LOANS

3 Months Ended

Mar. 31, 2021

Receivables [Abstract]

LOANS

NOTE 3 – LOANS

Loans are stated at amortized cost. Balances within the major loans receivable categories are presented in the following table:

(dollars in thousands)	March 31, 2021		December 31, 2020
Commercial, financial and agricultural	$	1,611,029	$	1,627,477
Consumer installment	257,097		306,995
Indirect automobile	482,637		580,083
Mortgage warehouse	880,216		916,353
Municipal	659,228		659,403
Premium finance	706,379		687,841
Real estate – construction and development	1,533,234		1,606,710
Real estate – commercial and farmland	5,616,826		5,300,006
Real estate – residential	2,853,159		2,796,057
	$	14,599,805	$	14,480,925

Included in commercial, financial and agricultural loans at March 31, 2021 and December 31, 2020 above are $792.0 million and $827.4 million, respectively, related to the SBA's Paycheck Protection Program (“PPP”). Accrued interest receivable on loans is reported in other assets on the consolidated balance sheets totaling $67.8 million and $73.4 million at March 31, 2021 and December 31, 2020, respectively. The Company recorded an allowance for credit losses of $556,000 and $718,000 related to deferred interest on loans modified under its Disaster Relief Program at March 31, 2021 and December 31, 2020, respectively.

Nonaccrual and Past-Due Loans

A loan is placed on nonaccrual status when, in management’s judgment, the collection of the interest income appears doubtful. Interest receivable that has been accrued and is subsequently determined to have doubtful collectability is charged to interest income. Interest on loans that are classified as nonaccrual is subsequently applied to principal until the loans are returned to accrual status. The Company’s loan policy states that a nonaccrual loan may be returned to accrual status when (i) none of its principal and interest is due and unpaid, and the Company expects repayment of the remaining contractual principal and interest, or (ii) it otherwise becomes well secured and in the process of collection. Restoration to accrual status on any given loan must be supported by a well-documented credit evaluation of the borrower’s financial condition and the prospects for full repayment, approved by the Company’s Chief Credit Officer. Past-due loans are loans whose principal or interest is past due 30 days or more. In some cases, where borrowers are experiencing financial difficulties, loans may be restructured to provide terms significantly different from the original contractual terms.

The following table presents an analysis of loans accounted for on a nonaccrual basis:

(dollars in thousands)	March 31, 2021		December 31, 2020
Commercial, financial and agricultural	$	9,686	$	9,836
Consumer installment	646		709
Indirect automobile	1,530		2,831
Real estate – construction and development	5,421		5,407
Real estate – commercial and farmland	14,046		18,517
Real estate – residential	39,860		39,157
	$	71,189	$	76,457

There was no interest income recognized on nonaccrual loans during the three months ended March 31, 2021 and 2020.

The following table presents an analysis of nonaccrual loans with no related allowance for credit losses:

(dollars in thousands)	March 31, 2021		December 31, 2020
Commercial, financial and agricultural	$	966	$	764
Real estate – construction and development	66		416
Real estate – commercial and farmland	3,621		7,015
Real estate – residential	6,842		5,299
	$	11,495	$	13,494

The following table presents an analysis of past-due loans as of March 31, 2021 and December 31, 2020:

(dollars in thousands)	Loans 30-59 Days Past Due		Loans 60-89 Days Past Due		Loans 90 or More Days Past Due		Total Loans Past Due		Current Loans		Total Loans		Loans 90 Days or More Past Due and Still Accruing
March 31, 2021
Commercial, financial and agricultural	$	5,729	$	1,094	$	4,922	$	11,745	$	1,599,284	$	1,611,029	$	—
Consumer installment	1,774		1,017		1,128		3,919		253,178		257,097		749
Indirect automobile	1,036		318		971		2,325		480,312		482,637		—
Mortgage warehouse	—		—		—		—		880,216		880,216		—
Municipal	—		—		—		—		659,228		659,228		—
Premium finance	4,693		2,833		4,057		11,583		694,796		706,379		4,057
Real estate – construction and development	28,769		1,898		2,621		33,288		1,499,946		1,533,234		291
Real estate – commercial and farmland	9,796		527		8,114		18,437		5,598,389		5,616,826		—
Real estate – residential	13,307		4,199		35,904		53,410		2,799,749		2,853,159		—
Total	$	65,104	$	11,886	$	57,717	$	134,707	$	14,465,098	$	14,599,805	$	5,097

