LOANS AND ALLOWANCE FOR LOAN LOSSES | 4. LOANS AND ALLOWANCE FOR LOAN LOSSES Loans are stated at their face amount, net of deferred fees and costs, and consist of the following at June 30, 2019 and December 31, 2018 (dollars in thousands): June 30, 2019 December 31, 2018 Construction and Land Development $ 1,267,712 $ 1,194,821 Commercial Real Estate - Owner Occupied 1,966,776 1,337,345 Commercial Real Estate - Non-Owner Occupied 3,104,823 2,467,410 Multifamily Real Estate 602,115 548,231 Commercial & Industrial 2,032,799 1,317,135 Residential 1-4 Family - Commercial 801,703 713,750 Residential 1-4 Family - Mortgage 850,063 600,578 Auto 311,858 301,943 HELOC 660,621 613,383 Consumer 383,653 379,694 Other Commercial 238,391 241,917 Total loans held for investment, net (1) $ 12,220,514 $ 9,716,207 (1) Loans, as presented, are net of deferred fees and costs totaling $7.2 million and $5.1 million as of June 30, 2019 and December 31, 2018, respectively. The following table shows the aging of the Company’s loan portfolio, by segment, at June 30, 2019 (dollars in thousands): Greater than 30-59 Days 60-89 Days 90 Days and Past Due Past Due still Accruing PCI Nonaccrual Current Total Loans Construction and Land Development $ 2,327 $ 318 $ 855 $ 12,181 $ 5,619 $ 1,246,412 $ 1,267,712 Commercial Real Estate - Owner Occupied 1,707 — 2,540 32,628 4,062 1,925,839 1,966,776 Commercial Real Estate - Non-Owner Occupied 141 164 1,489 15,755 1,685 3,085,589 3,104,823 Multifamily Real Estate 1,218 — — 92 — 600,805 602,115 Commercial & Industrial 3,223 1,175 295 3,930 1,183 2,022,993 2,032,799 Residential 1-4 Family - Commercial 1,622 651 863 12,675 4,135 781,757 801,703 Residential 1-4 Family - Mortgage 5,969 2,801 845 17,821 8,677 813,950 850,063 Auto 2,120 299 122 7 449 308,861 311,858 HELOC 4,978 1,336 658 4,869 1,432 647,348 660,621 Consumer 2,794 1,423 1,099 689 115 377,533 383,653 Other Commercial 30 — 62 654 105 237,540 238,391 Total loans held for investment $ 26,129 $ 8,167 $ 8,828 $ 101,301 $ 27,462 $ 12,048,627 $ 12,220,514 The following table shows the aging of the Company’s loan portfolio, by segment, at December 31, 2018 (dollars in thousands): Greater than 30-59 Days 60-89 Days 90 Days and Past Due Past Due still Accruing PCI Nonaccrual Current Total Loans Construction and Land Development $ 759 $ 6 $ 180 $ 8,654 $ 8,018 $ 1,177,204 $ 1,194,821 Commercial Real Estate - Owner Occupied 8,755 1,142 3,193 25,644 3,636 1,294,975 1,337,345 Commercial Real Estate - Non-Owner Occupied 338 41 — 17,335 1,789 2,447,907 2,467,410 Multifamily Real Estate — 146 — 88 — 547,997 548,231 Commercial & Industrial 3,353 389 132 2,156 1,524 1,309,581 1,317,135 Residential 1-4 Family - Commercial 6,619 1,577 1,409 13,707 2,481 687,957 713,750 Residential 1-4 Family - Mortgage 12,049 5,143 2,437 16,766 7,276 556,907 600,578 Auto 3,320 403 195 7 576 297,442 301,943 HELOC 4,611 1,644 440 5,115 1,518 600,055 613,383 Consumer 1,504 1,096 870 32 135 376,057 379,694 Other Commercial 126 — — 717 — 241,074 241,917 Total loans held for investment $ 41,434 $ 11,587 $ 8,856 $ 90,221 $ 26,953 $ 9,537,156 $ 9,716,207 The following table shows the PCI loan portfolios, by segment and their delinquency status, at June 30, 2019 (dollars in thousands): 30-89 Days Greater than Past Due 90 Days Current Total Construction and Land Development $ 165 $ 1,296 $ 10,720 $ 12,181 Commercial Real Estate - Owner Occupied 745 3,974 