Note 4 - Loans

9 Months Ended

Sep. 30, 2012

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

4.  LOANS

Loans Held-for-Investment

Loans that the Company intends to hold until they are paid in full or mature are classified as loans held-for-investment. The following table presents the Company’s loans held-for-investment by class.

Loan Portfolio

(Dollar amounts in thousands)

	September 30, 2012		December 31, 2011
Commercial and industrial	$	1,610,169	$	1,458,446
Agricultural		259,787		243,776
Commercial real estate:
Office, retail, and industrial		1,330,331		1,299,082
Multi-family		309,509		288,336
Residential construction		61,920		105,836
Commercial construction		136,509		144,909
Other commercial real estate		780,712		888,146
Total commercial real estate		2,618,981		2,726,309
Total corporate loans		4,488,937		4,428,531
Home equity		397,506		416,194
1-4 family mortgages		292,908		201,099
Installment loans		38,994		42,289
Total consumer loans		729,408		659,582
Total loans, excluding covered loans		5,218,345		5,088,113
Covered loans (1)		216,610		260,502
Total loans	$	5,434,955	$	5,348,615
Deferred loan fees included in total loans	$	6,460	$	7,828
Overdrawn demand deposits included in total loans	$	2,816	$	2,850

(1) For information on covered loans, refer to Note 5, “Covered Assets.”

The Company primarily lends to small and mid-sized commercial and industrial businesses, commercial real estate customers, and consumers in the markets in which the Company operates. Within these areas, the Company seeks to diversify its loan portfolio by loan type, industry, and borrower.

It is the Company’s policy to review each prospective credit to determine the appropriateness and the adequacy of security or collateral prior to making a loan. In the event of borrower default, the Company seeks recovery in compliance with state lending laws, the Company’s lending standards, and credit monitoring and remediation procedures.

Loans Held-for-Sale

During third quarter 2012, the Company identified $171.1 million of certain performing potential problem loans and non-performing loans for accelerated disposition wholesale loan transactions. The Company determined that the loans met the held-for-sale criteria in connection with the preparation of the quarterly financial statements, and transferred them into the held-for-sale category at the lower of the recorded investment in the loan or the estimated fair value of the loan, which resulted in charge-offs of $80.3 million. The fair value was determined by the estimated bid price of a potential sale. The transactions are expected to close in fourth quarter 2012. Refer to Note 13, “Subsequent Events,” for additional detail.

In addition, the Company sold two other non-performing commercial real estate loans totaling $4.2 million during the first six months of 2012.

Loans Transferred to Held-for-Sale as of September 30, 2012

 (Dollar amounts in thousands)

	Carrying Amount of Loans Prior to Transfer to Held-for-Sale
	Pass		Substandard/ Special Mention		Non-accrual		Total		Charge-offs at Date of Transfer		Carrying Amount (1)
Commercial and industrial	$	2,868	$	23,728	$	21,796	$	48,392	$	22,508	$	25,101
Agricultural		-		7,411		1,308		8,719		4,356		4,353
Commercial real estate:
Office, retail, and industrial		4,272		24,975		20,653		49,900		23,696		26,144
Multi-family		-		2,380		1,829		4,209		1,859		2,349
Residential construction		-		7,953		6,900		14,853		5,690		9,252
Commercial construction		-		2,032		2,026		4,058		1,850		2,208
Other commercial real estate		855		29,602		8,971		39,428		19,438		19,976
Total commercial real estate		5,127		66,942		40,379		112,448		52,533		59,929
Home equity		1,303		-		30		1,333		773		558
1-4 family mortgages		160		-		-		160		90		70
Total consumer		1,463		-		30		1,493		863		628
Total loans transferred to held-for-sale	$	9,458	$	98,081	$	63,513	$	171,052	$	80,260	$	90,011

(1) The carrying amount as of September 30, 2012 includes $781,000 in payments received subsequent to the transfer to held-for-sale.