(dollars in thousands)	Loans 30-59 Days Past Due		Loans 60-89 Days Past Due		Loans 90 or More Days Past Due		Total Loans Past Due		Current Loans		Total Loans		Loans 90 Days or More Past Due and Still Accruing
December 31, 2020
Commercial, financial and agricultural	$	4,576	$	2,018	$	5,652	$	12,246	$	1,615,231	$	1,627,477	$	—
Consumer installment	2,189		1,114		2,318		5,621		301,374		306,995		1,755
Indirect automobile	3,293		1,006		2,171		6,470		573,613		580,083		—
Mortgage warehouse	—		—		—		—		916,353		916,353		—
Municipal	—		—		—		—		659,403		659,403		—
Premium finance	7,188		3,895		6,571		17,654		670,187		687,841		6,571
Real estate – construction and development	13,348		723		5,150		19,221		1,587,489		1,606,710		—
Real estate – commercial and farmland	5,370		1,701		8,651		15,722		5,284,284		5,300,006		—
Real estate – residential	20,519		3,125		34,081		57,725		2,738,332		2,796,057		—
Total	$	56,483	$	13,582	$	64,594	$	134,659	$	14,346,266	$	14,480,925	$	8,326

Collateral-Dependent Loans

Collateral-dependent loans are loans where repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty. If the Company determines that foreclosure is probable, these loans are written down to the lower of cost or collateral value less estimated costs to sell. When repayment is expected to be from the operation of the collateral, the allowance for credit losses is calculated as the amount by which the amortized cost basis of the financial asset exceeds the present value of expected cash flows from the operation of the collateral. The Company may, in the alternative, measure the allowance for credit loss as the amount by which the amortized cost basis of the financial asset exceeded the estimated fair value of the collateral.

The following table presents an analysis of collateral-dependent financial assets and related allowance for credit losses:

	March 31, 2021				December 31, 2020
(dollars in thousands)	Balance		Allowance for Credit Losses		Balance		Allowance for Credit Losses
Commercial, financial and agricultural	$	5,375	$	1,777	$	5,490	$	2,252
Premium finance	1,577		11		3,523		—
Real estate – construction and development	4,109		619		4,173		512
Real estate – commercial and farmland	93,689		20,378		100,180		21,001
Real estate – residential	12,672		1,579		9,716		891
	$	117,422	$	24,364	$	123,082	$	24,656

Credit Quality Indicators

The Company uses a nine category risk grading system to assign a risk grade to each loan in the portfolio. The following is a description of the general characteristics of the grades:

Grade 1 – Prime Credit – This grade represents loans to the Company’s most creditworthy borrowers or loans that are secured by cash or cash equivalents.

Grade 2 – Strong Credit – This grade includes loans that exhibit one or more characteristics better than that of a Good Credit. Generally, the debt service coverage and borrower’s liquidity is materially better than required by the Company’s loan policy.

Grade 3 – Good Credit – This grade is assigned to loans to borrowers who exhibit satisfactory credit histories, contain acceptable loan structures and demonstrate ability to repay.

Grade 4 – Satisfactory Credit – This grade includes loans which exhibit all the characteristics of a Good Credit, but warrant more than normal level of banker supervision due to (i) circumstances which elevate the risks of performance (such as start-up operations, untested management, heavy leverage and interim losses); (ii) adverse, extraordinary events that have affected, or could affect, the borrower’s cash flow, financial condition, ability to continue operating profitability or refinancing (such as death of principal, fire and divorce); (iii) loans that require more than the normal servicing requirements (such as any type of construction financing, acquisition and development loans, accounts receivable or inventory loans and floor plan loans); (iv) existing technical exceptions which raise some doubts about the Bank’s perfection in its collateral position or the continued financial capacity of the borrower; or (v) improvements in formerly criticized borrowers, which may warrant banker supervision.

