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Credit Quality of Loans and Allowance for Loan Losses (Tables)
3 Months Ended
Mar. 31, 2018
Receivables [Abstract]  
Components of Loans Receivable
The loan portfolio consisted of the following (in thousands):
 
 
March 31, 2018
 
December 31, 2017
Commercial, financial and agricultural
 
$
401,048

 
$
435,207

Real estate – construction
 
94,679

 
90,287

Real estate – commercial
 
438,779

 
448,406

Real estate – residential
 
145,671

 
146,751

Installment loans to individuals
 
50,888

 
56,398

Lease financing receivable
 
692

 
732

Other
 
5,498

 
5,645

 
 
1,137,255

 
1,183,426

Less allowance for loan losses
 
(25,371
)
 
(26,888
)
 
 
$
1,111,884

 
$
1,156,538

Roll Forward of Activity in Allowance for Loan Losses
A rollforward of the activity within the allowance for loan losses by loan type and recorded investment in loans for the three months ended March 31, 2018 and 2017 is as follows (in thousands):
 
 
 
March 31, 2018
 
 
 
 
Real Estate
 
 
 
 
 
 
 
 
 
 
Coml, Fin,
and Agric
 
Construction
 
Commercial
 
Residential
 
Installment
loans to
individuals
 
Lease
financing
receivable
 
Other
 
Total
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
 
$
20,577

 
$
596

 
$
3,893

 
$
837

 
$
957

 
$
3

 
$
25

 
$
26,888

Charge-offs
 
(1,524
)
 
(2
)
 
(86
)
 
(3
)
 
(221
)
 

 

 
(1,836
)
Recoveries
 
276

 

 
6

 
1

 
36

 

 

 
319

Provision
 
(264
)
 
159

 
(106
)
 
64

 
146

 

 
1

 

Ending balance
 
$
19,065

 
$
753

 
$
3,707

 
$
899

 
$
918

 
$
3

 
$
26

 
$
25,371

Ending balance: individually evaluated for impairment
 
$
5,968

 
$
94

 
$
76

 
$
20

 
$
6

 
$

 
$

 
$
6,164

Ending balance: collectively evaluated for impairment
 
$
13,097

 
$
659

 
$
3,631

 
$
879

 
$
912

 
$
3

 
$
26

 
$
19,207

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Ending balance
 
$
401,048

 
$
94,679

 
$
438,779

 
$
145,671

 
$
50,888

 
$
692

 
$
5,498

 
$
1,137,255

Ending balance: individually evaluated for impairment
 
$
55,092

 
$
192

 
$
26,005

 
$
2,088

 
$
50

 
$

 
$

 
$
83,427

Ending balance: collectively evaluated for impairment
 
$
345,956

 
$
94,487

 
$
412,774

 
$
143,583

 
$
50,838

 
$
692

 
$
5,498

 
$
1,053,828

 
 
March 31, 2017
 
 
 
 
Real Estate
 
 
 
 
 
 
 
 
 
 
Coml, Fin,
and Agric
 
Construction
 
Commercial
 
Residential
 
Installment
loans to
individuals
 
Lease
financing
receivable
 
Other
 
Total
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
 
$
16,057

 
$
585

 
$
5,384

 
$
940

 
$
1,395

 
$
5

 
$
6

 
$
24,372

Charge-offs
 
(1,705
)
 

 
(823
)
 
(117
)
 
(261
)
 

 

 
(2,906
)
Recoveries
 
154

 

 
10

 
90

 
58

 

 

 
312

Provision
 
3,832

 
(321
)
 
(238
)
 
(249
)
 
(222
)
 
(2
)
 

