Loans Held for Investment and Allowance for Loan Losses

3 Months Ended

Mar. 31, 2024

Receivables [Abstract]

Loans Held for Investment and Allowance for Credit Losses

Note 3 – Loans Held-for-Investment and Allowance for Credit Losses

For the periods ended March 31, 2024 and 2023, and December 31, 2023, the following tables outline the Company’s loan portfolio by the ten portfolio segments where applicable.

Loans held-for-investment by portfolio segment are as follows (dollars in thousands):

	March 31,						December 31,
	2024			2023			2023
Commercial:
C&I	$	1,191,516		$	954,686		$	1,164,811
Municipal		211,013			221,379			214,850
Total Commercial		1,402,529			1,176,065			1,379,661
Agricultural		87,882			77,017			84,890
Real Estate:
Construction & Development		921,773			921,190			963,158
Farm		311,002			307,706			344,954
Non-Owner Occupied CRE		853,721			737,117			827,969
Owner Occupied CRE		1,032,845			1,043,018			1,037,281
Residential		1,918,573			1,628,841			1,834,593
Total Real Estate		5,037,914			4,637,872			5,007,955
Consumer:
Auto		549,837			537,410			521,859
Non-Auto		151,248			147,851			154,426
Total Consumer		701,085			685,261			676,285
Total Loans		7,229,410			6,576,215			7,148,791
Less: Allowance for credit losses		(89,562	)		(80,818	)		(88,734	)
Loans, net	$	7,139,848		$	6,495,397		$	7,060,057

Outstanding loan balances at March 31, 2024 and 2023, and December 31, 2023, are net of unearned income, including net deferred loan fees.

At March 31, 2024, $5,095,506,000 in loans held by our bank subsidiary were subject to blanket liens as security for a line of credit with the Federal Home Loan Bank of Dallas ("FHLB"). At March 31, 2024, this available line of credit was $1,984,900,000. At March 31, 2024, there was $781,500,000 used on the line advance for undisbursed commitments (letters of credit) used to secure public funds.

The Company’s nonaccrual loans and loans still accruing and past due 90 days or more are as follows (dollars in thousands):

	March 31,				December 31,
	2024		2023		2023
Nonaccrual loans	$	36,157	$	24,171	$	33,609
Loans still accruing and past due 90 days or more		33		22		1,004
Total nonperforming loans	$	36,190	$	24,193	$	34,613

The Company had $37,204,000, $24,389,000 and $35,096,000 in nonaccrual, past due 90 days or more and still accruing, and foreclosed assets at March 31, 2024 and 2023, and December 31, 2023, respectively. Nonaccrual loans at March 31, 2024 and 2023, and December 31, 2023, consisted of the following (dollars in thousands):

	March 31,				December 31,
	2024		2023		2023
Commercial:
C&I	$	3,950	$	5,343	$	4,132
Municipal		—		—		—
Total Commercial		3,950		5,343		4,132
Agricultural		2,043		161		155
Real Estate:
Construction & Development		1,976		773		1,444
Farm		4,597		452		4,804
Non-Owner Occupied CRE		9,243		2,907		8,022
Owner Occupied CRE		5,719		6,823		6,822
Residential		7,815		7,232		7,649
Total Real Estate		29,350		18,187		28,741
Consumer:
Auto		486		398		464
Non-Auto		328		82		117
Total Consumer		814		480		581
Total	$	36,157	$	24,171	$	33,609

No significant additional funds are committed to be advanced in connection with nonaccrual loans as of March 31, 2024.

Summary information on the allowance for credit losses for the three-months ended March 31, 2024 and 2023, are outlined by portfolio segment in the following tables (dollars in thousands):

Three-Months Ended March 31, 2024	C&I			Municipal		Agricultural			Construction & Development			Farm
Beginning balance	$	15,698		$	195	$	1,281		$	28,553		$	2,914
Provision for loan losses		501			—		2,017			(3,709	)		(397	)
Recoveries		111			—		5			—			—
Charge-offs		(204	)		—		(60	)		(33	)		—
Ending balance	$	16,106		$	195	$	3,243		$	24,811		$	2,517

Three-Months Ended March 31, 2024 (continued)	Non-Owner Occupied CRE		Owner Occupied CRE			Residential		Auto			Non-Auto			Total
Beginning balance	$	13,425	$	13,813		$	11,654	$	810		$	391		$	88,734
Provision for loan losses		1,536		(1,099	)		1,813		384			210			1,256
Recoveries		7		42			98		112			47			422
Charge-offs		—		—			—		(399	)		(154	)		(850	)
Ending balance	$	14,968	$	12,756		$	13,565	$	907		$	494		$	89,562