Grade 5 – Fair Credit – This grade is assigned to loans that are currently performing and supported by adequate financial information that reflects repayment capacity but exhibits a loan-to-value ratio greater than 110%, based on a documented collateral valuation.

Grade 6 – Other Assets Especially Mentioned – This grade includes loans that exhibit potential weaknesses that deserve management’s close attention. If left uncorrected, these weaknesses may result in deterioration of the repayment prospects for the asset or in the Company’s credit position at some future date.

Grade 7 – Substandard – This grade represents loans which are inadequately protected by the current credit worthiness and paying capacity of the borrower or of the collateral pledged, if any. These assets exhibit a well-defined weakness or are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. These weaknesses may be characterized by past due performance, operating losses or questionable collateral values.

Grade 8 – Doubtful – This grade includes loans which exhibit all of the characteristics of a substandard loan with the added provision that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable or improbable.

Grade 9 – Loss – This grade is assigned to loans which are considered uncollectible and of such little value that their continuance as active assets of the Bank is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing it off.

The following tables present the loan portfolio's amortized cost by class of financing receivable, risk grade and year of origination (in thousands) as of March 31, 2021 and December 31, 2020. Generally, current period renewals of credit are underwritten again at the point of renewal and considered current period originations for purposes of the tables below. The Company had an immaterial amount of revolving loans which converted to term loans and the amortized cost basis of those loans is included in the applicable origination year. There were no loans risk graded 9 at December 31, 2020.

As of March 31, 2021	Term Loans by Origination Year												Revolving Loans Amortized Cost Basis
	2021		2020		2019		2018		2017		Prior				Total
Commercial, Financial and Agricultural
Risk Grade:
1	$	329,750	$	483,062	$	2,631	$	983	$	295	$	5,290	$	63,365	$	885,376
2	7,799		449		8,991		638		810		976		10,771		30,434
3	30,638		69,131		43,563		14,490		17,168		9,080		61,094		245,164
4	38,031		74,263		59,189		77,684		30,449		35,375		75,733		390,724
5	76		4,191		4,543		4,374		6,345		4,493		6,431		30,453
6	3		12		1,673		470		576		3,847		397		6,978
7	343		3,080		3,790		2,686		4,072		6,361		1,568		21,900
Total commercial, financial and agricultural	$	406,640	$	634,188	$	124,380	$	101,325	$	59,715	$	65,422	$	219,359	$	1,611,029

As of March 31, 2021	Term Loans by Origination Year												Revolving Loans Amortized Cost Basis
	2021		2020		2019		2018		2017		Prior				Total
Consumer Installment
Risk Grade:
1	$	1,597	$	5,577	$	2,625	$	1,308	$	510	$	33	$	155	$	11,805
2	—		—		—		33		1		58		41		133
3	5,983		11,263		5,382		2,045		647		1,921		4,991		32,232
4	11,275		87,762		46,500		35,996		14,116		11,715		3,308		210,672
5	—		46		86		12		25		163		—		332
6	—		—		—		9		—		143		6		158
7	—		287		525		188		94		581		86		1,761
9	—		—		2		—		—		—		2		4
Total consumer installment	$	18,855	$	104,935	$	55,120	$	39,591	$	15,393	$	14,614	$	8,589	$	257,097
Indirect Automobile
Risk Grade:
2	$	—	$	—	$	—	$	75	$	29	$	6,512	$	—	$	6,616
3	—		—		31,573		162,594		159,571		119,905		—		473,643
6	—		—		—		30		33		101		—		164
7	—		—		38		288		354		1,534		—		2,214
Total indirect automobile	$	—	$	—	$	31,611	$	162,987	$	159,987	$	128,052	$	—	$	482,637
Mortgage Warehouse
Risk Grade:
3	$	—	$	—	$	—	$	—	$	—	$	—	$	880,216	$	880,216
Total mortgage warehouse	$	—	$	—	$	—	$	—	$	—	$	—	$	880,216	$	880,216
Municipal
Risk Grade:
1	$	25,045	$	91,812	$	11,565	$	8,540	$	141,216	$	205,673	$	—	$	483,851
2	—		72,903		—		—		—		13,012		—		85,915
3	—		61,551		682		—		5,452		12,648		—		80,333
4	—		6,285		—		—		—		2,844		—		9,129
Total municipal	$	25,045	$	232,551	$	12,247	$	8,540	$	146,668	$	234,177	$	—	$	659,228
Premium Finance
Risk Grade:
2	$	351,490	$	340,097	$	9,738	$	257	$	638	$	100	$	—	$	702,320
7	—		3,980		79		—		—		—		—		4,059
Total premium finance	$	351,490	$	344,077	$	9,817	$	257	$	638	$	100	$	—	$	706,379

