XML 80 R14.htm IDEA: XBRL DOCUMENT v3.3.0.814
Accounting for Certain Loans Acquired in a Purchase
 9 Months Ended
Sep. 30, 2015
Receivables [Abstract]  
Accounting for Certain Loans Acquired in a Purchase
ACCOUNTING FOR CERTAIN LOANS ACQUIRED IN A PURCHASE

The acquired loans detailed in the tables below are included in Note 4. LOANS AND ALLOWANCE, in the Notes to Consolidated Condensed Financial Statements of this Quarterly Report on Form 10-Q. As described in Note 4, loans purchased after December 31, 2008 are recorded at the acquisition date fair value, which could result in a fair value discount or premium. Purchased loans with evidence of credit deterioration since origination and for which it is probable at the date of acquisition that the acquirer will not collect all contractually required principal and interest payments are accounted for under ASC 310-30, Loans Acquired with Deteriorated Credit Quality. The difference between contractually required payments and the cash flows expected to be collected at acquisition is referred to as the nonaccretable portion of the fair value discount or premium. The accretable portion of the fair value discount or premium is the difference between the expected cash flows and the net present value of expected cash flows, with such difference accreted into earnings over the term of the loans. All other loans not accounted for under ASC 310-30 are accounted for under ASC 310-20.

The following table includes the outstanding balance and carrying amount of loans acquired during the years 2012, 2013, 2014 and 2015, which are included in the balance sheet amounts of loans receivable at September 30, 2015, and December 31, 2014 as applicable.


September 30, 2015

C Financial

Community

CFS

SCB

Total
Commercial and industrial loans
$
109


$
6,628


$
55,927


$
5,008


$
67,672

Agricultural production financing and other loans to farmers



2,024





1,456


3,480

Real estate loans:








 
Construction
6,209


8,959


1,660





16,828

Commercial and farmland
28,094


56,148


207,197


13,981


305,420

Residential
58,096


23,465


122,369


6,449


210,379

       Home Equity
9,861


8,147


34,404


13,799


66,211

Individuals' loans for household and other personal expenditures
12


577


531


56


1,176

Other commercial loans






73





73

Total
$
102,381


$
105,948


$
422,161


$
40,749


$
671,239











Carrying Amount
$
100,001


$
99,467


$
401,497


$
35,617


$
636,582

Allowance



109


202





311

Carrying Amount Net of Allowance
$
100,001


$
99,358


$
401,295


$
35,617


$
636,271





December 31, 2014

Community

CFS

SCB

Total
Commercial and industrial loans
$
8,168


$
64,897


$
6,059


$
79,124

Agricultural production financing and other loans to farmers
1,100





893


1,993

Real estate loans:






 
Construction
19,063


9,113





28,176

Commercial and farmland
74,600


251,002


15,593


341,195

Residential
28,863


144,396


7,384


180,643

       Home Equity
9,881


39,244


15,758


64,883

Individuals' loans for household and other personal expenditures
1,314


922


121


2,357

Other commercial loans



86





86

Total
$
142,989


$
509,660


$
45,808


$
698,457









Carrying Amount
$
134,198


$
484,949


$
39,324


$
658,471

Allowance



650





650

Carrying Amount Net of Allowance
$
134,198


$
484,299


$
39,324


$
657,821



The outstanding balance and related carrying amount of loans acquired and accounted for under ASC 310-30 as of September 30, 2015 were $82.9 million and $62.0 million, respectively. Additionally, the outstanding balance and related carrying amount of those loans as of December 31, 2014 were $99.0 million and $73.1 million, respectively.


As customer cash flow expectations improve, nonaccretable yield can be reclassified to accretable yield. The accretable yield, or income expected to be collected, and reclassifications from nonaccretable yield, are identified in the table below.  The table reflects only purchased loans accounted for under ASC 310-30 and not the entire portfolio of purchased loans.


Three Months Ended September 30, 2015

C Financial

Community

CFS

SCB

Total
Beginning balance
$
133


$
1,818


$
1,732


$
758


$
4,441

Additions














Accretion
(8
)

(139
)

(1,058
)

(285
)

(1,490
)
Reclassification from nonaccretable



21


704


235


960

Disposals



(140
)

(3
)




(143
)
Ending balance
$
125


$
1,560


$
1,375


$
708


$
3,768




Nine Months Ended September 30, 2015

C Financial

Community

CFS

SCB

Total
Beginning balance



$
2,122


$
2,400


$
868


$
5,390

Additions
$
145











145

Accretion
(20
)

(671
)

(2,977
)

(774
)

(4,442
)
Reclassification from nonaccretable



249


1,963


614


2,826

Disposals



(140
)

(11
)




(151
)
Ending balance
$
125


$
1,560


$
1,375


$
708


$
3,768




Three Months Ended September 30, 2014

CFS

SCB

Total
Beginning balance
$
3,488


$
1,170


$
4,658

Additions





Accretion
(2,156
)

(518
)

(2,674
)
Reclassification from nonaccretable
1,428


311


1,739

Disposals
(136
)

(35
)

(171
)
Ending balance
$
2,624


$
928


$
3,552




Nine Months Ended September 30, 2014

CFS

SCB

Total
Beginning balance
$
4,164


$
1,388


$
5,552

Additions





Accretion
(3,699
)

(920
)

(4,619
)
Reclassification from nonaccretable
2,330


495


2,825

Disposals
(171
)

(35
)

(206
)
Ending balance
$
2,624


$
928


$
3,552



The following table presents loans acquired, as of their respective acquisition dates, during the periods ended September 30, 2015 and 2014, for which it was probable that all contractually required payments would not be collected:

 
C Financial - 2015
 
Community - 2014
Contractually required payments receivable at acquisition date
2,632

 
26,032

Nonaccretable difference
393

 
3,498

Expected cash flows at acquisition date
2,239

 
22,534

Accretable difference
145

 
2,234

Basis in loans at acquisition date
2,094

 
20,300