Loans and Allowance for Credit Losses (Tables)

6 Months Ended

Jun. 30, 2020

The various categories of loans are summarized as follows:


	June 30,		December 31,
(In thousands)	2020		2019
Consumer:
Credit cards	$	184,348	$	204,802
Other consumer	214,024		249,195
Total consumer	398,372		453,997
Real Estate:
Construction and development	2,010,256		2,248,673
Single family residential	2,207,087		2,414,753
Other commercial	6,316,444		6,358,514
Total real estate	10,533,787		11,021,940
Commercial:
Commercial	3,038,216		2,451,119
Agricultural	217,715		191,525
Total commercial	3,255,931		2,642,644
Other	418,810		307,123
Total loans	$	14,606,900	$	14,425,704

Nonaccrual Loans

The amortized cost basis of nonaccrual loans segregated by class of loans are as follows:


	June 30,		December 31,
(In thousands)	2020		2019
Consumer:
Credit cards	$	223	$	382
Other consumer	1,912		1,705
Total consumer	2,135		2,087
Real estate:
Construction and development	6,501		5,289
Single family residential	32,244		27,695
Other commercial	36,255		16,582
Total real estate	75,000		49,566
Commercial:
Commercial	53,538		40,924
Agricultural	710		753
Total commercial	54,248		41,677
Total	$	131,383	$	93,330

Past Due Loans

An age analysis of the amortized cost basis of past due loans, including nonaccrual loans, 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
June 30, 2020
Consumer:
Credit cards	$	672	$	262	$	934	$	183,414	$	184,348	$	262
Other consumer	2,626		724		3,350		210,674		214,024		1
Total consumer	3,298		986		4,284		394,088		398,372		263
Real estate:
Construction and development	3,574		4,698		8,272		2,001,984		2,010,256		—
Single family residential	13,805		15,389		29,194		2,177,893		2,207,087		—
Other commercial	4,665		19,480		24,145		6,292,299		6,316,444		50
Total real estate	22,044		39,567		61,611		10,472,176		10,533,787		50
Commercial:
Commercial	6,413		14,891		21,304		3,016,912		3,038,216		180
Agricultural	411		401		812		216,903		217,715		1
Total commercial	6,824		15,292		22,116		3,233,815		3,255,931		181
Other	—		—		—		418,810		418,810		—
Total	$	32,166	$	55,845	$	88,011	$	14,518,889	$	14,606,900	$	494

December 31, 2019
Consumer:
Credit cards	$	848	$	641	$	1,489	$	203,313	$	204,802	$	259
Other consumer	4,884		735		5,619		243,576		249,195		—
Total consumer	5,732		1,376		7,108		446,889		453,997		259
Real estate:
Construction and development	5,792		1,078		6,870		2,241,803		2,248,673		—
Single family residential	26,318		13,789		40,107		2,374,646		2,414,753		597
Other commercial	7,645		6,450		14,095		6,344,419		6,358,514		—
Total real estate	39,755		21,317		61,072		10,960,868		11,021,940		597
Commercial:
Commercial	10,579		13,551		24,130		2,426,989		2,451,119		—
Agricultural	1,223		456		1,679		189,846		191,525		—
Total commercial	11,802		14,007		25,809		2,616,835		2,642,644		—
Other	—		—		—		307,123		307,123		—
Total	$	57,289	$	36,700	$	93,989	$	14,331,715	$	14,425,704	$	856

Impaired Financing Receivables

The following table presents information pertaining to impaired loans as of December 31, 2019, in accordance with previous US GAAP prior to the adoption of ASU 2016-13.


(In thousands)	Unpaid Contractual Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Investment in Impaired Loans			Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized
December 31, 2019													Three Months Ended June 30, 2019							Six Months Ended June 30, 2019
Consumer:
Credit cards	$	382	$	382	$	—	$	382	$	—	$	332		$	40	$	320	$	70
Other consumer	1,537		1,378		—		1,378		—		1,563			12		1,762		25
Total consumer	1,919		1,760		—		1,760		—		1,895			52		2,082		95
Real estate:
Construction and development	4,648		4,466		72		4,538		4		2,355			14		1,993		28
Single family residential	19,466		15,139		2,963		18,102		42		15,486			105		14,351		203
Other commercial	10,645		4,713		3,740		8,453		694		7,676			59		8,751		123
Total real estate	34,759		24,318		6,775		31,093		740		25,517			178		25,095		354
Commercial:
Commercial	53,436		6,582		28,998		35,580		5,007		29,776			187		23,811		335
Agricultural	525		383		116		499		—		1,148			8		1,159		16
Total commercial	53,961		6,965		29,114		36,079		5,007		30,924			195		24,970		351
Total	$	90,639	$	33,043	$	35,889	$	68,932	$	5,747	$	58,336		$	425	$	52,147	$	800

Troubled Debt Restructuring

The following table presents a summary of TDRs segregated by class of loans.


