| Loans Held for Investment and Allowance for Loan Losses |
Loans and Allowance for Credit Losses on Loans Loans are summarized by portfolio segment as follows: | | | | | | | | | | | | | | December 31, | | (in thousands) | 2022 | | 2021 | | Loans held for investment(1): | | | | | Commercial | $ | 8,902,948 | | | $ | 9,897,561 | | | Energy | 1,159,296 | | | 721,373 | | | Mortgage finance | 4,090,033 | | | 7,475,497 | | | Real estate | 5,198,643 | | | 4,777,530 | | | | | | | | | | | | | | | Gross loans held for investment | 19,350,920 | | | 22,871,961 | | | Unearned income (net of direct origination costs) | (63,580) | | | (65,007) | | | Total loans held for investment | 19,287,340 | | | 22,806,954 | | | Allowance for credit losses on loans | (253,469) | | | (211,866) | | | Total loans held for investment, net | $ | 19,033,871 | | | $ | 22,595,088 | | | Loans held for sale: | | | | | Mortgage loans, at fair value | $ | — | | | $ | 8,123 | | | Non-mortgage loans, at lower of cost or fair value | 36,357 | | | — | | | Total loans held for sale | $ | 36,357 | | | $ | 8,123 | |
(1) Excludes accrued interest receivable of $100.4 million and $50.9 million at December 31, 2022 and December 31, 2021, respectively, that is recorded in accrued interest receivable and other assets on the consolidated balance sheets. The following tables summarize gross loans held for investment by year of origination and internally assigned credit grades: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (in thousands) | | 2022 | | 2021 | | 2020 | | 2019 | | 2018 | | 2017 and prior | | Revolving lines of credit | | Revolving lines of credit converted to term loans | | Total | | December 31, 2022 | | | | | | | | | | | | | | | | | | | | Commercial | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | $ | 1,903,529 | | | $ | 671,459 | | | $ | 244,568 | | | $ | 255,444 | | | $ | 325,201 | | | $ | 244,373 | | | $ | 4,877,753 | | | $ | 21,063 | | | $ | 8,543,390 | | | (8) Special mention | | 9,141 | | | 7,740 | | | 3,628 | | | 37,794 | | | 11,998 | | | 4,975 | | | 95,310 | | | 2,250 | | | 172,836 | | | (9) Substandard - accruing | | 18,670 | | | 71,147 | | | 514 | | | 1,666 | | | 14,933 | | | 6,305 | | | 30,070 | | | — | | | 143,305 | | | (9+) Non-accrual | | 376 | | | 512 | | | 751 | | | 30,425 | | | 6,226 | | | 2,520 | | | 2,607 | | | — | | | 43,417 | | | Total commercial | | $ | 1,931,716 | | | $ | 750,858 | | | $ | 249,461 | | | $ | 325,329 | | | $ | 358,358 | | | $ | 258,173 | | | $ | 5,005,740 | | | $ | 23,313 | | | $ | 8,902,948 | | | Energy | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | $ | 124,691 | | | $ | 12,517 | | | $ | — | | | $ | — | | | $ | — | | | $ | 3,317 | | | $ | 1,007,776 | | | $ | — | | | $ | 1,148,301 | | | (8) Special mention | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (9) Substandard - accruing | | — | | | — | | | — | | | — | | | — | | | — | | | 7,337 | | | — | | | 7,337 | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | — | | | — | | | 3,658 | | | — | | | 3,658 | | | Total energy | | $ | 124,691 | | | $ | 12,517 | | | $ | — | | | $ | — | | | $ | — | | | $ | 3,317 | | | $ | 1,018,771 | | | $ | — | | | $ | 1,159,296 | | | Mortgage finance | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | $ | 30,485 | | | $ | 482,477 | | | $ | 197,045 | | | $ | 267,758 | | | $ | 464,753 | | | $ | 2,647,515 | | | $ | — | | | $ | — | | | $ | 4,090,033 | | | (8) Special mention | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (9) Substandard - accruing | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | Total mortgage finance | | $ | 30,485 | | | $ | 482,477 | | | $ | 197,045 | | | $ | 267,758 | | | $ | 464,753 | | | $ | 2,647,515 | | | $ | — | | | $ | — | | | $ | 4,090,033 | | | Real estate | | | | | | | | | | | | | | | | | | | | CRE | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | $ | 1,085,254 | | | $ | 756,180 | | | $ | 563,341 | | | $ | 447,346 | | | $ | 183,634 | | | $ | 284,698 | | | $ | 