Loans, Net and Allowance for Loan Losses | Loans, Net and Allowance for Loan Losses Loans, net at December 31, 2020 and 2019, consisted of the following: December 31, 2020 2019 Commercial $ 3,902,266 $ 2,482,356 Real estate: Commercial 6,096,676 5,872,653 Commercial construction, land and land development 1,245,801 1,236,623 Residential 1,352,465 1,515,227 Single-family interim construction 326,575 378,120 Agricultural 85,014 97,767 Consumer 66,952 32,603 Other 346 621 Total loans 13,076,095 11,615,970 Deferred loan fees, net (10,037) (1,695) Allowance for loan losses (87,820) (51,461) Total loans, net $ 12,978,238 $ 11,562,814 The Company has certain lending policies and procedures in place that are designed to maximize loan income within an acceptable level of risk. Management reviews and approves these policies and procedures on a regular basis. A reporting system supplements the review process by providing management with frequent reports related to loan production, loan quality, concentrations of credit, loan delinquencies and nonperforming and potential problem loans. Commercial loans are underwritten after evaluating and understanding the borrower’s ability to operate profitably and prudently expand its business. The Company’s management examines current and projected cash flows to determine the ability of the borrower to repay their obligations as agreed. Commercial loans are primarily made based on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the borrower. These cash flows, however, may not be as expected and the value of collateral securing the loans may fluctuate. Most commercial loans are secured by the assets being financed or other business assets such as accounts receivable or inventory and may incorporate a personal guarantee; however, some short term loans may be made on an unsecured basis. Additionally, our commercial loan portfolio includes loans made to customers in the energy industry, which is a complex, technical and cyclical industry. Experienced bankers with specialized energy lending experience originate our energy loans. Companies in this industry produce, extract, develop, exploit and explore for oil and natural gas. Loans are primarily collateralized with proven producing oil and gas reserves based on a technical evaluation of these reserves. At December 31, 2020 and 2019, there were approximately $205,496 and $189,781 of energy-related loans outstanding, respectively. The Company has a mortgage warehouse purchase program providing mortgage inventory financing for residential mortgage loans originated by mortgage banker clients across a broad geographic scale. Proceeds from the sale of mortgages is the primary source of repayment for warehouse inventory financing via approved investor takeout commitments. These loans typically have a very short duration ranging between a few days to 15 days. In some cases, loans to larger mortgage originators may be financed for up to 60 days. These loans are reported as commercial loans since the loans are secured by notes receivable, not real estate. As of December 31, 2020 and 2019, mortgage warehouse purchase loans outstanding totaled $1,453,797 and $687,317, respectively. With the passage of the CARES Act Paycheck Protection Program (PPP), administered by the Small Business Administration (SBA), the Company has participated in originating loans to its customers through the program. PPP loans have terms of two Commercial real estate loans are subject to underwriting standards and processes similar to commercial loans. These loans are viewed primarily as cash flow loans and secondarily as loans secured by real estate. Commercial real estate lending typically involves higher loan principal amounts and the repayment of these loans is generally largely dependent on the successful operation of the property or the business conducted on the property securing the loan. Commercial real estate loans may be more adversely affected by conditions in the real estate markets or in the general economy. The properties securing the Company’s commercial real estate portfolio are diverse in terms of type and geographic location. Management monitors the diversification of the portfolio on a quarterly basis by type and geographic location. Management also tracks the level of owner-occupied property versus non owner-occupied property. At