10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________________________

FORM 10-Q

____________________________________________________

☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2020

or

 ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number: 001-16715

____________________________________________________

First Citizens BancShares, Inc.

(Exact name of Registrant as specified in its charter)

____________________________________________________

Delaware			56-1528994
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification Number)
4300 Six Forks Road	Raleigh	North Carolina	27609
(Address of principle executive offices)			(Zip code)
		(919)	716-7000
(Registrant’s telephone number, including area code)

____________________________________________________

Securities Registered Pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class	Trading Symbol	Name of each exchange on which registered
Class A Common Stock, Par Value $1	FCNCA	Nasdaq Global Select Market
Depositary Shares, Each Representing a 1/40th Interest in a Share of 5.375% Non-Cumulative Perpetual Preferred Stock, Series A	FCNCP	Nasdaq Global Select Market

Securities Registered Pursuant to Section 12(g) of the Securities Exchange Act of 1934.

Class B Common Stock, Par Value $1

(Title of class)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past ninety days.    Yes  ☒   No  ☐

Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or such shorter period that the Registrant was required to submit and post such files)    Yes  ☒    No  ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “larger accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

Class A Common Stock—8,811,220 shares

Class B Common Stock—1,005,185 shares

(Number of shares outstanding, by class, as of July 31, 2020)

INDEX

		Page No.
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Balance Sheets (Unaudited)	3
	Consolidated Statements of Income (Unaudited)	4
	Consolidated Statements of Comprehensive Income (Unaudited)	5
	Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)	6
	Consolidated Statements of Cash Flows (Unaudited)	7
	Notes to Consolidated Financial Statements (Unaudited)	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	41
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	66
Item 4.	Controls and Procedures	66
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	67
Item 1A.	Risk Factors	67
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	68
Item 6.	Exhibits	68

2

PART I 

Item 1.Financial Statements

First Citizens BancShares, Inc. and Subsidiaries

Consolidated Balance Sheets

(Dollars in thousands, unaudited)	June 30, 2020		December 31, 2019
Assets
Cash and due from banks	$	389,233	$	376,719
Overnight investments	3,107,575		1,107,844
Investment in marketable equity securities (cost of $116,322 at June 30, 2020 and $59,262 at December 31, 2019)	114,316		82,333
Investment securities available for sale (cost of $8,472,398 at June 30, 2020 and $7,052,152 at December 31, 2019)	8,619,282		7,059,674
Investment securities held to maturity (fair value of $791,325 at June 30, 2020 and $30,996 at December 31, 2019)	774,878		30,996
Loans held for sale	107,881		67,869
Loans and leases	32,418,425		28,881,496
Allowance for credit losses	(222,450)		(225,141)
Net loans and leases	32,195,975		28,656,355
Premises and equipment	1,255,688		1,244,396
Other real estate owned	53,850		46,591
Income earned not collected	175,496		123,154
Goodwill	350,298		349,398
Other intangible assets	58,606		68,276
Other assets	663,116		610,891
Total assets	$	47,866,194	$	39,824,496
Liabilities
Deposits:
Noninterest-bearing	$	18,149,466	$	12,926,796
Interest-bearing	23,329,779		21,504,440
Total deposits	41,479,245		34,431,236
Securities sold under customer repurchase agreements	740,276		442,956
Federal Home Loan Bank borrowings	657,682		572,185
Subordinated debt	504,246		163,412
Other borrowings	96,791		148,318
FDIC shared-loss payable	15,025		112,395
Other liabilities	381,485		367,810
Total liabilities	43,874,750		36,238,312
Shareholders’ equity
Common stock:
Class A - $1 par value (16,000,000 shares authorized; 8,928,920 and 9,624,310 shares issued and outstanding at June 30, 2020 and December 31, 2019 respectively)	8,929		9,624
Class B - $1 par value (2,000,000 shares authorized; 1,005,185 shares issued and outstanding at June 30, 2020 and December 31, 2019)	1,005		1,005
Preferred stock - $0.01 par value (10,000,000 shares authorized; 345,000 and no shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively)	339,937		—
Surplus	—		44,081
Retained earnings	3,651,237		3,658,197
Accumulated other comprehensive loss	(9,664)		(126,723)
Total shareholders’ equity	3,991,444		3,586,184
Total liabilities and shareholders’ equity	$	47,866,194	$	39,824,496

See accompanying Notes to Unaudited Consolidated Financial Statements.

3

First Citizens BancShares, Inc. and Subsidiaries

Consolidated Statements of Income

	Three months ended June 30				Six months ended June 30
(Dollars in thousands, except per share data, unaudited)	2020		2019		2020		2019
Interest income
Loans and leases	$	326,099	$	303,233	$	651,647	$	594,155
Investment securities interest and dividend income	36,605		40,209		76,098		79,821
Overnight investments	553		7,279		5,071		13,669
Total interest income	363,257		350,721		732,816		687,645
Interest expense
Deposits	17,916		19,158		42,110		32,084
Securities sold under customer repurchase agreements	399		515		841		974
Federal Home Loan Bank borrowings	2,472		1,586		5,456		2,871
Subordinated debt	4,677		1,952		7,432		3,624
Other borrowings	399		162		1,183		272
Total interest expense	25,863		23,373		57,022		39,825
Net interest income	337,394		327,348		675,794		647,820
Provision for credit losses	20,552		5,198		48,907		16,948
Net interest income after provision for credit losses	316,842		322,150		626,887		630,872
Noninterest income
Service charges on deposit accounts	17,522		25,790		43,935		50,855
Wealth management services	22,371		24,573		48,783		49,574
Cardholder services, net	17,587		18,479		35,747		35,112
Other service charges and fees	7,145		8,164		14,937		15,586
Merchant services, net	5,363		6,455		11,251		12,290
Mortgage income	9,811		5,038		15,035		8,696
Insurance commissions	3,189		2,854		6,877		6,145
ATM income	1,395		1,625		2,817		3,136
Marketable equity securities gains, net	64,570		3,144		13,162		14,472
Realized gains on investment securities available for sale, net	13,752		5,719		33,547		5,719
Other	2,697		5,034		3,322		8,953
Total noninterest income	165,402		106,875		229,413		210,538
Noninterest expense
Salaries and wages	146,633		136,526		291,888		268,947
Employee benefits	30,364		30,197		68,875		62,732
Occupancy expense	29,556		26,886		57,036		54,647
Equipment expense	28,774		28,489		56,624		55,229
Processing fees paid to third parties	10,186		6,641		20,558		13,730
FDIC insurance expense	3,731		2,757		7,197		5,417
Collection and foreclosure-related expenses	3,949		3,659		8,003		6,681
Merger-related expenses	4,369		4,084		8,601		5,803
Other	34,117		34,158		72,868		67,868
Total noninterest expense	291,679		273,397		591,650		541,054
Income before income taxes	190,565		155,628		264,650		300,356
Income taxes	36,779		36,269		53,695		69,638
Net income	$	153,786	$	119,359	$	210,955	$	230,718
Less: Preferred stock dividends	4,790		—		4,790		—
Net income available to common shareholders	$	148,996	$	119,359	$	206,165	$	230,718
Weighted average common shares outstanding	10,105,520		11,286,520		10,289,320		11,402,112
Net income per common share	$	14.74	$	10.56	$	20.04	$	20.23

See accompanying Notes to Unaudited Consolidated Financial Statements.

4

First Citizens BancShares, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income

	Three months ended June 30				Six months ended June 30
(Dollars in thousands, unaudited)	2020		2019		2020		2019
Net income	$	153,786	$	119,359	$	210,955	$	230,718
Other comprehensive income
Unrealized gains on securities available for sale:
Unrealized gains on securities available for sale arising during the period	28,066		30,971		172,909		59,042
Tax effect	(6,455)		(7,123)		(39,768)		(13,579)
Reclassification adjustment for realized gains on securities available for sale included in income before income taxes	(13,752)		(5,719)		(33,547)		(5,719)
Tax effect	3,163		1,315		7,716		1,315
Unrealized gains on securities available for sale arising during the period, net of tax	11,022		19,444		107,310		41,059
Unrealized losses on securities available for sale transferred from/to held to maturity:
Reclassification adjustment for accretion of unrealized losses on securities available for sale transferred to held to maturity	—		5,947		—		11,909
Tax effect	—		(1,368)		—		(2,739)
Total change in unrealized losses on securities available for sale transferred to held to maturity, net of tax	—		4,579		—		9,170
Change in pension obligation:
Amortization of actuarial losses and prior service cost	6,398		2,735		12,662		5,490
Tax effect	(1,472)		(629)		(2,913)		(1,263)
Total change in pension obligation, net of tax	4,926		2,106		9,749		4,227
Other comprehensive income	15,948		26,129		117,059		54,456
Total comprehensive income	$	169,734	$	145,488	$	328,014	$	285,174

See accompanying Notes to Unaudited Consolidated Financial Statements.

5

First Citizens BancShares, Inc. and Subsidiaries

Consolidated Statements of Changes in Shareholders’ Equity

	Three months ended June 30
(Dollars in thousands, unaudited)	Class A Common Stock		Class B Common Stock		Preferred Stock		Surplus		Retained Earnings		Accumulated Other Comprehensive Loss		Total Shareholders’ Equity
Balance at March 31, 2019	$	10,380	$	1,005	$	—	$	393,449	$	3,325,335	$	(206,860)	$	3,523,309
Net income	—		—		—		—		119,359		—		119,359
Other comprehensive income, net of tax	—		—		—		—		—		26,129		26,129
Repurchase of 205,500 shares of Class A common stock	(205)		—		—		(89,569)		—		—		(89,774)
Cash dividends declared ($0.40 per common share)
Class A common stock	—		—		—		—		(4,008)		—		(4,008)
Class B common stock	—		—		—		—		(402)		—		(402)
Balance at June 30, 2019	$	10,175	$	1,005	$	—	$	303,880	$	3,440,284	$	(180,731)	$	3,574,613
Balance at March 31, 2020	$	9,275	$	1,005	$	339,958	$	—	$	3,632,894	$	(25,612)	$	3,957,520
Net income	—		—		—		—		153,786		—		153,786
Other comprehensive income, net of tax	—		—		—		—		—		15,948		15,948
Issuance of preferred stock	—		—		(21)		—		—		—		(21)
Repurchase of 346,000 shares of Class A common stock	(346)		—		—		—		(126,645)		—		(126,991)
Cash dividends declared ($0.40 per common share)
Class A common stock	—		—		—		—		(3,606)		—		(3,606)
Class B common stock	—		—		—		—		(402)		—		(402)
Preferred stock dividends declared	—		—		—		—		(4,790)		—		(4,790)
Balance at June 30, 2020	$	8,929	$	1,005	$	339,937	$	—	$	3,651,237	$	(9,664)	$	3,991,444
	Six months ended June 30
(Dollars in thousands, unaudited)	Class A Common Stock		Class B Common Stock		Preferred Stock		Surplus		Retained Earnings		Accumulated Other Comprehensive Loss		Total Shareholders’ Equity
Balance at December 31, 2018	$	10,623	$	1,005	$	—	$	493,962	$	3,218,551	$	(235,187)	$	3,488,954
Net income	—		—		—		—		230,718		—		230,718
Other comprehensive income, net of tax	—		—		—		—		—		54,456		54,456
Repurchase of 448,500 shares of Class A common stock	(448)		—		—		(190,082)		—		—		(190,530)
Cash dividends declared ($0.80 per common share)
Class A common stock	—		—		—		—		(8,181)		—		(8,181)
Class B common stock	—		—		—		—		(804)		—		(804)
Balance at June 30, 2019	$	10,175	$	1,005	$	—	$	303,880	$	3,440,284	$	(180,731)	$	3,574,613
Balance at December 31, 2019	$	9,624	$	1,005	$	—	$	44,081	$	3,658,197	$	(126,723)	$	3,586,184
Cumulative effect of adoption of ASC 326	—		—		—		—		36,943		—		36,943
Net income	—		—		—		—		210,955		—		210,955
Other comprehensive income, net of tax	—		—		—		—		—		117,059		117,059
Issuance of preferred stock	—		—		339,937		—		—		—		339,937
Repurchase of 695,390 shares of Class A common stock	(695)		—		—		(44,081)		(241,919)		—		(286,695)
Cash dividends declared ($0.80 per common share)
Class A common stock	—		—		—		—		(7,345)		—		(7,345)
Class B common stock	—		—		—		—		(804)		—		(804)
Preferred stock dividends declared	—		—		—		—		(4,790)		—		(4,790)
Balance at June 30, 2020	$	8,929	$	1,005	$	339,937	$	—	$	3,651,237	$	(9,664)	$	3,991,444

See accompanying Notes to Unaudited Consolidated Financial Statements.

6

First Citizens BancShares, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

	Six months ended June 30
(Dollars in thousands, unaudited)	2020		2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	210,955	$	230,718
Adjustments to reconcile net income to cash provided by operating activities:
Provision for credit losses on loans and leases	48,907		16,948
Deferred tax expense	17,774		5,126
Net decrease (increase) in current tax receivable	12,122		(23,826)
Depreciation and amortization	53,806		50,574
Net (decrease) increase in accrued interest payable	(4,012)		10,485
Net increase in income earned not collected	(51,784)		(1,747)
Contribution to pension plans	(100,000)		—
Realized gains on investment securities available for sale, net	(33,547)		(5,719)
Marketable equity securities gains, net	(13,162)		(14,472)
Origination of loans held for sale	(503,190)		(328,481)
Proceeds from sale of loans held for sale	474,153		326,640
Gain on sale of loans held for sale	(15,578)		(6,395)
Net write-downs/losses on other real estate owned	2,475		1,417
Net amortization (accretion) of premiums and discounts	20,889		(16,491)
Amortization of intangible assets	12,464		12,019
Net change in mortgage servicing rights	357		(2,283)
Net change in other assets	(17,459)		(12,375)
Net change in other liabilities	(14,380)		(22,373)
Net cash provided by operating activities	100,790		219,765
CASH FLOWS FROM INVESTING ACTIVITIES
Net increase in loans outstanding	(3,488,854)		(168,572)
Purchases of investment securities available for sale	(5,659,704)		(1,553,876)
Purchases of investment securities held to maturity	(803,307)		(183,288)
Purchases of marketable equity securities	(331,952)		(14,108)
Proceeds from maturities, calls, and principal repayments of investment securities held to maturity	57,057		190,644
Proceeds from maturities, calls, and principal repayments of investment securities available for sale	1,139,291		1,061,895
Proceeds from sales of investment securities available for sale	3,122,454		610,787
Proceeds from sales of marketable equity securities	313,131		10,694
Net increase in overnight investments	(1,964,602)		(840,371)
Proceeds from sales of portfolio loans	—		24,247
Cash paid to FDIC for settlement of shared-loss agreement	(99,468)		—
Proceeds from sales of other real estate owned	9,263		11,884
Proceeds from sales of premises and equipment	37		75
Purchases of premises and equipment	(62,721)		(54,873)
Business acquisitions, net of cash acquired	(59,999)		(73,792)
Net cash used in investing activities	(7,829,374)		(978,654)
CASH FLOWS FROM FINANCING ACTIVITIES
Net (decrease) increase in time deposits	(623,833)		291,930
Net increase in demand and other interest-bearing deposits	7,649,120		762,021
Net increase (decrease) in short-term borrowings	2,043		(109,109)
Repayment of long-term obligations	(75,908)		(33,008)
Origination of long-term obligations	400,000		—
Net proceeds from subordinated notes issuance	345,850		—
Net proceeds from preferred stock issuance	339,937		—
Repurchase of common stock	(282,923)		(186,995)
Cash dividends paid	(13,188)		(9,243)
Net cash provided by financing activities	7,741,098		715,596
Change in cash and due from banks	12,514		(43,293)
Cash and due from banks at beginning of period	376,719		327,440
Cash and due from banks at end of period	$	389,233	$	284,147
	Six months ended June 30
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES:	2020		2019
Transfers of loans to other real estate	$	7,138	$	5,710
Dividends declared but not paid	4,007		4,410
Unsettled maturities of investment securities	—		150,122
Unsettled purchases of investment securities	—		1,126
Net reclassification of portfolio loans (to) from loans held for sale	(3,027)		23,343
Transfers of premises and equipment to other real estate	2,046		2,184
Unsettled common stock repurchases	3,772		3,535

See accompanying Notes to Unaudited Consolidated Financial Statements.

7

First Citizens BancShares, Inc. and Subsidiaries

Notes to Unaudited Consolidated Financial Statements

NOTE A - ACCOUNTING POLICIES AND BASIS OF PRESENTATION

First Citizens BancShares, Inc. (“BancShares”) is a financial holding company organized under the laws of Delaware and conducts operations through its banking subsidiary, First-Citizens Bank & Trust Company (“FCB”), which is headquartered in Raleigh, North Carolina.

General

These consolidated financial statements and notes thereto are presented in accordance with instructions for Form 10-Q and Article 10 of Regulation S-X and, therefore, do not include all information and notes necessary for a complete presentation of financial position, results of operations and cash flow activity required in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, all normal recurring adjustments necessary for a fair presentation of the consolidated financial position and consolidated results of operations have been made. The unaudited interim consolidated financial statements included in this Form 10-Q should be read in conjunction with the Consolidated Financial Statements and Notes to the Consolidated Financial Statements included in BancShares’ Annual Report on Form 10-K for the year ended December 31, 2019.

Reclassifications

In certain instances, amounts reported in prior periods’ consolidated financial statements have been reclassified to conform to the current financial statement presentation. Such reclassifications had no effect on previously reported cash flows, shareholders’ equity or net income.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions which affect the amounts reported. Actual results could differ from those estimates. The estimates BancShares considers significant are the allowance for credit losses, fair value measurements, and income taxes.

Issuance of Preferred Stock and Subordinated Debt

On March 4, 2020, BancShares completed its public offering of $350 million aggregate principal amount of its 3.375% Fixed-to-Floating Rate Subordinated Notes due 2030 and redeemable at the option of BancShares starting in 2025. On March 12, 2020, BancShares issued and sold an aggregate of 13,800,000 depositary shares, each representing a 1/40th interest in a share of 5.375% Non-Cumulative Perpetual Preferred Stock, Series A, par value $0.01 per share, with a liquidation preference of $25 per Depositary Share (equivalent to $1,000 per share of Series A Preferred Stock) for a total of $345 million. The capital raise provides liquidity for general corporate purposes, which may include, but is not limited to, providing capital to support our growth organically or through strategic acquisitions, financing investments and capital expenditures, for funding investments in First Citizens Bank as regulatory capital, and redeeming or repurchasing our common stock.

Share Repurchases

During the second quarter of 2020, BancShares repurchased 346,000 shares of Class A common stock for $127.0 million at an average cost per share of $366.98. During the second quarter of 2019, BancShares purchased a total of 205,500 shares of Class A common stock for $89.8 million at an average cost per share of $436.81. During the six months ended June 30, 2020, BancShares repurchased 695,390 shares of Class A common stock for $286.7 million at an average cost per share of $412.23. During the six months ended June 30, 2019, BancShares repurchased a total of 448,500 shares of Class A common stock for $190.5 million at an average cost per share of $424.77. All Class A common stock repurchases were consummated under previously approved authorizations.

The share repurchases during 2020 included 45,000 shares of Class A common stock repurchased from Ella Ann Holding, as trustee of her revocable trust. Pursuant to the existing share repurchase authorization and BancShares’ related person transaction policy, the Board of Director’s (the “Board”) independent Audit Committee reviewed and approved the repurchase of up to 250,000 shares held by Mrs. Holding on or before April 30, 2020.

Subsequent to quarter-end through July 31, 2020, BancShares repurchased an additional 117,700 shares of Class A common stock for $47.1 million at an average cost per share of $399.77. Upon completion of the current authorization on July 31, 2020, share repurchase activity has been suspended and will be reevaluated in subsequent periods.

8

Small Business Administration Paycheck Protection Program

The Small Business Administration Paycheck Protection Program (“SBA-PPP”) is one of the centerpieces of the Coronavirus Aid Relief and Economic Security Act (the “CARES Act”), which was passed on March 27, 2020 in response to the outbreak of coronavirus (“COVID-19”) and was supplemented with subsequent legislation. Overseen by the United States (“U.S.”) Treasury Department, the SBA-PPP offers cash-flow assistance to nonprofit and small business employers through guaranteed loans for expenses incurred between February 15, 2020, and August 8, 2020. Borrowers are eligible for forgiveness of principal and accrued interest on SBA-PPP loans to the extent that the proceeds are used to cover eligible payroll costs, interest costs, rent, and utility costs over a period between eight and 24-weeks after the loan is made as long as the borrower retains its employees and their compensation levels. The CARES Act authorized the SBA to temporarily guarantee these loans.

