PAST DUE LOANS, ALLOWANCE FOR CREDIT LOSSES, IMPAIRED LOANS, AND TDRS

Past Due and Non-accrual Loans

The following table presents an aging analysis of the Company's past due loans as of March 31, 2019 and December 31, 2018. The aging is determined without regard to accrual status. The table also presents non-performing loans, consisting of non-accrual loans (the majority of which are past due) and loans 90 days or more past due and still accruing interest, as of each balance sheet date.

Aging Analysis of Past Due Loans and Non-performing Loans by Class

(Dollar amounts in thousands)



	Aging Analysis (Accruing and Non-accrual)										Non-performing Loans
	Current⁽¹⁾		30-89 Days Past Due		90 Days or More Past Due		Total Past Due		Total Loans		Non- accrual⁽²⁾		90 Days or More Past Due, Still Accruing Interest
As of March 31, 2019
Commercial and industrial	$	4,139,771	$	16,386	$	27,105	$	43,491	$	4,183,262	$	34,694	$	3,280
Agricultural	436,328		—		2,133		2,133		438,461		2,359		101
Commercial real estate:
Office, retail, and industrial	1,777,762		19,960		9,170		29,130		1,806,892		17,484		3,884
Multi-family	746,107		3,866		2,970		6,836		752,943		2,959		11
Construction	678,380		5,066		29		5,095		683,475		—		29
Other commercial real estate	1,304,499		4,227		1,152		5,379		1,309,878		2,971		251
Total commercial real estate	4,506,748		33,119		13,321		46,440		4,553,188		23,414		4,175
Total corporate loans	9,082,847		49,505		42,559		92,064		9,174,911		60,467		7,556
Home equity	855,502		4,116		2,450		6,566		862,068		5,836		39
1-4 family mortgages	1,082,513		1,574		2,177		3,751		1,086,264		3,902		—
Installment	441,556		3,353		851		4,204		445,760		—		851
Total consumer loans	2,379,571		9,043		5,478		14,521		2,394,092		9,738		890
Total loans	$	11,462,418	$	58,548	$	48,037	$	106,585	$	11,569,003	$	70,205	$	8,446
As of December 31, 2018
Commercial and industrial	$	4,085,164	$	8,832	$	26,297	$	35,129	$	4,120,293	$	33,507	$	422
Agricultural	428,357		940		1,631		2,571		430,928		1,564		101
Commercial real estate:
Office, retail, and industrial	1,803,059		8,209		9,649		17,858		1,820,917		6,510		4,081
Multi-family	759,402		1,487		3,296		4,783		764,185		3,107		189
Construction	645,774		3,419		144		3,563		649,337		144		—
Other commercial real estate	1,353,442		4,921		3,447		8,368		1,361,810		2,854		2,197
Total commercial real estate	4,561,677		18,036		16,536		34,572		4,596,249		12,615		6,467
Total corporate loans	9,075,198		27,808		44,464		72,272		9,147,470		47,686		6,990
Home equity	843,217		6,285		2,105		8,390		851,607		5,393		104
1-4 family mortgages	1,009,925		4,361		2,895		7,256		1,017,181		3,856		1,147
Installment	428,836		1,648		41		1,689		430,525		—		41
Total consumer loans	2,281,978		12,294		5,041		17,335		2,299,313		9,249		1,292
Total loans	$	11,357,176	$	40,102	$	49,505	$	89,607	$	11,446,783	$	56,935	$	8,282


⁽¹⁾	PCI loans with an accretable yield are considered current.


⁽²⁾	Includes PCI loans of $45,000 and $58,000 as of March 31, 2019 and December 31, 2018, respectively, which no longer have an accretable yield as estimates of expected future cash flows have decreased since the acquisition due to credit deterioration.

Allowance for Credit Losses

The Company maintains an allowance for credit losses at a level deemed adequate by management to absorb estimated losses inherent in the existing loan portfolio. See Note 1, "Summary of Significant Accounting Policies," for the accounting policy for the allowance for credit losses. A rollforward of the allowance for credit losses by portfolio segment for the quarters ended March 31, 2019 and 2018 is presented in the table below.