December 31, 2020, the portfolio consisted of approximately 29% of owner-occupied property. Land and commercial land development loans are underwritten using feasibility studies, independent appraisal reviews and financial analysis of the developers or property owners. Generally, borrowers must have a proven track record of success. Commercial construction loans are generally based upon estimates of cost and value of the completed project. These estimates may not be accurate. Commercial construction loans often involve the disbursement of substantial funds with the repayment dependent on the success of the ultimate project. Sources of repayment for these loans may be pre-committed permanent financing or sale of the developed property. The loans in this portfolio are geographically diverse and due to the increased risk are monitored closely by management and the board of directors on a quarterly basis. Residential real estate and single-family interim construction loans are underwritten primarily based on borrowers’ credit scores, documented income and minimum collateral values. Relatively small loan amounts are spread across many individual borrowers which minimizes risk in the residential portfolio. In addition, management evaluates trends in past dues and current economic factors on a regular basis. Agricultural loans are collateralized by real estate and/or agricultural-related assets. Agricultural real estate loans are primarily comprised of loans for the purchase of farmland. Loan-to-value ratios on loans secured by farmland generally do not exceed 80% and have amortization periods limited to twenty years. Agricultural non-real estate loans are generally comprised of term loans to fund the purchase of equipment, livestock and seasonal operating lines to grain farmers to plant and harvest corn and soybeans. Specific underwriting standards have been established for agricultural-related loans including the establishment of projections for each operating year based on industry developed estimates of farm input costs and expected commodity yields and prices. Operating lines are typically written for one year and secured by the crop and other farm assets as considered necessary. Agricultural loans carry significant credit risks as they involve larger balances concentrated with single borrowers or groups of related borrowers. In addition, repayment of such loans depends on the successful operation or management of the farm property securing the loan or for which an operating loan is utilized. Farming operations may be affected by adverse weather conditions such as drought, hail or floods that can severely limit crop yields. Consumer loans represent less than 1% of the outstanding total loan portfolio. Collateral consists primarily of automobiles and other personal assets. Credit score analysis is used to supplement the underwriting process. Most of the Company’s lending activity occurs within the State of Texas, primarily in the north, central and southeast Texas regions and the State of Colorado, specifically along the Front Range area. As of December 31, 2020, loans in the Colorado region represented about 24% of the total portfolio. A large percentage of the Company’s portfolio consists of commercial and residential real estate loans. As of December 31, 2020 and 2019, there were no concentrations of loans related to a single industry in excess of 10% of total loans. The allowance for loan losses is an amount that management believes will be adequate to absorb estimated losses relating to specifically identified loans, as well as probable credit losses inherent in the balance of the loan portfolio. The allowance is derived from the following two components: 1) allowances established on individual impaired loans, which are based on a review of the individual characteristics of each loan, including the customer’s ability to repay the loan, the underlying collateral values and the industry the customer operates and 2) allowances based on actual historical loss experience for the last three years for similar types of loans in the Company’s loan portfolio adjusted for primarily changes in the lending policies and procedures; collection, charge-off and recovery practices; nature and volume of the loan portfolio; change in value of underlying collateral; volume and severity of nonperforming