Three-Months Ended March 31, 2023	C&I			Municipal		Agricultural			Construction & Development		Farm
Beginning balance	$	16,129		$	1,026	$	1,041		$	26,443	$	1,957
Provision for loan losses		(64	)		41		(28	)		2,084		(20	)
Recoveries		52			—		201			100		—
Charge-offs		(34	)		—		—			—		—
Ending balance	$	16,083		$	1,067	$	1,214		$	28,627	$	1,937

Three-Months Ended March 31, 2023 (continued)	Non-Owner Occupied CRE			Owner Occupied CRE		Residential		Auto			Non-Auto			Total
Beginning balance	$	9,075		$	9,928	$	9,075	$	845		$	315		$	75,834
Provision for loan losses		(49	)		2,013		624		70			36			4,707
Recoveries		25			7		3		132			45			565
Charge-offs		—			—		—		(190	)		(64	)		(288	)
Ending balance	$	9,051		$	11,948	$	9,702	$	857		$	332		$	80,818

Additionally, the Company records a reserve for unfunded commitments in other liabilities, which totaled $7,455,000, $10,397,000 and $7,903,000 at March 31, 2024 and 2023, and December 31, 2023, respectively. The provision for loan losses of $1,256,000 for the three-months ended March 31, 2024 is combined with the reversal of the provision for unfunded commitments of $448,000 and reported in the net aggregate of $808,000 under the provision for credit losses in the consolidated statement of earnings for the three-months ended March 31, 2024.

The $4,707,000 provision for loan losses for the three-months ended March 31, 2023 above is combined with the reversal of provision for unfunded commitments of $1,926,000 and reported in the aggregate of $2,781,000 under the provision for credit losses for the three-months ended March 31, 2023.

The Company’s loans that are individually evaluated for credit losses (both collateral and non-collateral dependent) and their related allowances as of March 31, 2024 and 2023, and December 31, 2023, are summarized in the following tables by loan segment (dollars in thousands):

March 31, 2024	Collateral Dependent Loans Individually Evaluated for Credit Losses Without an Allowance		Collateral Dependent Loans Individually Evaluated for Credit Losses With an Allowance		Non-Collateral Dependent Loans Individually Evaluated for Credit Losses		Total Loans Individually Evaluated for Credit Losses		Related Allowance on Collateral Dependent Loans		Related Allowance on Non-Collateral Dependent Loans		Total Allowance for Credit Losses on Loans Individually Evaluated for Credit Losses
Commercial:
C&I	$	756	$	3,194	$	37,504	$	41,454	$	1,541	$	4,170	$	5,711
Municipal		—		—		559		559		—		—		—
Total Commercial		756		3,194		38,063		42,013		1,541		4,170		5,711
Agricultural		713		1,330		4,044		6,087		849		1,881		2,730
Real Estate:
Construction & Development		903		1,073		28,953		30,929		189		2,054		2,243
Farm		—		4,597		1,936		6,533		727		31		758
Non-Owner Occupied CRE		1,850		7,393		22,412		31,655		1,235		1,772		3,007
Owner Occupied CRE		2,827		2,892		35,460		41,179		445		1,793		2,238
Residential		4,404		3,411		31,456		39,271		242		2,014		2,256
Total Real Estate		9,984		19,366		120,217		149,567		2,838		7,664		10,502
Consumer:
Auto		—		486		2,342		2,828		1		4		5
Non-Auto		—		328		764		1,092		72		57		129
Total Consumer		—		814		3,106		3,920		73		61		134
Total	$	11,453	$	24,704	$	165,430	$	201,587	$	5,301	$	13,776	$	19,077

March 31, 2023	Collateral Dependent Loans Individually Evaluated for Credit Losses Without an Allowance		Collateral Dependent Loans Individually Evaluated for Credit Losses With an Allowance		Non-Collateral Dependent Loans Individually Evaluated for Credit Losses		Total Loans Individually Evaluated for Credit Losses		Related Allowance on Collateral Dependent Loans		Related Allowance on Non-Collateral Dependent Loans		Total Allowance for Credit Losses on Loans Individually Evaluated for Credit Losses
Commercial:
C&I	$	—	$	5,343	$	20,141	$	25,484	$	3,582	$	3,941	$	7,523
Municipal		—		—		907		907		—		—		—
Total Commercial		—		5,343		21,048		26,391		3,582		3,941		7,523
Agricultural		—		161		912		1,073		86		485		571
Real Estate:
Construction & Development		397		376		18,813		19,586		57		2,340		2,397
Farm		452		—		1,232		1,684		—		—		—
Non-Owner Occupied CRE		2,136		771		28,557		31,464		152		1,929		2,081
Owner Occupied CRE		4,111		2,712		31,978		38,801		297		2,308		2,605
Residential		4,771		2,461		28,463		35,695		259		1,404		1,663
Total Real Estate		11,867		6,320		109,043		127,230		765		7,981		8,746
Consumer:
Auto		—		398		1,250		1,648		1		2		3
Non-Auto		—		82		632		714		—		2		2
Total Consumer		—		480		1,882		2,362		1		4		5
Total	$	11,867	$	12,304	$	132,885	$	157,056	$	4,434	$	12,411	$	16,845

