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Purchased Credit Impaired ("PCI") Loans
 9 Months Ended
Sep. 30, 2019
Receivables [Abstract]  
Purchase Credit Impaired (PCI) Loans
Below is a summary of PCI loans by category at September 30, 2019 and December 31, 2018:
 
September 30, 2019
 
December 31, 2018
(in thousands)
Weighted-
Average
Risk Rating1
Recorded
Investment
PCI Loans
 
Weighted-
Average
Risk Rating1
Recorded
Investment
PCI Loans
Commercial and industrial
5.77
$
15,773

 
6.09
$
2,159

Real estate:
 
 
 
 
 
Commercial - investor owned
7.04
39,329

 
7.19
23,939

Commercial - owner occupied
6.58
20,435

 
7.39
9,669

Construction and land development
5.75
7,847

 
6.03
4,548

Residential
6.31
12,011

 
6.40
6,082

Total real estate loans
 
79,622

 
 
44,238

Consumer and other
5.54
228

 
2.18
4

Total
 
$
95,623

 
 
$
46,401

1Risk ratings are based on the borrower’s contractual obligation, which is not reflective of the purchase discount.


The aging of the recorded investment in past due PCI loans by portfolio class and category at September 30, 2019 and December 31, 2018, is shown below:

 
September 30, 2019
(in thousands)
30-89 Days
 Past Due
 
90 or More
Days
Past Due
 
Total
Past Due
 
Current
 
Total
Commercial and industrial
$
922

 
$
532

 
$
1,454

 
$
14,319

 
$
15,773

Real estate:
 
 
 
 
 
 
 
 
 
Commercial - investor owned
—

 
2,115

 
2,115

 
37,214

 
39,329

Commercial - owner occupied
—

 
1,023

 
1,023

 
19,412

 
20,435

Construction and land development
14

 
217

 
231

 
7,616

 
7,847

Residential
703

 
833

 
1,536

 
10,475

 
12,011

Consumer and other
—

 
35

 
35

 
193

 
228

Total
$
1,639

 
$
4,755


$
6,394


$
89,229


$
95,623


 
December 31, 2018
(in thousands)
30-89 Days
 Past Due
 
90 or More
Days
Past Due
 
Total
Past Due
 
Current
 
Total
Commercial and industrial
$
—

 
$
—

 
$
—

 
$
2,159

 
$
2,159

Real estate:
 
 
 
 
 
 
 
 
 
Commercial - investor owned
416

 
88

 
504

 
23,435

 
23,939

Commercial - owner occupied
591

 
6,279

 
6,870

 
2,799

 
9,669

Construction and land development
—

 
—

 
—

 
4,548

 
4,548

Residential
146

 
37

 
183

 
5,899

 
6,082

Consumer and other
—

 
—

 
—

 
4

 
4

Total
$
1,153

 
$
6,404


$
7,557


$
38,844


$
46,401



The following table is a roll forward of PCI loans, net of the allowance for loan losses, for the nine months ended September 30, 2019 and 2018.
(in thousands)
Contractual Cashflows
 
Non-accretable Difference
 
Accretable Yield
 
Carrying Amount
Balance December 31, 2018
$
73,157

 
$
15,299

 
$
12,638

 
$
45,220

Acquisitions
111,963

 
13,542

 
30,238

 
68,183

Principal reductions and interest payments
(33,548
)
 
—

 
—

 
(33,548
)
Accretion of loan discount
—

 
—

 
(8,014
)
 
8,014

Changes in contractual and expected cash flows due to remeasurement
10,490

 
(2,057
)
 
(86
)
 
12,633

Reductions due to disposals
(9,121
)
 
(3,345
)
 
(40
)
 
(5,736
)
Balance September 30, 2019
$
152,941

 
$
23,439


$
34,736


$
94,766

 
 
 
 
 
 
 
 
Balance December 31, 2017
$
112,710

 
$
29,005

 
$
13,964

 
$
69,741

Principal reductions and interest payments
(38,165
)
 
—

 
—

 
(38,165
)
Accretion of loan discount
—

 
—

 
(5,118
)
 
5,118

Changes in contractual and expected cash flows due to remeasurement
4,341

 
(8,939
)
 
3,179

 
10,101

Balance September 30, 2018
$
78,886

 
$
20,066


$
12,025


$
46,795



The accretable yield is recognized in interest income over the estimated life of the acquired loans using the effective yield method. Outstanding customer balances on PCI loans were $121.5 million and $64.7 million as of September 30, 2019, and December 31, 2018, respectively.