	Accruing TDR Loans				Nonaccrual TDR Loans					Total TDR Loans
(Dollars in thousands)	Number	Balance		Number	Balance		Number	Balance
June 30, 2020
Real estate:
Single-family residential	12	$	1,221	7	$	680	19	$	1,901
Other commercial	—	—		2	70		2	70
Total real estate	12	1,221		9	750		21	1,971
Commercial:
Commercial	4	2,739		3	68		7	2,807
Total commercial	4	2,739		3	68		7	2,807
Total	16	$	3,960	12	$	818	28	$	4,778

December 31, 2019
Real estate:
Construction and development	—	$	—	1	$	72	1	$	72
Single-family residential	7	1,151		12	671		19	1,822
Other commercial	1	476		2	80		3	556
Total real estate	8	1,627		15	823		23	2,450
Commercial:
Commercial	4	2,784		3	79		7	2,863
Total commercial	4	2,784		3	79		7	2,863
Total	12	$	4,411	18	$	902	30	$	5,313

There were no loans restructured as TDRs during the three and six month periods ended June 30, 2019.



(Dollars in thousands)	Number of loans	Balance Prior to TDR		Balance at June 30,		Change in Maturity Date		Change in Rate		Financial Impact on Date of Restructure
Three and Six Months Ended June 30, 2020
Real estate:
Single-family residential	1	$	147	$	147	$	147	$	—	$	—
Total real estate	1	$	147	$	147	$	147	$	—	$	—

Loans by Credit Risk Ratings

The following table presents a summary of loans by credit quality indicator, other than pass or current, as of June 30, 2020 segregated by class of loans.


	Term Loans Amortized Cost Basis by Origination Year
(In thousands)	2020 (YTD)		2019		2018		2017		2016		2015 and Prior		Lines of Credit (“LOC”) Amortized Cost Basis		LOC Converted to Term Loans Amortized Cost Basis		Total
Consumer - credit cards
Delinquency:
30-89 days past due	$	—	$	—	$	—	$	—	$	—	$	—	$	672	$	—	$	672
90+ days past due	—		—		—		—		—		—		262		—		262
Total consumer - credit cards	—		—		—		—		—		—		934		—		934
Consumer - other
Delinquency:
30-89 days past due	89		446		387		576		633		71		424		—		2,626
90+ days past due	31		110		107		291		135		29		21		—		724
Total consumer - other	120		556		494		867		768		100		445		—		3,350
Real estate - C&D
Risk rating:
5 internal grade	—		43		17		1,947		20		—		—		—		2,027
6 internal grade	241		2,988		425		197		422		1,082		850		799		7,004
7 internal grade	—		—		—		—		—		—		—		—		—
Total real estate - C&D	241		3,031		442		2,144		442		1,082		850		799		9,031
Real estate - SF residential
Delinquency:
30-89 days past due	321		2,074		1,980		1,415		1,796		4,553		1,666		—		13,805
90+ days past due	—		2,402		2,916		2,378		1,518		3,822		2,353		—		15,389
Total real estate - SF residential	321		4,476		4,896		3,793		3,314		8,375		4,019		—		29,194
Real estate - other commercial
Risk rating:
5 internal grade	18,591		2,425		11,530		1,049		1,349		2,591		18,027		24,917		80,479
6 internal grade	35,258		6,008		8,995		4,411		4,110		13,502		39,073		10,077		121,434
7 internal grade	—		—		—		—		—		—		—		—		—
Total real estate - other commercial	53,849		8,433		20,525		5,460		5,459		16,093		57,100		34,994		201,913
Commercial
Risk rating:
5 internal grade	3,377		325		478		136		233		58		46,465		—		51,072
6 internal grade	9,588		5,098		4,885		2,024		1,168		697		55,123		860		79,443
7 internal grade	—		—		—		—		—		—		—		—		—
Total commercial	12,965		5,423		5,363		2,160		1,401		755		101,588		860		130,515
Commercial - agriculture
Risk rating:
5 internal grade	—		86		15		379		—		—		37		—		517
6 internal grade	21		112		193		95		149		11		63		—		644
7 internal grade	—		—		—		—		—		—		—		—		—
Total commercial - agriculture	21		198		208		474		149		11		100		—		1,161
Total	$	67,517	$	22,117	$	31,928	$	14,898	$	11,533	$	26,416	$	165,036	$	36,653	$	376,098