December 31, 2023	Collateral Dependent Loans Individually Evaluated for Credit Losses Without an Allowance		Collateral Dependent Loans Individually Evaluated for Credit Losses With an Allowance		Non-Collateral Dependent Loans Individually Evaluated for Credit Losses		Total Loans Individually Evaluated for Credit Losses		Related Allowance on Collateral Dependent Loans		Related Allowance on Non-Collateral Dependent Loans		Total Allowance for Credit Losses on Loans Individually Evaluated for Credit Losses
Commercial:
C&I	$	1,322	$	2,810	$	18,633	$	22,765	$	1,363	$	4,495	$	5,858
Municipal		—		—		733		733		—		—		—
Total Commercial		1,322		2,810		19,366		23,498		1,363		4,495		5,858
Agricultural		57		98		1,304		1,459		50		700		750
Real Estate:
Construction & Development		758		686		22,545		23,989		148		2,253		2,401
Farm		—		4,804		1,362		6,166		937		57		994
Non-Owner Occupied CRE		1,919		6,103		29,117		37,139		700		2,984		3,684
Owner Occupied CRE		4,661		2,161		35,746		42,568		232		1,431		1,663
Residential		3,909		3,740		30,257		37,906		360		1,799		2,159
Total Real Estate		11,247		17,494		119,027		147,768		2,377		8,524		10,901
Consumer:
Auto		—		464		2,125		2,589		1		3		4
Non-Auto		—		117		782		899		—		60		60
Total Consumer		—		581		2,907		3,488		1		63		64
Total	$	12,626	$	20,983	$	142,604	$	176,213	$	3,791	$	13,782	$	17,573

The Company’s allowance for loans that are individually evaluated for credit losses and collectively evaluated for credit losses as of March 31, 2024 and 2023, and December 31, 2023, are summarized in the following table by loan segment (dollars in thousands). Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.

March 31, 2024	C&I		Municipal		Agricultural		Construction & Development		Farm
Loans individually evaluated for credit losses	$	5,711	$	—	$	2,730	$	2,243	$	758
Loans collectively evaluated for credit losses		10,395		195		513		22,568		1,759
Total	$	16,106	$	195	$	3,243	$	24,811	$	2,517

March 31, 2024 (continued)	Non-Owner Occupied CRE		Owner Occupied CRE		Residential		Auto		Non-Auto		Total
Loans individually evaluated for credit losses	$	3,007	$	2,238	$	2,256	$	5	$	129	$	19,077
Loans collectively evaluated for credit losses		11,961		10,518		11,309		902		365		70,485
Total	$	14,968	$	12,756	$	13,565	$	907	$	494	$	89,562

March 31, 2023	C&I		Municipal		Agricultural		Construction & Development		Farm
Loans individually evaluated for credit losses	$	7,523	$	—	$	571	$	2,397	$	—
Loans collectively evaluated for credit losses		8,560		1,067		643		26,230		1,937
Total	$	16,083	$	1,067	$	1,214	$	28,627	$	1,937

March 31, 2023 (continued)	Non-Owner Occupied CRE		Owner Occupied CRE		Residential		Auto		Non-Auto		Total
Loans individually evaluated for credit losses	$	2,081	$	2,605	$	1,663	$	3	$	2	$	16,845
Loans collectively evaluated for credit losses		6,970		9,343		8,039		854		330		63,973
Total	$	9,051	$	11,948	$	9,702	$	857	$	332	$	80,818

December 31, 2023	C&I		Municipal		Agricultural		Construction & Development		Farm
Loans individually evaluated for credit losses	$	5,858	$	—	$	750	$	2,401	$	994
Loans collectively evaluated for credit losses		9,840		195		531		26,152		1,920
Total	$	15,698	$	195	$	1,281	$	28,553	$	2,914

December 31, 2023 (continued)	Non-Owner Occupied CRE		Owner Occupied CRE		Residential		Auto		Non-Auto		Total
Loans individually evaluated for credit losses	$	3,684	$	1,663	$	2,159	$	4	$	60	$	17,573
Loans collectively evaluated for credit losses		9,741		12,150		9,495		806		331		71,161
Total	$	13,425	$	13,813	$	11,654	$	810	$	391	$	88,734