loans; existence and effect of any concentrations of credit and the level of such concentrations and current, national and local economic and business conditions. This second component also includes an unallocated allowance to cover uncertainties that could affect management’s estimate of probable losses. The unallocated allowance reflects the imprecision inherent in the underlying assumptions used in the methodologies for estimating this component. The Company’s management continually evaluates the allowance for loan losses determined from the allowances established on individual loans and the amounts determined from historical loss percentages adjusted for the qualitative factors above. Should any of the factors considered by management change, the Company’s estimate of loan losses could also change and would affect the level of future provision expense. While the calculation of the allowance for loan losses utilizes management’s best judgment and all the information available, the adequacy of the allowance for loan losses is dependent on a variety of factors beyond the Company’s control, including, among other things, the performance of the entire loan portfolio, the economy, changes in interest rates and the view of regulatory authorities towards loan classifications. In addition, regulatory agencies, as an integral part of their examination process, periodically review the Bank’s allowance for loan losses, and may require the Bank to make additions to the allowance based on their judgment about information available to them at the time of their examinations. Loans requiring an allocated loan loss provision are generally identified at the servicing officer level based on review of weekly past due reports and/or the loan officer’s communication with borrowers. In addition, the status of past due loans are routinely discussed within each lending region as well as credit committee meetings to determine if classification is warranted. The Company’s internal loan review department has implemented an internal risk based loan review process to identify potential internally classified loans that supplements the independent external loan review. External loan reviews cover a wide range of the loan portfolio, including large lending relationships and recently acquired loan portfolios. As such, the external loan review generally covers loans exceeding $3,500. These reviews include analysis of borrower’s financial condition, payment histories and collateral values to determine if a loan should be internally classified. Generally, once classified, an impaired loan analysis is completed by the credit department to determine if the loan is impaired and the amount of allocated allowance required. Following unprecedented declines caused by the pandemic and volatile energy prices, the Texas economy, specifically in the Company’s lending areas of north, central and southeast Texas, and the Colorado economy expanded at a moderate pace by the end of the fourth quarter of 2020. Activity in the manufacturing and service sectors picked up while the retail sector activity remained weak. Energy activity showed mounting signs of improvement after a prolonged contraction. Loan volume increased during the year, driven by a sharp rise in residential real estate lending. Loan pricing fell further, and credit standards and terms continue to tighten with expectations for future loan demand turning slightly negative. Outlooks are generally positive, but uncertainty remains high with continued concerns about rising COVID-19 infection rates impacting the overall economic recovery mitigated slightly by optimism about the vaccine paving the way to a resumption of normal economic activity in 2021. The pandemic crisis has been impactful and the timing and magnitude of recovery cannot be predicted. The risk of loss associated with all segments of the portfolio could increase due to these factors. The economy and other risk factors are minimized by the Company’s underwriting standards which include the following principles: 1) financial strength of the borrower including strong earnings, high net worth, significant liquidity and acceptable debt to worth ratio, 2) managerial business competence, 3) ability to repay, 4) loan to value, 5) projected cash flow and 6) guarantor financial statements as applicable. The following is a