The following table presents a summary of loans by credit risk rating as of December 31, 2019 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	247,668		—		2,026		—		—		249,694
Total consumer	451,829		—		2,667		—		—		454,496
Real estate:
Construction and development	2,229,019		70		7,735		—		37		2,236,861
Single family residential	2,394,284		6,049		41,601		130		—		2,442,064
Other commercial	6,068,425		69,745		67,429		—		—		6,205,599
Total real estate	10,691,728		75,864		116,765		130		37		10,884,524
Commercial:
Commercial	2,384,263		26,713		84,317		43		180		2,495,516
Agricultural	309,741		41		5,672		—		—		315,454
Total commercial	2,694,004		26,754		89,989		43		180		2,810,970
Other	275,714		—		—		—		—		275,714
Total	$	14,113,275	$	102,618	$	209,421	$	173	$	217	$	14,425,704

Allowance for Loan Losses

The collateral securing these loans consist of commercial real estate properties, residential properties, other business assets, and secured energy production assets.


(In thousands)	Real Estate Collateral		Energy		Other Collateral		Total
Construction and development	$	2,465	$	—	$	—	$	2,465
Single family residential	5,479		—		—		5,479
Other commercial real estate	18,654		—		—		18,654
Commercial	—		21,755		6,696		28,451
Total	$	26,598	$	21,755	$	6,696	$	55,049

The following table details activity in the allowance for credit losses by portfolio segment for loans for the three and six months ended June 30, 2020. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.


(In thousands)	Commercial		Real Estate		Credit Card		Other Consumer and Other		Total
Allowance for credit losses:
Three Months Ended June 30, 2020
Beginning balance, April 1, 2020	$	76,327	$	141,022	$	7,817	$	18,029	$	243,195
Provision for credit loss expense	18,400		10,020		3,943		(5,685)		26,678
Charge-offs	(35,687)		(1,824)		(1,053)		(592)		(39,156)
Recoveries	98		253		272		303		926
Net charge-offs	(35,589)		(1,571)		(781)		(289)		(38,230)
Ending balance, June 30, 2020	$	59,138	$	149,471	$	10,979	$	12,055	$	231,643


(In thousands)	Commercial		Real Estate		Credit Card		Other Consumer and Other		Total
Six Months Ended June 30, 2020
Beginning balance, January 1, 2020 - prior to adoption of CECL	$	22,863	$	39,161	$	4,051	$	2,169	$	68,244
Impact of CECL adoption	22,733		114,314		2,232		12,098		151,377
Provision for credit loss expense	49,307		(2,138)		6,693		(987)		52,875
Charge-offs	(36,210)		(2,220)		(2,494)		(1,971)		(42,895)
Recoveries	445		354		497		746		2,042
Net charge-offs	(35,765)		(1,866)		(1,997)		(1,225)		(40,853)
Ending balance, June 30, 2020	$	59,138	$	149,471	$	10,979	$	12,055	$	231,643

Activity in the allowance for credit losses for the three and six months ended June 30, 2019 was as follows:


(In thousands)	Commercial		Real Estate		Credit Card		Other Consumer and Other		Total
Allowance for credit losses:
Three Months Ended June 30, 2019
Beginning balance, April 1, 2019	$	19,394	$	34,870	$	3,919	$	2,372	$	60,555
Provision for credit losses	2,956		2,681		800		642		7,079
Charge-offs	(1,963)		(1,216)		(1,039)		(964)		(5,182)
Recoveries	967		158		271		331		1,727
Net charge-offs	(996)		(1,058)		(768)		(633)		(3,455)
Ending balance, June 30, 2019	$	21,354	$	36,493	$	3,951	$	2,381	$	64,179

Six Months Ended June 30, 2019
Beginning balance, January 1, 2019	$	20,514	$	29,838	$	3,923	$	2,419	$	56,694
Provision for credit losses	4,830		7,988		1,698		1,848		16,364
Charge-offs	(5,115)		(1,633)		(2,181)		(2,517)		(11,446)
Recoveries	1,125		300		511		631		2,567
Net charge-offs	(3,990)		(1,333)		(1,670)		(1,886)		(8,879)
Ending balance, June 30, 2019	$	21,354	$	36,493	$	3,951	$	2,381	$	64,179