The Company’s recorded investment in loans as of March 31, 2024 and 2023, and December 31, 2023, related to the balance in the allowance for credit losses follows below (dollars in thousands):

March 31, 2024	C&I		Municipal		Agricultural		Construction & Development		Farm
Loans individually evaluated for credit losses	$	41,454	$	559	$	6,087	$	30,929	$	6,533
Loans collectively evaluated for credit losses		1,150,062		210,454		81,795		890,844		304,469
Total	$	1,191,516	$	211,013	$	87,882	$	921,773	$	311,002

March 31, 2024 (continued)	Non-Owner Occupied CRE		Owner Occupied CRE		Residential		Auto		Non-Auto		Total
Loans individually evaluated for credit losses	$	31,655	$	41,179	$	39,271	$	2,828	$	1,092	$	201,587
Loans collectively evaluated for credit losses		822,066		991,666		1,879,302		547,009		150,156		7,027,823
Total	$	853,721	$	1,032,845	$	1,918,573	$	549,837	$	151,248	$	7,229,410

March 31, 2023	C&I		Municipal		Agricultural		Construction & Development		Farm
Loans individually evaluated for credit losses	$	25,484	$	907	$	1,073	$	19,586	$	1,684
Loans collectively evaluated for credit losses		929,202		220,472		75,944		901,604		306,022
Total	$	954,686	$	221,379	$	77,017	$	921,190	$	307,706

March 31, 2023 (continued)	Non-Owner Occupied CRE		Owner Occupied CRE		Residential		Auto		Non-Auto		Total
Loans individually evaluated for credit losses	$	31,464	$	38,801	$	35,695	$	1,648	$	714	$	157,056
Loans collectively evaluated for credit losses		705,653		1,004,217		1,593,146		535,762		147,137		6,419,159
Total	$	737,117	$	1,043,018	$	1,628,841	$	537,410	$	147,851	$	6,576,215

December 31, 2023	C&I		Municipal		Agricultural		Construction & Development		Farm
Loans individually evaluated for credit losses	$	22,765	$	733	$	1,459	$	23,989	$	6,166
Loans collectively evaluated for credit losses		1,142,046		214,117		83,431		939,169		338,788
Total	$	1,164,811	$	214,850	$	84,890	$	963,158	$	344,954

December 31, 2023 (continued)	Non-Owner Occupied CRE		Owner Occupied CRE		Residential		Auto		Non-Auto		Total
Loans individually evaluated for credit losses	$	37,139	$	42,568	$	37,906	$	2,589	$	899	$	176,213
Loans collectively evaluated for credit losses		790,830		994,713		1,796,687		519,270		153,527		6,972,578
Total	$	827,969	$	1,037,281	$	1,834,593	$	521,859	$	154,426	$	7,148,791

From a credit risk standpoint, the Company rates its loans in one of five categories: (i) pass, (ii) special mention, (iii) substandard, (iv) doubtful or (v) loss (which are charged-off).

The ratings of loans reflect a judgment about the risks of default and loss associated with the loan. The Company reviews the ratings on our credits as part of our ongoing monitoring of the credit quality of our loan portfolio. Ratings are adjusted to reflect the degree of risk and loss that are felt to be inherent in each credit as of each reporting period. Our methodology is structured so that specific allocations are increased in accordance with deterioration in credit quality (and a corresponding increase in risk and loss) or decreased in accordance with improvement in credit quality (and a corresponding decrease in risk and loss).

Credits rated special mention show clear signs of financial weaknesses or deterioration in credit worthiness, however, such concerns are not so pronounced that the Company generally expects to experience significant loss within the short-term. Such credits typically maintain the ability to perform within standard credit terms and credit exposure is not as prominent as credits rated more harshly.

Credits rated substandard are those in which the normal repayment of principal and interest may be, or has been, jeopardized by reason of adverse trends or developments of a financial, managerial, economic or political nature, or important weaknesses exist in collateral. A protracted workout on these credits is a distinct possibility. Prompt corrective action is therefore required to strengthen the Company’s position, and/or to reduce exposure and to assure that adequate remedial measures are taken by the borrower. Credit exposure becomes more likely in such credits and a serious evaluation of the secondary support to the credit is performed.

Credits rated doubtful are those in which full collection of principal appears highly questionable, and which some degree of loss is anticipated, even though the ultimate amount of loss may not yet be certain and/or other factors exist which could affect collection of debt. Based upon available information, positive action by the Company is required to avert or minimize loss. Credits rated doubtful are generally also placed on nonaccrual.