As of March 31, 2021	Term Loans by Origination Year												Revolving Loans Amortized Cost Basis
	2021		2020		2019		2018		2017		Prior				Total
Real Estate – Construction and Development
Risk Grade:
2	$	—	$	62	$	—	$	—	$	—	$	—	$	—	$	62
3	14,018		42,007		6,565		4,269		3,444		11,263		873		82,439
4	168,849		545,742		362,783		132,341		49,482		35,491		37,990		1,332,678
5	387		2,136		17,825		38,407		13,755		29,389		106		102,005
6	—		120		892		5,991		598		1,194		—		8,795
7	—		143		3,019		482		629		2,982		—		7,255
Total real estate – construction and development	$	183,254	$	590,210	$	391,084	$	181,490	$	67,908	$	80,319	$	38,969	$	1,533,234
Real Estate – Commercial and Farmland
Risk Grade:
1	$	—	$	—	$	—	$	156	$	—	$	—	$	—	$	156
2	—		7,352		380		448		2,094		13,262		17		23,553
3	186,578		928,268		414,458		181,807		248,378		515,131		52,651		2,527,271
4	87,859		366,846		563,285		396,659		255,335		671,363		43,474		2,384,821
5	1,323		17,020		96,085		71,810		63,286		142,589		4,223		396,336
6	—		—		10,313		15,984		47,716		38,807		3		112,823
7	—		7,714		55,005		18,532		13,038		76,935		642		171,866
Total real estate – commercial and farmland	$	275,760	$	1,327,200	$	1,139,526	$	685,396	$	629,847	$	1,458,087	$	101,010	$	5,616,826
Real Estate - Residential
Risk Grade:
1	$	—	$	—	$	—	$	—	$	—	$	17	$	—	$	17
2	—		36		388		11		99		42,503		1,313		44,350
3	296,261		731,149		434,948		202,552		154,099		467,379		197,899		2,484,287
4	5,768		29,740		17,636		14,464		10,104		61,238		40,174		179,124
5	481		8,581		28,055		9,476		9,202		28,452		3,523		87,770
6	49		418		951		881		367		3,520		107		6,293
7	789		3,385		10,435		13,031		4,406		16,630		2,642		51,318
Total real estate - residential	$	303,348	$	773,309	$	492,413	$	240,415	$	178,277	$	619,739	$	245,658	$	2,853,159