Due to the unique nature of these provisions, SBA-PPP loans have been disclosed as a separate loan class. Origination fees received by the SBA are capitalized into the carrying amount of the loans. The deferred fee income, net of origination costs, is recognized over the life of the loan as an adjustment to yield using the effective interest method. Loans outstanding as of June 30, 2020 totaled $3.08 billion and generated $19.0 million of interest income during the second quarter of 2020.

Recently Adopted Accounting Pronouncements

Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2018-13 - Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement

This ASU modifies the disclosure requirements on fair value measurements by eliminating the requirements to disclose (1) the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy (2) the policy for timing of transfers between levels and (3) the valuation processes for Level 3 fair value measurements. This ASU also added specific disclosure requirements for fair value measurements for public business entities including the requirement to disclose the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements.

BancShares adopted this ASU during the first quarter of 2020 and have made all applicable updates to the disclosure within the Notes to the Unaudited Consolidated Financial Statements.

FASB ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment

This ASU eliminates Step 2 from the goodwill impairment test. Under Step 2, an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, under the amendments in this ASU, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. This ASU eliminates the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative test.

BancShares adopted this ASU during the first quarter 2020 with no impact to our consolidated financial position or consolidated results of operations as a result of the adoption.

FASB ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments

This ASU (and all subsequent ASUs on this topic) introduce the current expected credit loss (“CECL”) model, a new credit loss methodology, replacing multiple existing impairment methods in current GAAP, which generally require that a loss be incurred before it is recognized. The amendments in this ASU require loss estimates be determined over the lifetime of the asset and broaden the information that an entity must consider in developing its expected credit losses. The ASU does not specify a method for measuring expected credit losses and allows an entity to apply methods that reasonably reflect its expectations of the credit loss estimate based on the entity's size, complexity and risk profile. In addition, the disclosures of credit quality indicators in relation to the amortized cost of financing receivables, a current disclosure requirement, are further disaggregated by year of origination.

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BancShares adopted this ASU (and all subsequent ASUs on this topic) as of January 1, 2020 using the modified retrospective approach for all loans, leases, debt securities designated as held to maturity, and unfunded loan commitments. BancShares adopted the ASU using the prospective approach for debt securities available for sale and purchased credit deteriorated (“PCD”) loans previously accounted for under Accounting Standard Codification (“ASC”) ASC 310-30. Results for reporting periods beginning after January 1, 2020 are presented under ASC 326, while prior period amounts continue to be reported in accordance with previously applicable GAAP. BancShares made changes to loan classifications and segmentation in order to align with ASC 326 requirements and facilitate CECL modeling. Using this updated segmentation, BancShares developed new loan level models to estimate the allowance for credit losses (“ACL”) and facilitate revised disclosures.

The information presented below represents changes from Note A, Accounting Policies and Basis of Presentation, included in BancShares’ Annual Report on Form 10-K for the year ended December 31, 2019, as well as information on the impact of adoption.

Accounting Policy - Debt Securities

BancShares classifies debt securities as held to maturity (“HTM”) or available for sale (“AFS”). Debt securities are classified as HTM when BancShares has the intent and ability to hold the securities to maturity and are reported at amortized cost. Other debt securities are classified as AFS and reported at estimated fair value, with unrealized gains and losses, net of income taxes, reported in Accumulated Other Comprehensive Income (“AOCI”). Amortization of premiums and accretion of discounts for debt securities are included in interest income. Realized gains and losses from the sale of debt securities are determined by specific identification on a trade date basis and are included in noninterest income.

BancShares performs pre-purchase due diligence and evaluates the credit risk of AFS and HTM securities purchased directly into our portfolio or via acquisition. If securities have evidence of more than insignificant credit deterioration since issuance, they are designated as PCD. PCD securities are recorded at fair value at the date of acquisition which includes an associated allowance that is added to the purchase price or fair value to arrive at the Day 1 amortized cost basis. The difference between the purchase price and the Day 1 amortized cost is amortized or accreted to interest income over the contractual life of the securities using the effective interest method.

For AFS securities, management performs a quarterly analysis of the investment portfolio to evaluate securities currently in an unrealized loss position for potential credit-related impairment. If BancShares intends to sell a security, or does not have the intent and ability to hold a security before recovering the amortized cost, the entirety of the unrealized loss is immediately recorded in earnings. For the remaining securities, an analysis is performed to determine if any portion of the unrealized loss recorded relates to credit impairment. If credit related impairment exists, the amount is recorded through the ACL and related provision. This review includes indicators such as changes in credit rating, delinquency, bankruptcy or other significant news event impacting the issuer.

BancShares’ portfolio of HTM debt securities is made up of mortgage-backed securities issued by government agencies and government sponsored entities. Given the historically strong credit rating of the U.S. Treasury and the long history of no credit losses on debt securities issued by government agencies and government sponsored entities, we determined zero expected credit losses on the HTM portfolio.

Accounting Policy - Loans and Leases

BancShares’ accounting methods for loans and leases depends on whether they are originated or purchased, and if purchased, whether or not the loans reflect more than insignificant credit deterioration since origination as of the date of acquisition.

Non-Purchased Credit Deteriorated (“Non-PCD”) Loans

Non-PCD loans consist of loans originated by BancShares and loans purchased from other institutions that do not reflect more than insignificant credit deterioration at acquisition.

Originated loans for which management has the intent and ability to hold for the foreseeable future are classified as held for investment and carried at the principal amount outstanding net of any unearned income, charge-offs and unamortized fees and costs. Nonrefundable fees collected and certain direct costs incurred related to loan originations are deferred and recorded as an adjustment to loans outstanding. The net amount of the nonrefundable fees and costs is amortized to interest income over the contractual lives using methods that approximate a constant yield.

Purchased loans which do not reflect more than insignificant credit deterioration at acquisition are classified as non-PCD loans. These loans are recorded at fair value at the date of acquisition and an initial allowance is recorded on these assets as provision expense at the date of acquisition. The difference between the fair value and the unpaid principal balance at the acquisition date is amortized or accreted to interest income over the contractual life of the loan using the effective interest method.

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Purchased Credit Deteriorated Loans

Purchased loans which reflect a more than insignificant credit deterioration since origination as of the date of acquisition are classified as PCD and are recorded at acquisition date amortized cost, which is the purchase price or fair value in a business combination, plus our initial estimate of expected credit losses. The difference between the unpaid principal balance and the acquisition date amortized cost is amortized or accreted to interest income over the contractual life of the loan using the effective interest method.

The performance of all loans within the BancShares portfolio is subject to a number of external risks, including but not limited to changes in the overall health of the economy, declines in real estate or other collateral values, changes in the demand for products and services and personal events, such as death, disability or change in marital status. BancShares evaluates and reports its non-PCD and PCD loan portfolios separately, and each non-PCD portfolio is further divided into commercial and consumer segments based on the type of borrower, purpose, collateral and/or our underlying credit management processes. Additionally, non-PCD commercial and consumer loans are assigned to loan classes, which further disaggregate the loan portfolio. PCD loans are reported as a single loan segment and class.

Upon adoption of ASC 326, owner occupied and non-owner occupied commercial real estate were segregated into separate classes within the commercial segment. Similarly, consumer auto was segregated into its own class within the consumer segment. These enhancements were made to capture the unique credit characteristics used in our CECL models. Information for reporting periods beginning after January 1, 2020 are presented in accordance with ASC 326 and reflect changes to the respective classes, while prior period amounts continue to be reported in accordance with previously applicable GAAP and have not been reclassified to conform to the current financial statement presentation.

The following represent our classes of loans as of January 1, 2020 upon adoption of ASC 326 (with the exception of SBA-PPP, which was added during second quarter 2020):

Commercial loans and leases

Construction and land development - Construction and land development consists of loans to finance land for development of commercial or residential real property and construction of multifamily apartments or other commercial properties. These loans are highly dependent on the supply and demand for commercial real estate as well as the demand for newly constructed residential homes and lots acquired for development. Deterioration in demand could result in decreased collateral values, which could make repayments of outstanding loans difficult for customers.

Owner occupied commercial mortgage - Owner occupied commercial mortgages consists of loans to purchase or re-finance owner occupied nonresidential properties. This includes office buildings, other commercial facilities, and farmland. Commercial mortgages secured by owner occupied properties are primarily dependent on the ability of borrowers to achieve business results consistent with those projected at loan origination. While these loans and leases are collateralized by real property in an effort to mitigate risk, it is possible the liquidation of collateral will not fully satisfy the obligation.

Non-owner occupied commercial mortgage - Non-owner occupied commercial mortgage consists of loans to purchase or refinance investment nonresidential properties. This includes office buildings and other facilities rented or leased to unrelated parties, as well as farmland and multifamily properties. The primary risk associated with income producing commercial mortgage loans is the ability of the income-producing property that collateralizes the loan to produce adequate cash flow to service the debt. While these loans and leases are collateralized by real property in an effort to mitigate risk, it is possible the liquidation of collateral will not fully satisfy the obligation.

Commercial and industrial and leases - Commercial and industrial loans consist of loans or lines of credit to finance accounts receivable, inventory or other general business needs, business credit cards, and lease financing agreements for equipment, vehicles, or other assets. The primary risk associated with commercial and industrial and lease financing loans is the ability of borrowers to achieve business results consistent with those projected at origination. Failure to achieve these projections presents risk the borrower will be unable to service the debt consistent with the contractual terms of the loan or lease.

SBA-PPP - These loans were originated as part of the SBA-PPP to finance payroll and other costs for nonprofit and small businesses impacted by the COVID-19 pandemic. These loans are guaranteed by the SBA and borrowers have the ability to qualify for loan forgiveness through the U.S. Treasury.

Consumer loans

Residential mortgage - Residential mortgage consists of loans to purchase or refinance the borrower’s primary dwelling, second residence or vacation home and are often secured by 1-4 family residential property. Significant and rapid declines in real estate values can result in borrowers having debt levels in excess of the current market value of the collateral.

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Revolving mortgage - Revolving mortgage consists of home equity lines of credit and other lines of credit secured by first or second liens on the borrower’s primary residence. These loans are secured by both senior and junior liens on the residential real estate and are particularly susceptible to declining collateral values. This risk is elevated for loans secured by junior lines as a substantial decline in value could render a the junior lien position effectively unsecured.

Construction and land development - Construction and land development consists of loans to construct a borrower’s primary or secondary residence or vacant land upon which the owner intends to construct a dwelling at a future date. These loans are typically secured by undeveloped or partially developed land in anticipation of completing construction of a 1-4 family residential property. There is risk these construction and development projects can experience delays and cost overruns exceeding the borrower’s financial ability to complete the project. Such cost overruns can result in foreclosure of partially completed and unmarketable collateral.

Consumer auto loans - Consumer auto loans consist of installment loans to finance purchases of vehicles. These loans include direct auto loans originated in bank branches, as well indirect auto loans originated through agreements with auto dealerships. The value of the underlying collateral within this class is at risk of potential rapid depreciation which could result in unpaid balances in excess of the collateral.

Other consumer - Other consumer loans consist of loans to finance unsecured home improvements, student loans and revolving lines of credit that can be secured or unsecured, including personal credit cards. The value of the underlying collateral within this class is at risk of potential rapid depreciation which could result in unpaid balances in excess of the collateral.

Accounting Policy - Nonperforming Assets and Troubled Debt Restructurings

Nonperforming Assets (“NPA”)

NPAs include nonaccrual loans, past due securities and foreclosed property. Foreclosed property consists of real estate and other assets acquired as a result of loan defaults and is discussed below.

All loans are classified as past due when the payment of principal and interest based upon contractual terms is greater than 30 days delinquent. Loans are generally placed on nonaccrual when principal or interest becomes 90 days past due or when it is probable the principal or interest is not fully collectible. When loans are placed on nonaccrual, all previously uncollected accrued interest is reversed from interest income and the ongoing accrual of interest is discontinued. All payments received thereafter are applied as a reduction of the remaining principal balance as long as doubt exists as to the ultimate collection of the principal. Loans and leases are generally removed from nonaccrual status when they become current for a sustained period of time and there is no longer concern as to the collectability of principal and interest.

Securities are also classified as past due when the payment of principal and interest based upon contractual terms is greater than 30 days delinquent. Missed interest payments on securities are rare. We review all securities with delinquent interest and immediately charge off any accrued interest determined to be uncollectible.

Troubled Debt Restructurings (“TDR”)

A loan is considered a TDR when both of the following occur: (1) a modification to a borrower’s debt agreement is made and (2) a concession is granted for economic or legal reasons related to a borrower’s financial difficulties that otherwise would not be granted. TDR concessions could include short-term deferrals of interest, modifications of payment terms, or (in certain limited instances) forgiveness of principal or interest. Loans restructured as a TDR are treated and reported as such for the remaining life of the loan. TDR loans can be nonaccrual or accrual, depending on the individual facts and circumstances of the borrower. In circumstances where a portion of the loan balance is charged-off, the remaining balance is typically classified as nonaccrual.

Accounting Policy - Allowance for Credit Losses (“ACL”)

Loans

Loans within the various reporting classes are segregated into pools with similar risk characteristics and models are built to estimate the ACL. These loan level ACL models estimate the probability of default and loss given default for individual loans within the risk pool based on historical loss experience, borrower characteristics, collateral type, forecasts of relevant economic conditions, expected future recoveries and other factors. Pools for estimating the ACL are aggregated into loan classes, as described above, which roll up into commercial and consumer loan segments. Non-PCD and PCD loans are modeled together within the loan level models using acquired and PCD indicator variables to provide differentiation of individual loan risk. BancShares uses a two year reasonable and supportable forecast period which incorporates economic forecasts at the time of evaluation. For most pools, BancShares uses a 12-month straight-line reversion period to historical averages for model inputs; however for the consumer other, consumer card and commercial card pools, immediate reversion to historical net loss rates is utilized.

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The ACL for SBA-PPP loans originated during the second quarter of 2020 were separately evaluated given the explicit government guarantee. This analysis, which incorporated historical experience with similar SBA guarantees and underwriting, concluded the likelihood of loss was remote and therefore these loans were assigned a zero expected credit loss in the ACL.

The ACL represents management’s best estimate of credit losses expected over the life of the loan, adjusted for expected contractual payments and the impact of prepayment expectations. Prepayment assumptions were developed through a review of BancShares’ historical prepayment activity and began with a review of prepayment assumptions utilized in other modeling activities. Estimates for loan losses are determined by analyzing quantitative and qualitative components present as of the evaluation date. Adjustments to the ACL are recorded with a corresponding entry to provision for credit losses. Loan balances considered uncollectible are charged-off against the ACL. Recoveries of amounts previously charged-off are credited to the ACL.

A primary component of determining the ACL on loans is the actual net loss history of the various loan pools. For commercial pools, key factors utilized in the models include delinquency trends as well as macroeconomic variables such as unemployment and commercial real estate price index. For consumer pools, key factors include delinquency trends and the borrower’s original credit score, as well as other macroeconomic variables such as unemployment, gross domestic product, home price index, and commercial real estate index. As the models project losses over the life of the loans, prepayment assumptions also serve as significant inputs. Model outputs may be adjusted through a qualitative assessment to reflect economic conditions and trends not captured within the models including credit quality, concentrations, and significant policy and underwriting changes.

Within our ACL model, TDRs meet the definition of default and are given a 100% probability of default rating. TDRs are not individually evaluated unless determined to be collateral-dependent. Therefore, loss given default is calculated based on the individual risk characteristics of the loan as defined in the model.

When loans do not share risk characteristics similar to others in the pool, the ACL is evaluated on an individual basis. Given that BancShares' CECL models are loan level models, the population of loans evaluated individually is minimal and consists primarily of loans greater than $500 thousand and determined to be collateral-dependent. BancShares elected the practical expedient allowed under ASC 326 to assess the collectability of these loans, where repayment is expected to be provided substantially through operation or sale of collateral, based on the fair value of the underlying collateral. The fair value of the collateral is estimated using appraised and market values (appropriately adjusted for an assessment of the sales and marketing costs when applicable). A specific allowance is established, or partial charge-off is recorded, for the difference between the excess amortized cost of loan and the collateral’s estimated fair value.

Accrued Interest Receivable

BancShares has elected not to measure an ACL for accrued interest receivable and has excluded it from the amortized cost basis of loans and held to maturity debt securities as our accounting policies and credit monitoring provide that uncollectible accrued interest is reversed or written off against interest income in a timely manner.

Unfunded Commitments

A reserve for unfunded commitments is established for off-balance sheet exposures such as unfunded balances for existing lines of credit, commitments to extend future credit, as well a both standby and commercial letters of credit when there is a contractual obligation to extend credit and when this extension of credit is not unconditionally cancellable (i.e. commitment cannot canceled at any time). These unfunded commitments are assessed to determine both the probability of funding as well the expectation of future losses. The expected funding balance is used in the probability of default and loss given default models to determine the reserve. The reserve for unfunded commitments was $13.7 million at June 30, 2020, and is recorded within other liabilities with changes recorded through other expense.

Adoption Impact

Upon adoption, BancShares recorded a net decrease of $37.9 million in the ACL which included a reduction of $56.9 million in the ACL on non-PCD loans, offset by an increase of $19.0 million in the ACL on PCD loans. The $56.9 million reduction in the ACL on non-PCD loans, as well as an $8.9 million increase in the reserve for unfunded commitments, net of deferred taxes, resulted in an increase in retained earnings of $36.9 million. The $19.0 million increase in the ACL on PCD loans was a reclassification of the PCD credit discount and resulted in a gross up of loan balances by this same amount and did not have any effect on retained earnings. Impact to total capital and capital ratios was not significant and we did not elect the capital phase-in option allowable for regulatory reporting purposes. There was no ACL recorded on debt securities held to maturity at adoption.

The largest changes in the ACL, affecting beginning retained earnings as a result of the adoption, were decreases in the ACL on commercial loan segments as these portfolios have exhibited strong historical credit performance and have relatively short average lives. The reduction in ACL on these segments was partially offset by increases in ACL on our consumer loan segments primarily due to their longer average lives. The increase in the reserve for unfunded commitments was primarily due to increases in the scope of off-balance sheet exposures considered in this estimate due to the provisions in ASU 2016-13.

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BancShares adopted this ASU using the prospective transition approach for PCD loans previously accounted for under ASC 310-30. In accordance with the standard, we did not assess whether purchased credit impaired (“PCI”) loans met the criteria of PCD as of the date of adoption and all loans previously classified as PCI were updated to the PCD classification. Pools utilized for PCI accounting under ASC 310-30 were dissolved upon adoption. Loans from performing PCI pools, not previously considered nonaccrual of $47.0 million, were reclassified into nonaccrual status as a result of adoption. PCD loans were assessed using the loan level probability of default and loss given default models, as well as utilizing prior specific loan reviews to inform the initial PCD loan ACL. The ACL for PCD loans increased as a result of adoption and the amortized cost basis of these loans was adjusted to reflect the transfer of this amount from credit discount to ACL. The remaining noncredit discount will be accreted into interest income at the effective interest rate as of January 1, 2020. At the date of adoption, no securities were determined to be PCD.

BancShares also adopted this ASU under the prospective transition approach for debt securities available for sale. No previously recorded other than temporary impairment was reported on the portfolio of debt securities.

Recently Issued Accounting Pronouncements

FASB ASU 2018-14 - Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans

This ASU modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans by eliminating the requirement to disclose the amounts in accumulated other comprehensive income expected to be recognized as components of net periodic benefit cost over the next fiscal year and adding a requirement to disclose an explanation of the reasons for significant gains and losses related to changes in the benefit obligation for the period.

The amendments in this ASU are effective for public entities for fiscal years ending after December 15, 2020. Early adoption is permitted for all entities. BancShares will adopt all applicable amendments and update the disclosures as appropriate during the fourth quarter of 2020.

NOTE B - BUSINESS COMBINATIONS

BancShares evaluated the financial statement significance for all business combinations completed during 2020 and concluded the completed business combinations noted below are not material to its consolidated financial statements, individually or in aggregate, and therefore, pro forma financial data is not included.

Each transaction is accounted for under the acquisition method of accounting and, accordingly, assets acquired and liabilities assumed are recorded at their estimated fair values as of the acquisition date. Fair values are preliminary and subject to refinement for up to one year after the closing date of the acquisition as additional information regarding closing date fair value becomes available.

As part of the accounting for each acquisition, we perform an analysis of the acquired bank’s loan portfolio and based on such credit factors as past due status, nonaccrual status, life-to-date charge-offs and other quantitative and qualitative considerations segregate the acquired loans into PCD loans and non-PCD loans. PCD loans are accounted for under ASC 326-20, and non-PCD loans which do not meet this criteria are accounted for under ASC 310-20. Additionally, we perform an analysis of the acquired bank’s portfolio of debt securities to determine if any debt securities should be designated PCD.