97,337 | | | $ | 11,944 | | | $ | 3,429,734 | | | (8) Special mention | | 2,765 | | | 6,524 | | | 37,791 | | | 5,295 | | | 19,350 | | | 3,652 | | | — | | | — | | | 75,377 | | | (9) Substandard - accruing | | — | | | 17,850 | | | — | | | — | | | 11,458 | | | 17,698 | | | — | | | — | | | 47,006 | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | — | | | 182 | | | — | | | — | | | 182 | | | RBF | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | 94,066 | | | 70,951 | | | 12,161 | | | 6,106 | | | 2,655 | | | — | | | 326,164 | | | — | | | 512,103 | | | (8) Special mention | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (9) Substandard - accruing | | 7,840 | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 7,840 | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | Other | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | 182,840 | | | 131,538 | | | 94,611 | | | 67,518 | | | 76,951 | | | 163,838 | | | 42,333 | | | 31,293 | | | 790,922 | | | (8) Special mention | | 729 | | | — | | | 8,721 | | | — | | | — | | | 386 | | | — | | | — | | | 9,836 | | | (9) Substandard - accruing | | — | | | — | | | — | | | 247 | | | — | | | 1,035 | | | — | | | — | | | 1,282 | | | (9+) Non-accrual | | — | | | — | | | 1,081 | | | — | | | — | | | — | | | — | | | — | | | 1,081 | | | Secured by 1-4 family | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | 64,050 | | | 89,967 | | | 53,003 | | | 24,314 | | | 16,953 | | | 70,082 | | | 4,911 | | | — | | | 323,280 | | | (8) Special mention | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (9) Substandard - accruing | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | Total real estate | | $ | 1,437,544 | | | $ | 1,073,010 | | | $ | 770,709 | | | $ | 550,826 | | | $ | 311,001 | | | $ | 541,571 | | | $ | 470,745 | | | $ | 43,237 | | | $ | 5,198,643 | | | Total | | $ | 3,524,436 | | | $ | 2,318,862 | | | $ | 1,217,215 | | | $ | 1,143,913 | | | $ | 1,134,112 | | | $ | 3,450,576 | | | $ | 6,495,256 | | | $ | 66,550 | | | $ | 19,350,920 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (in thousands) | | 2021 | | 2020 | | 2019 | | 2018 | | 2017 | | 2016 and prior | | Revolving lines of credit | | Revolving lines of credit converted to term loans | | Total | | December 31, 2021 | | | | | | | | | | | | | | | | | | | | Commercial | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | $ | 1,133,013 | | | $ | 3,157,150 | | | $ | 546,520 | | | $ | 319,246 | | | $ | 200,478 | | | $ | 289,795 | | | $ | 3,960,706 | | | $ | 41,377 | | | $ | 9,648,285 | | | (8) Special mention | | 2,650 | | | 5,277 | | | 23,129 | | | 8,697 | | | 39 | | | 5,322 | | | 5,120 | | | 7,883 | | | 58,117 | | | (9) Substandard - accruing | | — | | | 7,705 | | | 102,619 | | | 25,010 | | | 6,202 | | | 6,962 | | | 14,742 | | | 2,007 | | | 165,247 | | | (9+) Non-accrual | | 736 | | | 1,191 | | | 49 | | | 12,955 | | | 1,166 | | | 6,196 | | | 3,619 | | | — | | | 25,912 | | | Total commercial | | $ | 1,136,399 | | | $ | 3,171,323 | | | $ | 672,317 | | | $ | 365,908 | | | $ | 207,885 | | | $ | 308,275 | | | $ | 3,984,187 | | | $ | 51,267 | | | $ | 9,897,561 | | | Energy | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | $ | 71,750 | | | $ | — | | | $ | — | | | $ | 3 | | | $ | — | | | $ | 7,188 | | | $ | 577,988 | | | $ | — | | | $ | 656,929 | | | (8) Special mention | | — | | | — | | | — | | | — | | | — | | | — | | | 27,421 | | | — | | | 27,421 | | | (9) Substandard - accruing | | — | | | — | | | — | | | — | | | — | | | 8,643 | | | — | | | — | | | 8,643 | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | — | | | — | | | 28,380 | | | — | | | 28,380 | | | Total energy | | $ | 71,750 | | | $ | — | | | $ | — | | | $ | 3 | | | $ | — | | | $ | 15,831 | | | $ | 633,789 | | | $ | — | | | $ | 721,373 | | | Mortgage finance | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | $ | 289,042 | | | $ | 590,616 | | | $ | 656,445 | | | $ | 754,507 | | | $ | 332,001 | | | $ | 4,852,886 | | | $ | — | | | $ | — | | | $ | 7,475,497 | | | (8) Special mention | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (9) Substandard - accruing | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | Total mortgage finance | | $ | 289,042 | | | $ | 590,616 | | | $ | 656,445 | | | $ | 754,507 | | | $ | 332,001 | | | $ | 4,852,886 | | | $ | — | | | $ | — | | | $ | 7,475,497 | | | Real estate | | | | | | | | | | | | | | | | | | | | CRE | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | $ | 497,462 | | | $ | 576,344 | | | $ | 600,005 | | | $ | 294,005 | | | $ | 155,252 | | | $ | 451,042 | | | $ | 73,988 | | | $ | 25,970 | | | $ | 2,674,068 | | | (8) Special mention | | — | | | — | | | 291 | | | 8,827 | | | 20,089 | | | 26,344 | | | — | | | — | | | 55,551 | | | (9) Substandard - accruing | | 17,850 | | | — | | | — | | | 40,900 | | | 37,393 | | | 38,188 | | | — | | | 2,308 | | | 136,639 | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | — | | | 198 | | | — | | | — | | | 198 | | | RBF | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | 155,595 | | | 44,362 | | | 9,693 | | | 8,565 | | | — | | | 12,732 | | | 460,888 | | | — | | | 691,835 | | | (8) Special mention | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (9) Substandard - accruing | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | Other | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | 166,202 | | | 148,811 | | | 119,017 | | | 106,343 | | | 61,723 | | | 139,723 | | | 47,653 | | | 29,595 | | | 819,067 | | | (8) Special mention | | — | | | 7,365 | | | — | | | — | | | 845 | | | 4,982 | | | — | | | — | | | 13,192 | | | (9) Substandard - accruing | | — | | | 6,424 | | | — | | | — | | | 16,922 | | | 20,184 | | | — | | | — | | | 43,530 | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | 2,641 | | | 1,450 | | | — | | | 13,741 | | | 17,832 | | | Secured by 1-4 family | | | | | | | | | | | | | | | | | | | | (1-7) Pass | | 96,899 | | | 60,659 | | | 40,586 | | | 22,976 | | | 31,826 | | | 65,910 | | | 4,535 | | | — | | | 323,391 | | | (8) Special mention | | — | | | 553 | | | — | | | — | | | — | | | 291 | | | — | | | — | | | 844 | | | (9) Substandard - accruing | | — | | | — | | | — | | | — | | | — | | | 1,203 | | | — | | | — | | | 1,203 | | | (9+) Non-accrual | | — | | | — | | | — | | | — | | | — | | | 180 | | | — | | | — | | | 180 | | | Total real estate | | $ | 934,008 | | | $ | 844,518 | | | $ | 769,592 | | | $ | 481,616 | | | $ | 326,691 | | | $ | 762,427 | | | $ | 587,064 | | | $ | 71,614 | | | $ | 4,777,530 | | | Total | | $ | 2,431,199 | | | $ | 4,606,457 | | | $ | 2,098,354 | | | $ | 1,602,034 | | | $ | 866,577 | | | $ | 5,939,419 | | | $ | 5,205,040 | | | $ | 122,881 | | | $ | 22,871,961 | |
The following table details activity in the allowance for credit losses on loans. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories. | | | | | | | | | | | | | | | | | | | | (in thousands) | Commercial | Energy | Mortgage
Finance | Real
Estate | | Total | | Year Ended December 31, 2022 | | | | | | | | Beginning balance | $ | 102,202 | | $ | 52,568 | | $ | 6,083 | | $ | 51,013 | | | $ | 211,866 | | | | | | | | | | Provision for credit losses on loans | 51,571 | | (981) | | 4,662 | | 6,220 | | | 61,472 | | | Charge-offs | 17,614 | | 5,605 | | — | | 350 | | | 23,569 | | | Recoveries | 682 | | 3,018 | | — | | — | | | 3,700 | | | Net charge-offs (recoveries) | 16,932 | | 2,587 | | — | | 350 | | | 19,869 | | | Ending balance | $ | 136,841 | | $ | 49,000 | | $ | 10,745 | | $ | 56,883 | | | $ | 253,469 | | | Year Ended December 31, 2021 | | | | | | | | Beginning balance | $ | 73,061 | | $ | 84,064 | | $ | 4,699 | | $ | 92,791 | | | $ | 254,615 | | | Provision for credit losses on loans | 36,733 | | (27,045) | | 1,384 | | (40,903) | | | (29,831) | | | Charge-offs | 11,987 | | 6,418 | | — | | 1,192 | | | 19,597 | | | Recoveries | 4,395 | | 1,967 | | — | | 317 | | | 6,679 | | | Net charge-offs (recoveries) | 7,592 | | 4,451 | | — | | 875 | | | 12,918 | | | Ending balance | $ | 102,202 | | $ | 52,568 | | $ | 6,083 | | $ | 51,013 | | | $ | 211,866 | |