As of December 31, 2020	Term Loans by Origination Year												Revolving Loans Amortized Cost Basis
	2020		2019		2018		2017		2016		Prior				Total
Commercial, Financial and Agricultural
Risk Grade:
1	$	829,710	$	2,912	$	1,055	$	387	$	490	$	4,961	$	36,373	$	875,888
2	1,213		1,512		668		996		172		967		14,317		19,845
3	109,352		54,266		16,932		17,968		7,027		3,905		68,806		278,256
4	86,837		71,645		74,388		37,779		15,359		23,069		85,366		394,443
5	4,061		4,269		4,772		7,443		804		5,842		4,352		31,543
6	21		72		506		193		3,509		1,232		632		6,165
7	3,312		3,460		2,579		3,573		1,294		5,214		1,886		21,318
8	—		—		—		—		—		—		19		19
Total commercial, financial and agricultural	$	1,034,506	$	138,136	$	100,900	$	68,339	$	28,655	$	45,190	$	211,751	$	1,627,477
Consumer Installment
Risk Grade:
1	$	6,782	$	3,001	$	1,550	$	583	$	95	$	1	$	667	$	12,679
2	—		—		46		2		—		63		42		153
3	15,172		6,960		2,838		887		1,455		601		4,389		32,302
4	120,800		53,593		53,182		16,329		3,121		9,437		3,556		260,018
5	49		127		28		30		3		242		8		487
6	—		2		9		—		—		145		—		156
7	30		209		72		105		134		553		97		1,200
Total consumer installment	$	142,833	$	63,892	$	57,725	$	17,936	$	4,808	$	11,042	$	8,759	$	306,995
Indirect Automobile
Risk Grade:
2	$	—	$	—	$	81	$	31	$	5,356	$	3,054	$	—	$	8,522
3	—		35,432		187,656		188,302		103,570		52,781		—		567,741
6	—		—		57		70		62		85		—		274
7	—		163		519		561		1,078		1,225		—		3,546
Total indirect automobile	$	—	$	35,595	$	188,313	$	188,964	$	110,066	$	57,145	$	—	$	580,083
Mortgage Warehouse
Risk Grade:
3	$	—	$	—	$	—	$	—	$	—	$	—	$	916,353	$	916,353
Total mortgage warehouse	$	—	$	—	$	—	$	—	$	—	$	—	$	916,353	$	916,353
Municipal
Risk Grade:
1	$	91,692	$	12,685	$	8,944	$	143,741	$	124,929	$	97,923	$	—	$	479,914
2	73,000		—		—		—		9,410		—		—		82,410
3	39,990		713		—		5,453		7,204		5,489		—		58,849
4	31,394		—		—		—		—		6,836		—		38,230
Total municipal	$	236,076	$	13,398	$	8,944	$	149,194	$	141,543	$	110,248	$	—	$	659,403

As of December 31, 2020	Term Loans by Origination Year												Revolving Loans Amortized Cost Basis
	2020		2019		2018		2017		2016		Prior				Total
Premium Finance
Risk Grade:
2	$	661,614	$	18,236	$	515	$	746	$	121	$	38	$	—	$	681,270
7	5,811		760		—		—		—		—		—		6,571
Total premium finance	$	667,425	$	18,996	$	515	$	746	$	121	$	38	$	—	$	687,841
Real Estate – Construction and Development
Risk Grade:
3	$	59,325	$	7,035	$	6,870	$	8,046	$	3,415	$	6,916	$	1,293	$	92,900
4	605,254		445,496		205,444		50,181		14,672		26,915		68,574		1,416,536
5	1,614		26,720		9,612		13,261		17,712		10,127		107		79,153
6	685		1,036		3,646		1,302		—		4,564		—		11,233
7	15		2,858		566		271		42		3,136		—		6,888
Total real estate – construction and development	$	666,893	$	483,145	$	226,138	$	73,061	$	35,841	$	51,658	$	69,974	$	1,606,710
Real Estate – Commercial and Farmland
Risk Grade:
1	$	—	$	—	$	161	$	—	$	—	$	—	$	—	$	161
2	7,482		540		521		2,131		4,375		10,663		1,138		26,850
3	918,939		370,703		143,591		197,942		224,712		274,665		67,067		2,197,619
4	344,777		584,814		423,241		331,024		242,573		545,745		34,326		2,506,500
5	4,027		39,216		69,173		80,726		25,561		94,461		1,274		314,438
6	—		10,680		4,895		28,139		7,670		31,224		—		82,608
7	250		54,439		18,574		15,489		27,044		55,763		271		171,830
Total real estate – commercial and farmland	$	1,275,475	$	1,060,392	$	660,156	$	655,451	$	531,935	$	1,012,521	$	104,076	$	5,300,006
Real Estate - Residential
Risk Grade:
1	$	—	$	—	$	—	$	—	$	—	$	19	$	—	$	19
2	37		398		12		121		1,275		47,286		1,402		50,531
3	763,101		529,268		254,632		186,531		154,285		388,825		203,491		2,480,133
4	19,296		19,874		15,784		11,607		14,240		53,869		44,276		178,946
5	400		1,768		3,489		3,479		1,151		12,824		3,618		26,729
6	527		1,843		1,030		334		724		3,391		255		8,104
7	3,442		9,387		12,339		4,667		2,157		16,659		2,944		51,595
Total real estate - residential	$	786,803	$	562,538	$	287,286	$	206,739	$	173,832	$	522,873	$	255,986	$	2,796,057