Community Financial Holding Company, Inc.

On February 1, 2020, FCB completed the merger of Duluth, Georgia-based Community Financial Holding Company, Inc. (“Community Financial”) and its bank subsidiary, Gwinnett Community Bank. Under the terms of the agreement, total cash consideration of $2.3 million was paid to the shareholders of Community Financial. The merger allows FCB to expand its presence and enhance banking efforts in Georgia.

The fair value of the assets acquired was $221.4 million, including $110.6 million in non-PCD loans, $23.4 million in PCD loans, net of an ACL of $1.2 million, and $536 thousand in a core deposit intangible. No debt securities purchased in the transaction were designated PCD. Liabilities assumed were $219.8 million, of which $209.3 million were deposits. As a result of the transaction, FCB recorded $686 thousand of goodwill. The amount of goodwill represents the excess purchase price over the estimated fair value of the net assets acquired. The premium paid reflects the increased market share and related synergies expected to result from the acquisition. None of the goodwill was deductible for income tax purposes as the merger was accounted for as a qualified stock purchase.

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The following table provides the purchase price as of the acquisition date and the identifiable assets acquired and liabilities assumed at their estimated fair values:

(Dollars in thousands)	As recorded by FCB
Purchase price			$	2,320
Assets
Cash and due from banks	$	1,085
Overnight investments	35,129
Investment securities	30,146
Loans	133,989
Premises and equipment	7,624
Other real estate owned	9,813
Income earned not collected	558
Intangible assets	536
Other assets	2,520
Total assets acquired	221,400
Liabilities
Deposits	209,340
Borrowings	9,925
Other liabilities	501
Total liabilities assumed	$	219,766
Fair value of net assets acquired			1,634
Goodwill recorded for Community Financial			$	686

Merger-related expenses of $495 thousand and $1.7 million were recorded for the three and six months ended June 30, 2020, respectively. Loan-related interest income generated from Community Financial was approximately $2.7 million since the acquisition date. The ongoing contribution of this transaction to BancShares’ financial statements is not considered material, and therefore pro forma financial data is not included.

Entegra Financial Corp.

On December 31, 2019, FCB completed the merger of Franklin, North Carolina-based Entegra Financial Corp. (“Entegra”) and its bank subsidiary, Entegra Bank. In order to obtain regulatory approval, FCB entered into an agreement for Select Bank & Trust Company (“Select Bank”) to purchase three North Carolina branches, located in Highlands, Sylva and Franklin. On April 17, 2020, FCB completed the divestiture of the branches including loans and leases, premises and equipment and total deposits with fair values of $110.1 million, $2.1 million and $184.8 million, respectively. The Select Bank purchase price for the divested branches included an 8% premium for deposits acquired that was applied against goodwill generated as part of the merger with Entegra Bank.

NOTE C - INVESTMENTS

Information for reporting periods beginning after January 1, 2020 are presented in accordance with ASC 326 and reflect changes required by the adoption of this standard which includes evaluating held to maturity and available for sale debt securities to determine the need to record a related allowance for credit losses. Prior period information continues to be reported in accordance with previously applicable GAAP. See Note A - Accounting Policies and Basis for Presentation for more detail on our policies and adoption.

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The amortized cost and fair value of investment securities at June 30, 2020 and December 31, 2019, were as follows:

	June 30, 2020
(Dollars in thousands)	Cost		Gross unrealized gains		Gross unrealized losses		Allowance for credit losses		Fair value
Investment securities available for sale
U.S. Treasury	$	754,350	$	236	$	—	$	—	$	754,586
Government agency	549,673		292		4,256		—		545,709
Residential mortgage-backed securities	5,671,151		119,935		694		—		5,790,392
Commercial mortgage-backed securities	1,047,601		32,221		—		—		1,079,822
Corporate bonds	449,623		4,387		5,237		—		448,773
Total investment securities available for sale	$	8,472,398	$	157,071	$	10,187	$	—	$	8,619,282
Investment in marketable equity securities	116,322		6,297		8,303				114,316
Investment securities held to maturity
Residential mortgage-backed securities	693,143		16,196		—		—		709,339
Commercial mortgage-backed securities	78,729		251		—				78,980
Other	3,006		—		—		—		3,006
Total investment securities held to maturity	774,878		16,447		—		—		791,325
Total investment securities	$	9,363,598	$	179,815	$	18,490	$	—	$	9,524,923
			December 31, 2019
(Dollars in thousands)			Cost		Gross unrealized gains		Gross unrealized losses		Fair value
Investment securities available for sale
U.S. Treasury			$	409,397	$	602	$	—	$	409,999
Government agency			684,085		928		2,241		682,772
Residential mortgage-backed securities			5,269,060		13,417		15,387		5,267,090
Commercial mortgage-backed securities			373,105		6,974		59		380,020
Corporate bonds			198,278		3,420		132		201,566
State, county and municipal			118,227		—		—		118,227
Total investment securities available for sale			$	7,052,152	$	25,341	$	17,819	$	7,059,674
Investment in marketable equity securities			59,262		23,304		233		82,333
Investment securities held to maturity
Other			30,996		—		—		30,996
Total investment securities held to maturity			30,996		—		—		30,996
Total investment securities			$	7,142,410	$	48,645	$	18,052	$	7,173,003

Investments in residential and commercial mortgage-backed securities represent securities issued by the Government National Mortgage Association, Federal National Mortgage Association and Federal Home Loan Mortgage Corporation. Investments in government agency securities represent securities issued by the United States Small Business Administration. Investments in corporate bonds and marketable equity securities represent positions in securities of other financial institutions. Other held to maturity investments include certificates of deposit with other financial institutions.

BancShares also holds approximately 354,000 shares of Visa Class B common stock. BancShares’ Visa Class B shares are not considered to have a readily determinable fair value and are recorded at $0. BancShares held FHLB stock of $45.4 million and $43.0 million and other non-marketable equity securities of $13.1 million and $12.5 million at June 30, 2020 and December 31, 2019, respectively. These securities are recorded in other assets.

As of June 30, 2020 and January 1, 2020, no ACL was required for available for sale and held to maturity debt securities. Accrued interest receivable on debt securities at June 30, 2020 was $21.3 million and was excluded from the estimate of credit losses. During the three and six months ended June 30, 2020, no accrued interest was deemed uncollectible and written off against interest income.

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The following table provides the amortized cost and fair value by contractual maturity for investment securities available for sale and held to maturity. Expected maturities will differ from contractual maturities on certain securities because issuers and borrowers of underlying collateral may have the right to call or prepay obligations with or without prepayment penalties.

	June 30, 2020				December 31, 2019
(Dollars in thousands)	Cost		Fair value		Cost		Fair value
Investment securities available for sale
Non-amortizing securities maturing in:
One year or less	$	754,350	$	754,586	$	406,325	$	406,927
One through five years	51,589		51,887		24,496		24,971
Five through 10 years	369,075		368,281		185,209		187,868
Over 10 years	28,959		28,605		109,872		110,026
Government agency	549,673		545,709		684,085		682,772
Residential mortgage-backed securities	5,671,151		5,790,392		5,269,060		5,267,090
Commercial mortgage-backed securities	1,047,601		1,079,822		373,105		380,020
Total investment securities available for sale	$	8,472,398	$	8,619,282	$	7,052,152	$	7,059,674
Investment securities held to maturity
Non-amortizing securities maturing in:
One year or less	2,257		2,257		30,746		30,746
One through five years	749		749		250		250
Residential mortgage-backed securities	693,143		709,339		—		—
Commercial mortgage-backed securities	78,729		78,980		—		—
Total investment securities held to maturity	$	774,878	$	791,325	$	30,996	$	30,996

There were gross gains of $13.8 million on sales of investment securities available for sale during the three months ended June 30, 2020 and no gross losses. There were gross gains of $34.2 million and gross losses of $679 thousand on sales of investment securities available for sale during the six months ended June 30, 2020. There were $5.7 million gross gains on sales of investment securities available for sale for the three and six months ended June 30, 2019 and no gross losses.

The following table provides the realized and unrealized gains and losses on marketable equity securities for the six months ended June 30, 2020 and 2019:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Marketable equity securities gains, net	$	64,570	$	3,144	$	13,162	$	14,472
Less net gains recognized on marketable equity securities sold	36,993		2,271		37,316		2,315
Unrealized gains (losses) recognized on marketable equity securities held	$	27,577	$	873	$	(24,154)	$	12,157

17

The following table provides information regarding securities with unrealized losses as of June 30, 2020 and December 31, 2019:

	June 30, 2020
	Less than 12 months				12 months or more				Total
(Dollars in thousands)	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Investment securities available for sale
Government agency	$	447,983	$	3,709	$	58,806	$	547	$	506,789	$	4,256
Residential mortgage-backed securities	172,628		302		149,170		392		321,798		694
Corporate bonds	112,172		5,120		9,451		117		121,623		5,237
Total	$	732,783	$	9,131	$	217,427	$	1,056	$	950,210	$	10,187
	December 31, 2019
	Less than 12 months				12 months or more				Total
(Dollars in thousands)	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Investment securities available for sale
Government agency	$	347,081	$	1,827	$	63,947	$	414	$	411,028	$	2,241
Residential mortgage-backed securities	2,387,293		14,016		264,257		1,371		2,651,550		15,387
Commercial mortgage-backed securities	35,926		59		—		—		35,926		59
Corporate bonds	7,714		123		4,749		9		12,463		132
Total	$	2,778,014	$	16,025	$	332,953	$	1,794	$	3,110,967	$	17,819

As of June 30, 2020, there were 47 investment securities available for sale with continuous losses for more than 12 months, of which 45 were government sponsored enterprise-issued mortgage-backed securities or government agency securities and two were corporate bonds.

None of the unrealized losses identified as of June 30, 2020, or December 31, 2019, relate to the marketability of the securities or the issuers’ ability to honor redemption obligations. Rather, the unrealized losses relate to changes in interest rates relative to when the investment securities were purchased, and do not indicate credit-related impairment. BancShares considered other factors including changes in credit ratings, delinquencies, and other macroeconomic factors in this determination. As a result, none of the securities were deemed to require an allowance for credit losses. BancShares has the ability and intent to retain these securities for a period of time sufficient to recover all unrealized losses.

Investment securities having an aggregate carrying value of $4.53 billion at June 30, 2020, and $3.93 billion at December 31, 2019, were pledged as collateral to secure public funds on deposit and certain short-term borrowings, and for other purposes as required by law.

BancShares’ portfolio of held to maturity debt securities consists of mortgage-backed securities issued by government agencies and government sponsored entities. Given the consistently strong credit rating of the U.S. Treasury and the long history of no credit losses on debt securities issued by government agencies and government sponsored entities, no further credit monitoring is performed on these portfolios. Should there be downgrades to the credit rating of the U.S. Treasury or losses reported on securities issued by government agencies and government sponsored entities, BancShares will reevaluate its determination of zero expected credit losses on held to maturity debt securities.

There were no debt securities held to maturity on nonaccrual status as of June 30, 2020.

A security is considered past due once it is 30 days contractually past due under the terms of the agreement. There were no securities past due as of June 30, 2020.

18

NOTE D - LOANS AND LEASES

BancShares’ accounting methods for loans and leases depends on whether they are originated or purchased, and if purchased, whether or not the loans reflect more than insignificant credit deterioration since origination, which is determined as of the acquisition date. Non-PCD loans consist of loans originated by BancShares and loans purchased from other institutions, that do not reflect more than insignificant credit deterioration at acquisition and are reported by loan segments and classes as defined in Note A - Accounting Polices and Basis of Presentation. Purchased loans which reflect more than insignificant credit deterioration are classified as PCD and reported as a single loan segment or class. At the date of acquisition, all acquired loans are recorded at fair value.

Loans and leases outstanding included the following at June 30, 2020 and December 31, 2019:

(Dollars in thousands)	June 30, 2020
Commercial:
Construction and land development	$	1,012,365
Owner occupied commercial mortgage	10,352,793
Non-owner occupied commercial mortgage	3,056,328
Commercial and industrial and leases	4,650,839
SBA-PPP	3,084,549
Total commercial loans	22,156,874
Consumer:
Residential mortgage	5,404,682
Revolving mortgage	2,233,977
Construction and land development	353,382
Consumer auto	1,195,771
Consumer other	543,088
Total consumer loans	9,730,900
Total non-PCD loans and leases	31,887,774
PCD loans	530,651
Total loans and leases	$	32,418,425

(Dollars in thousands)	December 31, 2019
Commercial:
Construction and land development	$	1,013,454
Commercial mortgage	12,282,635
Other commercial real estate	542,028
Commercial and industrial and leases	4,403,792
Other	310,093
Total commercial loans	18,552,002
Noncommercial:
Residential mortgage	5,293,917
Revolving mortgage	2,339,072
Construction and land development	357,385
Consumer	1,780,404
Total noncommercial loans	9,770,778
Total non-PCI loans and leases	28,322,780
PCI loans	558,716
Total loans and leases	$	28,881,496

Accrued interest receivable on loans at June 30, 2020 was $139.8 million and was excluded from the estimate of credit losses. Management reviewed this policy election during the second quarter of 2020 due to the increase in accrued interest receivable and concluded the policy election remained appropriate.

At June 30, 2020, $11.78 billion in non-PCD loans with a lendable collateral value of $8.52 billion were used to secure $653.7 million in Federal Home Loan Bank (“FHLB”) of Atlanta advances, resulting in additional borrowing capacity of $7.86 billion. At December 31, 2019, $9.41 billion in non-PCD loans with a lendable collateral value of $6.57 billion were used to secure $563.7 million in FHLB of Atlanta advances, resulting in additional borrowing capacity of $6.01 billion. At June 30, 2020, $3.93 billion in non-PCD loans with a lendable collateral value of $3.14 billion were used to secure additional borrowing capacity at the Federal Reserve Bank (“FRB”). At December 31, 2019, $3.68 billion in non-PCD loans with a lendable collateral value of $2.98 billion were used to secure additional borrowing capacity at the FRB.

19

Certain residential real estate loans are originated to be sold to investors and are recorded in loans held for sale at fair value. In addition, we may change our strategy for certain portfolio loans and decide to sell them in the secondary market. At that time, portfolio loans are transferred to loans held for sale at fair value. Loans held for sale totaled $107.9 million and $67.9 million at June 30, 2020 and December 31, 2019, respectively.

Net deferred fees on non-PCD loans and leases, including unearned and unamortized costs and fees, were $100.7 million and $927 thousand at June 30, 2020 and December 31, 2019, respectively. Of the amount outstanding as of June 30, 2020, $96.6 million relates to net deferred fees and costs on SBA-PPP loans. The net unamortized discount related to purchased non-PCD loans and leases was $25.8 million at June 30, 2020 and $30.9 million at December 31, 2019. The net unamortized discount related to PCD loans and leases was $54.7 million at June 30, 2020 and $88.2 million at December 31, 2019.

The aging of the outstanding loans and leases, by class, at June 30, 2020 and December 31, 2019 is provided in the tables below. Loans and leases past due 30 days or less are considered current as various grace periods allow borrowers to make payments within a stated period after the due date and still remain in compliance with the loan agreement.

	June 30, 2020
(Dollars in thousands)	30-59 days past due		60-89 days past due		90 days or greater		Total past due		Current		Total loans and leases
Commercial:
Construction and land development	$	1,618	$	14	$	1,721	$	3,353	$	1,009,012	$	1,012,365
Owner occupied commercial mortgage	14,360		2,518		12,820		29,698		10,323,095		10,352,793
Non-owner occupied commercial mortgage	7,914		982		8,520		17,416		3,038,912		3,056,328
Commercial and industrial and leases	10,464		3,196		4,215		17,875		4,632,964		4,650,839
SBA-PPP	—		—		—		—		3,084,549		3,084,549
Total commercial loans	34,356		6,710		27,276		68,342		22,088,532		22,156,874
Consumer:
Residential mortgage	25,243		7,082		35,044		67,369		5,337,313		5,404,682
Revolving mortgage	8,874		4,615		9,006		22,495		2,211,482		2,233,977
Construction and land development	1,735		127		57		1,919		351,463		353,382
Consumer auto	3,093		1,124		976		5,193		1,190,578		1,195,771
Consumer other	2,433		1,691		1,835		5,959		537,129		543,088
Total consumer loans	41,378		14,639		46,918		102,935		9,627,965		9,730,900
PCD loans	18,850		4,694		33,483		57,027		473,624		530,651
Total loans and leases	$	94,584	$	26,043	$	107,677	$	228,304	$	32,190,121	$	32,418,425
	December 31, 2019
(Dollars in thousands)	30-59 days past due		60-89 days past due		90 days or greater		Total past due		Current		Total loans and leases
Commercial:
Construction and land development	$	3,146	$	195	$	2,702	$	6,043	$	1,007,411	$	1,013,454
Commercial mortgage	20,389		8,774		8,319		37,482		12,245,153		12,282,635
Other commercial real estate	861		331		698		1,890		540,138		542,028
Commercial and industrial and leases	18,269		4,842		5,032		28,143		4,375,649		4,403,792
Other	51		411		126		588		309,505		310,093
Total commercial loans	42,716		14,553		16,877		74,146		18,477,856		18,552,002
Noncommercial:
Residential mortgage	45,839		18,289		24,409		88,537		5,205,380		5,293,917
Revolving mortgage	9,729		3,468		9,865		23,062		2,316,010		2,339,072
Construction and land development	977		218		1,797		2,992		354,393		357,385
Consumer	10,481		3,746		3,571		17,798		1,762,606		1,780,404
Total noncommercial loans	67,026		25,721		39,642		132,389		9,638,389		9,770,778
PCI loans	26,478		10,784		28,973		66,235		492,481		558,716
Total loans and leases	$	136,220	$	51,058	$	85,492	$	272,770	$	28,608,726	$	28,881,496

20

The amortized cost, by class, of loans and leases on nonaccrual status, and loans and leases greater than 90 days past due and still accruing at June 30, 2020 and December 31, 2019, were as follows:

	January 1, 2020(1)		June 30, 2020
(Dollars in thousands)	Nonaccrual loans and leases		Nonaccrual loans and leases		Loans and leases > 90 days and accruing
Commercial:
Construction and land development	$	4,281	$	2,938	$	69
Owner occupied commercial mortgage	24,476		28,283		111
Non-owner occupied commercial mortgage	5,965		8,491		615
Commercial and industrial and leases	7,685		7,239		1,399
Total commercial loans	42,407		46,951		2,194
Consumer:
Residential mortgage	44,357		59,352		—
Revolving mortgage	22,411		23,600		—
Construction and land development	2,828		1,699		—
Consumer auto	2,145		2,677		—
Consumer other	798		1,001		1,450
Total consumer loans	72,539		88,329		1,450
PCD loans	53,771		62,511		152
Total loans and leases	$	168,717	$	197,791	$	3,796
(1)Upon the adoption of ASC 326, BancShares eliminated the pooling of PCI loans and as a result $47.0 million in additional PCD loans were recognized as nonaccrual loans at January 1, 2020. As of June 30, 2020, $35.9 million of these loans remained outstanding.

	December 31, 2019
(Dollars in thousands)	Nonaccrual loans and leases		Loans and leases > 90 days and accruing
Commercial:
Construction and land development	$	4,281	$	—
Commercial mortgage	29,733		—
Commercial and industrial and leases	7,365		1,094
Other commercial real estate	708		—
Other	320		—
Total commercial loans	42,407		1,094
Noncommercial:
Construction and land development	2,828		—
Residential mortgage	44,357		45
Revolving mortgage	22,411		—
Consumer	2,943		2,152
Total noncommercial loans	72,539		2,197
PCI loans	6,743		24,257
Total loans and leases	$	121,689	$	27,548

Credit Quality

Loans and leases are monitored for credit quality on a recurring basis. Commercial and consumer loans and leases have different credit quality indicators as a result of the unique characteristics of the loan segments being evaluated. The credit quality indicators for commercial loans and leases are borrower risk classifications developed through a review of individual borrowers on an ongoing basis. Commercial loans are evaluated at least annually, with more frequent evaluations done on criticized loans. Commercial loans are also updated if there is evidence of potential credit deterioration, such as delinquency. Commercial credit cards are included in the Commercial and industrial and leases segment, but are evaluated based primarily upon delinquency status. The risk classifications as of the date presented are based on the most recent assessment performed and are defined below:

Pass – A pass rated asset is not adversely classified because it does not display any of the characteristics for adverse classification.

Special mention – A special mention asset has potential weaknesses that deserve management’s close attention. If left uncorrected, such potential weaknesses may result in deterioration of the repayment prospects or collateral position at some future date. Special mention assets are not adversely classified and do not warrant adverse classification.