 
2,800

Ending balance
 
$
18,338

 
$
264

 
$
4,333

 
$
664

 
$
970

 
$
3

 
$
6

 
$
24,578

Ending balance: individually evaluated for impairment
 
$
4,173

 
$
9

 
$
1,656

 
$
217

 
$
160

 
$

 
$

 
$
6,215

Ending balance: collectively evaluated for impairment
 
$
14,165

 
$
255

 
$
2,677

 
$
447

 
$
810

 
$
3

 
$
6

 
$
18,363

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Ending balance
 
$
469,815

 
$
100,248

 
$
464,859

 
$
159,426

 
$
75,258

 
$
969

 
$
1,425

 
$
1,272,000

Ending balance: individually evaluated for impairment
 
$
35,346

 
$
26

 
$
20,623

 
$
1,956

 
$
487

 
$

 
$

 
$
58,438

Ending balance: collectively evaluated for impairment
 
$
434,469

 
$
100,222

 
$
443,802

 
$
157,401

 
$
74,771

 
$
969

 
$
1,425

 
$
1,213,059

Ending balance: loans acquired with deteriorated credit quality
 
$

 
$

 
$
434

 
$
69

 
$

 
$

 
$

 
$
503

Age Analysis of Past Due Loans by Class of Loans
An age analysis of past due loans (including both accruing and non-accruing loans) is as follows (in thousands):
 
 
March 31, 2018
 
 
30-59
Days
Past Due
 
60-89
Days
Past
Due
 
Greater
than 90
Days
Past Due
 
Total
Past
Due
 
Current
 
Total Loans
 
Recorded
Investment
> 90 days
 and
Accruing
Commercial, financial, and agricultural
 
$
2,235

 
$
3,156

 
$
12,816

 
$
18,207

 
$
382,841

 
$
401,048

 
$
1

Real estate - construction
 
927

 
1,179

 
192

 
2,298

 
92,381

 
94,679

 

Real estate - commercial
 
5,681

 
6,079

 
11,330

 
23,090

 
415,689

 
438,779

 

Real estate - residential
 
657

 
1,137

 
1,187

 
2,981

 
142,690

 
145,671

 

Installment loans to individuals
 
202

 
125

 
50

 
377

 
50,511

 
50,888

 

Lease financing receivable
 

 

 

 

 
692

 
692

 

Other loans
 
65

 
16

 

 
81

 
5,417

 
5,498

 

 
 
$
9,767

 
$
11,692

 
$
25,575

 
$
47,034

 
$
1,090,221

 
$
1,137,255

 
$
1

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2017
 
 
30-59
Days
Past Due
 
60-89
Days
Past
Due
 
Greater
than 90
Days
Past Due
 
Total
Past
Due
 
Current
 
Total Loans
 
Recorded
Investment
> 90 days
and
Accruing
Commercial, financial, and agricultural
 
$
1,195

 
$
1,893

 
$
14,847

 
$
17,935

 
$
417,272

 
$
435,207

 
$
545

Real estate - construction
 
616

 

 
190

 
806

 
89,481

 
90,287

 
125

Real estate - commercial
 
5,889

 
6,402

 
4,163

 
16,454

 
431,952

 
448,406

 
58

Real estate - residential
 
1,065

 
235

 
559

 
1,859

 
144,892

 
146,751

 

Installment loans to individuals
 
276

 
32

 
34

 
342

 
56,056

 
56,398

 

Lease financing receivable
 

 

 

 

 
732

 
732

 

Other loans
 

 

 

 

 
5,645

 
5,645

 

 
 
$
9,041

 
$
8,562

 
$
19,793

 
$
37,396

 
$
1,146,030

 
$
1,183,426

 
$
728

Schedule of Loans on Nonaccrual Status
Non-accrual loans are as follows (in thousands):
 
 
 
March 31, 2018
 
December 31, 2017
Commercial, financial, and agricultural
 
$
53,939

 
$
37,418

Real estate - construction
 
192

 
66

Real estate - commercial
 
26,006

 
11,128

Real estate - residential
 
2,088

 
618

Installment loans to individuals
 
50

 
48

Lease financing receivable
 

 

Other
 

 

 
 
$
82,275

 
$
49,278

Schedule of Loans Evaluated for Impairment
The following table presents loans that are individually evaluated for impairment (in thousands). Interest income recognized represents interest on accruing loans modified in a TDR.
 