Troubled Debt Restructurings

The restructuring of a loan is considered a “troubled debt restructuring” if both (i) the borrower is experiencing financial difficulties and (ii) the Company has granted a concession. Concessions may include interest rate reductions to below market interest rates, principal forgiveness, restructuring amortization schedules and other actions intended to minimize potential losses. The Company has exhibited the greatest success for rehabilitation of the loan by a reduction in the rate alone (maintaining the amortization of the debt) or a combination of a rate reduction and the forbearance of previously past due interest or principal. This has most typically been evidenced in certain commercial real estate loans whereby a disruption in the borrower’s cash flow resulted in an extended past due status, of which the borrower was unable to catch up completely as the cash flow of the property ultimately stabilized at a level lower than its original level. A reduction in rate, coupled with a forbearance of unpaid principal and/or interest, allowed the net cash flows to service the debt under the modified terms.

The Company’s policy requires a restructure request to be supported by a current, well-documented credit evaluation of the borrower’s financial condition and a collateral evaluation that is no older than six months from the date of the restructure. Key factors of that evaluation include the documentation of current, recurring cash flows, support provided by the guarantor(s) and the current valuation of the collateral. If the appraisal in the file is older than six months, an evaluation must be made as to the continued reasonableness of the valuation. For certain income-producing properties, current rent rolls and/or other income information can be utilized to support the appraisal valuation, when coupled with documented cap rates within our markets and a physical inspection of the collateral to validate the current condition.

The Company’s policy states that in the event a loan has been identified as a troubled debt restructuring, it should be assigned a grade of substandard until such time the borrower has demonstrated the ability to service the loan payments based on the restructured terms – generally defined as six months of satisfactory payment history. Missed payments under the original loan terms are not considered under the new structure; however, subsequent missed payments are considered non-performance and are not considered toward the six month required term of satisfactory payment history.

In the normal course of business, the Company renews loans with a modification of the interest rate or terms that are not deemed to be troubled debt restructurings because the borrower is not experiencing financial difficulty. The Company modified loans in the first three months of 2021 and 2020 totaling $118.0 million and $71.3 million, respectively, under such parameters.

As of March 31, 2021 and December 31, 2020, the Company had a balance of $87.1 million and $85.0 million, respectively, in troubled debt restructurings. The Company has recorded $1.2 million and $1.2 million in previous charge-offs on such loans at March 31, 2021 and December 31, 2020, respectively. The Company’s balance in the allowance for credit losses allocated to such troubled debt restructurings was $14.2 million and $13.0 million at March 31, 2021 and December 31, 2020, respectively. At March 31, 2021, the Company did not have any commitments to lend additional funds to debtors whose terms have been modified in troubled restructurings.