21

Substandard – A substandard asset is inadequately protected by the current net worth and paying capacity of the borrower or of the collateral pledged, if any. Assets classified as substandard generally have a well-defined weakness, or weaknesses, that jeopardize the liquidation of the debt. These assets are characterized by the distinct possibility of loss if the deficiencies are not corrected.

Doubtful – An asset classified as doubtful has all the weaknesses inherent in an asset classified substandard with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable on the basis of currently existing facts, conditions and values.

Loss – Assets classified as loss are considered uncollectible and of such little value that it is inappropriate to be carried as an asset. This classification is not necessarily equivalent to any potential for recovery or salvage value, but rather that it is not appropriate to defer a full charge-off even though partial recovery may be affected in the future.

Ungraded – Ungraded loans represent loans that are not included in the individual credit grading process due to their relatively small balances or borrower type. The majority of ungraded loans at June 30, 2020 relate to business credit cards. Business credit card loans are subject to automatic charge-off when they become 120 days past due in the same manner as unsecured consumer lines of credit. The remaining balance is comprised of a small amount of commercial mortgage, lease financing and other commercial real estate loans.

The credit quality indicators for consumer and PCD loans are based on delinquency status of the borrower as of the date presented. As the borrower becomes more delinquent, the likelihood of loss increases.

The following tables represent current credit quality indicators by origination year as of June 30, 2020.

	Commercial Loans Amortized Cost Basis by Origination Year
Classification:	2020		2019		2018		2017		2016		Prior		Revolving		Revolving converted to term loans		Total
(Dollars in thousands)
Construction and land development
Pass	$	175,302	$	404,898	$	217,555	$	132,753	$	31,599	$	14,453	$	25,141	$	—	$	1,001,701
Special Mention	88		—		334		5,507		—		93		—		—		6,022
Substandard	1,405		1,221		1,813		29		8		166		—		—		4,642
Total	176,795		406,119		219,702		138,289		31,607		14,712		25,141		—		1,012,365
Owner occupied commercial mortgage
Pass	1,345,296		2,218,595		1,850,128		1,452,273		1,203,335		1,943,057		106,274		137		10,119,095
Special Mention	2,296		11,164		29,941		13,089		17,795		30,315		2,742		—		107,342
Substandard	9,186		12,309		16,886		24,063		14,255		40,331		9,254		72		126,356
Total	1,356,778		2,242,068		1,896,955		1,489,425		1,235,385		2,013,703		118,270		209		10,352,793
Non-owner occupied commercial mortgage
Pass	380,269		685,067		490,693		452,152		360,096		595,139		36,723		—		3,000,139
Special Mention	—		2,048		20,236		872		5,885		7,658		787		—		37,486
Substandard	1,237		1,094		3,653		1,642		6,513		3,085		1,479		—		18,703
Total	381,506		688,209		514,582		454,666		372,494		605,882		38,989		—		3,056,328
Commercial and industrial and leases
Pass	750,806		1,207,639		630,297		401,635		301,561		401,284		805,691		5,565		4,504,478
Special Mention	1,431		3,426		6,387		5,534		3,159		2,518		13,928		243		36,626
Substandard	11,847		3,794		4,323		5,608		2,790		4,941		22,084		696		56,083
Doubtful	—		—		39		—		—		—		2		—		41
Ungraded	—		—		—		—		—		—		53,611		—		53,611
Total	764,084		1,214,859		641,046		412,777		307,510		408,743		895,316		6,504		4,650,839
SBA-PPP
Pass	3,084,549		—		—		—		—		—		—		—		3,084,549
Total	3,084,549		—		—		—		—		—		—		—		3,084,549
Total commercial	$	5,763,712	$	4,551,255	$	3,272,285	$	2,495,157	$	1,946,996	$	3,043,040	$	1,077,716	$	6,713	$	22,156,874

22

	Consumer and PCD Loans Amortized Cost Basis by Origination Year
Days Past Due:	2020		2019		2018		2017		2016		Prior		Revolving		Revolving converted to term loans		Total
(Dollars in thousands)
Residential mortgage
Current	$	891,796	$	1,105,486	$	837,530	$	755,457	$	591,255	$	1,132,116	$	23,673	$	—	$	5,337,313
30-59 days	488		2,760		2,985		4,612		2,594		11,685		119		—		25,243
60-89 days	26		158		326		265		1,851		4,456		—		—		7,082
90 days or greater	23		738		5,815		6,054		6,203		13,239		2,972		—		35,044
Total	892,333		1,109,142		846,656		766,388		601,903		1,161,496		26,764		—		5,404,682
Revolving mortgage
Current	—		—		—		—		—		—		2,054,864		156,618		2,211,482
30-59 days	—		—		—		—		—		—		4,622		4,252		8,874
60-89 days	—		—		—		—		—		—		452		4,163		4,615
90 days or greater	—		—		—		—		—		—		3,150		5,856		9,006
Total	—		—		—		—		—		—		2,063,088		170,889		2,233,977
Construction and land development
Current	88,063		174,326		52,270		16,909		8,123		7,881		3,891		—		351,463
30-59 days	245		1,312		91		—		—		87		—		—		1,735
60-89 days	—		—		—		11		—		116		—		—		127
90 days or greater	—		—		—		—		—		57		—		—		57
Total	88,308		175,638		52,361		16,920		8,123		8,141		3,891		—		353,382
Consumer auto
Current	245,264		421,363		284,557		142,512		74,782		22,100		—		—		1,190,578
30-59 days	172		1,070		654		710		319		168		—		—		3,093
60-89 days	75		432		239		215		132		31		—		—		1,124
90 days or greater	22		312		306		206		76		54		—		—		976
Total	245,533		423,177		285,756		143,643		75,309		22,353		—		—		1,195,771
Consumer other
Current	27,655		40,769		17,093		9,585		10,595		31,275		400,157		—		537,129
30-59 days	78		33		79		31		13		22		2,177		—		2,433
60-89 days	31		67		70		—		5		—		1,518		—		1,691
90 days or greater	1		97		5		—		74		—		1,658		—		1,835
Total	27,765		40,966		17,247		9,616		10,687		31,297		405,510		—		543,088
Total consumer	$	1,253,939	$	1,748,923	$	1,202,020	$	936,567	$	696,022	$	1,223,287	$	2,499,253	$	170,889	$	9,730,900
PCD loans
Current	$	21,462	$	28,900	$	32,863	$	39,973	$	33,294	$	278,266	$	14,999	$	23,867	$	473,624
30-59 days	1,005		546		199		132		808		15,591		182		387		18,850
60-89 days	117		141		37		34		—		3,669		72		624		4,694
90 days or greater	454		3,075		8,152		1,469		1,101		17,135		516		1,581		33,483
Total	$	23,038	$	32,662	$	41,251	$	41,608	$	35,203	$	314,661	$	15,769	$	26,459	$	530,651
Total loans and leases	$	7,040,689	$	6,332,840	$	4,515,556	$	3,473,332	$	2,678,221	$	4,580,988	$	3,592,738	$	204,061	$	32,418,425

23

Loans and leases outstanding at December 31, 2019 by credit quality indicator are provided below:

	December 31, 2019
	Commercial loans and leases
(Dollars in thousands)	Construction and land development		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		PCI		Total commercial loans and leases
Grade:
Pass	$	1,004,922	$	12,050,799	$	536,682	$	4,256,456	$	308,796	$	148,412	$	18,157,655
Special mention	2,577		115,164		3,899		44,604		622		44,290		166,866
Substandard	5,955		116,672		1,447		34,148		675		87,970		158,897
Doubtful	—		—		—		3		—		3,657		3
Ungraded	—		—		—		68,581		—		—		68,581
Total	$	1,013,454	$	12,282,635	$	542,028	$	4,403,792	$	310,093	$	284,329	$	18,552,002

	December 31, 2019
	Noncommercial loans and leases
(Dollars in thousands)	Residential mortgage		Revolving mortgage		Construction and land development		Consumer		PCI		Total noncommercial loans and leases
Days past due:
Current	$	5,205,380	$	2,316,010	$	354,393	$	1,762,606	$	240,995	$	9,638,389
30-59 days past due	45,839		9,729		977		10,481		13,764		67,026
60-89 days past due	18,289		3,468		218		3,746		5,608		25,721
90 days or greater past due	24,409		9,865		1,797		3,571		14,020		39,642
Total	$	5,293,917	$	2,339,072	$	357,385	$	1,780,404	$	274,387	$	9,770,778

Purchased loans and leases

The following table summarizes PCD loans acquired in the Community Financial transaction and provides the contractually required payments, less the initial allowance for credit losses and discount to produce the fair value of acquired loans with evidence of more than insignificant credit quality deterioration since origination at the acquisition date:

(Dollars in thousands)	Community Financial
Contractually required payments	$	25,635
Initial PCD allowance	1,193
Discount	1,055
Fair value at acquisition date	$	23,387

The recorded fair values of purchased non-PCD loans acquired in the Community Financial transaction as of the acquisition date are as follows:

(Dollars in thousands)	Community Financial
Commercial:
Construction and land development	$	9,428
Owner occupied commercial mortgage	31,473
Non-owner occupied commercial mortgage	25,143
Commercial and industrial and leases	15,065
Total commercial loans	81,109
Consumer:
Residential mortgage	21,168
Revolving mortgage	2,084
Construction and land development	5,254
Consumer auto	294
Consumer other	693
Total consumer loans	29,493
Total non-PCD loans	$	110,602

24

NOTE E - ALLOWANCE FOR CREDIT LOSSES (“ACL”)

As noted in Note A - Accounting Polices and Basis of Presentation, BancShares determined SBA-PPP loans have zero expected credit losses and as such these are excluded from ACL disclosures included in the following tables.

Activity in the ACL by class of loans is summarized as follows:

	Three months ended June 30, 2020
(Dollars in thousands)	Construction and land development - commercial		Owner occupied commercial mortgage		Non-owner occupied commercial mortgage		Commercial and industrial and leases		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer auto		Consumer other		PCD		Total
Allowance for credit losses:
Balance at April 1	$	2,290	$	22,970	$	16,531	$	30,619	$	38,366	$	24,557	$	1,140	$	5,769	$	40,101	$	26,916	$	209,259
Provision (credits)	4,705		(721)		5,542		(2,898)		4,909		2,211		486		4,042		2,034		242		20,552
Charge-offs	(138)		—		(8)		(3,869)		(460)		(495)		—		(1,255)		(4,447)		(1,392)		(12,064)
Recoveries	49		240		84		781		57		367		14		342		1,607		1,162		4,703
Balance at June 30	$	6,906	$	22,489	$	22,149	$	24,633	$	42,872	$	26,640	$	1,640	$	8,898	$	39,295	$	26,928	$	222,450
	Three months ended June 30, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer		PCD		Total
Balance at April 1	$	37,476	$	45,281	$	2,399	$	57,025	$	2,167	$	16,987	$	21,495	$	2,473	$	34,492	$	8,980	$	228,775
Provision (credits)	(5,544)		3,714		(57)		2,699		(174)		371		(328)		277		4,877		(637)		5,198
Charge-offs	(28)		(89)		—		(3,422)		(31)		(478)		(493)		—		(6,061)		—		(10,602)
Recoveries	40		56		—		599		221		52		447		—		1,797		—		3,212
Balance at June 30	$	31,944	$	48,962	$	2,342	$	56,901	$	2,183	$	16,932	$	21,121	$	2,750	$	35,105	$	8,343	$	226,583
	Six months ended June 30, 2020
(Dollars in thousands)	Construction and land development - commercial		Owner occupied commercial mortgage		Non-owner occupied commercial mortgage		Commercial and industrial and leases		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer auto		Consumer other		PCD		Total
Balance at December 31	$	33,213	$	36,444	$	11,102	$	61,610	$	18,232	$	19,702	$	2,709	$	4,292	$	30,301	$	7,536	$	225,141
Adoption of ASC 326	(31,061)		(19,316)		460		(37,637)		17,118		3,665		(1,291)		1,100		10,037		19,001		(37,924)
Balance at January 1	2,152		17,128		11,562		23,973		35,350		23,367		1,418		5,392		40,338		26,537		187,217
Provision (credits)	4,756		5,386		10,498		7,525		8,502		3,515		263		5,000		5,808		(2,346)		48,907
Initial allowance on PCD loans	—		—		—		—		—		—		—		—		—		1,193		1,193
Charge-offs	(138)		(320)		(8)		(8,918)		(1,260)		(1,080)		(70)		(2,199)		(9,817)		(2,515)		(26,325)
Recoveries	136		295		97		2,053		280		838		29		705		2,966		4,059		11,458
Balance at June 30	$	6,906	$	22,489	$	22,149	$	24,633	$	42,872	$	26,640	$	1,640	$	8,898	$	39,295	$	26,928	$	222,450
	Six months ended June 30, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - non - commercial		Consumer		PCI		Total
Balance at January 1	$	35,270	$	43,451	$	2,481	$	55,620	$	2,221	$	15,472	$	21,862	$	2,350	$	35,841	$	9,144	$	223,712
Provision (credits)	(3,425)		6,085		(140)		5,424		(672)		1,879		(119)		400		8,317		(801)		16,948
Charge-offs	(72)		(850)		—		(5,280)		(31)		(644)		(1,456)		—		(12,423)		—		(20,756)
Recoveries	171		276		1		1,137		665		225		834		—		3,370		—		6,679
Balance at June 30	$	31,944	$	48,962	$	2,342	$	56,901	$	2,183	$	16,932	$	21,121	$	2,750	$	35,105	$	8,343	$	226,583

Upon adoption of ASC 326, BancShares recorded a net decrease of $37.9 million in the ACL which included a decrease of $56.9 million in the ACL on non-PCD loans, offset by an increase of $19.0 million in the ACL on PCD loans. The largest changes as a result of adoption were decreases in the ACL on commercial loan segments as these portfolios have exhibited strong historical credit performance and have relatively short average lives. The reduction in ACL on these segments was partially offset by increases in ACL on our consumer loan segments primarily due to their longer average lives. The increase in the ACL on PCD loans was primarily the result of reallocating credit discount from loan balances into ACL.

25

The ACL is calculated using a variety of factors, including, but not limited to, charge-off and recovery activity, loan growth, changes in macroeconomic factors, collateral type, estimated loan life and changes in credit quality. For the period ended June 30, 2020 the primary reason for the ACL change since the adoption of ASC 326, was a $36.1 million reserve build due to the potential economic impact of COVID-19 and its estimated impact on credit losses. Forecasted economic conditions are developed using third party macroeconomic scenarios adjusted based on management’s expectations over a forecast period of two years. Assumptions revert to long term historic averages over a one year period. Significant macroeconomic factors used in estimating the expected losses include unemployment, gross domestic product, home price index and commercial real estate index. Our model results included baseline, adverse and upside scenarios, as well as management’s expectation of borrower performance based upon COVID-19 residual risk by industry and geography. Expected loss estimates considered the potential impact of slower economic activity and elevated unemployment, as well as mitigating impacts from the government stimulus and loan modification programs. These loss estimates were also influenced by BancShares strong credit quality, historically low net charge-offs and recent credit trends, which remained stable through the quarter ended June 30, 2020.

BancShares individually reviews loans greater than $500 thousand that are determined to be collateral-dependent. These collateral-dependent loans are evaluated based on the fair value of the underlying collateral as repayment of the loan is expected to be made through the operation or sale of the collateral. Commercial and industrial loans and leases are collateralized by business assets, while the remaining loan classes are collateralized by real property.

The following table presents information on collateral-dependent loans by class and includes the amortized cost of collateral-dependent loans and leases, the net realizable value of the collateral, the extent to which collateral secures collateral-dependent loans and the associated ACL as of June 30, 2020 were as follows:

(Dollars in thousands)	Collateral-Dependant Loans		Net Realizable Value of Collateral		Collateral Coverage		Allowance for Credit Losses
Commercial loans:
Construction and land development	$	2,862	$	3,224	112.6	%	$	—
Owner occupied commercial mortgage	10,690		24,546		229.6		—
Non-owner occupied commercial mortgage	6,995		11,133		159.2		—
Commercial and industrial and leases	—		—		—		—
Total commercial loans	20,547		38,903		189.3		—
Consumer:
Residential mortgage	19,445		25,599		131.6		75
Revolving mortgage	310		310		100.0		—
Construction and land development	—		—		—		—
Total consumer loans	19,755		25,909		131.2		75
Total non-PCD loans	40,302		64,812		160.8		75
PCD	22,013		33,821		153.6		235
Total collateral-dependent loans	$	62,315	$	98,633	158.3	%	$	310

Collateral-dependent nonaccrual loans with no recorded allowance totaled $58.8 million as of June 30, 2020. All other nonaccrual loans have a recorded allowance.

The following tables present the allowance and recorded investment in loans and leases by class of loans, as well as the associated impairment method at December 31, 2019:

	December 31, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - non- commercial		Consumer		Total
Non-PCI Loans
Allowance for loan and lease losses:
ALLL for loans and leases individually evaluated for impairment	$	463	$	3,650	$	39	$	1,379	$	103	$	3,278	$	2,722	$	174	$	1,107	$	12,915
ALLL for loans and leases collectively evaluated for impairment	32,750		41,685		2,172		57,995		2,133		14,954		16,980		2,535		33,486		204,690
Total allowance for loan and lease losses	$	33,213	$	45,335	$	2,211	$	59,374	$	2,236	$	18,232	$	19,702	$	2,709	$	34,593	$	217,605
Loans and leases:
Loans and leases individually evaluated for impairment	$	4,655	$	70,149	$	1,268	$	12,182	$	639	$	60,442	$	28,869	$	3,882	$	3,513	$	185,599
Loans and leases collectively evaluated for impairment	1,008,799		12,212,486		540,760		4,391,610		309,454		5,233,475		2,310,203		353,503		1,776,891		28,137,181
Total loan and leases	$	1,013,454	$	12,282,635	$	542,028	$	4,403,792	$	310,093	$	5,293,917	$	2,339,072	$	357,385	$	1,780,404	$	28,322,780

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The following table presents the PCI allowance and recorded investment in loans at December 31, 2019:

(Dollars in thousands)	December 31, 2019
ALLL for loans acquired with deteriorated credit quality	$	7,536
Loans acquired with deteriorated credit quality	558,716

At December 31, 2019, $139.4 million of PCI loans experienced an adverse change in expected cash flows since the date of acquisition.

The following tables provide information on non-PCI impaired loans and leases, exclusive of loans and leases collectively evaluated:

	December 31, 2019
(Dollars in thousands)	With a recorded allowance		With no recorded allowance		Total		Unpaid principal balance		Related allowance recorded
Non-PCI impaired loans and leases:
Commercial:
Construction and land development	$	1,851	$	2,804	$	4,655	$	5,109	$	463
Commercial mortgage	42,394		27,755		70,149		74,804		3,650
Other commercial real estate	318		950		1,268		1,360		39
Commercial and industrial and leases	7,547		4,635		12,182		13,993		1,379
Other	406		233		639		661		103
Total commercial loans	52,516		36,377		88,893		95,927		5,634
Noncommercial:
Residential mortgage	48,796		11,646		60,442		64,741		3,278
Revolving mortgage	26,104		2,765		28,869		31,960		2,722
Construction and land development	2,470		1,412		3,882		4,150		174
Consumer	3,472		41		3,513		3,821		1,107
Total noncommercial loans	80,842		15,864		96,706		104,672		7,281
Total non-PCI impaired loans and leases	$	133,358	$	52,241	$	185,599	$	200,599	$	12,915

Non-PCI impaired loans less than $500,000 that were collectively evaluated for impairment totaled $41.0 million at December 31, 2019.

The following tables show the average non-PCI impaired loan balance and the interest income recognized by loan class for the six months ended June 30, 2019:

	Three months ended June 30, 2019				Six months ended June 30, 2019
(Dollars in thousands)	Average balance		Interest income recognized		Average balance		Interest income recognized
Non-PCI impaired loans and leases:
Commercial:
Construction and land development	$	2,102	$	6	$	2,125	$	34
Commercial mortgage	58,906		538		57,768		1,102
Other commercial real estate	519		6		602		14
Commercial and industrial and leases	11,348		113		10,674		213
Other	328		2		322		4
Total commercial	73,203		665		71,491		1,367
Noncommercial:
Residential mortgage	48,490		317		45,558		642
Revolving mortgage	29,623		256		29,183		503
Construction and land development	3,547		32		3,647		68
Consumer	3,014		31		3,007		60
Total noncommercial	84,674		636		81,395		1,273
Total non-PCI impaired loans and leases	$	157,877	$	1,301	$	152,886	$	2,640

Troubled Debt Restructurings

BancShares accounts for certain loan modifications or restructurings as TDRs. In general, the modification or restructuring of a loan is considered a TDR if, for economic or legal reasons related to a borrower’s financial difficulties, a concession is granted to the borrower that creditors would not otherwise consider. Concessions may relate to the contractual interest rate, maturity date, payment structure or other actions. Within our allowance for credit loss models, TDRs are not individually evaluated unless determined to be collateral-dependent and are included in the definition of default which provides for a 100% probability of default applied within the models. As a result, subsequent changes in default status do not impact the calculation of the allowance for credit losses on TDR loans.