The following summarizes the Company’s internal ratings of its loans held-for-investment, including the year of origination, by portfolio segments, at March 31, 2024 (dollars in millions):

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
C&I
Risk rating:
Pass	$	236	$	551	$	226	$	70	$	32	$	36	$	—	$	1,151
Special mention		6		17		1		—		—		—		—		24
Substandard		2		10		1		1		2		1		—		17
Doubtful		—		—		—		—		—		—		—		—
Total	$	244	$	578	$	228	$	71	$	34	$	37	$	—	$	1,192
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
Municipal
Risk rating:
Pass	$	5	$	20	$	81	$	15	$	10	$	79	$	—	$	210
Special mention		—		—		—		—		—		—		—		—
Substandard		—		—		—		1		—		—		—		1
Doubtful		—		—		—		—		—		—		—		—
Total	$	5	$	20	$	81	$	16	$	10	$	79	$	—	$	211
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
Agricultural
Risk rating:
Pass	$	18	$	54	$	6	$	3	$	1	$	—	$	—	$	82
Special mention		—		1		—		—		—		—		—		1
Substandard		3		1		—		—		—		1		—		5
Doubtful		—		—		—		—		—		—		—		—
Total	$	21	$	56	$	6	$	3	$	1	$	1	$	—	$	88
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
Construction & Development
Risk rating:
Pass	$	117	$	438	$	240	$	63	$	19	$	14	$	—	$	891
Special mention		7		6		3		—		—		—		—		16
Substandard		1		7		1		6		—		—		—		15
Doubtful		—		—		—		—		—		—		—		—
Total	$	125	$	451	$	244	$	69	$	19	$	14	$	—	$	922
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
Farm
Risk rating:
Pass	$	23	$	58	$	101	$	71	$	23	$	29	$	—	$	305
Special mention		—		1		—		—		—		—		—		1
Substandard		—		1		—		—		4		—		—		5
Doubtful		—		—		—		—		—		—		—		—
Total	$	23	$	60	$	101	$	71	$	27	$	29	$	—	$	311
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
Non-Owner Occupied CRE
Risk rating:
Pass	$	59	$	133	$	244	$	174	$	104	$	108	$	—	$	822
Special mention		—		—		—		1		1		1		—		3
Substandard		—		2		1		3		7		16		—		29
Doubtful		—		—		—		—		—		—		—		—
Total	$	59	$	135	$	245	$	178	$	112	$	125	$	—	$	854
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
Owner Occupied CRE
Risk rating:
Pass	$	28	$	155	$	305	$	202	$	110	$	190	$	—	$	990
Special mention		—		2		1		8		—		—		—		11
Substandard		—		2		6		5		1		18		—		32
Doubtful		—		—		—		—		—		—		—		—
Total	$	28	$	159	$	312	$	215	$	111	$	208	$	—	$	1,033
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
Residential
Risk rating:
Pass	$	130	$	450	$	424	$	302	$	151	$	281	$	141	$	1,879
Special mention		—		1		1		1		1		2		1		7
Substandard		2		7		4		4		2		10		3		32
Doubtful		—		—		—		—		—		—		—		—
Total	$	132	$	458	$	429	$	307	$	154	$	293	$	145	$	1,918
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
Auto
Risk rating:
Pass	$	91	$	175	$	188	$	64	$	22	$	8	$	—	$	548
Special mention		—		—		—		—		—		—		—		—
Substandard		—		—		1		1		—		—		—		2
Doubtful		—		—		—		—		—		—		—		—
Total	$	91	$	175	$	189	$	65	$	22	$	8	$	—	$	550
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
Non-Auto
Risk rating:
Pass	$	18	$	59	$	41	$	20	$	3	$	2	$	7	$	150
Special mention		—		—		—		—		—		—		—		—
Substandard		—		1		—		—		—		—		—		1
Doubtful		—		—		—		—		—		—		—		—
Total	$	18	$	60	$	41	$	20	$	3	$	2	$	7	$	151
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2024		2023		2022		2021		2020		Prior		Revolving Loans Amortized Cost Basis		Total
Total Loans
Risk rating:
Pass	$	725	$	2,093	$	1,856	$	984	$	475	$	747	$	148	$	7,028
Special mention		13		28		6		10		2		3		1		63
Substandard		8		31		14		21		16		46		3		139
Doubtful		—		—		—		—		—		—		—		—
Total	$	746	$	2,152	$	1,876	$	1,015	$	493	$	796	$	152	$	7,230
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

The following summarizes the Company’s internal ratings of its loans held-for-investment, including the year of origination, by portfolio segments, at March 31, 2023 (dollars in millions):