Allowance for Credit Losses by Portfolio Segment

(Dollar amounts in thousands)



	Commercial, Industrial, and Agricultural			Office, Retail, and Industrial			Multi- family			Construction			Other Commercial Real Estate			Consumer			Reserve for Unfunded Commitments		Total Allowance for Credit Losses
Quarter ended March 31, 2019
Beginning balance	$	63,276		$	7,900		$	2,464		$	2,173		$	4,934		$	21,472		$	1,200	$	103,419
Charge-offs	(6,451		)	(628		)	(340		)	(6		)	(210		)	(3,142		)	—		(10,777		)
Recoveries	1,301			10			1			6			21			354			—		1,693
Net charge-offs	(5,150		)	(618		)	(339		)	—			(189		)	(2,788		)	—		(9,084		)
Provision for loan losses and other	6,559			397			91			(42		)	185			3,254			—		10,444
Ending balance	$	64,685		$	7,679		$	2,216		$	2,131		$	4,930		$	21,938		$	1,200	$	104,779
Quarter ended March 31, 2018
Beginning balance	$	55,791		$	10,996		$	2,534		$	3,481		$	6,381		$	16,546		$	1,000	$	96,729
Charge-offs	(14,670		)	(461		)	—			—			(69		)	(1,885		)	—		(17,085		)
Recoveries	538			97			—			13			39			342			—		1,029
Net charge-offs	(14,132		)	(364		)	—			13			(30		)	(1,543		)	—		(16,056		)
Provision for loan losses and other	15,541			(25		)	58			(1,522		)	(1,060		)	2,189			—		15,181
Ending balance	$	57,200		$	10,607		$	2,592		$	1,972		$	5,291		$	17,192		$	1,000	$	95,854

The table below provides a breakdown of loans and the related allowance for credit losses by portfolio segment as of March 31, 2019 and December 31, 2018.

Loans and Related Allowance for Credit Losses by Portfolio Segment

(Dollar amounts in thousands)



	Loans								Allowance for Credit Losses
	Individually Evaluated for Impairment		Collectively Evaluated for Impairment		PCI		Total		Individually Evaluated for Impairment		Collectively Evaluated for Impairment		PCI		Total
As of March 31, 2019
Commercial, industrial, and agricultural	$	34,093	$	4,581,830	$	5,800	$	4,621,723	$	2,716	$	61,620	$	349	$	64,685
Commercial real estate:
Office, retail, and industrial	15,842		1,777,559		13,491		1,806,892		295		5,947		1,437		7,679
Multi-family	3,177		743,286		6,480		752,943		—		2,118		98		2,216
Construction	—		677,244		6,231		683,475		—		1,979		152		2,131
Other commercial real estate	1,531		1,257,566		50,781		1,309,878		—		4,186		744		4,930
Total commercial real estate	20,550		4,455,655		76,983		4,553,188		295		14,230		2,431		16,956
Total corporate loans	54,643		9,037,485		82,783		9,174,911		3,011		75,850		2,780		81,641
Consumer	—		2,374,768		19,324		2,394,092		—		20,794		1,144		21,938
Reserve for unfunded commitments	—		—		—		—		—		1,200		—		1,200
Total loans	$	54,643	$	11,412,253	$	102,107	$	11,569,003	$	3,011	$	97,844	$	3,924	$	104,779
As of December 31, 2018
Commercial, industrial, and agricultural	$	32,415	$	4,514,349	$	4,457	$	4,551,221	$	3,961	$	58,947	$	368	$	63,276
Commercial real estate:
Office, retail, and industrial	5,057		1,799,304		16,556		1,820,917		748		5,984		1,168		7,900
Multi-family	3,492		747,030		13,663		764,185		—		2,154		310		2,464
Construction	—		644,499		4,838		649,337		—		2,019		154		2,173
Other commercial real estate	1,545		1,305,444		54,821		1,361,810		—		4,180		754		4,934
Total commercial real estate	10,094		4,496,277		89,878		4,596,249		748		14,337		2,386		17,471
Total corporate loans	42,509		9,010,626		94,335		9,147,470		4,709		73,284		2,754		80,747
Consumer	—		2,279,780		19,533		2,299,313		—		20,094		1,378		21,472
Reserve for unfunded commitments	—		—		—		—		—		1,200		—		1,200
Total loans	$	42,509	$	11,290,406	$	113,868	$	11,446,783	$	4,709	$	94,578	$	4,132	$	103,419

Loans Individually Evaluated for Impairment

The following table presents loans individually evaluated for impairment by class of loan as of March 31, 2019 and December 31, 2018. PCI loans are excluded from this disclosure.