27

The Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus was published by banking regulators in April 2020 to clarify expectations around loan modifications and the determination of TDRs for borrowers experiencing COVID-19-related financial difficulty. BancShares applied this regulatory guidance during its TDR identification process for short-term loan forbearance agreements as a result of COVID-19 and in most cases is not recording these as TDRs.

The following tables provides a summary of total TDRs by accrual status:

	June 30, 2020
(Dollars in thousands)	Accruing		Nonaccruing		Total
Commercial loans:
Construction and land development	$	1,072	$	1,304	$	2,376
Owner occupied commercial mortgage	35,080		12,682		47,762
Non-owner occupied commercial mortgage	7,343		313		7,656
Commercial and industrial and leases	29,463		2,803		32,266
Total commercial loans	72,958		17,102		90,060
Consumer:
Residential mortgage	35,439		14,167		49,606
Revolving mortgage	22,342		7,012		29,354
Construction and land development	2,355		1,452		3,807
Consumer auto	1,989		796		2,785
Consumer other	1,091		139		1,230
Total consumer loans	63,216		23,566		86,782
PCD loans	18,639		6,024		24,663
Total loans	$	154,813	$	46,692	$	201,505

	December 31, 2019
(Dollars in thousands)	Accruing		Nonaccruing		Total
Commercial loans:
Construction and land development	$	487	$	2,279	$	2,766
Commercial mortgage	50,819		11,116		61,935
Other commercial real estate	571		—		571
Commercial and industrial and leases	9,430		2,409		11,839
Other	320		105		425
Total commercial loans	61,627		15,909		77,536
Noncommercial:
Residential mortgage	41,813		16,048		57,861
Revolving mortgage	21,032		7,367		28,399
Construction and land development	1,452		2,430		3,882
Consumer	2,826		688		3,514
Total noncommercial loans	67,123		26,533		93,656
Total loans	$	128,750	$	42,442	$	171,192

Total TDRs included $17.2 million of PCI TDRs at December 31, 2019.

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The following table provides the types of modifications designated as TDRs during the six months ended June 30, 2020 and June 30, 2019, as well as a summary of loans modified as a TDR during the twelve month periods ended June 30, 2020 and June 30, 2019 that subsequently defaulted during the six months ended June 30, 2020 and June 30, 2019. BancShares defines payment default as movement of the TDR to nonaccrual status, which is generally 90 days past due for TDRs, foreclosure or charge-off, whichever occurs first.

	Three months ended June 30, 2020						Three months ended June 30, 2019
	All restructurings			Restructurings with payment default			All restructurings			Restructurings with payment default
(Dollars in thousands)	Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end
Loans and leases
Interest only	7	$	15,352	3	$	3,398	4	$	4,343	—	$	—
Loan term extension	27	2,925		13	1,459		4	998		2	183
Below market interest rate	69	17,291		18	1,069		67	6,979		30	2,612
Discharged from bankruptcy	43	1,472		9	311		40	5,054		30	3,106
Total restructurings	146	$	37,040	43	$	6,237	115	$	17,374	62	$	5,901
	Six months ended June 30, 2020						Six months ended June 30, 2019
	All restructurings			Restructurings with payment default			All restructurings			Restructurings with payment default
(Dollars in thousands)	Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end
Loans and leases
Interest only	17	$	19,328	3	$	3,398	4	$	4,343	2	$	3,203
Loan term extension	33	3,657		16	1,667		8	1,437		4	534
Below market interest rate	157	25,389		46	2,324		125	11,063		61	4,645
Discharged from bankruptcy	110	5,640		44	1,507		102	7,679		53	3,948
Total restructurings	317	$	54,014	109	$	8,896	239	$	24,522	120	$	12,330

For the six months ended June 30, 2020 and June 30, 2019, the pre-modification and post-modification outstanding amortized cost of loans modified as TDRs were not materially different.

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NOTE F - OTHER REAL ESTATE OWNED

The following table explains changes in OREO during the six months ended June 30, 2020 and 2019:

(Dollars in thousands)	OREO
Balance at December 31, 2019	$	46,591
Additions	9,184
Acquired in business combinations	9,813
Sales	(9,497)
Write-downs/losses	(2,241)
Balance at June 30, 2020	$	53,850
Balance at December 31, 2018	$	48,030
Additions	7,894
Acquired in business combinations	3,613
Sales	(11,012)
Write-downs/losses	(2,289)
Balance at June 30, 2019	$	46,236

At June 30, 2020 and December 31, 2019, BancShares had $11.7 million and $14.5 million, respectively, of foreclosed residential real estate property in OREO. The recorded investment in consumer mortgage loans collateralized by residential real estate property in the process of foreclosure was $25.5 million and $23.0 million at June 30, 2020 and December 31, 2019, respectively. Net gains and losses recorded on the sale of OREO properties were losses of $234 thousand and gains of $872 thousand for the six months ended June 30, 2020 and June 30, 2019, respectively

NOTE G - SERVICING RIGHTS

Mortgage Servicing Rights

Our portfolio of residential mortgage loans serviced for third parties was $3.37 billion and $3.38 billion as of June 30, 2020 and December 31, 2019, respectively. These loans are originated and sold to third parties on a non-recourse basis with servicing rights retained. The retained servicing rights were recorded as a servicing asset and are reported in other intangible assets. The associated amortization expense and any valuation allowance recognized were included as a reduction of mortgage income. Mortgage servicing rights are initially recorded at fair value and then carried at the lower of amortized cost or fair value.

Contractually specified mortgage servicing fees, late fees and ancillary fees earned for the three months ended June 30, 2020 and 2019 were $2.1 million and $2.0 million, respectively, and are reported in mortgage income. For the six months ended June 30, 2020 and 2019, contractually specified mortgage servicing fees, late fees, and ancillary fees earned were $4.3 million and $3.9 million, respectively.

The following table presents changes in the servicing asset during the three and six months ended June 30, 2020 and 2019:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Beginning balance	$	19,756	$	20,647	$	22,963	$	21,396
Servicing rights originated	2,096		1,552		3,679		2,411
Amortization	(2,119)		(1,567)		(3,942)		(3,014)
Valuation allowance (increase) decrease	(1,069)		33		(4,036)		(128)
Ending balance	$	18,664	$	20,665	$	18,664	$	20,665

The following table presents the activity in the servicing asset valuation allowance for the three and six months ended June 30, 2020 and 2019:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Beginning balance	$	3,189	$	161	$	222	$	—
Valuation allowance increase (decrease)	1,069		(33)		4,036		128
Ending balance	$	4,258	$	128	$	4,258	$	128

30

Mortgage servicing rights valuations are performed using a pooling methodology where loans with similar risk characteristics are grouped together and evaluated using discounted cash flows to estimate the present value of future earnings. Key economic assumptions used to value mortgage servicing rights were as follows:

	June 30, 2020			December 31, 2019
Discount rate - conventional fixed loans	7.66		%	8.92		%
Discount rate - all loans excluding conventional fixed loans	8.66		%	9.92		%
Weighted average constant prepayment rate	20.19		%	13.72		%
Weighted average cost to service a loan	$	87.30		$	87.09

The fair value of mortgage servicing rights is sensitive to changes in assumptions and is determined by estimating the present value of the asset’s future cash flows by utilizing discount rates, prepayment rates, and other inputs. The discount rate is based on the 10-year U.S. Treasury rate plus a risk premium of 700 basis points for conventional fixed loans and 800 basis points for all other loans. The prepayment rate is derived from the Public Securities Association Standard Prepayment model. Generally, as interest rates decline, mortgage loan prepayments accelerate due to increased refinance activity, which results in a decrease in the fair value and may result in the recognition of a valuation allowance. The average cost to service a loan is based on the number of loans serviced and the total cost to service the loans.

NOTE H - REPURCHASE AGREEMENTS

BancShares utilizes securities sold under agreements to repurchase to facilitate the needs of customers and secure wholesale funding needs. Repurchase agreements are transactions whereby BancShares offers to sell to a counterparty an undivided interest in an eligible security at an agreed upon price, and which obligates BancShares to repurchase the security at an agreed upon date, repurchase price, and interest rate. These agreements are recorded at the amount of cash received in connection with the transaction and are reflected as securities sold under customer repurchase agreements.

BancShares monitors collateral levels on a continuous basis and maintains records of each transaction specifically describing the applicable security and the counterparty’s interest in that security, and segregates the security from general assets in accordance with regulations governing custodial holdings of securities. The primary risk with repurchase agreements is market risk associated with the investments securing the transactions, as additional collateral may be required based on fair value changes of the underlying investments. Securities pledged as collateral under repurchase agreements are maintained with safekeeping agents. The carrying value of investment securities available for sale pledged as collateral under repurchase agreements was $766.8 million and $477.6 million at June 30, 2020 and December 31, 2019, respectively.

At June 30, 2020, BancShares held $740.3 million of securities sold under agreements to repurchase, with overnight and continuous remaining contractual maturities, made up of $470.8 million collateralized by government agency securities and $269.5 million collateralized by commercial mortgage-backed securities. At December 31, 2019, BancShares held securities sold under agreements to repurchase of $443.0 million, with overnight and continuous remaining contractual maturities collateralized by government agency securities.

NOTE I - FDIC SHARED-LOSS PAYABLE

At June 30, 2020, shared-loss protection remains for single family residential loans acquired in the amount of $38.0 million. The shared-loss agreement for two of the FDIC-assisted transactions include a provision related to a payment that may be owed to the FDIC at the termination of the agreement if actual cumulative losses on acquired covered assets are lower than the cumulative losses originally estimated by the FDIC at the time of acquisition (the “clawback liability”). BancShares issued a payment to the FDIC in the first quarter of 2020 for $99.5 million related to one of the transactions. The remaining clawback liability payment date is March 2021.

The following table provides changes in the FDIC shared-loss payable since December 31, 2019:

(Dollars in thousands)	Total
Balance at December 31, 2019	$	112,395
Accretion	2,098
Payment made to the FDIC to settle shared-loss agreement	(99,468)
Balance at June 30, 2020	$	15,025

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NOTE J - ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Accumulated other comprehensive income (loss) included the following as of June 30, 2020 and December 31, 2019:

	June 30, 2020						December 31, 2019
(Dollars in thousands)	Accumulated other comprehensive income (loss)		Deferred tax expense (benefit)		Accumulated other comprehensive income (loss), net of tax		Accumulated other comprehensive income (loss)		Deferred tax expense (benefit)		Accumulated other comprehensive income (loss), net of tax
Unrealized gains on securities available for sale	$	146,884	$	33,782	$	113,102	$	7,522	$	1,730	$	5,792
Defined benefit pension items	(159,436)		(36,670)		(122,766)		(172,098)		(39,583)		(132,515)
Total	$	(12,552)	$	(2,888)	$	(9,664)	$	(164,576)	$	(37,853)	$	(126,723)

The following table highlights changes in accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2020 and 2019:

	Three months ended June 30, 2020
(Dollars in thousands, net of tax)	Unrealized gains (losses) on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	102,080	$	—	$	(127,692)	$	(25,612)
Net unrealized gains arising during period	21,611		—		—		21,611
Amounts reclassified from accumulated other comprehensive loss	(10,589)		—		4,926		(5,663)
Net current period other comprehensive income	11,022		—		4,926		15,948
Ending balance	$	113,102	$	—	$	(122,766)	$	(9,664)
	Three months ended June 30, 2019
(Dollars in thousands, net of tax)	Unrealized gains (losses) on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	(16,890)	$	(66,558)	$	(123,412)	$	(206,860)
Net unrealized gains arising during period	23,848		—		—		23,848
Amounts reclassified from accumulated other comprehensive loss	(4,404)		4,579		2,106		2,281
Net current period other comprehensive income	19,444		4,579		2,106		26,129
Ending balance	$	2,554	$	(61,979)	$	(121,306)	$	(180,731)

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	Six months ended June 30, 2020
(Dollars in thousands, net of tax)	Unrealized gains on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	5,792	$	—	$	(132,515)	$	(126,723)
Net unrealized gains arising during period	133,141		—		—		133,141
Amounts reclassified from accumulated other comprehensive loss	(25,831)		—		9,749		(16,082)
Net current period other comprehensive income	107,310		—		9,749		117,059
Ending balance	$	113,102	$	—	$	(122,766)	$	(9,664)
	Six months ended June 30, 2019
(Dollars in thousands, net of tax)	Unrealized gains on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	(38,505)	$	(71,149)	$	(125,533)	$	(235,187)
Net unrealized gains arising during period	45,463		—		—		45,463
Amounts reclassified from accumulated other comprehensive loss	(4,404)		9,170		4,227		8,993
Net current period other comprehensive income	41,059		9,170		4,227		54,456
Ending balance	$	2,554	$	(61,979)	$	(121,306)	$	(180,731)

The following table presents the amounts reclassified from accumulated other comprehensive income (loss) and the line item affected in the statement where net income is presented for the three and six months ended June 30, 2020 and 2019:

(Dollars in thousands)	Three months ended June 30, 2020
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	13,752	Realized gains on investment securities available for sale, net
	(3,163)		Income taxes
	$	10,589
Amortization of defined benefit pension actuarial losses	(6,398)		Other
	1,472		Income taxes
	$	(4,926)
Total reclassifications for the period	$	5,663
	Three months ended June 30, 2019
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	5,719	Realized gains on investment securities available for sale, net
	(1,315)		Income taxes
	$	4,404
Amortization of unrealized losses on securities available for sale transferred to held to maturity	$	(5,947)	Net interest income
	1,368		Income taxes
	$	(4,579)
Amortization of defined benefit pension items
Prior service costs	$	(14)	Salaries and wages
Actuarial losses	(2,721)		Other
	(2,735)		Income before income taxes
	629		Income taxes
	$	(2,106)
Total reclassifications for the period	$	(2,281)

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	Six months ended June 30, 2020
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	33,547	Realized gains on investment securities available for sale, net
	(7,716)		Income taxes
	$	25,831
Amortization of defined benefit pension items
Actuarial losses	$	(12,662)	Other
	2,913		Income taxes
	$	(9,749)
Total reclassifications for the period	$	16,082
	Six months ended June 30, 2019
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	5,719	Realized gains on investment securities available for sale, net
	(1,315)		Income taxes
	$	4,404	Net income
Amortization of unrealized losses on securities available for sale transferred to held to maturity	$	(11,909)	Net interest income
	2,739		Income taxes
	$	(9,170)
Amortization of defined benefit pension items
Prior service costs	$	(28)	Salaries and wages
Actuarial losses	(5,462)		Other
	(5,490)		Income before income taxes
	1,263		Income taxes
	$	(4,227)
Total reclassifications for the period	$	(8,993)

NOTE K - ESTIMATED FAIR VALUES

Fair value estimates are intended to represent the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. Where there is no active market for a financial instrument, BancShares has made estimates using discounted cash flows or other valuation techniques. Inputs used in these valuation techniques are subjective in nature, involve uncertainties and require significant judgment and therefore can only be derived within a range of precision. Accordingly, the derived fair value estimates presented below are not necessarily indicative of the amounts BancShares would realize in a current market exchange.

ASC 820, Fair Value Measurements and Disclosures, indicates that assets and liabilities are recorded at fair value according to a fair value hierarchy comprised of three levels. The levels are based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. The level within the fair value hierarchy for an asset or liability is based on the highest level of input that is significant to the fair value measurement (with Level 1 considered highest and Level 3 considered lowest). A brief description of each level follows:

•Level 1 values are based on quoted prices for identical instruments in active markets.

•Level 2 values are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market.

•Level 3 values are derived from valuation techniques in which one or more significant inputs or assumptions are not observable in the market. These unobservable inputs and assumptions reflect estimates that market participants would use in pricing the asset or liability. Valuation techniques include the use of discounted cash flow models and similar techniques.

BancShares’ management reviews any changes to its valuation methodologies to ensure they are appropriate and supportable, and refines valuation methodologies as more market-based data becomes available. Accuracy of the levels of the fair value hierarchy are validated at the end of the reporting period.

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The methodologies used to estimate the fair value of financial assets and financial liabilities are discussed below:

Investment securities available for sale and held to maturity. The fair value of U.S. Treasury, government agency and mortgage-backed securities, municipal securities, as well as a portion of corporate bonds, is generally estimated using a third party pricing service. The third party provider evaluates securities based on comparable investments with trades and market data and will utilize pricing models that use a variety of inputs, such as benchmark yields, reported trades, broker-dealer quotes, issuer spreads, benchmark securities, bids and offers as needed. These securities are generally classified as Level 2. The remaining corporate bonds held are generally measured at fair value based on indicative bids from broker-dealers and are not directly observable. These securities are considered Level 3.

Investment in marketable equity securities. Equity securities are measured at fair value using observable closing prices and the market activity. Equity securities are classified as Level 1 if they are traded in an active market and as Level 2 if the observable closing price is from a less than active market.

Loans held for sale. Management elects the fair value option on certain residential real estate loans originated to be sold to investors. The loans are carried at fair value based on quoted market prices for similar types of loans. Accordingly, the inputs used to calculate fair value of originated residential real estate loans held for sale are classified as Level 2 inputs. Loans held for investment subsequently transferred to held for sale are carried at fair value when a firm commitment to purchase from a counterparty exists. The fair value of the transferred loans is based on the quoted prices and is considered a Level 1 input.

Net loans and leases. Fair value is estimated based on discounted future cash flows using the current interest rates at which loans with similar terms would be made to borrowers of similar credit quality. The inputs used in the fair value measurements for loans and leases are considered Level 3 inputs.

FHLB stock. The carrying amount of FHLB stock is a reasonable estimate of fair value as these securities are not readily marketable and are evaluated for impairment based on the ultimate recoverability of the par value. BancShares considers positive and negative evidence, including the profitability and asset quality of the issuer, dividend payment history and recent redemption experience, when determining the ultimate recoverability of the par value. BancShares believes its investment in FHLB stock is ultimately recoverable at par. The inputs used in the fair value measurement for the FHLB stock are considered Level 2 inputs.

Mortgage and other servicing rights. Mortgage and other servicing rights are carried at the lower of amortized cost or market value and are, therefore, carried at fair value only when fair value is less than the amortized cost. The fair value of mortgage and other servicing rights is performed using a pooling methodology. Similar loans are pooled together and a model that relies on discount rates, estimates of prepayment rates and the weighted average cost to service the loans is used to determine the fair value. The inputs used in the fair value measurement for mortgage and other servicing rights are considered Level 3 inputs.

Deposits. For non-time deposits, carrying value is a reasonable estimate of fair value. The fair value of time deposits is estimated by discounting future cash flows using the interest rates currently offered for deposits with similar remaining maturities. The inputs used in the fair value measurement for deposits are considered Level 2 inputs.    

Borrowings. For borrowings, the fair values are determined based on recent trades or sales of the actual security if available. Otherwise, fair values are estimated by discounting future cash flows using current interest rates for similar financial instruments. The inputs used in the fair value measurement for FHLB borrowings, subordinated debentures, and other borrowings are considered Level 2 inputs.

Payable to the FDIC for shared-loss agreements. The fair value of the payable to the FDIC for shared-loss agreements is determined based on expected payments to the FDIC in accordance with the shared-loss agreements. Cash flows are discounted using current discount rates to reflect the timing of the estimated amounts due to the FDIC. The inputs used in the fair value measurement for the payable to the FDIC are considered Level 3 inputs.

Off-balance-sheet commitments and contingencies. Carrying amounts are reasonable estimates of the fair values for such financial instruments. Carrying amounts include unamortized fee income and, in some cases, reserves for any credit losses from those financial instruments. These amounts are not material to BancShares’ financial position.

For all other financial assets and liabilities, the carrying value is a reasonable estimate of the fair value as of June 30, 2020 and December 31, 2019. The carrying value and fair value for these assets and liabilities are equivalent because they are relatively short term in nature and there is no interest rate or credit risk that would cause the fair value to differ from the carrying value. Cash and due from banks is classified on the fair value hierarchy as Level 1. Overnight investments, income earned not collected, securities sold under customer repurchase agreements, and accrued interest payable are considered Level 2.