27,909 32,628 Commercial Real Estate - Non-Owner Occupied 116 999 14,640 15,755 Multifamily Real Estate — — 92 92 Commercial & Industrial 245 1,081 2,604 3,930 Residential 1-4 Family - Commercial 582 670 11,423 12,675 Residential 1-4 Family - Mortgage 1,423 3,779 12,619 17,821 Auto — — 7 7 HELOC 277 361 4,231 4,869 Consumer — 5 684 689 Other Commercial — — 654 654 Total $ 3,553 $ 12,165 $ 85,583 $ 101,301 The following table shows the PCI loan portfolios, by segment and their delinquency status, at December 31, 2018 (dollars in thousands): 30-89 Days Greater than Past Due 90 Days Current Total Construction and Land Development $ 108 $ 1,424 $ 7,122 $ 8,654 Commercial Real Estate - Owner Occupied 658 4,281 20,705 25,644 Commercial Real Estate - Non-Owner Occupied 61 1,810 15,464 17,335 Multifamily Real Estate — — 88 88 Commercial & Industrial 47 1,092 1,017 2,156 Residential 1-4 Family - Commercial 931 3,464 9,312 13,707 Residential 1-4 Family - Mortgage 1,899 2,412 12,455 16,766 Auto — — 7 7 HELOC 498 252 4,365 5,115 Consumer 5 9 18 32 Other Commercial 57 — 660 717 Total $ 4,264 $ 14,744 $ 71,213 $ 90,221 The Company measures the amount of impairment by evaluating loans either in their collective homogeneous pools or individually. The following table shows the Company’s impaired loans, excluding PCI loans, by segment at June 30, 2019 and December 31, 2018 (dollars in thousands): June 30, 2019 December 31, 2018 Unpaid Unpaid Recorded Principal Related Recorded Principal Related Investment Balance Allowance Investment Balance Allowance Loans without a specific allowance Construction and Land Development $ 6,837 $ 8,863 $ — $ 10,290 $ 12,038 $ — Commercial Real Estate - Owner Occupied 10,138 10,433 — 8,386 9,067 — Commercial Real Estate - Non-Owner Occupied 6,265 6,568 — 6,578 6,929 — Commercial & Industrial 2,583 2,605 — 3,059 3,251 — Residential 1-4 Family - Commercial 4,986 5,126 — 4,516 4,576 — Residential 1-4 Family - Mortgage 8,821 9,455 — 8,504 9,180 — HELOC 2,205 2,220 — 1,150 1,269 — Consumer — — — 30 102 — Other Commercial — — — 478 478 — Total impaired loans without a specific allowance $ 41,835 $ 45,270 $ — $ 42,991 $ 46,890 $ — Loans with a specific allowance Construction and Land Development $ 877 $ 954 $ 111 $ 372 $ 491 $ 63 Commercial Real Estate - Owner Occupied 1,723 1,834 104 4,304 4,437 359 Commercial Real Estate - Non-Owner Occupied 565 613 11 391 391 1 Commercial & Industrial 407 430 135 1,183 1,442 752 Residential 1-4 Family - Commercial 4,703 4,850 341 3,180 3,249 185 Residential 1-4 Family - Mortgage 6,985 7,302 612 5,329 5,548 374 Auto 449 668 179 576 830 231 HELOC 1,230 1,340 330 724 807 188 Consumer 186 349 69 178 467 64 Other Commercial 576 577 30 — — — Total impaired loans with a specific allowance $ 17,701 $ 18,917 $ 1,922 $ 16,237 $ 17,662 $ 2,217 Total impaired loans $ 59,536 $ 64,187 $ 1,922 $ 59,228 $ 64,552 $ 2,217 The following tables show the average recorded investment and interest income recognized for the Company’s impaired loans, excluding PCI loans, by segment for the three and six months ended June 30, 2019 and 2018 (dollars in thousands): Three Months Ended Six Months Ended June 30, 2019 June 30, 2019 Interest Interest Average Income Average Income Investment Recognized Investment Recognized Construction and Land Development $ 7,811 $ 13 $ 8,167 $ 54 Commercial Real Estate - Owner Occupied 12,002 91 12,030 200 Commercial Real Estate - Non-Owner Occupied 6,931 60 6,944 119 Commercial & Industrial 3,038 27 3,081 59 Residential 1-4 Family - Commercial 9,969 73 9,730 138 Residential 1-4 Family - Mortgage 15,986 6 16,057 105 Auto 493 — 520 1 HELOC 3,489 38 3,506 78 Consumer 191 2 195 3 Other Commercial 579 7 583 15 Total impaired loans $ 60,489 $ 317 $ 60,813 $ 772 Three Months Ended Six Months Ended June 30, 2018 June 30, 2018 Interest Interest Average Income Average Income Investment Recognized Investment Recognized Construction and Land Development $ 12,572 $ 68 $ 12,458 $ 145 Commercial Real Estate - Owner Occupied 13,130 116 13,262 238 Commercial Real Estate - Non-Owner Occupied 7,187 48 7,496 109 Commercial & Industrial 5,792 57 5,970 130 Residential 1-4 Family - Commercial 7,744 72 7,839 140 Residential 1-4 Family - Mortgage 18,876 63 18,951 163 Auto 1,002 6 1,056 17 HELOC 4,439 34 4,447 69 Consumer 268 2 286 2 Other Commercial 488 7 490 14 Total impaired loans $ 71,498 $ 473 $ 72,255 $ 1,027 The Company considers TDRs to be impaired loans. A modification of a loan’s terms constitutes a TDR if the creditor grants a concession that it would not otherwise consider to the borrower for economic or legal reasons related to the borrower’s financial difficulties. All loans that are considered to be TDRs are evaluated for impairment in accordance with the Company’s allowance for loan loss methodology and are included in the preceding impaired loan tables. For the three and six months ended June 30, 2019, the recorded investment in TDRs prior to modifications was not materially impacted by the modification. The following table provides a summary, by segment, of TDRs that continue to accrue interest under the terms of the applicable restructuring agreement, which are considered to be performing, and TDRs that have been placed on nonaccrual status, which are considered to be nonperforming, as of June 30, 2019 and December 31, 2018 (dollars in thousands): June 30, 2019 December 31, 2018 No. of Recorded Outstanding No. of Recorded Outstanding Loans Investment Commitment Loans Investment Commitment Performing Construction and Land Development 4 $ 1,953 $ — 5 $ 2,496 $ — Commercial Real Estate - Owner Occupied 8 2,734 26 8 2,783 — Commercial Real Estate - Non-Owner Occupied 3 4,244 — 4 4,438 — Commercial & Industrial 2 583 — 4 978 — Residential 1-4 Family - Commercial 40 3,926 — 30 2,887 — Residential 1-4 Family - Mortgage 27 5,161 — 30 5,070 — HELOC 2 57 — 2 58 — Consumer 2 15 — 1 13 — Other Commercial 1 471 — 1 478 — Total performing 89 $ 19,144 $ 26 85 $ 19,201 $ — Nonperforming Construction and Land Development 1 $ 1,016 $ — 2 $ 3,474 $ — Commercial Real Estate - Owner Occupied 2 185 — 2 198 — Commercial & Industrial 4 421 — 6 461 — Residential 1-4 Family - Commercial — — — 1 60 — Residential 1-4 Family - Mortgage 17 2,854 — 15 3,135 — HELOC 2 60 — 2 62 — Consumer — — — 1 7 — Total nonperforming 26 $ 4,536 $ — 29 $ 7,397 $ — Total performing and nonperforming 115 $ 23,680 $ 26 114 $ 26,598 $ — The Company considers a default of a TDR to occur when the borrower is 90 days past due following the restructure or a foreclosure and repossession of the applicable collateral occurs. During the three and six months ended June 30, 2019 and 2018, the Company did not have any material loans that went into default that had been restructured in the twelve-month period prior to the time of default. The following table shows, by