During the three months ended March 31, 2021 and 2020, the Company modified loans as troubled debt restructurings with principal balances of $8.7 million and $1.0 million, respectively, and these modifications did not have a material impact on the Company’s allowance for credit losses. The following table presents the loans by class modified as troubled debt restructurings which occurred during the three months ended March 31, 2021 and 2020: 

	March 31, 2021			March 31, 2020
Loan Class	#	Balance (in thousands)		#	Balance (in thousands)
Commercial, financial and agricultural	4	$	463	—	$	—
Consumer installment	—	—		1	9
Real estate – commercial and farmland	2	7,658		1	64
Real estate – residential	5	572		8	903
Total	11	$	8,693	10	$	976

Troubled debt restructurings with an outstanding balance of $6.2 million and $3.0 million defaulted during the three months ended March 31, 2021 and 2020, respectively, and these defaults did not have a material impact on the Company’s allowance for credit losses. The following table presents for loans the troubled debt restructurings by class that defaulted (defined as 30 days past due) during the three months ended March 31, 2021 and 2020: 

	March 31, 2021			March 31, 2020
Loan Class	#	Balance (in thousands)		#	Balance (in thousands)
Commercial, financial and agricultural	3	$	56	1	$	200
Consumer installment	5	6		—	—
Indirect automobile	16	94		—	—
Real estate – construction and development	1	1		2	287
Real estate – commercial and farmland	2	5,193		2	681
Real estate – residential	11	809		19	1,800
Total	38	$	6,159	24	$	2,968

The following table presents the amount of troubled debt restructurings by loan class classified separately as accrual and nonaccrual at March 31, 2021 and December 31, 2020: 

March 31, 2021	Accruing Loans			Non-Accruing Loans
Loan Class	#	Balance (in thousands)		#	Balance (in thousands)
Commercial, financial and agricultural	10	$	930	12	$	854
Consumer installment	8	27		22	53
Indirect automobile	385	1,931		47	321
Real estate – construction and development	4	501		5	706
Real estate – commercial and farmland	27	43,398		10	2,233
Real estate – residential	248	33,324		36	2,818
Total	682	$	80,111	132	$	6,985

December 31, 2020	Accruing Loans			Non-Accruing Loans
Loan Class	#	Balance (in thousands)		#	Balance (in thousands)
Commercial, financial and agricultural	9	$	521	11	$	849
Consumer installment	10	32		20	56
Indirect automobile	437	2,277		51	461
Real estate – construction and development	4	506		5	707
Real estate – commercial and farmland	28	36,707		7	1,401
Real estate – residential	264	38,800		34	2,671
Total	752	$	78,843	128	$	6,145

COVID-19 Deferrals

In response to the COVID-19 pandemic, the Company offered affected borrowers payment relief under its Disaster Relief Program. These modifications primarily consisted of short-term payment deferrals or interest-only periods to assist customers. The Company has also provided payment modifications to certain borrowers in economically sensitive industries of various terms up to nine months. Modifications related to the COVID-19 pandemic and qualifying under the provisions of Section 4013 of the CARES Act are not deemed to be troubled debt restructurings. As of March 31, 2021, $235.4 million in loans remained in payment deferral related to COVID-19 pandemic Disaster Relief Program compared with $332.8 million at December 31, 2020.

The table below presents short-term deferrals related to the COVID-19 pandemic that were not considered TDRs.

	March 31, 2021				December 31, 2020
(dollars in thousands)	COVID-19 Deferrals		Deferrals as a % of total loans		COVID-19 Deferrals		Deferrals as a % of total loans
Commercial, financial and agricultural	$	4,460	0.3	%	$	12,471	0.8	%
Consumer installment	569		0.2	%	1,418		0.5	%
Indirect automobile	3,536		0.7	%	8,936		1.5	%
Real estate – construction and development	418		—	%	11,049		0.7	%
Real estate – commercial and farmland	152,337		2.7	%	179,183		3.4	%
Real estate – residential	74,101		2.6	%	119,722		4.3	%
	$	235,421	1.6	%	$	332,779	2.3	%

Allowance for Credit Losses

The allowance for credit losses represents an allowance for expected losses over the remaining contractual life of the assets. The contractual term does not consider extensions, renewals or modifications unless the Company reasonably expects to execute a troubled debt restructuring with a borrower. The Company segregates the loan portfolio by type of loan and utilizes this segregation in evaluating exposure to risks within the portfolio.