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
C&I
Risk rating:
Pass	$	155	$	548	$	132	$	48	$	19	$	28	$	—	$	930
Special mention		1		3		1		2		1		—		—		8
Substandard		1		6		4		2		1		3		—		17
Doubtful		—		—		—		—		—		—		—		—
Total	$	157	$	557	$	137	$	52	$	21	$	31	$	—	$	955
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Municipal
Risk rating:
Pass	$	3	$	82	$	19	$	15	$	2	$	99	$	—	$	220
Special mention		—		—		—		—		1		—		—		1
Substandard		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—
Total	$	3	$	82	$	19	$	15	$	3	$	99	$	—	$	221
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Agricultural
Risk rating:
Pass	$	16	$	51	$	5	$	2	$	1	$	1	$	—	$	76
Special mention		—		1		—		—		—		—		—		1
Substandard		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—
Total	$	16	$	52	$	5	$	2	$	1	$	1	$	—	$	77
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Construction & Development
Risk rating:
Pass	$	111	$	586	$	124	$	56	$	12	$	13	$	—	$	902
Special mention		3		9		—		—		—		—		—		12
Substandard		2		4		1		—		—		—		—		7
Doubtful		—		—		—		—		—		—		—		—
Total	$	116	$	599	$	125	$	56	$	12	$	13	$	—	$	921
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Farm
Risk rating:
Pass	$	12	$	142	$	82	$	31	$	11	$	28	$	—	$	306
Special mention		—		—		—		—		—		—		—		—
Substandard		—		2		—		—		—		—		—		2
Doubtful		—		—		—		—		—		—		—		—
Total	$	12	$	144	$	82	$	31	$	11	$	28	$	—	$	308
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Non-Owner Occupied CRE
Risk rating:
Pass	$	36	$	244	$	192	$	96	$	47	$	91	$	—	$	706
Special mention		—		—		1		—		11		6		—		18
Substandard		—		2		2		1		2		6		—		13
Doubtful		—		—		—		—		—		—		—		—
Total	$	36	$	246	$	195	$	97	$	60	$	103	$	—	$	737
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Owner Occupied CRE
Risk rating:
Pass	$	73	$	316	$	247	$	124	$	74	$	170	$	—	$	1,004
Special mention		—		3		1		2		6		1		—		13
Substandard		1		3		2		1		3		16		—		26
Doubtful		—		—		—		—		—		—		—		—
Total	$	74	$	322	$	250	$	127	$	83	$	187	$	—	$	1,043
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Residential
Risk rating:
Pass	$	95	$	479	$	355	$	181	$	78	$	268	$	137	$	1,593
Special mention		—		1		3		2		—		4		1		11
Substandard		1		5		2		3		2		9		3		25
Doubtful		—		—		—		—		—		—		—		—
Total	$	96	$	485	$	360	$	186	$	80	$	281	$	141	$	1,629
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Auto
Risk rating:
Pass	$	51	$	296	$	116	$	46	$	20	$	6	$	—	$	535
Special mention		—		—		—		—		—		—		—		—
Substandard		—		1		—		1		—		—		—		2
Doubtful		—		—		—		—		—		—		—		—
Total	$	51	$	297	$	116	$	47	$	20	$	6	$	—	$	537
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Non-Auto
Risk rating:
Pass	$	21	$	74	$	34	$	7	$	2	$	2	$	7	$	147
Special mention		—		—		—		—		—		—		—		—
Substandard		—		—		1		—		—		—		—		1
Doubtful		—		—		—		—		—		—		—		—
Total	$	21	$	74	$	35	$	7	$	2	$	2	$	7	$	148
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

March 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Total Loans
Risk rating:
Pass	$	573	$	2,818	$	1,306	$	606	$	266	$	706	$	144	$	6,419
Special mention		4		17		6		6		19		11		1		64
Substandard		5		23		12		8		8		34		3		93
Doubtful		—		—		—		—		—		—		—		—
Total	$	582	$	2,858	$	1,324	$	620	$	293	$	751	$	148	$	6,576
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

The following summarizes the Company’s internal ratings of its loans held-for-investment, including the year of origination, by portfolio segments, at December 31, 2023 (dollars in millions):

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
C&I
Risk rating:
Pass	$	720	$	276	$	73	$	36	$	14	$	23	$	—	$	1,142
Special mention		1		1		—		—		1		—		—		3
Substandard		12		2		2		1		1		2		—		20
Doubtful		—		—		—		—		—		—		—		—
Total	$	733	$	279	$	75	$	37	$	16	$	25	$	—	$	1,165
Year-to-Date Gross Charge-Offs	$	—	$	—	$	1	$	—	$	—	$	—	$	—	$	1

