Loans Held for Investment and Allowance for Loan Losses (Tables)

12 Months Ended

Dec. 31, 2018

Receivables [Abstract]

Loans Held-for-Investment by Class of Financing Receivables

Loans held-for-investment by class of financing receivables are as follows (dollars in thousands):

	December 31,
	2018		2017
Commercial	$	844,953	$	684,099
Agricultural		96,677		94,543
Real estate		2,639,346		2,302,998
Consumer		372,660		403,929
Total loans held-for-investment	$	3,953,636	$	3,485,569

Non-Accrual Loans, Loans Still Accruing and Past Due 90 Days or More and Restructured Loans

The Company’s non-accrual loans, loan still accruing and past due 90 days or more and restructured loans are as follows (dollars in thousands):

	December 31,
	2018		2017
Non-accrual loans*	$	27,534	$	17,670
Loans still accruing and past due 90 days or more		1,008		288
Troubled debt restructured loans**		513		627
Total	$	29,055	$	18,585

* Includes $827,000 and $618,000, respectively, of purchased credit impaired loans as of December 31, 2018 and 2017.

** Our troubled debt restructured loans of $3,840,000 and $4,629,000, whose interest collection, after considering economic and business conditions and collection efforts, is doubtful are included in non-accrual loans as of December 31, 2018 and 2017, respectively.

Recorded Investment in Impaired Loans and Related Valuation Allowance

The Company’s recorded investment in impaired loans and the related valuation allowance are as follows (dollars in thousands):

December 31, 2018			December 31, 2017
Recorded Investment	Valuation Allowance		Recorded Investment		Valuation Allowance
$ 27,534	$	4,069	$	17,670	$	3,996

Schedule of Non-Accrual Loans

Non-accrual loans totaled $27,534,000 and $17,670,000 at December 31, 2018 and 2017, respectively, and consisted of the following amounts by type (dollars in thousands):

	December 31,
	2018		2017
Commercial	$	9,334	$	3,612
Agricultural		759		134
Real Estate		16,714		12,838
Consumer		727		1,086
Total	$	27,534	$	17,670

Schedule of Impaired Loans and Related Allowance

The Company’s impaired loans and related allowance as of December 31, 2018 and 2017 are summarized in the following tables by class of financing receivables (in thousands). No interest income was recognized on impaired loans subsequent to their classification as impaired.

December 31,       2018	Unpaid Contractual Principal Balance		Recorded Investment With No Allowance*		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		12 Month Average Recorded Investment
Commercial	$	10,808	$	6,728	$	2,606	$	9,334	$	1,133	$	7,986
Agricultural		799		213		546		759		170		842
Real Estate		24,072		6,699		10,015		16,714		2,409		16,042
Consumer		935		101		626		727		357		914
Total	$	36,614	$	13,741	$	13,793	$	27,534	$	4,069	$	25,784

* Includes $827,000 of purchased credit impaired loans.

December 31,       2017	Unpaid Contractual Principal Balance		Recorded Investment With No Allowance*		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		12 Month Average Recorded Investment
Commercial	$	5,597	$	518	$	3,094	$	3,612	$	1,194	$	4,849
Agricultural		147		—		134		134		31		120
Real Estate		16,823		2,348		10,490		12,838		2,316		13,835
Consumer		1,284		143		943		1,086		455		1,258
Total	$	23,851	$	3,009	$	14,661	$	17,670	$	3,996	$	20,062

* Includes $618,000 of purchased credit impaired loans.

Schedule of Internal Ratings of Loans

The following summarizes the Company’s internal ratings of its loans held-for-investment by class of financing receivables and portfolio segments, which classes are the same, at December 31, 2018 and 2017 (in thousands):

December 31,       2018	Pass		Special Mention		Substandard		Doubtful		Total
Commercial	$	804,584	$	23,392	$	16,977	$	—	$	844,953
Agricultural		92,864		46		3,767		—		96,677
Real Estate		2,559,379		26,626		53,341		—		2,639,346
Consumer		370,510		315		1,835		—		372,660
Total	$	3,827,337	$	50,379	$	75,920	$	—	$	3,953,636

December 31,       2017	Pass		Special Mention		Substandard		Doubtful		Total
Commercial	$	649,166	$	6,282	$	28,651	$	—	$	684,099
Agricultural		90,457		1,527		2,559		—		94,543
Real Estate		2,227,302		29,089		46,607		—		2,302,998
Consumer		401,434		181		2,314		—		403,929
Total	$	3,368,359	$	37,079	$	80,131	$	—	$	3,485,569

Schedule of Past Due Loans

At December 31, 2018 and 2017, the Company’s past due loans are as follows (dollars in thousands):

December 31,       2018	15-59 Days Past Due*		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Total Current		Total Loans		Total 90 Days Past Due Still Accruing
Commercial	$	3,546	$	682	$	677	$	4,905	$	840,048	$	844,953	$	—
Agricultural		791		19		26		836		95,841		96,677		—
Real Estate		13,185		881		2,020		16,086		2,623,260		2,639,346		960
Consumer		782		263		54		1,099		371,561		372,660		48
Total	$	18,304	$	1,845	$	2,777	$	22,926	$	3,930,710	$	3,953,636	$	1,008

December 31,       2017	15-59 Days Past Due*		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Total Current		Total Loans		Total 90 Days Past Due Still Accruing
Commercial	$	2,039	$	1,104	$	1,081	$	4,224	$	679,875	$	684,099	$	7
Agricultural		640		—		—		640		93,903		94,543		—
Real Estate		12,308		511		1,198		14,017		2,288,981		2,302,998		216
Consumer		1,360		361		135		1,856		402,073		403,929		65
Total	$	16,347	$	1,976	$	2,414	$	20,737	$	3,464,832	$	3,485,569	$	288

* 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.