Impaired Loans Individually Evaluated by Class

(Dollar amounts in thousands)



	As of March 31, 2019								As of December 31, 2018
	Recorded Investment In								Recorded Investment In
	Loans with No Specific Reserve		Loans with a Specific Reserve		Unpaid Principal Balance		Specific Reserve		Loans with No Specific Reserve		Loans with a Specific Reserve		Unpaid Principal Balance		Specific Reserve
Commercial and industrial	$	12,033	$	19,945	$	52,148	$	2,716	$	7,550	$	23,349	$	49,102	$	3,960
Agricultural	2,115		—		4,554		—		1,318		198		3,997		1
Commercial real estate:
Office, retail, and industrial	11,983		3,859		17,389		295		1,861		3,196		6,141		748
Multi-family	3,177		—		3,513		—		3,492		—		3,492		—
Construction	—		—		—		—		—		—		—		—
Other commercial real estate	1,531		—		1,620		—		1,545		—		1,612		—
Total commercial real estate	16,691		3,859		22,522		295		6,898		3,196		11,245		748
Total impaired loans individually evaluated for impairment	$	30,839	$	23,804	$	79,224	$	3,011	$	15,766	$	26,743	$	64,344	$	4,709

The following table presents the average recorded investment and interest income recognized on impaired loans by class for the quarters ended March 31, 2019 and 2018. PCI loans are excluded from this disclosure.

Average Recorded Investment and Interest Income Recognized on Impaired Loans by Class

(Dollar amounts in thousands)



	Quarters Ended March 31,
	2019				2018
	Average Recorded Investment		Interest Income Recognized⁽¹⁾		Average Recorded Investment		Interest Income Recognized⁽¹⁾
Commercial and industrial	$	31,439	$	16	$	40,798	$	22
Agricultural	1,816		—		1,935		—
Commercial real estate:
Office, retail, and industrial	10,450		3		11,093		112
Multi-family	3,335		—		506		7
Construction	—		—		—		—
Other commercial real estate	1,538		16		1,846		52
Total commercial real estate	15,323		19		13,445		171
Total impaired loans	$	48,578	$	35	$	56,178	$	193


⁽¹⁾	Recorded using the cash basis of accounting.

Credit Quality Indicators

Corporate loans and commitments are assessed for credit risk and assigned ratings based on various characteristics, such as the borrower's cash flow, leverage, and collateral. Ratings for commercial credits are reviewed periodically. The following tables present credit quality indicators by class for corporate and consumer loans, as of March 31, 2019 and December 31, 2018.

Corporate Credit Quality Indicators by Class

(Dollar amounts in thousands)



	Pass		Special Mention⁽¹⁾⁽⁴⁾		Substandard⁽²⁾⁽⁴⁾		Non-accrual⁽³⁾		Total
As of March 31, 2019
Commercial and industrial	$	3,985,650	$	57,746	$	105,172	$	34,694	$	4,183,262
Agricultural	410,422		9,119		16,561		2,359		438,461
Commercial real estate:
Office, retail, and industrial	1,681,471		62,937		45,000		17,484		1,806,892
Multi-family	734,064		9,409		6,511		2,959		752,943
Construction	657,979		16,088		9,408		—		683,475
Other commercial real estate	1,259,991		14,175		32,741		2,971		1,309,878
Total commercial real estate	4,333,505		102,609		93,660		23,414		4,553,188
Total corporate loans	$	8,729,577	$	169,474	$	215,393	$	60,467	$	9,174,911
As of December 31, 2018
Commercial and industrial	$	3,952,066	$	74,878	$	59,842	$	33,507	$	4,120,293
Agricultural	407,542		10,070		11,752		1,564		430,928
Commercial real estate:
Office, retail, and industrial	1,735,426		35,853		43,128		6,510		1,820,917
Multi-family	745,131		9,273		6,674		3,107		764,185
Construction	624,446		16,370		8,377		144		649,337
Other commercial real estate	1,294,128		47,736		17,092		2,854		1,361,810
Total commercial real estate	4,399,131		109,232		75,271		12,615		4,596,249
Total corporate loans	$	8,758,739	$	194,180	$	146,865	$	47,686	$	9,147,470


⁽¹⁾	Loans categorized as special mention exhibit potential weaknesses that require the close attention of management since these potential weaknesses may result in the deterioration of repayment prospects in the future.