summary of the activity in the allowance for loan losses by loan class for the years ended December 31, 2020, 2019 and 2018: Commercial Commercial Residential Single-Family Agricultural Consumer Other Unallocated Total Year ended December 31, 2020 Balance at beginning of year $ 12,844 $ 33,085 $ 3,678 $ 1,606 $ 332 $ 226 $ 5 $ (315) $ 51,461 Provision for loan losses 20,025 17,769 3,108 632 5 223 493 738 42,993 Charge-offs (5,670) (735) — (82) — (44) (342) — (6,873) Recoveries 112 4 — — — 37 86 — 239 Balance at end of year $ 27,311 $ 50,123 $ 6,786 $ 2,156 $ 337 $ 442 $ 242 $ 423 $ 87,820 Year ended December 31, 2019 Balance at beginning of year $ 11,793 $ 27,795 $ 3,320 $ 1,402 $ 241 $ 186 $ 3 $ 62 $ 44,802 Provision for loan losses 8,670 5,289 498 207 91 71 356 (377) 14,805 Charge-offs (7,709) (3) (140) (3) — (79) (430) — (8,364) Recoveries 90 4 — — — 48 76 — 218 Balance at end of year $ 12,844 $ 33,085 $ 3,678 $ 1,606 $ 332 $ 226 $ 5 $ (315) $ 51,461 Year ended December 31, 2018 Balance at beginning of year $ 10,599 $ 23,301 $ 3,447 $ 1,583 $ 250 $ 205 $ (32) $ 49 $ 39,402 Provision for loan losses 4,973 4,909 (124) (181) (9) 69 210 13 9,860 Charge-offs (3,863) (435) (6) — — (93) (228) — (4,625) Recoveries 84 20 3 — — 5 53 — 165 Balance at end of year $ 11,793 $ 27,795 $ 3,320 $ 1,402 $ 241 $ 186 $ 3 $ 62 $ 44,802 The following table details the amount of the allowance for loan losses and recorded investment in loans by class as of December 31, 2020 and 2019: Commercial Commercial Residential Single-Family Agricultural Consumer Other Unallocated Total December 31, 2020 Allowance for losses: Individually evaluated for impairment $ 8,281 $ 243 $ — $ — $ — $ — $ — $ — $ 8,524 Collectively evaluated for impairment 18,836 49,880 6,786 2,156 337 442 242 423 79,102 Loans acquired with deteriorated credit quality 194 — — — — — — — 194 Ending balance $ 27,311 $ 50,123 $ 6,786 $ 2,156 $ 337 $ 442 $ 242 $ 423 $ 87,820 Loans: Individually evaluated for impairment $ 39,298 $ 21,880 $ 2,550 $ — $ 613 $ 42 $ — $ — $ 64,383 Collectively evaluated for impairment 3,823,982 7,149,610 1,345,234 326,575 84,284 66,895 346 — 12,796,926 Acquired with deteriorated credit quality 38,986 170,987 4,681 — 117 15 — — 214,786 Ending balance $ 3,902,266 $ 7,342,477 $ 1,352,465 $ 326,575 $ 85,014 $ 66,952 $ 346 $ — $ 13,076,095 December 31, 2019 Allowance for losses: Individually evaluated for impairment $ 357 $ — $ — $ — $ — $ 1 $ — $ — $ 358 Collectively evaluated for impairment 12,108 32,615 3,678 1,606 332 225 5 (315) 50,254 Loans acquired with deteriorated credit quality 379 470 — — — — — — 849 Ending balance $ 12,844 $ 33,085 $ 3,678 $ 1,606 $ 332 $ 226 $ 5 $ (315) $ 51,461 Loans: Individually evaluated for impairment $ 3,130 $ 6,813 $ 2,008 $ — $ 114 $ 22 $ — $ — $ 12,087 Collectively evaluated for impairment 2,416,569 6,883,639 1,505,896 378,120 93,837 32,556 621 — 11,311,238 Acquired with deteriorated credit quality 62,657 218,824 7,323 — 3,816 25 — — 292,645 Ending balance $ 2,482,356 $ 7,109,276 $ 1,515,227 $ 378,120 $ 97,767 $ 32,603 $ 621 $ — $ 11,615,970 Nonperforming loans by loan class (excluding loans acquired with deteriorated credit quality) at December 31, 2020 and 2019, are summarized as follows: Commercial Commercial Residential Real Estate Single-Family Agricultural Consumer Other Total December 31, 2020 Nonaccrual loans $ 25,898 $ 20,072 $ 2,372 $ — $ 613 $ 42 $ — $ 48,997 Loans past due 90 days and still accruing 433 — — — — — — 433 Troubled debt restructurings (not included in nonaccrual or loans past due and still accruing) — 1,808 178 — — — — 1,986 $ 26,331 $ 21,880 $ 2,550 $ — $ 613 $ 42 $ — $ 51,416 December 31, 2019 Nonaccrual loans $ 3,130 $ 6,461 $ 1,820 $ — $ 114 $ 22 $ — $ 11,547 Loans past due 90 days and still accruing 14,529 — — — — — — 14,529 Troubled debt restructurings (not included in nonaccrual or loans past due and still accruing) — 352 188 — — — — 540 $ 17,659 $ 6,813 $ 2,008 $ — $ 114 $ 22 $ — $ 26,616 The accrual of interest is discontinued on a loan when management believes that, after considering collection efforts and other factors, the borrower's financial condition is such that collection of interest is doubtful. All interest accrued but not collected for loans that are placed on nonaccrual status or charged-off is reversed against interest income. Cash collections on nonaccrual loans are generally credited to the loan receivable balance, and no interest income is recognized on those loans until the principal balance has been collected. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Impaired loans are those loans where it is probable that all amounts due according to contractual terms of the loan agreement will not be collected. The Company has identified these loans through its normal loan review procedures. Impaired loans are measured based on 1) the present value of expected future cash flows discounted at the loan's effective interest rate; 2) the loan's observable market price; or 3) the fair value of collateral if the loan is collateral dependent. Substantially all of the Company’s impaired loans are measured at the fair value of the collateral. In limited cases, the Company may use other methods to determine the level of impairment of a loan if such loan is not collateral dependent. All commercial, real estate, agricultural loans and troubled debt restructurings are considered for individual impairment analysis. Smaller balance consumer loans are collectively evaluated for impairment. Impaired loans by loan class (excluding loans acquired with deteriorated credit quality) at December 31, 2020 and 2019 and for the years ended December 31, 2020, 2019 and 2018, are summarized as follows: Commercial Commercial Residential Single-Family Agricultural Consumer Other Total December 31, 2020 Recorded investment in impaired loans: Impaired loans with an allowance for loan losses $ 24,540 $ 475 $ — $ — $ — $ — $ — $ 25,015 Impaired loans with no allowance for loan losses 14,758 21,405 2,550 — 613 42 — 39,368 Total $ 39,298 $ 21,880 $ 2,550 $ — $ 613 $ 42 $ — $ 64,383 Unpaid principal balance of impaired loans $ 63,817 $ 22,543 $ 2,742 $ — $ 650 $ 44 $ — $ 89,796 Allowance for loan losses on impaired loans $ 8,281 $ 243 $ — $ — $ — $ — $ — $ 8,524 December 31, 2019 Recorded investment in impaired loans: Impaired loans with an allowance for loan losses $ 1,580 $ — $ — $ — $ — $ 1 $ — $ 1,581 Impaired loans with no allowance for loan losses 1,550 6,813 2,008 — 114 21 — 10,506 Total $ 3,130 $ 6,813 $ 2,008 $ — $ 114 $ 22 $ — $ 12,087 Unpaid principal balance of impaired loans $ 8,580 $ 6,967 $ 2,197 $ — $ 123 $ 24 $ — $ 17,891 Allowance for loan losses on impaired loans $ 357 $ — $ — $ — $ — $ 1 $ — $ 358 For the year ended December 31, 2020 Average recorded investment in impaired loans $ 21,559 $ 9,497 $ 2,362 $ — $ 442 $ 30 $ — $ 33,890 Interest income recognized on impaired loans $ 168 $ 139 $ 208 $ — $ — $ — $ — $ 515 For the year ended December 31, 2019 Average recorded investment in impaired loans $ 6,266 $ 3,979 $ 1,746 $ 716 $ 57 $ 30 $ — $ 12,794 Interest income recognized on impaired loans $ 30 $ 39 $ 39 $ 119 $ — $ 6 $ — $ 233 For the year ended December 31, 2018 Average recorded investment in impaired loans $ 8,919 $ 2,667 $ 2,033 $ 716 $ — $ 46 $ — $ 14,381 Interest income recognized on impaired loans $ 119 $ 65 $ 81 $ 1 $ — $ 2 $ — $ 268 Certain impaired loans have adequate collateral and do not require a related allowance for loan loss. The Company will charge-off that portion of any loan which management considers a loss. Commercial and real estate loans are generally considered for charge-off when exposure beyond collateral coverage is apparent and when no further collection of the loss portion is anticipated based on the borrower’s financial condition. The restructuring of a loan is considered a “troubled debt restructuring” (TDR) if both 1) the borrower is experiencing financial difficulties and 2) the creditor has granted a concession. Concessions may include interest rate reductions or below market interest rates, principal forgiveness, extending amortization and other actions intended to minimize potential losses. A TDR loan is identified as impaired and measured for credit impairment as of each reporting period in accordance with the guidance in Accounting Standards Codification ASC 310-10-35. Modifications primarily relate to extending the amortization periods of the loans and interest rate concessions. The majority of these loans were identified as impaired prior to restructuring; therefore, the modifications did not materially impact the Company’s determination of the allowance for loan losses. The recorded investment in