 
March 31, 2018
 
 
Recorded
Investment
 
Unpaid Principal Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest Income
Recognized
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
$
44,445

 
$
50,416

 
$

 
$
34,552

 
$
18

Real estate - construction
 

 

 

 

 

Real estate - commercial
 
25,250

 
27,514

 

 
17,861

 

Real estate - residential
 
1,400

 
1,400

 

 
851

 

Installment loans to individuals
 
24

 
24

 

 
12

 

Finance leases
 

 

 

 

 

Subtotal:
 
71,119

 
79,354

 

 
53,276

 
18

With an allowance recorded:
 
 

 
 

 
 

 
 

 
 

Commercial, financial, and agricultural
 
10,647

 
10,802

 
5,968

 
12,383

 

Real estate - construction
 
192

 
192

 
94

 
129

 

Real estate - commercial
 
755

 
755

 
76

 
706

 

Real estate - residential
 
688

 
688

 
20

 
502

 

Installment loans to individuals
 
26

 
26

 
6

 
37

 

Finance leases
 

 

 

 

 

Subtotal:
 
12,308

 
12,463

 
6,164

 
13,757

 

Totals:
 
 

 
 

 
 

 
 

 
 

Commercial
 
81,097

 
89,487

 
6,044

 
65,502

 
18

Construction
 
192

 
192

 
94

 
129

 

Residential
 
2,088

 
2,088

 
20

 
1,353

 

Consumer
 
50

 
50

 
6

 
49

 

Grand total:
 
$
83,427

 
$
91,817

 
$
6,164

 
$
67,033

 
$
18

 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2017
 
 
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest Income
Recognized
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
$
24,659

 
$
30,630

 
$

 
$
19,880

 
$
90

Real estate - construction
 

 

 

 
5

 

Real estate - commercial
 
10,471

 
11,965

 

 
11,590

 

Real estate - residential
 
302

 
302

 

 
602

 

Installment loans to individuals
 

 

 

 
37

 

Subtotal:
 
35,432

 
42,897

 

 
32,114

 
90

With an allowance recorded:
 
 

 
 

 
 

 
 

 
 

Commercial, financial, and agricultural
 
14,119

 
14,150

 
7,197

 
15,245

 
1

Real estate - construction
 
66

 
136

 
23

 
33

 

Real estate - commercial
 
657

 
657

 
131

 
8,318

 

Real estate - residential
 
316

 
316

 
5

 
620

 

Installment loans to individuals
 
48

 
50

 
14

 
258

 

Subtotal:
 
15,206

 
15,309

 
7,370

 
24,474

 
1

Totals:
 
 

 
 

 
 

 
 

 
 

Commercial
 
49,906

 
57,402

 
7,328

 
55,033

 
91

Construction
 
66

 
136

 
23

 
38

 

Residential
 
618

 
618

 
5

 
1,222

 

Consumer
 
48

 
50

 
14

 
295

 

Grand total:
 
$
50,638

 
$
58,206

 
$
7,370

 
$
56,588

 
$
91

Credit Quality Indicators by Class of Loans
The following tables present the classes of loans by risk rating (in thousands):
 
 
 
  
 
March 31, 2018
Commercial Credit Exposure
 
 
 
 
 
 
 
 
 
 
 
 
Credit Risk Profile by
Creditworthiness Category
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial,
financial, and
agricultural
 
Real estate - commercial
 
Total
 
% of Total
Pass
 
 
 
 
 
$
326,697

 
$
393,327

 
$
720,024

 
85.73
%
Special mention
 
 
 
 
 
8,718

 
5,798

 
14,516

 
1.73
%
Substandard
 
 
 
 
 
65,633

 
39,654

 
105,287

 
12.54
%
 
 
 
 
 
 
$
401,048

 
$
438,779

 
$
839,827

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Construction Credit Exposure
 
 
 
 
 
 
 
 
 
 
 
 
Credit Risk Profile by
Creditworthiness Category
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Real estate - construction
 
% of Total
Pass
 
 
 
 
 
 
 
 
 
$
92,978

 
98.20
%
Special mention
 
 
 
 
 
 
 
 
 
167

 
0.18
%
Substandard
 
 
 
 
 
 
 
 
 
1,534

 
1.62
%
 
 
 
 
 
 
 
