(4,646		)
Cash flows expected to be collected at acquisition	2,033,315			11,176
Accretable yield	(38,555		)	—
Basis in acquired loans at acquisition	$	1,994,760		$	11,176

Changes in the carrying amount of the accretable yield for all purchased impaired loans were as follows for the years ended December 31, 2019, 2018 and 2017.



(In thousands)	Accretable Yield			Carrying Amount of Loans
Balance, January 1, 2017	$	1,655		$	17,802
Additions	—			13,793
Accretable yield adjustments	4,893			—
Accretion	(5,928		)	5,928
Payments and other reductions, net	—			(20,407		)
Balance, December 31, 2017	620			17,116

Additions	—			—
Accretable yield adjustments	2,045			—
Accretion	(1,205		)	1,205
Payments and other reductions, net	—			(14,271		)
Balance, December 31, 2018	1,460			4,050

Additions	—			11,351
Accretable yield adjustments	39			—
Accretion	(51		)	51
Payments and other reductions, net	—			(2,068		)
Balance, December 31, 2019	$	1,448		$	13,384

The following is a summary of the loans acquired in the Hardeman acquisition on May 15, 2017, as of the date of acquisition.



(In thousands)	Not Impaired			Impaired
Contractually required principal and interest at acquisition	$	254,189		$	3,452
Non-accretable difference (expected losses and foregone interest)	—			(990		)
Cash flows expected to be collected at acquisition	254,189			2,462
Accretable yield	(5,002		)	—
Basis in acquired loans at acquisition	$	249,187		$	2,462