Loans | NOTE 4—LOANS Loans at September 30, 2015 and December 31, 2014 were as follows: September 30, December 31, Loans that are not PCI loans Construction and land development $ 334,208 $ 239,225 Commercial real estate: Nonfarm, nonresidential 303,657 240,975 Other 9,478 5,377 Residential real estate: Closed-end 1-4 family 144,080 130,631 Other 104,371 83,129 Commercial and industrial 219,341 76,570 Consumer and other 6,893 8,025 Loans before net deferred loan fees 1,122,028 783,932 Deferred loan fees, net (2,115 ) (1,059 ) Total loans that are not PCI loans 1,119,913 782,873 PCI loans Construction and land development $ 77 $ 77 Commercial real estate: Nonfarm, nonresidential 1,452 1,798 Other — — Residential real estate: Closed-end 1-4 family 707 706 Other 2 108 Commercial and industrial 1,675 1,624 Consumer and other — 2 Total PCI loans 3,913 4,315 Allowance for loan losses (9,744 ) (6,680 ) Total loans, net of allowance for loan losses $ 1,114,082 $ 780,508 The following table presents the activity in the allowance for loan losses by portfolio segment for the three month periods ended September 30, 2015 and 2014: Construction Commercial Residential Commercial Consumer Total Three Months Ended September 30, 2015 Allowance for loan losses: Beginning balance $ 2,567 $ 2,321 $ 1,739 $ 1,324 $ 65 $ 8,016 Provision (credit) for loan losses 461 135 (71 ) 1,253 (54 ) 1,724 Loans charged-off — — (15 ) (15 ) (33 ) (63 ) Recoveries — — 6 — 61 67 Total ending allowance balance $ 3,028 $ 2,456 $ 1,659 $ 2,562 $ 39 $ 9,744 Three Months Ended September 30, 2014 Allowance for loan losses: Beginning balance $ 1,910 $ 1,740 $ 1,560 $ 508 $ 53 $ 5,771 Provision (credit) for loan losses 231 173 192 72 (4 ) 664 Loans charged-off — (540 ) (11 ) (4 ) — (555 ) Recoveries — — 3 — — 3 Total ending allowance balance $ 2,141 $ 1,373 $ 1,744 $ 576 $ 49 $ 5,883 There was $5 in allowance for loan losses for PCI loans for the three months ended September 30, 2015. There was no allowance for loan losses for the three months ended September 30, 2014. The following table presents the activity in the allowance for loan losses by portfolio segment for the nine-month periods ended September 30, 2015 and 2014: Construction Commercial Residential Commercial Consumer Total Nine Months Ended September 30, 2015 Allowance for loan losses: Beginning balance $ 2,690 $ 1,494 $ 1,791 $ 650 $ 55 $ 6,680 Provision (credit) for loan losses 338 962 (114 ) 1,927 41 3,154 Loans charged-off — — (32 ) (15 ) (121 ) (168 ) Recoveries — — 14 — 64 78 Total ending allowance balance $ 3,028 $ 2,456 $ 1,659 $ 2,562 $ 39 $ 9,744 Nine Months Ended September 30, 2014 Allowance for loan losses: Beginning balance $ 1,552 $ 1,511 $ 1,402 $ 337 $ 98 $ 4,900 Provision (credit) for loan losses 589 402 304 243 (49 ) 1,489 Loans charged-off — (540 ) (11 ) (4 ) — (555 ) Recoveries — — 49 — — 49 Total ending allowance balance $ 2,141 $ 1,373 $ 1,744 $ 576 $ 49 $ 5,883 There was $5 in allowance for loan losses for PCI loans for the nine months ended September 30, 2015. There was no allowance for loan losses for the nine months ended September 30, 2014. The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of September 30, 2015 and December 31, 2014. For purposes of this table, recorded investment in loans excludes accrued interest receivable and loan fees, net due to immateriality. Construction Commercial Residential Commercial Consumer Total September 30, 2015 Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ — $ — $ 80 $ — $ 80 Collectively evaluated for impairment 3,028 2,451 1,659 2,482 39 9,659 Purchased credit-impaired loans — 5 — — — 5 Total ending allowance balance $ 3,028 $ 2,456 $ 1,659 $ 2,562 $ 39 $ 9,744 Loans: Individually evaluated for impairment $ — $ 914 $ 709 $ 102 $ 25 $ 1,750 Collectively evaluated for impairment 334,208 312,221 247,742 219,239 6,868 1,120,278 Purchased credit-impaired loans 77 1,452 709 1,675 — 3,913 Total ending loans balance $ 334,285 $ 314,587 $ 249,160 $ 221,016 $ 6,893 $ 1,125,941 Construction Commercial Residential Commercial Consumer Total December 31, 2014 Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ — $ — $ 18 $ — $ 18 Collectively evaluated for impairment 2,690 1,494 1,791 632 55 6,662 Purchased credit-impaired