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Municipal
Risk rating:
Pass	$	25	$	83	$	15	$	10	$	1	$	80	$	—	$	214
Special mention		—		—		—		—		—		—		—		—
Substandard		—		—		1		—		—		—		—		1
Doubtful		—		—		—		—		—		—		—		—
Total	$	25	$	83	$	16	$	10	$	1	$	80	$	—	$	215
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Agricultural
Risk rating:
Pass	$	63	$	15	$	4	$	1	$	1	$	—	$	—	$	84
Special mention		—		—		—		—		—		—		—		—
Substandard		1		—		—		—		—		—		—		1
Doubtful		—		—		—		—		—		—		—		—
Total	$	64	$	15	$	4	$	1	$	1	$	—	$	—	$	85
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Construction & Development
Risk rating:
Pass	$	515	$	311	$	78	$	20	$	9	$	6	$	—	$	939
Special mention		8		2		—		—		—		—		—		10
Substandard		9		4		1		—		—		—		—		14
Doubtful		—		—		—		—		—		—		—		—
Total	$	532	$	317	$	79	$	20	$	9	$	6	$	—	$	963
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Farm
Risk rating:
Pass	$	101	$	111	$	73	$	24	$	8	$	22	$	—	$	339
Special mention		—		—		—		—		—		—		—		—
Substandard		—		—		—		5		—		1		—		6
Doubtful		—		—		—		—		—		—		—		—
Total	$	101	$	111	$	73	$	29	$	8	$	23	$	—	$	345
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Non-Owner Occupied CRE
Risk rating:
Pass	$	167	$	232	$	172	$	106	$	41	$	73	$	—	$	791
Special mention		—		5		1		—		—		2		—		8
Substandard		2		1		2		7		13		4		—		29
Doubtful		—		—		—		—		—		—		—		—
Total	$	169	$	238	$	175	$	113	$	54	$	79	$	—	$	828
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Owner Occupied CRE
Risk rating:
Pass	$	154	$	305	$	217	$	114	$	62	$	142	$	—	$	994
Special mention		1		1		4		—		1		1		—		8
Substandard		3		6		4		—		7		15		—		35
Doubtful		—		—		—		—		—		—		—		—
Total	$	158	$	312	$	225	$	114	$	70	$	158	$	—	$	1,037
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Residential
Risk rating:
Pass	$	477	$	415	$	313	$	158	$	67	$	229	$	138	$	1,797
Special mention		1		2		2		2		—		3		1		11
Substandard		4		4		3		3		3		7		3		27
Doubtful		—		—		—		—		—		—		—		—
Total	$	482	$	421	$	318	$	163	$	70	$	239	$	142	$	1,835
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Auto
Risk rating:
Pass	$	195	$	212	$	74	$	26	$	10	$	2	$	—	$	519
Special mention		—		—		—		—		—		—		—		—
Substandard		—		1		1		1		—		—		—		3
Doubtful		—		—		—		—		—		—		—		—
Total	$	195	$	213	$	75	$	27	$	10	$	2	$	—	$	522
Year-to-Date Gross Charge-Offs	$	—	$	1	$	—	$	—	$	—	$	—	$	—	$	1

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Non-Auto
Risk rating:
Pass	$	71	$	47	$	22	$	4	$	1	$	1	$	7	$	153
Special mention		—		—		—		—		—		—		—		—
Substandard		1		—		—		—		—		—		—		1
Doubtful		—		—		—		—		—		—		—		—
Total	$	72	$	47	$	22	$	4	$	1	$	1	$	7	$	154
Year-to-Date Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

December 31,	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Total Loans
Risk rating:
Pass	$	2,488	$	2,007	$	1,041	$	499	$	214	$	578	$	145	$	6,972
Special mention		11		11		7		2		2		6		1		40
Substandard		32		18		14		17		24		29		3		137
Doubtful		—		—		—		—		—		—		—		—
Total	$	2,531	$	2,036	$	1,062	$	518	$	240	$	613	$	149	$	7,149
Year-to-Date Gross Charge-Offs	$	—	$	1	$	1	$	—	$	—	$	—	$	—	$	2

At March 31, 2024 and 2023, and December 31, 2023, the Company’s past due loans are as follows (dollars in thousands):