troubled debt restructurings, including those on nonaccrual, was $2,564 and $1,208 as of December 31, 2020 and 2019, respectively. Following is a summary of loans modified under troubled debt restructurings during the years ended December 31, 2020 and 2019: Commercial Commercial Residential Single-Family Agricultural Consumer Other Total Troubled debt restructurings during the year ended December 31, 2020 Number of contracts — 1 — — — — — 1 Pre-restructuring outstanding recorded investment $ — $ 1,517 $ — $ — $ — $ — $ — $ 1,517 Post-restructuring outstanding recorded investment $ — $ 1,517 $ — $ — $ — $ — $ — $ 1,517 Troubled debt restructurings during the year ended December 31, 2019 Number of contracts — — 1 — — — — 1 Pre-restructuring outstanding recorded investment $ — $ — $ 29 $ — $ — $ — $ — $ 29 Post-restructuring outstanding recorded investment $ — $ — $ 29 $ — $ — $ — $ — $ 29 At December 31, 2020 and 2019, there were no loans modified under troubled debt restructurings during the previous twelve month period that subsequently defaulted during the years ended December 31, 2020 and 2019. At December 31, 2020 and 2019, the Company had no commitments to lend additional funds to any borrowers with loans whose terms have been modified under troubled debt restructurings. Under ASC Subtopic 310-40 and federal banking agencies interagency guidance, certain short-term loan modifications made on a good faith basis in response to COVID-19 (as defined by the guidance) are not considered TDRs. Additionally, under section 4013 of the CARES Act, banks may elect to suspend the requirement for certain loan modifications to be categorized as a TDR. In response to the COVID-19 pandemic, the Company has implemented prudent modifications allowing for primarily short-term payment deferrals or other payment relief to borrowers with pandemic-related economic hardships, where appropriate, that complies with the above guidance. As such, the Company's TDR loans noted above do not include loans that are modifications to borrowers impacted by COVID-19. Deferred payments along with any interest accrued during the deferral period are due and payable on the maturity date. As of December 31, 2020, the Company has 1,298 loans with outstanding deferred accrued interest of $22,128 on balances of $1,651,376. 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 table presents information regarding the aging of past due loans by loan class as of December 31, 2020 and 2019: Loans Loans Total Past Current Total December 31, 2020 Commercial $ 3,243 $ 13,227 $ 16,470 $ 3,846,810 $ 3,863,280 Commercial real estate, construction, land and land development 2,453 16,790 19,243 7,152,247 7,171,490 Residential real estate 5,169 1,028 6,197 1,341,587 1,347,784 Single-family interim construction — — — 326,575 326,575 Agricultural — 1 1 84,896 84,897 Consumer 86 41 127 66,810 66,937 Other — — — 346 346 10,951 31,087 42,038 12,819,271 12,861,309 Acquired with deteriorated credit quality 624 3,219 3,843 210,943 214,786 $ 11,575 $ 34,306 $ 45,881 $ 13,030,214 $ 13,076,095 December 31, 2019 Commercial $ 4,512 $ 17,656 $ 22,168 $ 2,397,531 $ 2,419,699 Commercial real estate, construction, land and land development 9,153 2,905 12,058 6,878,394 6,890,452 Residential real estate 3,242 642 3,884 1,504,020 1,507,904 Single-family interim construction 2,836 — 2,836 375,284 378,120 Agricultural 22 114 136 93,815 93,951 Consumer 167 22 189 32,389 32,578 Other — — — 621 621 19,932 21,339 41,271 11,282,054 11,323,325 Acquired with deteriorated credit quality 2,556 6,766 9,322 283,323 292,645 $ 22,488 $ 28,105 $ 50,593 $ 11,565,377 $ 11,615,970 The Company’s internal classified report is segregated into the following categories: 1) Pass/Watch, 2) Special Mention, 3) Substandard and 4) Doubtful. The loans placed in the Pass/Watch category reflect the Company’s opinion that the loans reflect potential weakness that requires monitoring on a more frequent basis. The loans in the Special Mention category reflect the Company’s opinion that the credit contains weaknesses which represent a greater degree of risk and warrant extra attention. These loans are reviewed monthly by officers and senior management to determine if a change in category is warranted. The loans placed in the Substandard category are considered to be potentially inadequately protected