Schedule of Allowance for Loan Losses by Portfolio Segment

The following table details the allowance for loan losses at December 31, 2018 and 2017 by portfolio segment (in thousands). There were no allowances for purchased credit impaired loans at December 31, 2018 or 2017. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.

December 31, 2018	Commercial		Agricultural		Real Estate		Consumer		Total
Loans individually evaluated for impairment	$	1,133	$	170	$	2,409	$	357	$	4,069
Loan collectively evaluated for impairment		10,815		1,276		29,933		5,109		47,133
Total	$	11,948	$	1,446	$	32,342	$	5,466	$	51,202

December 31, 2017	Commercial		Agricultural		Real Estate		Consumer		Total
Loans individually evaluated for impairment	$	1,194	$	31	$	2,316	$	455	$	3,996
Loan collectively evaluated for impairment		9,671		1,274		27,580		5,635		44,160
Total	$	10,865	$	1,305	$	29,896	$	6,090	$	48,156

Changes in Allowance for Loan Losses

Changes in the allowance for loan losses for the years ended December 31, 2018 and 2017 are summarized as follows (in thousands):

December 31, 2018	Commercial			Agricultural		Real Estate			Consumer			Total
Beginning balance	$	10,865		$	1,305	$	29,896		$	6,090		$	48,156
Provision for loan losses		1,662			126		3,463			414			5,665
Recoveries		839			15		462			512			1,828
Charge-offs		(1,418	)		—		(1,479	)		(1,550	)		(4,447	)
Ending balance	$	11,948		$	1,446	$	32,342		$	5,466		$	51,202

December 31, 2017	Commercial			Agricultural			Real Estate			Consumer			Total
Beginning balance	$	11,707		$	1,101		$	26,864		$	6,107		$	45,779
Provision for loan losses		1,233			243			4,055			999			6,530
Recoveries		943			32			192			501			1,668
Charge-offs		(3,018	)		(71	)		(1,215	)		(1,517	)		(5,821	)
Ending balance	$	10,865		$	1,305		$	29,896		$	6,090		$	48,156

Schedule of Investment in Loans Related to Balance in Allowance for Loan Losses on Basis of Company's Impairment Methodology

The Company’s recorded investment in loans as of December 31, 2018 and 2017 related to the balance in the allowance for loan losses on the basis of the Company’s impairment methodology was as follows (in thousands). Purchased credit impaired loans of $827,000 and $618,000, respectively, at December 31, 2018 and 2017 are included in loans individually evaluated for impairment.

December 31, 2018	Commercial		Agricultural		Real Estate		Consumer		Total
Loans individually evaluated for impairment	$	9,334	$	759	$	16,714	$	727	$	27,534
Loan collectively evaluated for impairment		835,619		95,918		2,622,632		371,933		3,926,102
Total	$	844,953	$	96,677	$	2,639,346	$	372,660	$	3,953,636

December 31, 2017	Commercial		Agricultural		Real Estate		Consumer		Total
Loans individually evaluated for impairment	$	3,612	$	134	$	12,838	$	1,086	$	17,670
Loan collectively evaluated for impairment		680,487		94,409		2,290,160		402,843		3,467,899
Total	$	684,099	$	94,543	$	2,302,998	$	403,929	$	3,485,569

Schedule of Loans Modified and Considered Troubled Debt Restructurings

The Company’s loans that were modified in the years ended December 31, 2018 and 2017, and considered troubled debt restructurings are as follows (dollars in thousands):

	Year Ended December 31, 2018						Year Ended December 31, 2017
	Number		Pre-Modification Recorded Investment		Post- Modification Recorded Investment		Number		Pre-Modification Recorded Investment		Post- Modification Recorded Investment
Commercial		4	$	864	$	864		11	$	895	$	895
Agricultural		1		4		4		—		—		—
Real Estate		5		643		643		5		625		625
Consumer		8		209		209		1		25		25
Total		18	$	1,720	$	1,720		17	$	1,545	$	1,545

Schedule of How Loans Were Modified as Troubled Debt Restructured Loans

The balances below provide information as to how the loans were modified as troubled debt restructured loans during the years ended December 31, 2018 and 2017 (dollars in thousands):

	Year Ended December 31, 2018						Year Ended December 31, 2017
	Adjusted Interest Rate		Extended Maturity		Combined Rate and Maturity		Adjusted Interest Rate		Extended Maturity		Combined Rate and Maturity
Commercial	$	—	$	529	$	335	$	—	$	195	$	700
Agricultural		—		—		4		—		—		—
Real Estate		—		280		363		—		312		313
Consumer		—		—		209		—		25		—
Total	$	—	$	809	$	911	$	—	$	532	$	1,013

Schedule of Troubled Debt Restructurings

The loans with payment default are as follows (dollars in thousands):

	Year Ended December 31, 2018				Year Ended December 31, 2017
	Number		Balance		Number		Balance
Commercial		1	$	491		2	$	88
Agriculture		—		—		—		—
Real Estate		—		—		—		—
Consumer		—		—		—		—
Total		1	$	491		2	$	88

Analysis of Changes in Loans to Officers, Directors, Principal Shareholders, or Associates of Such Persons

An analysis of the changes in loans to officers, directors, principal shareholders, or associates of such persons for the year ended December 31, 2018 (determined as of each respective year-end) follows (dollars in thousands):

	Beginning Balance		Additional Loans		Payments		Ending Balance
Year ended December 31, 2018	$	55,904	$	55,678	$	44,188	$	67,394