The Company recorded a $61.5 million provision for credit losses for the year ended December 31, 2022, compared to a $29.8 million negative provision for the same period of 2021. The $61.5 million provision for credit losses resulted primarily from updated views on the downside risks to the economic forecast and an increase in net charge-offs during 2022. Net charge-offs for the year ended December 31, 2022 were $19.9 million, compared to $12.9 million during the same period of 2021. Criticized loans totaled $513.2 million at December 31, 2022 and $582.9 million at December 31, 2021. A loan is considered collateral-dependent when the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. There were no loans that met these criteria at December 31, 2022. The table below provides an age analysis of loans held for investment: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (in thousands) | 30-59 Days
Past Due | | 60-89 Days
Past Due | | 90 Days or More Past Due | | Total Past
Due | | Non-accrual(2) | | Current | | Total | | Non-accrual With No Allowance | | December 31, 2022 | | | | | | | | | | | | | | | | | Commercial | $ | 6,714 | | | $ | 3,041 | | | $ | 131 | | | $ | 9,886 | | | $ | 43,417 | | | $ | 8,849,645 | | | $ | 8,902,948 | | | $ | 41,476 | | | Energy | — | | | — | | | — | | | — | | | 3,658 | | | 1,155,638 | | | 1,159,296 | | | 3,658 | | | Mortgage finance | — | | | — | | | — | | | — | | | — | | | 4,090,033 | | | 4,090,033 | | | — | | | Real estate | | | | | | | | | | | | | | | | | CRE | 440 | | | — | | | — | | | 440 | | | 182 | | | 3,551,677 | | | 3,552,299 | | | — | | | RBF | — | | | — | | | — | | | — | | | — | | | 519,943 | | | 519,943 | | | — | | | Other | 2,438 | | | — | | | — | | | 2,438 | | | 1,081 | | | 799,602 | | | 803,121 | | | — | | | Secured by 1-4 family | — | | | — | | | — | | | — | | | — | | | 323,280 | | | 323,280 | | | — | | | Total | $ | 9,592 | | | $ | 3,041 | | | $ | 131 | | | $ | 12,764 | | | $ | 48,338 | | | $ | 19,289,818 | | | $ | 19,350,920 | | | $ | 45,134 | |
(1)As of December 31, 2022 $2.2 million of non-accrual loans were earning interest income on a cash basis compared to none as of December 31, 2021. Additionally, $801,000 and $624,000 of interest income was recognized on non-accrual loans for the years ended December 31, 2022 and 2021, respectively. Accrued interest of $1.6 million and $1.2 million was reversed during the years ended December 31, 2022 and 2021, respectively. As of December 31, 2022 and December 31, 2021, the Company did not have any loans considered restructured that were not on non-accrual. Of the non-accrual loans at December 31, 2022 and 2021, $531,000 and $19.4 million, respectively, met the criteria for restructured. These loans had no unfunded commitments at their respective balance sheet dates. The following table details the recorded investment at December 31, 2022 of loans restructured during the year ended December 31, 2022: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Extended Maturity | | Adjusted Payment Schedule | | Total | | (dollars in thousands) | | Number of Contracts | Balance at Period End | | Number of Contracts | Balance at Period End | | Number of Contracts | Balance at Period End | | Year Ended December 31, 2022 | | | | | | | | | | | Commercial | | — | | $ | — | | | 1 | | $ | 531 | | | 1 | | $ | 531 | | | | | | | | | | | | | Total | | — | | — | | | 1 | | 531 | | | 1 | | 531 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
The Company did not have any loans that were restructured during the year ended December 31, 2021. The restructuring of these loans did not have a significant impact on the allowance for credit losses at December 31, 2022 or 2021. As of December 31, 2022 and 2021, the Company did not have any loans that were restructured within the last 12 months that subsequently defaulted.
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