by the current debt service capacity of the borrower and/or the pledged collateral. These credits, even if apparently protected by collateral value, have shown weakness related to adverse financial, managerial, economic, market or political conditions which may jeopardize repayment of principal and interest. There is a possibility that some future loss could be sustained by the Company if such weakness is not corrected. The Doubtful category includes loans that are in default or principal exposure is probable. Substandard and Doubtful loans are individually evaluated to determine if they should be classified as impaired and an allowance is allocated if deemed necessary under ASC 310-10. The loans that are not impaired are included with the remaining “pass” credits in determining the portion of the allowance for loan loss based on historical loss experience and other qualitative factors. The portfolio is segmented into categories including: commercial loans, consumer loans, commercial real estate loans, residential real estate loans and agricultural loans. The adjusted historical loss percentage is applied to each category. Each category is then added together to determine the allowance allocated under ASC 450-20. A summary of loans by credit quality indicator by class as of December 31, 2020 and 2019, is as follows: Pass Pass/ Special Mention Substandard Doubtful Total December 31, 2020 Commercial $ 3,700,626 $ 55,960 $ 38,186 $ 97,403 $ 10,091 $ 3,902,266 Commercial real estate, construction, land and land development 6,504,933 352,910 360,963 123,671 — 7,342,477 Residential real estate 1,332,757 6,296 5,726 7,686 — 1,352,465 Single-family interim construction 323,800 2,775 — — — 326,575 Agricultural 76,951 6,194 1,205 664 — 85,014 Consumer 66,854 8 — 90 — 66,952 Other 346 — — — — 346 $ 12,006,267 $ 424,143 $ 406,080 $ 229,514 $ 10,091 $ 13,076,095 December 31, 2019 Commercial $ 2,332,611 $ 71,642 $ 37,739 $ 40,364 $ — $ 2,482,356 Commercial real estate, construction, land and land development 6,814,780 184,720 46,889 62,887 — 7,109,276 Residential real estate 1,501,019 4,850 994 8,364 — 1,515,227 Single-family interim construction 376,887 1,233 — — — 378,120 Agricultural 88,044 5,287 1,864 2,572 — 97,767 Consumer 32,459 33 2 109 — 32,603 Other 621 — — — — 621 $ 11,146,421 $ 267,765 $ 87,488 $ 114,296 $ — $ 11,615,970 The Company has acquired certain loans which experienced credit deterioration since origination (purchased credit impaired (PCI) loans). The Company has included PCI loans in the above grading tables. The following provides additional detail on the grades applied to those loans at December 31, 2020 and 2019: Pass Pass/ Special Mention Substandard Doubtful Total December 31, 2020 $ 117,896 $ 45,672 $ 32,557 $ 18,661 $ — $ 214,786 December 31, 2019 232,095 21,284 4,502 34,764 — 292,645 PCI loans may remain on accrual status to the extent the company can reasonably estimate the amount and timing of expected future cash flows. At December 31, 2020 and 2019, nonaccrual PCI loans were $6,699 and $10,850, respectively. Accretion on PCI loans is based on estimated future cash flows, regardless of contractual maturity. The following table summarizes the outstanding balance and related carrying amount of PCI loans by acquired bank as of the acquisition date for the acquisition occurring in 2019. Acquisition Date January 1, 2019 Guaranty Bancorp Outstanding balance $ 341,645 Nonaccretable difference (16,622) Accretable yield (13,299) Carrying amount $ 311,724 The carrying amount of all acquired PCI loans included in the consolidated balance sheet and the related outstanding balance at December 31, 2020 and 2019, were as follows: December 31, 2020 2019 Outstanding balance $ 237,786 $ 326,077 Carrying amount 214,786 292,645 There was an allocation of $194 and $849 established in the allowance for loan losses relating to PCI loans at December 31, 2020 and 2019, respectively. The changes in accretable yield during the years ended December 31, 2020 and 2019 in regard to loans transferred at acquisition for which it was probable that all contractually required payments would not be collected are presented in the table below. 2020 2019 Balance at January 1 $ 8,905 $ 1,436 Additions — 13,299 Accretion (3,287) (5,830) Transfers from nonaccretable — — Balance at December 31 $ 5,618 $ 8,905 |