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The table presents the carrying values and estimated fair values for financial instruments as of June 30, 2020 and December 31, 2019:

(Dollars in thousands)	June 30, 2020				December 31, 2019
	Carrying value		Fair value		Carrying value		Fair value
Cash and due from banks	$	389,233	$	389,233	$	376,719	$	376,719
Overnight investments	3,107,575		3,107,575		1,107,844		1,107,844
Investment in marketable equity securities	114,316		114,316		82,333		82,333
Investment securities available for sale	8,619,282		8,619,282		7,059,674		7,059,674
Investment securities held to maturity	774,878		791,325		30,996		30,996
Loans held for sale	107,881		107,881		67,869		67,869
Net loans and leases	32,195,975		32,604,388		28,656,355		28,878,550
Income earned not collected	175,496		175,496		123,154		123,154
Federal Home Loan Bank stock	45,392		45,392		43,039		43,039
Mortgage and other servicing rights	20,167		21,163		24,891		26,927
Deposits with no stated maturity	38,202,609		38,202,609		30,593,627		30,593,627
Time deposits	3,276,636		3,303,841		3,837,609		3,842,162
Securities sold under customer repurchase agreements	740,276		740,276		442,956		442,956
Federal Home Loan Bank borrowings	657,682		679,993		572,185		577,362
Subordinated debt	504,246		506,089		163,412		173,685
Other borrowings	96,791		95,861		148,318		149,232
FDIC shared-loss payable	15,025		15,730		112,395		114,252
Accrued interest payable	14,085		14,085		18,124		18,124

For assets and liabilities carried at fair value on a recurring basis, the following table provides fair value information as of June 30, 2020 and December 31, 2019:

	June 30, 2020
			Fair value measurements using:
(Dollars in thousands)	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Assets measured at fair value
Investment securities available for sale
U.S. Treasury	$	754,586	$	—	$	754,586	$	—
Government agency	545,709		—		545,709		—
Residential mortgage-backed securities	5,790,392		—		5,790,392		—
Commercial mortgage-backed securities	1,079,822		—		1,079,822		—
Corporate bonds	448,773		—		278,796		169,977
Total investment securities available for sale	$	8,619,282	$	—	$	8,449,305	$	169,977
Marketable equity securities	$	114,316	$	50,352	$	63,964	$	—
Loans held for sale	$	107,881	$	—	$	107,881	$	—
	December 31, 2019
			Fair value measurements using:
	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Assets measured at fair value
Investment securities available for sale
U.S. Treasury	$	409,999	$	—	$	409,999	$	—
Government agency	682,772		—		682,772		—
Residential mortgage-backed securities	5,267,090		—		5,267,090		—
Commercial mortgage-backed securities	380,020		—		380,020		—
Corporate bonds	201,566		—		131,881		69,685
State, county and municipal	118,227		—		118,227		—
Total investment securities available for sale	$	7,059,674	$	—	$	6,989,989	$	69,685
Marketable equity securities	$	82,333	$	29,458	$	52,875	$	—
Loans held for sale	$	67,869	$	—	$	67,869	$	—

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The following tables summarize activity for Level 3 assets:

	Corporate bonds
	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Beginning balance	$	67,016	$	146,287	$	69,685	$	143,226
Purchases	100,595		991		100,595		3,991
Unrealized net gains (losses) included in other comprehensive income	2,449		1,822		(1,917)		1,838
Amounts included in net income	(83)		37		(168)		82
Transfers in	—		—		1,782		—
Ending balance	$	169,977	$	149,137	$	169,977	$	149,137

During the three months ended June 30, 2020, there were no transfers between levels. During the six months ended June 30, 2020, there were transfers from Level 2 to Level 3 of $1.8 million in corporate bonds available for sale. The transfers were due to a lack of observable inputs and trade activity for those securities. During the three and six months ended June 30, 2019, there were no transfers between levels.

The following table presents quantitative information about Level 3 fair value measurements for fair value on a recurring basis at June 30, 2020:

(Dollars in thousands)			June 30, 2020
Level 3 assets	Valuation technique	Significant unobservable input	Fair Value
Corporate bonds	Indicative bid provided by broker	Multiple factors, including but not limited to, current operations, financial condition, cash flows, and recently executed financing transactions related to the issuer	$	169,977

Fair Value Option

BancShares has elected the fair value option for residential real estate loans originated to be sold. This election reduces certain timing differences in the Consolidated Statement of Income and better aligns with the management of the portfolio from a business perspective. The changes in fair value were recorded as a component of mortgage income and included a gain of $2.4 million and a loss of $82 thousand for the three months ended June 30, 2020 and 2019, respectively. The changes in fair value included gains of $3.6 million and $167 thousand for the six months ended June 30, 2020 and 2019, respectively.

The following table summarizes the difference between the aggregate fair value and the aggregate unpaid principal balance for residential real estate originated for sale measured at fair value as of June 30, 2020 and December 31, 2019:

	June 30, 2020
(Dollars in thousands)	Fair value		Aggregate unpaid principal balance		Difference
Originated loans held for sale	$	107,881	$	102,189	$	5,692
	December 31, 2019
	Fair value		Aggregate unpaid principal balance		Difference
Originated loans held for sale	$	67,869	$	65,697	$	2,172

No originated loans held for sale were 90 or more days past due or on nonaccrual status as of June 30, 2020 or December 31, 2019.

We may be required to measure certain financial assets at fair value on a nonrecurring basis. These adjustments to fair value usually result from the application of lower of amortized cost or fair value accounting or write-downs of individual assets due to impairment.

Following the adoption of ASC 326, the population of loans measured at fair value on a non-recurring basis has greatly diminished and is limited to collateral-dependent loans evaluated individually. These collateral-dependent loans are deemed to be at fair value if there is an associated allowance for credit losses or if a charge-off has been recorded in the previous 12 months. Collateral values are determined using appraisals or other third-party value estimates of the subject property discounted based on estimated selling costs, generally between 6% and 10%, and immaterial adjustments for other external factors that may impact the marketability of the collateral. The weighted average discount for estimated selling costs applied was 7.81%.

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Prior to the adoption of ASC 326, impaired loans were deemed to be at fair value if an associated allowance or current period charge-off had been recorded. The value of impaired loans was determined by either collateral valuations or discounted present value of the expected cash flow calculations. Collateral values were determined using appraisals or other third-party value estimates of the subject property with discounts, generally between 6% and 11%, applied for estimated selling costs and other external factors that may impact the marketability of the property. Expected cash flows were determined using expected payment information at the individual loan level, discounted using the effective interest rate. The effective interest rate for impaired loans generally ranges between 3% and 7%.

OREO acquired or written down within the previous 12 months is deemed to be at fair value. Asset valuations are determined by using appraisals or other third-party value estimates of the subject property with with discounts generally between 7% and 16% applied for estimated selling costs and other external factors that may impact the marketability of the property. At June 30, 2020, the weighted average discount applied was 8.16%. Changes to the value of the assets between scheduled valuation dates are monitored through continued communication with brokers and monthly reviews by the asset manager assigned to each asset. If there are any significant changes in the market or the subject property, valuations are adjusted or new appraisals ordered to ensure the reported values reflect the most current information.

For financial assets and liabilities carried at fair value on a nonrecurring basis, the following table provides fair value information as of June 30, 2020 and December 31, 2019:

	June 30, 2020
			Fair value measurements using:
(Dollars in thousands)	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Collateral-dependent loans	$	14,341	$	—	$	—	$	14,341
Other real estate owned	44,465		—		—		44,465
Mortgage servicing rights	17,992		—		—		17,992
	December 31, 2019
			Fair value measurements using:
	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Impaired loans	$	132,336	$	—	$	—	$	132,336
Other real estate owned	38,310		—		—		38,310
Mortgage servicing rights	3,757		—		—		3,757

No financial liabilities were carried at fair value on a nonrecurring basis as of June 30, 2020 and December 31, 2019.

NOTE L - EMPLOYEE BENEFIT PLANS

BancShares sponsors noncontributory defined benefit pension plans for its qualifying employees. The service cost component of net periodic benefit cost is included in salaries and wages while all other non-service cost components are included in other noninterest expense.

For the three and six months ended June 30, 2020 and 2019, the components of net periodic benefit cost are as follows:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Service cost	$	3,682	$	3,271	$	7,139	$	6,384
Interest cost	8,568		9,338		17,099		18,629
Expected return on assets	(16,435)		(15,661)		(32,844)		(31,296)
Amortization of prior service cost	—		14		—		28
Amortization of net actuarial loss	6,398		2,721		12,662		5,462
Net periodic cost (benefit)	$	2,213	$	(317)	$	4,056	$	(793)

A discretionary contribution of $100.0 million was made to the pension plans during the six months ended June 30, 2020. Management evaluates the need for its pension plan contributions on a periodic basis based upon numerous factors including, but not limited to, the funded status of the plans, returns on plan assets, discount rates and the current economic environment.

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NOTE M - LEASES

The following table presents lease assets and liabilities as of June 30, 2020 and December 31, 2019:

(Dollars in thousands)	Classification	June 30, 2020		December 31, 2019
Assets:
Operating	Other assets	$	73,488	$	77,115
Finance	Premises and equipment	7,547		8,820
Total leased assets		$	81,035	$	85,935
Liabilities:
Operating	Other liabilities	$	73,481	$	76,746
Finance	Other borrowings	7,463		8,230
Total lease liabilities		$	80,944	$	84,976

NOTE N - COMMITMENTS AND CONTINGENCIES

To meet the financing needs of its customers, BancShares and its subsidiaries have financial instruments with off-balance sheet risk. These financial instruments involve elements of credit, interest rate or liquidity risk and include commitments to extend credit and standby letters of credit.

Commitments to extend credit are legally binding agreements to lend to customers. These commitments generally have fixed expiration dates or other termination clauses and may require payment of fees. Since many of these commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future liquidity requirements. Established credit standards control the credit risk exposure associated with these commitments. In some cases, BancShares requires collateral be pledged to secure the commitment, including cash deposits, securities and other assets.

Standby letters of credit are commitments guaranteeing performance of a customer to a third party. Those commitments are primarily issued to support public and private borrowing arrangements. To mitigate its risk, BancShares’ credit policies govern the issuance of standby letters of credit. The credit risk related to the issuance of these letters of credit is essentially the same as in extending loans to clients and, therefore, these letters of credit are collateralized when necessary.

The following table presents the commitments to extend credit and standby letters of credit as of June 30, 2020 and December 31, 2019:

(Dollars in thousands)	June 30, 2020		December 31, 2019
Unused commitments to extend credit	$	11,705,547	$	10,682,378
Standby letters of credit	104,655		99,601

BancShares has investments in qualified affordable housing projects primarily for the purposes of fulfilling Community Reinvestment Act requirements and obtaining tax credits. Affordable housing project investments were $169.3 million and $167.8 million as of June 30, 2020 and December 31, 2019, respectively, and were recorded in other assets. Unfunded commitments to fund future investments in affordable housing projects totaled $68.3 million and $70.0 million as of June 30, 2020 and December 31, 2019, respectively, and were recorded in other liabilities.

BancShares and various subsidiaries have been named as defendants in legal actions arising from their normal business activities in which damages in various amounts were claimed. BancShares has also been exposed to litigation risk relating to the prior business activities of banks from which assets were acquired and liabilities assumed in the various merger transactions. Although the amount of any ultimate liability with respect to such matters cannot be determined, in the opinion of management, any such liability will not have a material effect on BancShares’ consolidated financial statements.

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Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations

Management’s discussion and analysis (“MD&A”) of earnings and related financial data are presented to assist in understanding the financial condition and results of operations of First Citizens BancShares, Inc. and Subsidiaries (“BancShares”). This discussion and analysis should be read in conjunction with the unaudited consolidated financial statements and related notes presented within this Quarterly Report on Form 10-Q along with our financial statements and related MD&A of financial condition and results of operations included in our 2019 Annual Report on Form 10-K. Intercompany accounts and transactions have been eliminated. Although certain amounts for prior years have been reclassified to conform to statement presentations for 2020, the reclassifications had no effect on shareholders’ equity or net income as previously reported. Unless otherwise noted, the terms “we,” “us” and “BancShares” refer to the consolidated financial position and consolidated results of operations for BancShares.

EXECUTIVE OVERVIEW

BancShares conducts its banking operations through its wholly-owned subsidiary First-Citizens Bank & Trust Company (“FCB”), a state-chartered bank organized under the laws of the state of North Carolina.

BancShares’ earnings and cash flows are primarily derived from our commercial and retail banking activities. We gather deposits from retail and commercial customers and also secure funding through various non-deposit sources. We invest the liquidity generated from these funding sources in interest-earning assets, including loans and leases, investment securities and overnight investments. We also invest in bank premises, hardware, software, furniture and equipment used to conduct our commercial and retail banking business. We provide treasury services products, cardholder and merchant services, wealth management services and various other products and services typically offered by commercial banks. The fees and service charges generated from these products and services are primary sources of noninterest income which is an essential component of our total revenue.

We are focused on expanding our position in legacy and target markets through organic growth and strategic acquisitions. We believe our franchise is positioned for continued growth as a result of our client centric banking principles, disciplined lending standards, and our people.

Refer to our 2019 Annual Report on Form 10-K for further discussion of our strategy.

RECENT ECONOMIC AND INDUSTRY DEVELOPMENTS

During the first quarter of 2020, a novel strain of coronavirus (“COVID-19”) spread throughout the world, causing significant disruptions to the domestic and global economies which continue to date. In response to the outbreak, governments have imposed restrictions resulting in business shutdowns, regional quarantines, disruptions of supply chains, changes in consumer behavior and overall economic instability. This uncertainty has led to volatility in the financial markets. This impact was coupled with spikes in unemployment as a result of business shutdowns that may continue to impact financial institutions operationally and financially. For a discussion of the risks we face with respect to the COVID-19 pandemic, the associated economic uncertainty, the steps taken to mitigate the pandemic and the resulting economic contraction, see "Item 1A — Risk Factors" in Part II of this quarterly report on Form 10-Q, which should be read in conjunction with the risk factors disclosed in our annual report on Form 10-K for the year ended December 31, 2019.

During the second quarter of 2020, the Federal Reserve’s Federal Open Market Committee (“FOMC”) maintained the federal funds rate at a target range of 0.00% to 0.25%. The FOMC cited the effects of COVID-19 on economic activity and the risks posed to the economic outlook. The FOMC expects to maintain this target range until it is confident the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.

On March 27, 2020, the Coronavirus Aid Relief and Economic Security Act (the “CARES Act”) was passed. The bill was designed to provide short-term economic relief to individuals and businesses most impacted by the fallout of the pandemic. Key provisions include: for individuals, economic impact payments and enhanced unemployment benefits; for small businesses, access to loans and support through the Small Business Administration Paycheck Protection Program (“SBA-PPP”), direct aid and loans to the medical industry and other affected sectors, and certain tax benefits that can be used in conjunction with the other aid mentioned. While direct aid to financial services entities is not a primary goal of the provisions, financial institutions will function to transmit funds from the Federal Reserve, SBA and United States (“U.S.”) Treasury to the public. This was supplemented by the Paycheck Protection Program Flexibility Act, which was signed into law on June 5, 2020 and amended provisions of the SBA-PPP including timing of the program and changes to forgiveness criteria. In addition, there were other regulatory actions taken that may impact our business including troubled debt restructuring recognition relief, changes in credit reporting on customer forbearance, federally backed mortgage forbearance, potential legal lending limit relaxation and other economic stabilization efforts. Further legislation is expected as the government continues to mitigate the economic impact on the crisis.

40

BANCSHARES’ COVID-19 CONTINUED MONITORING AND RESPONSE

BancShares ended second quarter in a very strong capital and liquidity position providing stability in navigating this crisis. Our leadership team continues to ensure appropriate measures are in place to protect the welfare of our employees and soundness of the organization, while continuing to support our customers. Approximately 95% of our branches have re-opened with enhanced safety protocols and our corporate locations remain at limited occupancy due to current virus trends.

At June 30, 2020 COVID-19 related loan extensions totaled approximately $5.6 billion in outstanding loan balances, representing approximately $166 million in payment deferrals. The first wave of loans with payment deferrals have completed their extension period and the volume of extension requests declined during the second quarter. As of July 31, 2020, COVID-19 related loan extensions decreased to approximately $1.5 billion in outstanding loan balances, representing approximately $43 million in payment deferrals. Of the accounts moving to active status, 91% have made their first scheduled payment and the majority of the remaining accounts are within 15 days of their payment date. To date, we have not seen significant shifts in credit line utilization or declines in overall credit quality.

BancShares originated approximately 23,000 SBA-PPP loan requests with an outstanding balance of $3.08 billion at June 30, 2020. We have collected all $116.9 million in SBA-PPP related loan fees per the program terms. These fees and related costs are deferred and are being recognized in interest income over the life of the loans. Once the forgiveness requirements and procedures are finalized by the regulatory bodies, we anticipate accelerated recognition of the fee income as borrower requests are processed and loans are forgiven.

Table 1

SBA-PPP LOANS BY LOAN SIZE

(Dollars in thousands)
Loan Size	$ of Loans		% of Loans $
Less than $150,000	$	853,103	27.7	%
$150,000 to $2,000,000	1,758,252		57.0
Greater than $2,000,000	473,194		15.3
Total	$	3,084,549	100.0	%

Strong Liquidity and Capital Position

We maintain a strong level of liquidity. As of June 30, 2020, liquid assets (available cash and unencumbered high quality liquid assets at market value) totaled approximately $8.04 billion representing 16.8% of consolidated assets as of June 30, 2020.

In addition to liquid assets, we had contingent sources of liquidity totaling approximately $11.68 billion in the form of Federal Home Loan Bank (“FHLB”) borrowing capacity, Federal Reserve Discount Window availability, federal funds lines and a committed line of credit.

At June 30, 2020, BancShares’ regulatory capital ratios were well in excess of Basel III capital requirements with a total risk-based capital ratio of 13.6%, a Tier 1 risk-based capital ratio of 11.4%, a common equity Tier 1 ratio of 10.3%, a Tier 1 leverage ratio of 8.1% and a capital conservation buffer of 5.4%, over twice the required level of 2.5%.

SIGNIFICANT EVENTS IN 2020

On January 1, 2020 BancShares adopted Accounting Standards Update (“ASU”) 2016-13, Financial Instruments-Credit Losses (Accounting Standards Codification (“ASC”) Topic 326): Measurement of Credit Losses on Financial Instruments, which introduced a new credit loss methodology for the estimation of credit losses.The amendments in this ASU require loss estimates be determined over an asset’s lifetime and broaden the information that an entity must consider in developing its expected credit losses. BancShares adopted this ASU using the modified retrospective approach for all loans, leases, debt securities designated as held to maturity, and unfunded loan commitments. BancShares adopted this ASU using the prospective transition approach for PCD loans previously accounted for under ASC 310-30 and debt securities available for sale. Refer to Note A - Accounting Policies and Basis of Presentation for additional information.

Upon adoption, BancShares recorded a net decrease of $37.9 million in the Allowance for Credit Losses (“ACL”) which included a decrease of $56.9 million in the ACL on non-purchased credit deteriorated (“non-PCD”) loans, offset by an increase of $19.0 million in the ACL on purchased credit deteriorated (“PCD”) loans. The $56.9 million change in the ACL on non-PCD loans, as well as an $8.9 million increase in the reserve for unfunded commitments, net of deferred taxes, resulted in a net increase in retained earnings of $36.9 million. The $19.0 million increase in the ACL on PCD loans was a reclassification of the PCD credit discount and resulted in a gross up of loan balances by this same amount and did not have any effect on retained earnings. Impact to total capital and capital ratios was not significant and we did not elect the capital phase-in option allowable for regulatory reporting purposes.

41

FINANCIAL PERFORMANCE SUMMARY

Second Quarter Highlights

•Net income for the second quarter of 2020 totaled $153.8 million, an increase of $34.4 million, or 28.8% compared to the same quarter in 2019. Net income available to common shareholders totaled $149.0 million. Net income per common share increased $4.18, or 39.6%, to $14.74 in the second quarter of 2020, from $10.56 per share during the same period in 2019. Second quarter 2020 earnings were impacted by positive changes in the fair value of the equity securities portfolio totaling $64.6 million, interest and fee income related to SBA-PPP loans of $19.0 million and realized gains on the sale of available for sale securities of $13.8 million, partially offset by an increase in provision expense of $15.4 million, primarily related to the potential impacts of COVID-19, and a decrease in net interest income, excluding the impact of SBA-PPP loans, of $9.0 million.

•Return on average assets for the second quarter of 2020 was 1.36%, up from 1.29% in the second quarter of 2019. Return on average equity for the second quarter of 2020 was 16.43%, up from 13.50% in the the second quarter of 2019.

