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Purchase Credit Impaired ("PCI") Loans
 9 Months Ended
Sep. 30, 2014
PORTFOLIO LOANS COVERED BY LOSS SHARE [Abstract]  
Purchase Credit Impaired (PCI) Loans (Formerly Referred to as Portfolio Loans Covered Under FDIC Loss Share or Covered Loans)
PURCHASE CREDIT IMPAIRED ("PCI") LOANS (FORMERLY REFERRED TO AS PORTFOLIO LOANS COVERED UNDER FDIC LOSS SHARE OR COVERED LOANS)

Below is a summary of PCI loans by category at September 30, 2014, and December 31, 2013:
 
 
September 30, 2014
 
December 31, 2013
(in thousands)
Weighted-
Average
Risk Rating
Recorded
Investment
PCI Loans
 
Weighted-
Average
Risk Rating
Recorded
Investment
PCI Loans
Real Estate Loans:
 
 
 
 
 
    Construction and land development
6.33

$7,842

 
6.84

$14,325

    Commercial real estate - Investor owned
7.17
39,275

 
6.81
48,146

    Commercial real estate - Owner occupied
6.50
29,922

 
6.75
32,525

    Residential real estate
5.94
30,289

 
5.92
34,498

Total real estate loans
 

$107,328

 
 

$129,494

    Commercial and industrial
7.04
6,103

 
6.87
9,271

    Consumer and other
4.30
431

 
6.47
1,773

    Portfolio loans
 

$113,862

 
 

$140,538



The aging of the recorded investment in past due PCI loans by portfolio class and category at September 30, 2014, and December 31, 2013, is shown below.

 
September 30, 2014
(in thousands)
30-89 Days
 Past Due
 
90 or More
Days
Past Due
 
Total
Past Due
 
Current
 
Total
    Commercial & Industrial
$
338

 
$
702

 
$
1,040

 
$
5,063

 
$
6,103

    Real Estate:
 
 
 
 
 
 
 
 
 
       Commercial - Owner Occupied
94

 
3,466

 
3,560

 
26,362

 
29,922

       Commercial - Investor Owned
—

 
4,270

 
4,270

 
35,005

 
39,275

       Construction and Land Development
—

 
94

 
94

 
7,748

 
7,842

       Residential
299

 
3,831

 
4,130

 
26,158

 
30,288

    Consumer & Other
—

 
13

 
13

 
419

 
432

          Total
$
731

 
$
12,376

 
$
13,107

 
$
100,755

 
$
113,862


 
December 31, 2013
(in thousands)
30-89 Days
 Past Due
 
90 or More
Days
Past Due
 
Total
Past Due
 
Current
 
Total
    Commercial & Industrial
$
397

 
$
573

 
$
970

 
$
8,301

 
$
9,271

    Real Estate:
 
 
 
 
 
 
 
 
 
       Commercial - Owner Occupied
255

 
6,595

 
6,850

 
25,675

 
32,525

       Commercial - Investor Owned
5,143

 
3,167

 
8,310

 
39,836

 
48,146

       Construction and Land Development
32

 
4,198

 
4,230

 
10,095

 
14,325

       Residential
639

 
5,276

 
5,915

 
28,583

 
34,498

    Consumer & Other
—

 
—

 
—

 
1,773

 
1,773

          Total
$
6,466

 
$
19,809

 
$
26,275

 
$
114,263

 
$
140,538






The following table is a rollforward of PCI loans, net of the allowance for loan losses, for the nine months ended September 30, 2014 and 2013.

(In thousands)
Contractual Cashflows
 
Less:
Non-accretable Difference
 
Less: Accretable Yield
 
Carrying Amount
Balance January 1, 2014
$
266,068

 
$
87,438

 
$
53,530

 
$
125,100

Principal reductions and interest payments
(25,261
)
 
—

 
—

 
(25,261
)
Accretion of loan discount
—

 
—

 
(12,323
)
 
12,323

Changes in contractual and expected cash flows due to remeasurement
(2,616
)
 
(7,378
)
 
(500
)
 
5,262

Reductions due to disposals
(30,334
)
 
(7,379
)
 
(3,849
)
 
(19,106
)
Balance September 30, 2014
$
207,857

 
$
72,681

 
$
36,858

 
$
98,318

 
 
 
 
 
 
 
 
Balance January 1, 2013
$
386,966

 
$
118,627

 
$
78,768

 
$
189,571

Principal reductions and interest payments
(37,421
)
 
—

 
—

 
(37,421
)
Accretion of loan discount
—

 
—

 
(19,987
)
 
19,987

Changes in contractual and expected cash flows due to remeasurement
9,216

 
(10,858
)
 
14,233

 
5,841

Reductions due to disposals
(68,953
)
 
(23,867
)
 
(12,288
)
 
(32,798
)
Balance September 30, 2013
$
289,808

 
$
83,902

 
$
60,726

 
$
145,180



The accretable yield is accreted into interest income over the estimated life of the acquired loans using the effective
yield method.

A summary of activity in the FDIC loss share receivable for the nine months ended September 30, 2014 is as follows:

(In thousands)
September 30,
2014
Balance at beginning of period
$
34,319

Adjustments not reflected in income:
 
Cash received from the FDIC for covered assets
(6,487
)
FDIC reimbursable losses, net
1,734

Adjustments reflected in income:
 
Amortization, net
(5,375
)
Loan impairment
741

Reductions for payments on covered assets in excess of expected cash flows
(2,893
)
Balance at end of period
$
22,039



Due to continued favorable projections in the expected cash flows, the Company continues to anticipate it will be required to pay the FDIC at the end of two of its loss share agreements. Accordingly, a liability of $2.6 million has been recorded at September 30, 2014. The liability will continue to be adjusted as part of the remeasurement process through the end of the loss share agreements.