March 31, 2024	15-59 Days Past Due*		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Current		Total Loans		90 Days Past Due Still Accruing
Commercial:
C&I	$	6,462	$	250	$	1,594	$	8,306	$	1,183,210	$	1,191,516	$	33
Municipal		25		—		—		25		210,988		211,013		—
Total Commercial		6,487		250		1,594		8,331		1,394,198		1,402,529		33
Agricultural		624		—		71		695		87,187		87,882		—
Real Estate:
Construction & Development		9,277		258		1,347		10,882		910,891		921,773		—
Farm		855		7		95		957		310,045		311,002		—
Non-Owner Occupied CRE		1,840		19		1,374		3,233		850,488		853,721		—
Owner Occupied CRE		3,269		—		70		3,339		1,029,506		1,032,845		—
Residential		13,804		414		2,540		16,758		1,901,815		1,918,573		—
Total Real Estate		29,045		698		5,426		35,169		5,002,745		5,037,914		—
Consumer:
Auto		967		120		—		1,087		548,750		549,837		—
Non-Auto		219		13		—		232		151,016		151,248		—
Total Consumer		1,186		133		—		1,319		699,766		701,085		—
Total	$	37,342	$	1,081	$	7,091	$	45,514	$	7,183,896	$	7,229,410	$	33

March 31, 2023	15-59 Days Past Due*		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Current		Total Loans		90 Days Past Due Still Accruing
Commercial:
C&I	$	3,952	$	292	$	1,825	$	6,069	$	948,617	$	954,686	$	14
Municipal		209		—		—		209		221,170		221,379		—
Total Commercial		4,161		292		1,825		6,278		1,169,787		1,176,065		14
Agricultural		816		25		24		865		76,152		77,017		—
Real Estate:
Construction & Development		7,058		332		—		7,390		913,800		921,190		—
Farm		264		—		372		636		307,070		307,706		—
Non-Owner Occupied CRE		3,183		—		695		3,878		733,239		737,117		—
Owner Occupied CRE		3,886		—		—		3,886		1,039,132		1,043,018		—
Residential		7,484		744		767		8,995		1,619,846		1,628,841		—
Total Real Estate		21,875		1,076		1,834		24,785		4,613,087		4,637,872		—
Consumer:
Auto		683		41		9		733		536,677		537,410		8
Non-Auto		136		—		—		136		147,715		147,851		—
Total Consumer		819		41		9		869		684,392		685,261		8
Total	$	27,671	$	1,434	$	3,692	$	32,797	$	6,543,418	$	6,576,215	$	22

December 31, 2023	15-59 Days Past Due*		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Current		Total Loans		90 Days Past Due Still Accruing
Commercial:
C&I	$	8,789	$	1,624	$	1,700	$	12,113	$	1,152,698	$	1,164,811	$	141
Municipal		102		—		—		102		214,748		214,850		—
Total Commercial		8,891		1,624		1,700		12,215		1,367,446		1,379,661		141
Agricultural		850		246		4		1,100		83,790		84,890		—
Real Estate:
Construction & Development		8,887		2,115		1,856		12,858		950,300		963,158		863
Farm		1,024		195		—		1,219		343,735		344,954		—
Non-Owner Occupied CRE		3,565		—		—		3,565		824,404		827,969		—
Owner Occupied CRE		2,818		240		1,823		4,881		1,032,400		1,037,281		—
Residential		12,293		828		2,816		15,937		1,818,656		1,834,593		—
Total Real Estate		28,587		3,378		6,495		38,460		4,969,495		5,007,955		863
Consumer:
Auto		1,482		251		24		1,757		520,102		521,859		—
Non-Auto		341		51		—		392		154,034		154,426		—
Total Consumer		1,823		302		24		2,149		674,136		676,285		—
Total	$	40,151	$	5,550	$	8,223	$	53,924	$	7,094,867	$	7,148,791	$	1,004

* The Company monitors commercial, agricultural and real estate loans after such loans are 15 days past due. Consumer loans are monitored after such loans are 30 days past due.

Modifications of receivables to debtors experiencing financial difficulty

On January 1, 2023, the Company adopted the accounting guidance in ASU 2022-02, which eliminates the recognition and measurement of a troubled debt restructuring ("TDR). Due to the removal of the TDR designation, the Company evaluates all loan restructurings according to the accounting guidance for loan modifications to determine if the restructuring results in a new loan or a continuation of the existing loan. Loan modifications to borrowers experiencing financial difficulty that result in a direct change in the timing or amount of contractual cash flows include situations where there is principal forgiveness, term extensions, interest rate reduction, and combinations of the listed modifications. Therefore, the disclosures related to loan restructurings are only for modifications that directly affect cash flows.

An assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification. Because the effect of most modifications made to borrowers experiencing financial difficulty is already included in the allowance for credit losses due to the measurement methodologies used to estimate the allowance, a change to the allowance for credit losses is generally not recorded upon modification. During the three-months ended March 31, 2024 and 2023, respectively, loan modifications made to borrowers experiencing financial difficulty was insignificant.