•Net interest income totaled $337.4 million for the second quarter of 2020, an increase of $10.0 million, or 3.1% compared to the same quarter in 2019. The taxable-equivalent net interest margin (“NIM”) was 3.14% for the second quarter of 2020, down 63 basis points from 3.77% for the second quarter in 2019.

•Noninterest income for the second quarter of 2020 totaled $165.4 million, an increase of $58.5 million, or 54.8% compared to the same quarter of 2019 predominantly due to positive changes on the fair value of the equity securities portfolio.

•Noninterest expense was $291.7 million for the second quarter of 2020, compared to $273.4 million during the same quarter of 2019, an increase of $18.3 million or 6.7%.

•Total loans grew to $32.42 billion, an increase of $3.18 billion, or by 43.7% on an annualized basis, since March 31, 2020, primarily due to SBA-PPP loan originations of $3.08 billion. Excluding SBA-PPP loans and loans divested in the quarter, total loans and leases grew $203.0 million, or by 2.8% on an annualized basis. The net charge-off ratio was 0.09% for the second quarter of 2020, down from 0.11% for the same quarter in 2019.

•Total deposits grew to $41.48 billion, an increase of $6.13 billion, or by 69.8% on an annualized basis, since March 31, 2020, including $3.51 billion of estimated combined deposits related to SBA-PPP loans and consumer stimulus checks. Excluding SBA-PPP and consumer related stimulus deposits and deposits divested in the quarter, total deposits grew $2.80 billion, or by 31.9% on an annualized basis.

•BancShares repurchased 346,000 shares of its Class A common stock during the second quarter of 2020 totaling $127.0 million. At June 30, 2020, BancShares remained well capitalized with a total risk-based capital ratio of 13.6%, a Tier 1 risk-based capital of 11.4%, a common equity Tier 1 ratio of 10.3%, and a leverage ratio of 8.1%.

42

Year to Date Highlights

•Net income for the six months ended June 30, 2020 totaled $211.0 million, a decrease of $19.8 million, or 8.6% compared to the same period of 2019. Net income available to common shareholders totaled $206.2 million. Earnings per share decreased $0.19, or 0.9%, to $20.04 for the six months ended June 30, 2020, from $20.23 per share during the same period in 2019.

•Return on average assets for the six months ended June 30, 2020 was 0.98%, down 30 basis points compared to the same period in 2019. Return on average equity for the six months ended June 30, 2020 was 11.40%, down 179 basis points compared to the same period in 2019.

•Net interest income for the six months ended June 30, 2020, was $675.8 million, an increase of $28.0 million, or 4.3% compared to the same period of 2019. The taxable-equivalent NIM was 3.33% for the six months ended June 30, 2020, down 48 basis points from 3.81% during the same period of 2019.

•The allowance for credit losses was $222.5 million at June 30, 2020, compared to $225.1 million at December 31, 2019. The $2.7 million change was due primarily to the $37.9 million reduction in the allowance as a result of adopting ASC 326, partially offset by a $36.1 million reserve build relating to potential COVID-19 impact.

•Total loans grew to $32.42 billion, an increase of $3.54 billion since December 31, 2019. The net growth from recent acquisitions and divestitures totaled $12.3 million and growth of $3.08 billion was related to loans originated through the SBA-PPP. Excluding acquired and SBA-PPP loans, total loans increased $440.1 million, or by 3.1% on an annualized basis. The net charge-off ratio was 0.10% for the six months ended June 30, 2020, a 1 basis point decrease compared to the same period of 2019.

•Total deposits grew to $41.48 billion, an increase of $7.05 billion since December 31, 2019. This growth includes $2.99 billion of reciprocal deposits from SBA-PPP (estimated at the time of funding) and $526.0 million from government stimulus deposits (estimated at time of issuance) as well as $43.0 million of net deposits related to acquisition and divestiture. Excluding the cumulative impact of these deposits total deposits grew $3.49 billion, or by 20.4% on an annualized basis.

•BancShares repurchased 695,390 shares of its Class A common stock during the six months ended June 30, 2020 totaling $286.7 million.

•During the first quarter of 2020, BancShares successfully completed a $695 million capital raise which consisted of $350 million of subordinated notes and $345 million of Series A preferred stock.

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Table 2

SELECTED QUARTERLY DATA

	2020						2019 (1)									Six months ended June 30
	Second			First			Fourth			Third			Second
(Dollars in thousands, except share data)	Quarter			Quarter			Quarter			Quarter			Quarter			2020			2019
SUMMARY OF OPERATIONS
Interest income	$	363,257		$	369,559		$	354,048		$	362,318		$	350,721		$	732,816		$	687,645
Interest expense	25,863			31,159			26,924			25,893			23,373			57,022			39,825
Net interest income	337,394			338,400			327,124			336,425			327,348			675,794			647,820
Provision for credit losses	20,552			28,355			7,727			6,766			5,198			48,907			16,948
Net interest income after provision for credit losses	316,842			310,045			319,397			329,659			322,150			626,887			630,872
Noninterest income	165,402			64,011			104,393			100,930			106,875			229,413			210,538
Noninterest expense	291,679			299,971			292,262			270,425			273,397			591,650			541,054
Income before income taxes	190,565			74,085			131,528			160,164			155,628			264,650			300,356
Income taxes	36,779			16,916			29,654			35,385			36,269			53,695			69,638
Net income	153,786			57,169			101,874			124,779			119,359			210,955			230,718
Net income available to common shareholders	$	148,996		$	57,169		$	101,874		$	124,779		$	119,359		$	206,165		$	230,718
PER COMMON SHARE DATA
Net income	$	14.74		$	5.46		$	9.55		$	11.27		$	10.56		$	20.04		$	20.23
Cash dividends on common shares	0.40			0.40			0.40			0.40			0.40			0.80			0.80
Market price at period end (Class A)	405.02			332.87			532.21			471.55			450.27			405.02			450.27
Book value at period-end	367.57			351.90			337.38			327.86			319.74			367.57			319.74
SELECTED QUARTERLY AVERAGE BALANCES
Total assets	$	45,553,502		$	40,648,806		$	38,326,641		$	37,618,836		$	37,049,030		$	43,101,154		$	36,338,839
Investment securities	8,928,467			7,453,159			7,120,023			6,956,981			6,803,570			8,190,813			6,797,656
Loans and leases (2)	31,635,958			29,098,101			27,508,062			26,977,476			26,597,242			30,367,030			26,059,602
Interest-earning assets	42,795,781			38,004,341			36,032,680			35,293,979			34,674,842			40,400,061			34,056,935
Deposits	39,146,415			34,750,061			33,295,141			32,647,264			32,100,210			36,948,238			31,454,973
Interest-bearing liabilities	24,407,285			23,153,777			20,958,943			20,551,393			20,397,445			23,780,042			20,028,489
Securities sold under customer repurchase agreements	659,244			474,231			495,804			533,371			556,374			566,737			547,318
Other short-term borrowings	45,549			157,759			28,284			23,236			40,513			101,654			20,369
Long-term borrowings	1,275,928			961,132			467,223			384,047			371,843			1,118,042			358,110
Common shareholders' equity	3,648,284			3,625,975			3,570,872			3,580,235			3,546,041			3,637,129			3,528,549
Shareholders’ equity	$	3,988,225		$	3,682,634		$	3,570,872		$	3,580,235		$	3,546,041		$	3,835,430		$	3,528,549
Common shares outstanding	10,105,520			10,473,119			10,708,084			11,060,462			11,286,520			10,289,320			11,402,112
SELECTED QUARTER-END BALANCES
Total assets (1)	$	47,866,194		$	41,594,453		$	39,824,496		$	37,748,324		$	37,655,094		$	47,866,194		$	37,655,094
Investment securities	9,508,476			8,845,197			7,173,003			7,167,680			6,695,578			9,508,476			6,695,578
Loans and leases	32,418,425			29,240,959			28,881,496			27,196,511			26,728,237			32,418,425			26,728,237
Deposits	41,479,245			35,346,711			34,431,236			32,743,277			32,719,671			41,479,245			32,719,671
Securities sold under customer repurchase agreements	740,276			540,362			442,956			522,195			544,527			740,276			544,527
Other short-term borrowings	—			105,000			295,277			—			—			—			—
Long-term borrowings	1,258,719			1,297,132			588,638			453,876			369,854			1,258,719			369,854
Shareholders’ equity	$	3,991,444		$	3,957,520		$	3,586,184		$	3,568,482		$	3,574,613		$	3,991,444		$	3,574,613
Common shares outstanding	9,934,105			10,280,105			10,629,495			10,884,005			11,179,905			9,934,105			11,179,905
SELECTED RATIOS AND OTHER DATA
Return on average assets (annualized)	1.36		%	0.57		%	1.05		%	1.32		%	1.29		%	0.98		%	1.28		%
Return on average common shareholders’ equity (annualized)	16.43			6.34			11.32			13.83			13.50			11.40			13.19
Net yield on interest-earning assets (taxable equivalent)	3.14			3.55			3.59			3.77			3.77			3.33			3.81
Net charge-offs (annualized) to average loans and leases	0.09			0.10			0.14			0.10			0.11			0.10			0.11
Allowance for credit losses to total loans and leases(3):
PCD	5.07			4.80			1.35			1.34			1.51			5.07			1.51
Non-PCD	0.61			0.64			0.77			0.82			0.83			0.61			0.83
Total	0.69			0.72			0.78			0.83			0.85			0.69			0.85
Ratio of total nonperforming assets to total loans, leases and other real estate owned (4)	0.77			0.79			0.58			0.57			0.56			0.77			0.56
Tier 1 risk-based capital ratio	11.38			11.43			10.86			11.80			12.03			11.38			12.03
Common equity Tier 1 ratio	10.32			10.36			10.86			11.80			12.03			10.32			12.03
Total risk-based capital ratio	13.63			13.65			12.12			13.09			13.34			13.63			13.34
Tier 1 leverage capital ratio	8.07			8.98			8.81			9.18			9.35			8.07			9.35
Dividend payout ratio	2.71			7.33			4.19			3.55			3.79			3.99			3.95
Average loans and leases to average deposits	80.81			83.74			82.62			82.63			82.86			82.19			82.85

⁽¹⁾ We adopted ASC Topic 326 (CECL) utilizing the modified retrospective approach. We did not restate selected financial data for the quarters prior to 2020 presented above.

⁽²⁾ Average loan and lease balances include PCD loans, non-PCD loans and leases, loans held for sale and nonaccrual loans and leases.

⁽³⁾ Loans originated in relation to the SBA-PPP ($3.08 billion as of June 30, 2020) do not have a recorded ACL. As of June 30, 2020, the ratio of ACL to total Non-PCD loans excluding SBA-PPP loans is 0.68% while the ratio of ACL to total loans excluding SBA-PPP loans is 0.76%.

⁽⁴⁾ Upon adoption of ASC 326, we dissolved pooling of PCI loans allowed under ASC 310-30. This increased the amount of nonaccrual loans as those nonaccrual loans within performing PCI pools were previously excluded from reporting. As of January 1, 2020, there were $47.0 million of nonaccrual loans released from performing PCI pools. Of these nonaccrual loans, $35.9 million were outstanding as of June 30, 2020.

44

BUSINESS COMBINATIONS

Community Financial Holding Company, Inc.

On February 1, 2020, FCB completed the merger of Duluth, Georgia-based Community Financial Holding Company, Inc. (“Community Financial”) and its bank subsidiary, Gwinnett Community Bank, into FCB. Under the terms of the agreement, total cash consideration of $2.3 million was paid to the shareholders of Community Financial. The merger allows FCB to expand its presence and enhance banking efforts in Georgia. The merger contributed $222.1 million in consolidated assets, which included $686 thousand of goodwill, $134.0 million in loans, and $209.3 million in deposits.

See Note B - Business Combinations for additional disclosures.

Entegra Financial Corp.

On December 31, 2019, FCB completed the merger of Franklin, North Carolina-based Entegra Financial Corp. (“Entegra”) and its bank subsidiary, Entegra Bank. In order to obtain regulatory approval, FCB entered into an agreement for Select Bank to purchase three of our North Carolina branches, located in Highlands, Sylva and Franklin. On April 17, 2020, FCB completed the divestiture of the branches including loans and leases, premises and equipment and total deposits with a fair value of $110.1 million, $2.1 million and $184.8 million, respectively. The Select Bank purchase price for the divested branches included an 8% premium for deposits acquired that was applied against goodwill generated as part of the merger with Entegra Bank.

Federal Deposit Insurance Corporation Assisted Transactions

BancShares completed fourteen Federal Deposit Insurance Corporation (“FDIC”) assisted transactions between 2009 and 2017. Nine of the fourteen FDIC-assisted transactions included shared-loss agreements which, for their terms, protect us from a substantial portion of the credit and asset quality risk we would otherwise incur. As of June 30, 2020, shared-loss protection remains for single family residential loans acquired in the amount of $38.0 million.

The shared-loss agreement for two of the FDIC-assisted transactions included a provision related to a payment owed to the FDIC at the termination of the agreement (the “clawback liability”). As of June 30, 2020 and December 31, 2019, the estimated clawback liability was $15.0 million and $112.4 million, respectively, as a result of a payment to the FDIC in the first quarter of 2020 for $99.5 million related to one of the transactions. The remaining clawback liability payment date is March 2021.

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Table 3

CONSOLIDATED QUARTER-TO-DATE AVERAGE TAXABLE-EQUIVALENT BALANCE SHEETS

	Three months ended June 30
	2020						2019
			Interest						Interest
	Average		Income/		Yield/		Average		Income/		Yield/
(Dollars in thousands)	Balance		Expense		Rate		Balance		Expense		Rate
Assets
Loans and leases	$	31,635,958	$	326,618	4.10	%	$	26,597,242	$	303,803	4.54	%
Investment securities:
U.S. Treasury	206,575		679		1.32		1,150,001		6,770		2.36
Government agency	657,405		1,428		0.87		383,700		3,034		3.16
Mortgage-backed securities	7,555,947		28,532		1.51		4,979,160		28,130		2.26
Corporate bonds	299,250		3,782		5.06		147,669		1,931		5.23
Other investments	209,290		2,236		4.30		143,040		626		1.76
Total investment securities	8,928,467		36,657		1.64		6,803,570		40,491		2.38
Overnight investments	2,231,356		553		0.10		1,274,030		7,280		2.29
Total interest-earning assets	42,795,781		363,828		3.38		34,674,842		351,574		4.04
Cash and due from banks	404,517						295,052
Premises and equipment	1,260,566						1,214,144
Allowance for credit losses	(209,973)						(229,067)
Other real estate owned	55,554						4,646
Other assets	1,247,057						1,047,813
Total assets	$	45,553,502					$	37,007,430
Liabilities
Interest-bearing deposits:
Checking with interest	$	8,562,145	$	1,310	0.06	%	$	7,485,693	$	1,571	0.08	%
Savings	2,846,557		312		0.04		2,658,974		527		0.08
Money market accounts	7,618,883		6,519		0.34		5,912,646		5,498		0.37
Time deposits	3,398,979		9,775		1.16		3,371,402		11,561		1.38
Total interest-bearing deposits	22,426,564		17,916		0.32		19,428,715		19,157		0.40
Securities sold under customer repurchase agreements	659,244		399		0.24		556,374		515		0.37
Other short-term borrowings	45,549		248		2.16		40,513		278		2.72
Long-term borrowings	1,275,928		7,300		2.26		371,843		3,423		3.64
Total interest-bearing liabilities	24,407,285		25,863		0.42		20,397,445		23,373		0.46
Noninterest-bearing deposits	16,719,851						12,671,495
Other liabilities	438,141						434,049
Shareholders’ equity	3,988,225						3,546,041
Total liabilities and shareholders’ equity	$	45,553,502					$	37,049,030
Interest rate spread					2.96	%					3.58	%
Net interest income and net yield on interest-earning assets			$	337,965	3.14	%			$	328,201	3.77	%

Loans and leases include PCD loans, non-PCD loans, nonaccrual loans and loans held for sale. Yields related to loans, leases and securities exempt from both federal and state income taxes, federal income taxes only, or state income taxes only are stated on a taxable-equivalent basis assuming statutory federal income tax rate of 21.0%, as well as state income tax rate of 3.4%, for both the three months ended June 30, 2020 and 2019. The taxable-equivalent adjustment was $571 thousand and $853 thousand for the three months ended June 30, 2020 and 2019, respectively.

46

Table 4

CONSOLIDATED YEAR-TO-DATE AVERAGE TAXABLE-EQUIVALENT BALANCE SHEETS

	Six months ended June 30
	2020						2019
			Interest						Interest
	Average		Income/		Yield/		Average		Income/		Yield/
(Dollars in thousands)	Balance		Expense		Rate		Balance		Expense		Rate
Assets
Loans and leases	$	30,367,030	$	652,774	4.27	%	$	26,059,602	$	595,372	4.56	%
Investment securities:
U.S. Treasury	253,176		2,356		1.87		1,178,955		13,267		2.27
Government agency	689,330		5,548		1.61		335,375		5,343		3.19
Mortgage-backed securities	6,808,190		59,239		1.74		5,015,089		56,964		2.27
Corporate bonds	252,377		6,259		4.96		146,405		3,868		5.28
Other investments	187,740		2,914		3.12		121,832		915		1.51
Total investment securities	8,190,813		76,316		1.86		6,797,656		80,357		2.37
Overnight investments	1,842,218		5,071		0.55		1,199,677		13,669		2.30
Total interest-earning assets	40,400,061		734,161		3.62		34,056,935		689,398		4.05
Cash and due from banks	352,475						288,592
Premises and equipment	1,256,268						1,210,306
Allowance for credit losses	(198,621)						(226,763)
Other real estate owned	54,455						46,669
Other assets	1,236,516						963,097
Total assets	$	43,101,154					$	36,338,836
Liabilities
Interest-bearing deposits:
Checking with interest	$	8,375,564	$	3,011	0.07	%	$	7,521,642	$	2,948	0.08	%
Savings	2,720,213		597		0.04		2,591,633		733		0.06
Money market accounts	7,317,735		15,628		0.43		5,880,372		9,639		0.33
Time deposits	3,580,097		22,874		1.28		3,109,045		18,764		1.22
Total interest-bearing deposits	21,993,609		42,110		0.39		19,102,692		32,084		0.34
Securities sold under customer repurchase agreements	566,737		841		0.30		547,318		974		0.36
Other short-term borrowings	101,654		1,052		2.05		20,369		278		2.72
Long-term borrowings	1,118,042		13,019		2.30		358,110		6,489		3.60
Total interest-bearing liabilities	23,780,042		57,022		0.48		20,028,489		39,825		0.40
Noninterest-bearing deposits	14,954,629						12,352,281
Other liabilities	531,053						429,517
Shareholders’ equity	3,835,430						3,528,549
Total liabilities and shareholders’ equity	$	43,101,154					$	36,338,836
Interest rate spread					3.14	%					3.65	%
Net interest income and net yield on interest-earning assets			$	677,139	3.33	%			$	649,573	3.81	%

Loans and leases include PCD loans, non-PCD loans, nonaccrual loans and loans held for sale. Yields related to loans, leases and securities exempt from both federal and state income taxes, federal income taxes only, or state income taxes only are stated on a taxable-equivalent basis assuming statutory federal income tax rate of 21.0%, as well as state income tax rate of 3.4%, for both the six months ended June 30, 2020 and June 30, 2019. The taxable-equivalent adjustment was $1.3 million and $1.8 million for the six months ended June 30, 2020 and June 30, 2019, respectively.

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Table 4

CHANGES IN CONSOLIDATED TAXABLE EQUIVALENT NET INTEREST INCOME

	Three months ended June 30, 2020						Six months ended June 30, 2020
	Change from prior year period due to:						Change from prior year period due to:
(Dollars in thousands)	Volume(1)		Yield/Rate(1)		Total Change		Volume(1)		Yield/Rate(1)		Total Change
Assets
Loans and leases	$	60,243	$	(37,428)	$	22,815	$	96,223	$	(38,821)	$	57,402
Investment securities:
U.S. Treasury	(5,558)		(533)		(6,091)		(10,423)		(488)		(10,911)
Government agency	2,164		(3,770)		(1,606)		5,639		(5,434)		205
Mortgage-backed securities	15,546		(15,144)		402		21,611		(19,336)		2,275
Corporate bonds	1,981		(130)		1,851		2,799		(408)		2,391
Other investments	291		1,319		1,610		245		1,754		1,999
Total investment securities	14,424		(18,258)		(3,834)		19,871		(23,912)		(4,041)
Overnight investments	5,435		(12,162)		(6,727)		7,352		(15,950)		(8,598)
Total interest-earning assets	$	80,102	$	(67,848)	$	12,254	$	123,446	$	(78,683)	$	44,763
Liabilities
Interest-bearing deposits:
Checking with interest	$	221	$	(482)	$	(261)	$	327	$	(264)	$	63
Savings	36		(251)		(215)		35		(171)		(136)
Money market accounts	1,567		(546)		1,021		2,303		3,686		5,989
Time deposits	63		(1,849)		(1,786)		2,777		1,333		4,110
Total interest-bearing deposits	1,887		(3,128)		(1,241)		5,442		4,584		10,026
Securities sold under customer repurchase agreements	33		(149)		(116)		(56)		(77)		(133)
Other short-term borrowings	34		(64)		(30)		545		229		774
Long-term borrowings	8,205		(4,328)		3,877		6,746		(216)		6,530
Total interest-bearing liabilities	10,159		(7,669)		2,490		12,677		4,520		17,197
Change in net interest income	$	69,943	$	(60,179)	$	9,764	$	110,769	$	(83,203)	$	27,566
(1) The rate/volume variance is allocated proportionally between the changes in volume and rate.

