Loans | Loans The following table presents loans by class as of the dates indicated: March 31, December 31, 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 Interest only period Extension of terms or maturity 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. |