Loan losses are charged against the allowance when management believes the collection of a loan’s principal is unlikely. Subsequent recoveries are credited to the allowance. Consumer loans are charged off in accordance with the Federal Financial Institutions Examination Council’s (“FFIEC”) Uniform Retail Credit Classification and Account Management Policy.

Commercial loans are charged off when they are deemed uncollectible, which usually involves a triggering event within the collection effort. If the loan is collateral dependent, the loss is more easily identified and is charged off when it is identified, usually based upon receipt of an appraisal. However, when a loan has guarantor support, the Company may carry the estimated loss as a reserve against the loan while collection efforts with the guarantor are pursued. If, after collection efforts with the guarantor are complete, the deficiency is still considered uncollectible, the loss is charged off and any further collections are treated as recoveries. In all situations, when a loan is downgraded to an Asset Quality Rating of 9 (Loss per the regulatory guidance), the uncollectible portion is charged off.

During the three months ended March 31, 2021, the allowance for credit losses decreased primarily due to improvement in forecasted macroeconomic factors. The allowance for credit losses was determined at March 31, 2021 using the Moody's baseline economic forecast, which Moody's defines as having a 50% probability the economy will perform better than the baseline projection and the same probability it will perform worse. The current forecast reflects, among other things, improvements in forecast levels of unemployment, home prices and commercial real estate prices compared with the forecast at December 31, 2020.

The following tables detail activity and end of period balances in the allowance for credit losses by portfolio segment for the periods indicated. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.

Three Months Ended March 31, 2021
(dollars in thousands)	Commercial, Financial and Agricultural		Consumer Installment		Indirect Automobile		Mortgage Warehouse		Municipal		Premium Finance
Balance, December 31, 2020	$	7,359	$	4,076	$	1,929	$	3,666	$	791	$	3,879
Provision for loan losses	2,575		5,806		(528)		(145)		(1)		442
Loans charged off	(2,370)		(1,448)		(829)		—		—		(1,343)
Recoveries of loans previously charged off	727		356		700		—		—		1,122
Balance, March 31, 2021	$	8,291	$	8,790	$	1,272	$	3,521	$	790	$	4,100
	Real Estate – Construction and Development		Real Estate – Commercial and Farmland		Real Estate – Residential		Total
Balance, December 31, 2020	$	45,304	$	88,894	$	43,524	$	199,422
Provision for loan losses	(22,587)		3,671		(5,812)		(16,579)
Loans charged off	(26)		(1,395)		(163)		(7,574)
Recoveries of loans previously charged off	167		41		188		3,301
Balance, March 31, 2021	$	22,858	$	91,211	$	37,737	$	178,570

Three Months Ended March 31, 2020
(dollars in thousands)	Commercial, Financial and Agricultural		Consumer Installment		Indirect Automobile		Mortgage Warehouse		Municipal		Premium Finance
Balance, December 31, 2019	$	4,567	$	3,784	$	—	$	640	$	484	$	2,550
Adjustment to allowance for adoption of ASU 2016-13	2,587		8,012		4,109		463		(92)		4,471
Provision for loan losses	3,080		4,149		564		(1)		130		4,634
Loans charged off	(2,486)		(1,142)		(1,231)		—		—		(831)
Recoveries of loans previously charged off	362		321		344		—		—		684
Balance, March 31, 2020	$	8,110	$	15,124	$	3,786	$	1,102	$	522	$	11,508
	Real Estate – Construction and Development		Real Estate – Commercial and Farmland		Real Estate – Residential		Total
Balance, December 31, 2019	$	5,995	$	9,666	$	10,503	$	38,189
Adjustment to allowance for adoption of ASU 2016-13	12,248		27,073		19,790		78,661
Provision for loan losses	6,734		15,858		1,899		37,047
Loans charged off	—		(928)		(100)		(6,718)
Recoveries of loans previously charged off	342		85		207		2,345
Balance, March 31, 2020	$	25,319	$	51,754	$	32,299	$	149,524