 
 
 
$
94,679

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential Credit Exposure
 
 
 
 

 
 

 
 

 
 

 
 

Credit Risk Profile by
Creditworthiness Category
 
 
 
 

 
 

 
 

 
 

 
 

 
 
 
 
 

 
 
 
 
 
Real estate - residential
 
% of Total
Pass
 
 
 
 

 


 
 
 
$
140,883

 
96.71
%
Special mention
 
 
 
 

 


 
 
 
854

 
0.59
%
Substandard
 
 
 
 

 
 
 
 
 
3,934

 
2.70
%
 
 
 
 
 

 


 
 
 
$
145,671

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer and Other Credit Exposure
 
 
 
 

 
 

 
 

 
 

 
 

Credit Risk Profile Based on
Payment Activity
 
 
 
 

 
 

 
 

 
 

 
 

 
 
 
 
Installment loans to individuals
 
Lease
financing
receivable
 
Other
 
Total
 
% of Total
Performing
 
 
 
$
50,837

 
$
692

 
$
5,498

 
$
57,027

 
99.91
%
Nonperforming
 

 
51

 

 

 
51

 
0.09
%
 
 

 
$
50,888

 
$
692

 
$
5,498

 
$
57,078

 
100.00
%
 
 
December 31, 2017
Commercial Credit Exposure
 
 
 
 
 
 
 
 
 
 
 
 
Credit Risk Profile by
Creditworthiness Category
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial,
financial, and
agricultural
 
Real estate - commercial
 
Total
 
%
of Total
Pass
 
 
 
 
 
$
358,373

 
$
411,280

 
$
769,653

 
87.10
%
Special mention
 
 
 
 
 
9,687

 
3,823

 
13,510

 
1.53
%
Substandard
 
 
 
 
 
67,147

 
33,303

 
100,450

 
11.37
%
 
 
 
 
 
 
$
435,207

 
$
448,406

 
$
883,613

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Construction Credit Exposure
 
 
 
 
 
 
 
 
 
 
 
 
Credit Risk Profile by
Creditworthiness Category
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Real estate - construction
 
%
of Total
Pass
 
 
 
 
 
 
 
 
 
$
89,323

 
98.93
%
Special mention
 
 
 
 
 
 
 
 
 
600

 
0.66
%
Substandard
 
 
 
 
 
 
 
 
 
364

 
0.40
%
 
 
 
 
 
 
 
 
 
 
$
90,287

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential Credit Exposure
 
 
 
 

 
 

 
 

 
 

 
 

Credit Risk Profile by
Creditworthiness Category
 
 
 
 

 
 

 
 

 
 

 
 

 
 
 
 
 

 
 
 
 
 
Real estate - residential
 
%
of Total
Pass
 
 
 
 

 
 
 


 
$
144,250

 
98.30
%
Special mention
 
 
 
 

 
 
 


 
1,233

 
0.84
%
Substandard
 
 
 
 

 
 
 


 
1,268

 
0.86
%
 
 
 
 
 

 
 
 


 
$
146,751

 
100.00
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer and Other Credit Exposure
 
 
 
 

 
 

 
 

 
 

 
 

Credit Risk Profile Based on
Payment Activity
 
 
 
 

 
 

 
 

 
 

 
 

 
 
 
 
Installment loans to individuals
 
Lease
financing
receivable
 
Other
 
Total
 
%
of Total
Performing
 

 
$
56,041

 
$
699

 
$
5,645

 
$
62,385

 
99.38
%
Nonperforming
 

 
357

 
33

 

 
390

 
0.62
%
 
 

 
$
56,398

 
$
732

 
$
5,645

 
$
62,775

 
100.00
%
Schedule of Modified Troubled Debt Restructurings During the Period
The following tables present information about TDRs that were modified during the periods presented by portfolio segment (in thousands):

 
 
Three months ended
 
 
March 31, 2018
 
March 31, 2017
 
 
Number of loans
 
Pre-modification recorded investment
 
Number of loans
 
Pre-modification recorded investment
Commercial, financial and agricultural
 

 
$

 
1

 
$
1,984