loans — — — — — — Total ending allowance balance $ 2,690 $ 1,494 $ 1,791 $ 650 $ 55 $ 6,680 Loans: Individually evaluated for impairment $ — $ 835 $ 93 $ 18 $ — $ 946 Collectively evaluated for impairment 239,225 245,517 213,667 76,552 8,025 782,986 Purchased credit-impaired loans 77 1,798 814 1,624 2 4,315 Total ending loans balance $ 239,302 $ 248,150 $ 214,574 $ 78,194 $ 8,027 $ 788,247 Loans collectively evaluated for impairment reported at September 30, 2015 include certain loans acquired from MidSouth on July 1, 2014. The acquired loans were recorded at estimated fair value at date of acquisition, which included an estimated credit discount. On July 1, 2014, acquired non-PCI loans were recorded at an estimated fair value of $178,818, comprised of contractually unpaid principal totaling $183,832 net of estimated discounts totaling $5,014 which included both credit and interest rate discount components. At September 30, 2015, acquired non-PCI loans were recorded at $104,853, comprised of contractually unpaid principal totaling $107,563 net of discounts totaling $2,710. Management evaluated these loans for credit deterioration since acquisition and determined that no allowance for loan losses was necessary at September 30, 2015. The following table presents information related to impaired loans by class of loans as of September 30, 2015 and December 31, 2014: Unpaid Recorded Allowance for September 30, 2015 With no allowance recorded: Commercial real estate: Nonfarm, nonresidential $ 2,501 $ 914 $ — Residential real estate: Other 709 709 — Commercial and industrial 22 22 — Consumer and other 25 25 — Subtotal 3,257 1,670 — With an allowance recorded: Commercial and industrial 80 80 80 Subtotal 80 80 80 Total $ 3,337 $ 1,750 $ 80 December 31, 2014 With no allowance recorded: Commercial real estate: Nonfarm, nonresidential $ 2,422 $ 835 $ — Residential real estate: Closed-end 1-4 family 93 93 — Subtotal 2,515 928 — With an allowance recorded: Commercial and industrial 18 18 18 Subtotal 18 18 18 Total $ 2,533 $ 946 $ 18 The following table presents the average recorded investment of impaired loans by class of loans for the three and nine months ended September 30, 2015 and 2014: Three Months Ended Nine Months Ended Average Recorded Investment 2015 2014 2015 2014 With no allowance recorded: Construction and land development $ — $ — $ — $ — Commercial real estate: Nonfarm, nonresidential 918 211 873 71 Residential real estate: Closed-end 1-4 family 33 — 188 — Other 712 — 317 — Commercial and industrial 23 — 77 — Consumer and other 25 — 8 — Subtotal 1,711 211 1,463 71 With an allowance recorded: Construction and land development $ — $ — $ — $ — Commercial real estate: Nonfarm, nonresidential — 1,194 — 837 Residential real estate: 1-4 family — — — 476 Commercial and industrial 90 64 50 65 Consumer and other 16 — 10 — Subtotal 106 1,258 60 1,378 Total $ 1,817 $ 1,469 $ 1,523 $ 1,449 The impact on net interest income for these loans was not material to the Company’s results of operations for the three and nine months ended September 30, 2015 and 2014. The following table presents the recorded investment in nonaccrual and loans past due over 90 days still on accrual by class of loans as of September 30, 2015 and December 31, 2014: Nonaccrual Loans Past Due September 30, 2015 Commercial real estate: Nonfarm, nonresidential $ 835 $ — Total $ 835 $ — December 31, 2014 Commercial real estate: Nonfarm, nonresidential $ 835 $ — Residential real estate: Closed-end 1-4 family — 316 Total $ 835 $ 316 Nonaccrual loans and loans past due 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. The following table presents the aging of the recorded investment in past due loans as of September 30, 2015 and December 31, 2014 by class of loans: 30-59 60-89 Greater Total Loans PCI Total September 30, 2015 Construction and land development $ 1,358 $ — $ — $ 1,358 $ 332,850 $ 77 $ 334,285 Commercial real estate: Nonfarm, nonresidential — — 835 835 302,822 1,452 305,109 Other — — — — 9,478 — 9,478 Residential real estate: Closed-end 1-4 family 839 — — 839 143,241 707 144,787 Other — — — — 104,371 2 104,373 Commercial and industrial 123 — — 123 219,218 1,675 221,016 Consumer and other 1 — — 1 6,892 — 6,893 $ 2,321 $ — $ 835 $ 3,156 $ 1,118,872 $ 3,913 $ 1,125,941 December 31, 2014 Construction and land development $ 354 $ — $ — $ 354 $ 238,871 $ 77 $ 239,302 Commercial real estate: Nonfarm, nonresidential — — 835 835 240,140 1,798 242,773 Other — — — — 5,377 — 5,377 Residential real estate: Closed-end 1-4 family 299 165 316 780 129,851 706 131,337 Other 52 — — 52 83,077 108 83,237 Commercial and industrial — 212 — 212 76,358 1,624 78,194 Consumer and other — — — — 8,025 2 8,027 $ 705 $ 377 $ 1,151 $ 2,233 $ 781,699 $ 4,315 $ 788,247 Credit Quality Indicators: Special Mention. Substandard. Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass-rated loans. The following table includes PCI loans, which are included in the “Substandard” column. Based on the most recent analysis performed, the risk category of loans by class of loans is as follows as of September 30, 2015 and December 31, 2014: Pass Special Substandard Total September 30, 2015 Construction and land development $ 334,208 $ — $ 77 $ 334,285 Commercial real estate: Nonfarm, nonresidential 302,387 — 2,722 305,109 Other 9,478 — — 9,478 Residential real estate: Closed-end 1-4 family 143,564 — 1,223 144,787 Other 103,663 — 710 104,373 Commercial and industrial 219,522 — 1,494 221,016 Consumer and other 6,868 — 25 6,893 $ 1,119,690 $ — $ 6,251 $ 1,125,941 December 31, 2014 Construction and land development $ 239,225 $ — $ 77 $ 239,302 Commercial real estate: Nonfarm, nonresidential 239,584 — 3,189 242,773 Other 5,377 — — 5,377 Residential real estate: Closed-end 1-4 family 128,869 — 2,468 131,337 Other 83,129 — 108 83,237 Commercial and industrial 76,552 — 1,642 78,194 Consumer and other 8,025 — 2 8,027 $ 780,761 $ — $ 7,486 $ 788,247 Purchased Credit-Impaired (“PCI”) Loans Income is recognized on PCI loans pursuant to ASC Topic 310-30. A portion of the fair value discount has been recognized as an accretable yield that is accreted into interest income over the estimated remaining life of the loans. The remaining non-accretable difference represents cash flows not expected to be collected. The table below summarizes the total contractually required principal and interest cash payments, management’s estimate of expected total cash payments and carrying value of the loans as of September 30, 2015 and December 31, 2014. Contractually required principal and interest payments have been adjusted for estimated prepayments. Sept 30, 2015 Dec 31, 2014 Contractually required principal and interest $ 5,872 $ 6,532 Non-accretable difference (307 ) (1,270 ) Cash flows expected to be collected 5,565 5,262 Accretable yield (1,652 ) (947 ) Carrying value of acquired loans 3,913 4,315 Allowance for loan losses (5 ) — Carrying value less allowance for loan losses $ 3,908 $ 4,315 Management adjusted estimates of future expected losses, cash flows and renewal assumptions during the nine months ended September 30, 2015. These adjustments resulted in a decrease in expected cash flows and accretable yield, and a decrease in the non-accretable difference. The table below summarizes the changes in total contractually required principal and interest cash payments, management’s estimate of expected total cash payments and carrying value of the loans during the three- and nine-month periods ended September 30, 2015. Activity during the three-month period ended September 30, 2015 Jun 30, 2015 Effect of Income All other Sept 30, 2015 Contractually required principal and interest $ 6,000 $ — $ — $ (128 ) $ 5,872 Non-accretable difference (973 ) — 839 (173 ) (307 ) Cash flows expected to be collected 5,027 — 839 (301 ) 5,565 Accretable yield (749 ) — 447 (1,350 ) (1,652 ) Carrying value of acquired loans $ 4,278 $ — $ 1,286 $ (1,651 ) $ 3,913 Activity during the nine-month period ended September 30, 2015 Dec 31, 2014 Effect of Income All other Sept 30, 2015 Contractually required principal and interest $ 6,532 $ — $ — $ (660 ) $ 5,872 Non-accretable difference (1,270 ) — 839 124 (307 ) Cash flows expected to be collected 5,262 — 839 (536 ) 5,565 Accretable yield (947 ) — 637 (1,342 ) (1,652 ) Carrying value of acquired loans $ 4,315 $ — $ 1,476 $ (1,878 ) $ 3,913 Troubled Debt Restructurings The Company’s loan portfolio contains no loans that have been modified in a troubled debt restructuring. |