⁽²⁾	Loans categorized as substandard exhibit well-defined weaknesses that may jeopardize the liquidation of the debt. These loans continue to accrue interest because they are well-secured and collection of principal and interest is expected within a reasonable time.


⁽³⁾	Loans categorized as non-accrual exhibit well-defined weaknesses that may jeopardize the liquidation of the debt or result in a loss if the deficiencies are not corrected.


⁽⁴⁾	Total special mention and substandard loans includes accruing TDRs of $624,000 as of March 31, 2019 and $657,000 as of December 31, 2018.

Consumer Credit Quality Indicators by Class

(Dollar amounts in thousands)



	Performing		Non-accrual		Total
As of March 31, 2019
Home equity	$	856,232	$	5,836	$	862,068
1-4 family mortgages	1,082,362		3,902		1,086,264
Installment	445,760		—		445,760
Total consumer loans	$	2,384,354	$	9,738	$	2,394,092
As of December 31, 2018
Home equity	$	846,214	$	5,393	$	851,607
1-4 family mortgages	1,013,325		3,856		1,017,181
Installment	430,525		—		430,525
Total consumer loans	$	2,290,064	$	9,249	$	2,299,313

TDRs

TDRs are generally performed at the request of the individual borrower and may include forgiveness of principal, reduction in interest rates, changes in payments, and maturity date extensions. The table below presents TDRs by class as of March 31, 2019 and December 31, 2018. See Note 1, "Summary of Significant Accounting Policies," for the accounting policy for TDRs.

TDRs by Class

(Dollar amounts in thousands)



	As of March 31, 2019						As of December 31, 2018
	Accruing		Non-accrual⁽¹⁾		Total		Accruing		Non-accrual⁽¹⁾		Total
Commercial and industrial	$	241	$	8,829	$	9,070	$	246	$	5,994	$	6,240
Agricultural	—		—		—		—		—		—
Commercial real estate:
Office, retail, and industrial	—		—		—		—		—		—
Multi-family	552		—		552		557		—		557
Construction	—		—		—		—		—		—
Other commercial real estate	179		—		179		181		—		181
Total commercial real estate	731		—		731		738		—		738
Total corporate loans	972		8,829		9,801		984		5,994		6,978
Home equity	112		266		378		113		327		440
1-4 family mortgages	760		280		1,040		769		291		1,060
Installment	—		—		—		—		—		—
Total consumer loans	872		546		1,418		882		618		1,500
Total loans	$	1,844	$	9,375	$	11,219	$	1,866	$	6,612	$	8,478


⁽¹⁾	These TDRs are included in non-accrual loans in the preceding tables.

TDRs are included in the calculation of the allowance for credit losses in the same manner as impaired loans. As of March 31, 2019 there were $173,000 of specific reserves related to TDRs. There were no specific reserves related to TDRs as of December 31, 2018.

There were no material restructurings during the quarters ended March 31, 2019 and 2018.

Accruing TDRs that do not perform in accordance with their modified terms are transferred to non-accrual. There were no material TDRs that defaulted within twelve months of the restructure date during the quarters ended March 31, 2019 and 2018.

A rollforward of the carrying value of TDRs for the quarters ended March 31, 2019 and 2018 is presented in the following table.

TDR Rollforward

(Dollar amounts in thousands)



	Quarters Ended March 31,
	2019			2018
Accruing
Beginning balance	$	1,866		$	1,796
Additions	12			—
Net payments	(34		)	(18		)
Net transfers to non-accrual	—			—
Ending balance	1,844			1,778
Non-accrual
Beginning balance	6,612			24,533
Additions	—			355
Net advances (payments)	2,921			(3,113		)
Charge-offs	(158		)	(1,309		)
Net transfers from accruing	—			—
Ending balance	9,375			20,466
Total TDRs	$	11,219		$	22,244

There were $631,000 and $3.8 million of commitments to lend additional funds to borrowers with TDRs as of March 31, 2019 and December 31, 2018, respectively.