segment and modification type, TDRs that occurred during the three and six months ended June 30, 2019 (dollars in thousands): All Restructurings Three Months Ended June 30, 2019 Six Months Ended June 30, 2019 Recorded Recorded No. of Investment at No. of Investment at Loans Period End Loans Period End Modified to interest only, at a market rate Total interest only at market rate of interest — $ — — $ — Term modification, at a market rate Residential 1-4 Family - Commercial — $ — 2 $ 293 Residential 1-4 Family - Mortgage 1 43 2 80 Consumer — — 1 9 Total loan term extended at a market rate 1 $ 43 5 $ 382 Term modification, below market rate Residential 1-4 Family - Commercial 8 $ 431 13 $ 1,358 Residential 1-4 Family - Mortgage 1 52 1 52 Consumer — — 1 6 Total loan term extended at a below market rate 9 $ 483 15 $ 1,416 Total 10 $ 526 20 $ 1,798 The following table shows, by segment and modification type, TDRs that occurred during the three and six months ended June 30, 2018 (dollars in thousands): All Restructurings Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Recorded Recorded No. of Investment at No. of Investment at Loans Period End Loans Period End Modified to interest only, at a market rate Total interest only at market rate of interest — $ — — $ — Term modification, at a market rate Construction and Land Development 2 $ 1,263 2 $ 1,263 Commercial Real Estate - Owner Occupied 2 564 5 1,375 Commercial & Industrial 1 63 1 63 Residential 1-4 Family - Commercial 1 72 2 221 Residential 1-4 Family - Mortgage 4 475 5 615 Total loan term extended at a market rate 10 $ 2,437 15 $ 3,537 Term modification, below market rate Residential 1-4 Family - Commercial 3 $ 608 3 $ 608 Residential 1-4 Family - Mortgage 2 248 4 413 Total loan term extended at a below market rate 5 $ 856 7 $ 1,021 Total 15 $ 3,293 22 $ 4,558 The following tables show the ALL activity by segment for the six months ended June 30, 2019 and 2018. The tables below include the provision for loan losses. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories (dollars in thousands): Six Months Ended June 30, 2019 Allowance for loan losses Balance, Recoveries Loans Provision Balance, beginning of credited to charged charged to end of the year allowance off operations period Construction and Land Development $ 6,803 $ 97 $ (800) $ (101) $ 5,999 Commercial Real Estate - Owner Occupied 4,023 54 (231) 235 4,081 Commercial Real Estate - Non-Owner Occupied 8,865 92 — 654 9,611 Multifamily Real Estate 649 85 — (70) 664 Commercial & Industrial 7,636 681 (1,858) 1,237 7,696 Residential 1-4 Family - Commercial 1,984 127 (267) 148 1,992 Residential 1-4 Family - Mortgage 1,200 219 (37) 136 1,518 Auto 1,443 339 (703) 334 1,413 HELOC 1,297 434 (523) 47 1,255 Consumer and all other (1) 7,145 1,238 (7,454) 7,305 8,234 Total $ 41,045 $ 3,366 $ (11,873) $ 9,925 $ 42,463 (1) Consumer and Other Commercial are grouped together as Consumer and all other for reporting purposes. Six Months Ended June 30, 2018 Allowance for loan losses Balance, Recoveries Loans Provision Balance, beginning of credited to charged charged to end of the year allowance off operations period Construction and Land Development $ 9,709 $ 279 $ (61) $ (600) $ 9,327 Commercial Real Estate - Owner Occupied 2,931 346 (125) 788 3,940 Commercial Real Estate - Non-Owner Occupied 7,544 7 (94) 295 7,752 Multifamily Real Estate 1,092 5 — 633 1,730 Commercial & Industrial 4,552 260 (459) 2,029 6,382 Residential 1-4 Family - Commercial 4,437 140 (113) (1,927) 2,537 Residential 1-4 Family - Mortgage 1,524 202 (141) 304 1,889 Auto 975 190 (480) 403 1,088 HELOC 1,360 469 (267) (263) 1,299 Consumer and all other (1) 4,084 783 (3,799) 4,258 5,326 Total $ 38,208 $ 2,681 $ (5,539) $ 5,920 $ 41,270 (1) Consumer and Other Commercial are grouped together as Consumer and all other for reporting purposes. The following tables show the loan and ALL balances based on impairment methodology by segment as of June 30, 2019 and December 31, 2018 (dollars in thousands): June 30, 2019 Loans individually Loans collectively Loans acquired with evaluated for evaluated for deteriorated credit impairment impairment quality Total Loans ALL Loans ALL Loans ALL Loans ALL Construction and Land Development $ 7,714 $ 111 $ 1,247,817 $ 5,888 $ 12,181 $ — $ 1,267,712 $ 5,999 Commercial Real Estate - Owner Occupied 11,861 104 1,922,287 3,977 32,628 — 1,966,776 4,081 Commercial Real Estate - Non-Owner Occupied 6,830 11 3,082,238 9,600 15,755 — 3,104,823 9,611 Multifamily Real Estate — — 602,023 664 92 — 602,115 664 Commercial & Industrial 2,990 135 2,025,879 7,561 3,930 — 2,032,799 7,696 Residential 1-4 Family - Commercial 9,689 341 779,339 1,651 12,675 — 801,703 1,992 Residential 1-4 Family - Mortgage 15,806 612 816,436 906 17,821 — 850,063 1,518 Auto 449 179 311,402 1,234 7 — 311,858 1,413 HELOC 3,435 330 652,317 925 4,869 — 660,621 1,255 Consumer and all other (1) 762 99 619,939 8,135 1,343 — 622,044 8,234 Total loans held for investment, net $ 59,536 $ 1,922 $ 12,059,677 $ 40,541 $ 101,301 $ — $ 12,220,514 $ 42,463 (1) Consumer and Other Commercial are grouped together as Consumer and all other for reporting purposes. December 31, 2018 Loans individually Loans collectively Loans acquired with evaluated for evaluated for deteriorated credit impairment impairment quality Total Loans ALL Loans ALL Loans ALL Loans ALL Construction and Land Development $ 10,662 $ 63 $ 1,175,505 $ 6,740 $ 8,654 $ — $ 1,194,821 $ 6,803 Commercial Real Estate - Owner Occupied 12,690 359 1,299,011 3,664 25,644 — 1,337,345 4,023 Commercial Real Estate - Non-Owner Occupied 6,969 1 2,443,106 8,864 17,335 — 2,467,410 8,865 Multifamily Real Estate — — 548,143 649 88 — 548,231 649 Commercial & Industrial 4,242 752 1,310,737 6,884 2,156 — 1,317,135 7,636 Residential 1-4 Family - Commercial 7,696 185 692,347 1,799 13,707 — 713,750 1,984 Residential 1-4 Family - Mortgage 13,833 374 569,979 826 16,766 — 600,578 1,200 Auto 576 231 301,360 1,212 7 — 301,943 1,443 HELOC 1,874 188 606,394 1,109 5,115 — 613,383 1,297 Consumer and all other (1) 686 64 620,176 7,081 749 — 621,611 7,145 Total loans held for investment, net $ 59,228 $ 2,217 $ 9,566,758 $ 38,828 $ 90,221 $ — $ 9,716,207 $ 41,045 (1) Consumer and Other Commercial are grouped together as Consumer and all other for reporting purposes. The Company uses a risk rating system and past due status as the primary credit quality indicators for the loan categories. The risk rating system on a scale of 0 through 9 is used to determine risk level as used in the calculation of the ALL; on those loans without a risk rating, the Company uses past due status to determine risk level. The risk levels, as described below, do not necessarily follow the regulatory definitions of risk levels with the same name. A general description of the characteristics of the risk levels follows: Pass is determined by the following criteria: ● Risk rated 0 loans have little or no risk and are with General Obligation Municipal Borrowers; ● Risk rated 1 loans have little or no risk and are generally secured by cash or cash equivalents; ● Risk rated 2 loans have minimal risk to well qualified borrowers and no significant questions as to safety; ● Risk rated 3 loans are satisfactory loans with strong borrowers and secondary sources of repayment; ● Risk rated 4 loans are satisfactory loans with borrowers not as strong as risk rated 3 loans and may exhibit a greater degree of financial risk based on the type of business supporting the loan; or ● Loans that are not risk rated but that are 0 to 29 days past due. Watch & Special Mention is determined by the following criteria: ● Risk rated 5 loans are watch loans that warrant more than the normal level of supervision and have the possibility of an event occurring that may weaken the borrower’s ability to repay; ● Risk rated 6 loans have increasing potential weaknesses beyond those at which the loan originally was granted and if not addressed could lead to inadequately protecting the Company’s credit position; or ● Loans that are not risk rated but that are 30 to 89 days past due. Substandard is determined by the following criteria: ● Risk rated 7 loans are substandard loans and are inadequately protected by the current sound worth or paying capacity of the obligor or the collateral pledged; these have well defined weaknesses that jeopardize the liquidation of the debt with the distinct possibility the Company will sustain some loss if the deficiencies are not corrected; or ● Loans that are not risk rated but that are 90 to 149 days past due. Doubtful is determined by the following criteria: ● Risk rated 8 loans are doubtful of collection and the possibility of loss is high but pending specific borrower plans for recovery, its classification as a loss is deferred until its more exact status is determined; ● Risk rated 9 loans are loss loans which are considered uncollectable and of such little value that their continuance as bankable assets is not warranted; or ● Loans that are not risk rated but that are over 149 days past due. The following table shows the recorded investment in all loans, excluding PCI loans, by segment with their related risk level as of June 30, 2019 (dollars in thousands): Pass Watch & Special Mention Substandard Doubtful Total Construction and Land Development $ 1,204,655 $ 43,268 $ 7,608 $ — $ 1,255,531 Commercial Real Estate - Owner Occupied 1,848,333 65,257 20,558 — 1,934,148 Commercial Real Estate - Non-Owner Occupied 3,042,648 40,760 5,660 — 3,089,068 Multifamily Real Estate 586,626 15,397 — — 602,023 Commercial & Industrial 1,945,547 79,232 4,090 — 2,028,869 Residential 1-4 Family - Commercial 755,438 26,284 7,306 — 789,028 Residential 1-4 Family - Mortgage 808,797 6,036 17,409 — 832,242 Auto 307,921 2,181 1,749 — 311,851 HELOC 643,778 5,418 6,556 — 655,752 Consumer 381,478 1,121 365 — 382,964 Other Commercial 235,981 1,588 168 — 237,737 Total $ 11,761,202 $ 286,542 $ 71,469 $ — $ 12,119,213 The following table shows the recorded investment in all loans, excluding PCI loans, by segment with their related risk level as of December 31, 2018 (dollars in thousands): Pass Watch & Special Mention Substandard Doubtful Total Construction and Land Development $ 1,130,577 $ 43,894 $ 11,696 $ — $ 1,186,167 Commercial Real Estate - Owner Occupied 1,231,422 50,939 29,340 — 1,311,701 Commercial Real Estate - Non-Owner Occupied 2,425,500 17,648 6,927 — 2,450,075 Multifamily Real Estate 537,572 10,571 — — 548,143 Commercial & Industrial 1,273,549 34,864 6,566 — 1,314,979 Residential 1-4 Family - Commercial 677,109 17,086 5,848 — 700,043 Residential 1-4 Family - Mortgage 554,192 14,855 14,765 — 583,812 Auto 296,907 3,590 1,439 — 301,936 HELOC 598,444 6,316 3,508 — 608,268 Consumer 378,873 547 242 — 379,662 Other Commercial 239,857 864 479 — 241,200 Total $ 9,344,002 $ 201,174 $ 80,810 $ — $ 9,625,986 The following table shows the recorded investment in only PCI loans by segment with their related risk level as of June 30, 2019 (dollars in thousands): Pass Watch & Special Mention Substandard Doubtful Total Construction and Land Development $ 1,455 $ 4,264 $ 6,462 $ — $ 12,181 Commercial Real Estate - Owner Occupied 8,690 10,453 13,485 — 32,628 Commercial Real Estate - Non-Owner Occupied 4,573 9,274 1,908 — 15,755 Multifamily Real Estate — 92 — — 92 Commercial & Industrial 109 94 3,727 — 3,930 Residential 1-4 Family - Commercial 6,238 2,998 3,371 68 12,675 Residential 1-4 Family - Mortgage 10,381 269 7,171 — 17,821 Auto 3 — 4 — 7 HELOC 3,502 760 607 — 4,869 Consumer 676 — 13 — 689 Other Commercial 52 602 — — 654 Total $ 35,679 $ 28,806 $ 36,748 $ 68 $ 101,301 The following table shows the recorded investment in only PCI loans by segment with their related risk level as of December 31, 2018 (dollars in thousands): Pass Watch & Special Mention Substandard Doubtful Total Construction and Land Development $ 1,835 $ 1,308 $ 5,511 $ — $ 8,654 Commercial Real Estate - Owner Occupied 8,347 6,685 10,612 — 25,644 Commercial Real Estate - Non-Owner Occupied 4,789 7,992 4,554 — 17,335 Multifamily Real Estate — 88 — — 88 Commercial & Industrial 762 134 1,260 — 2,156 Residential 1-4 Family - Commercial 6,512 2,771 4,424 — 13,707 Residential 1-4 Family - Mortgage 9,894 1,030 5,842 — 16,766 Auto 7 — — — 7 HELOC 3,438 1,031 646 — 5,115 Consumer 17 — 15 — 32 Other Commercial 57 660 — — 717 Total $ 35,658 $ 21,699 $ 32,864 $ — $ 90,221 Loans acquired are originally recorded at fair value, with certain loans being identified as impaired at the date of purchase. The fair values were determined based on the credit quality of the portfolio, expected future cash flows, and timing of those expected future cash flows. The following shows changes in the accretable yield for loans accounted for under ASC 310-30, Receivables – Loans and Debt Securities Acquired with Deteriorated Credit Quality, For the Six Months Ended June 30, 2019 2018 Balance at beginning of period $ 31,201 $ 14,563 Additions 2,432 12,225 Accretion (6,510) (4,673) Reclass of nonaccretable difference due to improvement in expected cash flows 716 139 Measurement period adjustment 2,629 2,981 Other, net (1) 2,182 70 Balance at end of period $ 32,650 $ 25,305 (1) This line item represents changes in the cash flows expected to be collected due to the impact of non-credit changes such as prepayment assumptions, changes in interest rates on variable rate PCI loans, and discounted payoffs that occurred in the quarter. The carrying value of the Company’s PCI loan portfolio, accounted for under ASC 310-30, Receivables - Loans and Debt Securities Acquired with Deteriorated Credit Quality Receivables – Nonrefundable Fees and Other Costs |