RESULTS OF OPERATIONS

Net Interest Income and Margin (Taxable-Equivalent Basis)

Second Quarter 2020 compared to Second Quarter 2019

Net interest income for the second quarter of 2020 totaled $337.4 million, an increase of $10.0 million, or 3.1%, compared to the second quarter of 2019. The taxable-equivalent NIM was 3.14% in the second quarter of 2020, a decrease of 63 basis points from the same quarter in the prior year.

The increase in net interest income was primarily due to an increase of $22.8 million in interest earned on loans due to loan growth, partially offset by an increase in interest expense on borrowings of $3.7 million. Interest and fee income related to SBA-PPP loans totaled $19.0 million in the second quarter of 2020. The primary drivers of the margin decline were lower yields on interest-earning assets, partially offset by a decrease in the rates paid on borrowings and interest-bearing deposits, largely in time deposits and money market accounts.

Average interest-earning assets increased by $8.12 billion to $42.80 billion, compared to the second quarter of 2019. The primary drivers for this change were higher average loan balances which increased $5.04 billion, due to contributions from both recent acquisitions and loans originated under the SBA-PPP, as well as organic loan growth, higher average investment securities of $2.12 billion and higher average overnight investments of $957.3 million. The yield on interest-earning assets decreased by 66 basis points to 3.38% when compared to the second quarter of 2019. The yield on loans and leases decreased to 4.10%, or by 44 basis points, primarily due to lower yields on commercial and home equity loans mostly due to downward rate resets on variable rate loans and lower rates on originations. The yield on overnight investments and investment securities decreased by 219 basis points and 74 basis points, respectively. The yield decrease on overnight investments was primarily due to a lower federal funds rate, while lower yields on government agency and mortgage-backed securities were the primary reasons for the investment securities yield decline.

Average interest-bearing liabilities increased by $4.01 billion to $24.41 billion, compared to the second quarter of 2019. This increase was primarily due to an increase in average interest-bearing deposit balances of $3.00 billion driven by contributions from organic deposit growth and recent acquisitions, including reciprocal deposits from SBA-PPP loans, as well as an increase in average long-term borrowings of $904.1 million.

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Rates on interest-bearing liabilities decreased by 4 basis points to 0.42%, primarily due to decreased rates paid on borrowings and time deposits, checking with interest deposits, and money market accounts.

Six Months of 2020 compared to Six Months of 2019

Net interest income for the six months ended June 30, 2020, was $675.8 million, an increase of $28.0 million, or 4.3%, compared to the same period of 2019. The taxable-equivalent NIM was 3.33% for the six months ended June 30, 2020, a decrease of 48 basis points from the same period of 2019.

Average year-to-date interest-earning assets for the six months ended June 30, 2020, increased by $6.34 billion to $40.40 billion, compared to the same period in 2019. This increase was primarily due to a $4.31 billion increase in average outstanding loans due the impact of recent acquisitions and organic loan growth, including growth from loans originated under the SBA-PPP. This increase was coupled with increases in average investment securities of $1.39 billion and average overnight investments of $642.5 million. The yield on interest-earning assets decreased by 43 basis points to 3.62% for the six months ended June 30, 2020, compared to the same period in 2019. The yield on loans and leases decreased by 29 basis points primarily due to decreases in yields on commercial and residential loans. The yield on overnight investments and the investment securities portfolio decreased by 175 basis points and 51 basis points, respectively. The lower federal funds rate was the primary driver for the yield decrease on overnight investments, while the lower yields on mortgage-backed securities, government agency securities, and U.S. Treasury securities were the primary drivers of the investment securities yield decline.

Average year-to-date interest-bearing liabilities for the six months ended June 30, 2020 increased by $3.75 billion to $23.78 billion, compared to the same period in 2019. This increase was primarily due to a $2.89 billion increase in average interest-bearing deposit balances driven by recent acquisitions and organic growth, including reciprocal deposits related to SBA-PPP loans. The rate paid on interest-bearing liabilities increased by 8 basis points to 0.48% for the six months ended June 30, 2020 compared to same period in 2019. The rate paid on interest-bearing deposits increased by 5 basis points due primarily to increased rates on time deposits, checking with interest deposits and money market accounts.

Provision for Credit Losses

BancShares recorded net provision expense of $20.6 million for the three months ended June 30, 2020 compared to $5.2 million for the same period in 2019. BancShares recorded a net provision expense for credit losses of $48.9 million for the six months ended June 30, 2020, compared to $16.9 million for the six months ended June 30, 2019. The increase for both the three and six month periods was primarily COVID-19 related as loss estimates consider the impact of slower economic activity and elevated unemployment, as well as potential mitigants due to unprecedented government stimulus and loan accommodations. The quarter and year-to-date provision expense includes $14.6 million and $36.1 million, respectively, in additions to the ACL specifically related to COVID-19.

Noninterest Income

Table 6

NONINTEREST INCOME

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Service charges on deposit accounts	$	17,522	$	25,790	$	43,935	$	50,855
Wealth management services	22,371		24,573		48,783		49,574
Cardholder services, net	17,587		18,479		35,747		35,112
Other service charges and fees	7,145		8,164		14,937		15,586
Merchant services, net	5,363		6,455		11,251		12,290
Mortgage income	9,811		5,038		15,035		8,696
Insurance commissions	3,189		2,854		6,877		6,145
ATM income	1,395		1,625		2,817		3,136
Marketable equity securities gains, net	64,570		3,144		13,162		14,472
Realized gains on investment securities available for sale, net	13,752		5,719		33,547		5,719
Other	2,697		5,034		3,322		8,953
Total noninterest income	$	165,402	$	106,875	$	229,413	$	210,538

Noninterest income is an essential component of our total revenue and is critical to our profitability level. The primary sources of noninterest income consist of fees and service charges generated from deposit accounts, cardholder and merchant services, wealth management services, and mortgage lending and servicing.

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Noninterest income for the second quarter of 2020 was $165.4 million, compared to $106.9 million for the same period of 2019, an increase of $58.5 million, or 54.8%. The most significant components of the change were as follows:

•Marketable equity securities gains increased by $61.4 million. The gains of $64.6 million consisted of realized gains of $37.0 million and unrealized gains of $27.6 million.

•Gains on sales of investment securities increased by $8.0 million.

•Mortgage income increased by $4.8 million primarily due to increased origination volume brought about by lower mortgage rates. The production-related income was partially offset by mortgage servicing rights impairment of $1.1 million due to declining mortgage rates.

•Service charges on deposit accounts declined by $8.3 million primarily due to decreased customer activity and efforts to aid our customers during the COVID-19 pandemic.

•Wealth management services decreased by $2.2 million primarily due to decreased sales volume driven by branch closures in response to local government mandates and low interest rates.

Noninterest income was $229.4 million for the first six months of 2020, compared to $210.5 million for the same period of 2019, an increase of $18.9 million, or 9.0%. The most significant components of the change were as follows:

•Gains on sales investment securities increased by $27.8 million.

•Mortgage income increased by $6.3 million primarily due to increased origination volume brought about by lower mortgage rates. The production-related income was partially offset by mortgage servicing rights impairment of $4.0 million recorded due to declining mortgage rates.

•Service charges on deposit accounts declined by $6.9 million primarily due to decreased customer activity and efforts to aid our customers during the COVID-19 pandemic.

•Other noninterest income decreased $5.6 million primarily due to acquired recoveries on PCD loans, formerly reported in noninterest income, now being recorded as a component of the allowance for credit losses .

Noninterest Expense

Table 7

NONINTEREST EXPENSE

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Salaries and wages	$	146,633	$	136,526	$	291,888	$	268,947
Employee benefits	30,364		30,197		68,875		62,732
Occupancy expense	29,556		26,886		57,036		54,647
Equipment expense	28,774		28,489		56,624		55,229
Processing fees paid to third parties	10,186		6,641		20,558		13,730
FDIC insurance expense	3,731		2,757		7,197		5,417
Collection and foreclosure-related expenses	3,949		3,659		8,003		6,681
Merger-related expenses	4,369		4,084		8,601		5,803
Telecommunications expense	2,815		2,393		5,788		4,434
Consultant expense	3,027		3,639		6,287		6,520
Advertising expense	1,980		2,942		4,649		5,494
Core deposit intangible amortization	3,672		4,233		7,531		8,480
Other	22,623		20,951		48,613		42,940
Total noninterest expense	$	291,679	$	273,397	$	591,650	$	541,054

50

The primary components of noninterest expense are salaries and related employee benefits, occupancy and equipment expense.

Noninterest expense was $291.7 million during the second quarter of 2020, compared to $273.4 million for the same period in 2019, an increase of $18.3 million, or 6.7%. The most significant components of the change were as follows:

•Personnel expense increased $10.3 million primarily due to an increase in salaries and wages as a result of merit increases and net staff additions, including personnel from acquisitions.

•Processing fees paid to third parties increased $3.5 million primarily due to the expansion of digital banking offerings as well as processing fees related to recent acquisitions.

•Occupancy expense increased $2.7 million primarily due to cleaning and sanitizing efforts in branches and corporate buildings to combat the spread of COVID-19 as well as increased building repairs.

•Other noninterest expense increased by $1.7 million primarily due to higher provision related to unfunded loan commitments as a result of potential economic impacts of COVID-19 and increased pension costs due to a lower discount rate.

Noninterest expense was $591.7 million for the first six months of 2020, compared to $541.1 million for the same period in 2019, an increase of $50.6 million, or 9.4%. The most significant components of the change were as follows:

•Personnel expense increased by $29.1 million primarily due to an increase in salaries and wages as a result of merit increases and increased headcount from recent acquisitions.

•Processing fees paid to third parties increased $6.8 million primarily due to the expansion of digital banking offerings as well as processing fees related to recent acquisitions.

•Other noninterest expense increased $5.7 million primarily due to higher provision related to unfunded loan commitments as a result of potential economic impacts of COVID-19 and increased pension costs due to a lower discount rate.

•Merger-related expenses increased $2.8 million primarily due to costs related to Entegra.

•Occupancy expense increased $2.4 million primarily due to cleaning and sanitizing efforts in branches and corporate buildings to combat the spread of COVID-19.

Income Taxes

Income tax expense was $36.8 million and $36.3 million for the second quarter of 2020 and 2019, respectively, representing effective tax rates of 19.3% and 23.3% during the periods. Income tax expense was $53.7 million and $69.6 million for the six months ended June 30, 2020 and 2019, respectively, representing effective tax rates of 20.3% and 23.2% during the periods.

The effective tax rate for the second quarter 2020 was favorably impacted by $6.9 million due to BancShares’ decision to utilize an allowable alternative for computing its 2020 federal income tax liability. Without this alternative, the effective tax rate would have been approximately 23%. The allowable alternative provides BancShares the ability to use the federal income tax rate for certain current year deductible amounts related to prior year FDIC-assisted acquisitions that was applicable when these amounts were originally subjected to tax. As a result of this favorable federal tax rate benefit, the effective tax rate for the remainder of 2020 is estimated to be approximately 21%. The actual 2020 effective tax rate will depend upon the nature and amount of future income and expenses as well as transactions with discrete tax effects.

We monitor and evaluate the potential impact of current events on the estimates used to establish income tax expenses and income tax liabilities. On a periodic basis, we evaluate our income tax positions based on current tax law, positions taken by various tax auditors within the jurisdictions where BancShares is required to file income tax returns, as well as potential or pending audits or assessments by tax auditors.

INTEREST-EARNING ASSETS

Interest-earning assets include investment securities, loans and leases, and overnight investments, all of which reflect varying interest rates based on the risk level and repricing characteristics of the underlying asset. Riskier investments typically carry a higher interest rate but expose us to higher levels of market risk. We strive to maintain a high level of interest-earning assets relative to total assets, while keeping non-earning assets at a minimum.

Interest-earning assets totaled $45.14 billion and $37.23 billion at June 30, 2020 and December 31, 2019, respectively. The $7.91 billion increase was primarily composed of a $3.54 billion increase in loans and leases, a $2.34 billion increase in investment securities and a $2.00 billion increase in overnight investments.

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Investment Securities

The primary objective of the investment portfolio is to generate incremental income by deploying excess funds into securities with minimal liquidity and credit risk, and low to moderate interest rate risk. Other objectives include acting as a stable source of liquidity, serving as a tool for asset and liability management and maintaining an interest rate risk profile compatible with BancShares’ objectives. Additionally, purchases of equities and corporate bonds in other financial institutions have been made largely under a long-term earnings optimization strategy. Changes in the total balance of our investment portfolio result from trends in balance sheet funding and market performance. Generally, when inflows arising from deposit and treasury services products exceed loan and lease demand, we invest excess funds into the securities portfolio and into overnight investments. Conversely, when loan demand exceeds growth in deposits and short-term borrowings, we allow overnight investments to decline and use proceeds from maturing securities and prepayments to fund loan demand. See Note C - Investments for additional disclosures.

The carrying value of investment securities totaled $9.51 billion at June 30, 2020, an increase of $2.34 billion compared to December 31, 2019. The increase in the portfolio was primarily attributable to investment securities purchases of $6.79 billion, partially offset by sales of $3.44 billion and maturities and paydowns of $1.20 billion.

As of June 30, 2020, investment securities available for sale had a net pre-tax unrealized gain of $146.9 million, compared to a net pre-tax unrealized gain of $7.5 million as of December 31, 2019. After evaluating the available for sale securities with unrealized losses, management concluded that the unrealized losses relate to changes in interest rates relative to when the securities were purchased, and therefore, no allowance for credit losses was needed at June 30, 2020. Available for sale securities are reported at fair value and unrealized gains and losses are included as a component of accumulated other comprehensive income (“AOCI”), net of deferred taxes.

As part of the adoption of ASC 326, BancShares evaluated its portfolios of held to maturity and available for sale debt securities to determine the need to record a related allowance for credit losses. See Note A - Accounting Policies and Basis for Presentation for more detail on our policies and adoption. As of January 1, 2020, no allowance for credit losses was required for available for sale and held to maturity debt securities

Table 8

INVESTMENT SECURITIES

	June 30, 2020						December 31, 2019
(Dollars in thousands)	Composition(1)		Cost		Fair value		Composition(1)		Cost		Fair value
Investment securities available for sale
U.S. Treasury	7.9	%	$	754,350	$	754,586	5.7	%	$	409,397	$	409,999
Government agency	5.7		549,673		545,709		9.5		684,085		682,772
Residential mortgage-backed securities	60.8		5,671,151		5,790,392		73.4		5,269,060		5,267,090
Commercial mortgage-backed securities	11.4		1,047,601		1,079,822		5.3		373,105		380,020
Corporate bonds	4.7		449,623		448,773		2.8		198,278		201,566
State, county and municipal	—		—		—		1.7		118,227		118,227
Total investment securities available for sale	90.5		8,472,398		8,619,282		98.4		7,052,152		7,059,674
Investment in marketable equity securities	1.2		116,322		114,316		1.2		59,262		82,333
Investment securities held to maturity
Residential mortgage-backed securities	7.5		693,143		709,339		—		—		—
Commercial mortgage-backed securities	0.8		78,729		78,980		—		—		—
Other	—		3,006		3,006		0.4		30,996		30,996
Total investment securities held to maturity	8.3		774,878		791,325		0.4		30,996		30,996
Total investment securities	100.0	%	$	9,363,598	$	9,524,923	100.0	%	$	7,142,410	$	7,173,003
(1) Calculated as a percent of the total fair value of investment securities.

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Loans and Leases

Loans for held for sale were $107.9 million at June 30, 2020, a net increase of $40.0 million since December 31, 2019. The increase is primarily due to originations of $503.2 million driven by low interest rates, partially offset by sales of $474.2 million.

Loans and leases held for investment were $32.42 billion at June 30, 2020, a net increase of $3.54 billion, representing annualized growth of 24.6% since December 31, 2019. This increase was driven by a $3.56 billion net increase in the non-PCD portfolio offset by a $28.1 million net decrease in the PCD loan portfolio. The net increase in the non-PCD portfolio was due to $3.08 billion related to SBA-PPP originations as well as organic growth primarily in our commercial segments. The net decrease in PCD loans was primarily due to a $69.2 million decline in loans from prior acquisitions, partially offset by $22.1 million in acquired PCD loans during 2020 along with a 19.0 million increase from the adoption of ASC 326. Excluding 2020 loans related to acquisitions and divestitures and SBA-PPP loans, total loans grew by 3.1% on an annualized basis.

BancShares reports non-PCD and PCD loan portfolios separately, and the non-PCD portfolio is further divided into commercial and consumer segments. Non-PCD loans and leases at June 30, 2020 were $31.89 billion compared to non-PCI loans of $28.32 billion at December 31, 2019, representing 98.4% and 98.1% of total loans, respectively. PCD loans at June 30, 2020 were $530.7 million, compared to $558.7 million of PCI loans at December 31, 2019, representing 1.6% and 1.9% of loans, respectively.

The discount related to acquired non-PCD loans and leases at June 30, 2020 and non-PCI loans and leases at December 31, 2019 was $25.8 million and $30.9 million, respectively. The discount related to PCD loans at June 30, 2020 and PCI loans at December 31, 2019 was $54.7 million and $88.2 million, respectively. The primary driver of the decrease in PCD discount is the adoption of ASC 326, which resulted in a reclassification of the credit portion of the loan discount to the ACL of $19.0 million.

During the three months ended June 30, 2020 and 2019, accretion income on purchased non-PCD loans and leases was $2.5 million and $3.4 million, respectively. During the three months ended June 30, 2020 and 2019, interest and accretion income on purchased PCD loans and leases was $14.4 million and $11.9 million, respectively.

During the six months ended June 30, 2020 and 2019, accretion income on purchased non-PCD loans and leases was $5.0 million and $6.7 million, respectively. During the six months ended June 30, 2020 and 2019, interest and accretion income on purchased PCD loans and leases was $33.0 million and $29.9 million, respectively.

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Table 9

LOANS AND LEASES

(Dollars in thousands)	June 30, 2020
Commercial:
Construction and land development	$	1,012,365
Owner occupied commercial mortgage	10,352,793
Non-owner occupied commercial mortgage	3,056,328
Commercial and industrial and leases	4,650,839
SBA-PPP	3,084,549
Total commercial loans	22,156,874
Consumer:
Residential mortgage	5,404,682
Revolving mortgage	2,233,977
Construction and land development	353,382
Consumer auto	1,195,771
Consumer other	543,088
Total consumer loans	9,730,900
Total non-PCD loans and leases	31,887,774
PCD loans	530,651
Total loans and leases	32,418,425
Less allowance for credit losses	(222,450)
Net loans and leases	$	32,195,975

(Dollars in thousands)	December 31, 2019
Commercial:
Construction and land development	$	1,013,454
Commercial mortgage	12,282,635
Other commercial real estate	542,028
Commercial and industrial and leases	4,403,792
Other	310,093
Total commercial loans	18,552,002
Noncommercial:
Residential mortgage	5,293,917
Revolving mortgage	2,339,072
Construction and land development	357,385
Consumer	1,780,404
Total noncommercial loans	9,770,778
Total non-PCI loans and leases	28,322,780
PCI loans	558,716
Total loans and leases	28,881,496
Less allowance for loan and lease losses	(225,141)
Net loans and leases	$	28,656,355

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ALLOWANCE FOR CREDIT LOSSES

The ACL was $222.5 million at June 30, 2020, representing a decrease of $2.7 million since December 31, 2019. The ACL as a percentage of total loans and leases was 0.69% at June 30, 2020, compared to 0.78% December 31, 2019. The ACL as a percentage of loans and leases excluding SBA-PPP loans, which have no recorded ACL, was 0.76% at June 30, 2020.

Upon adoption of ASC 326 on January 1, 2020, BancShares recorded a net decrease of $37.9 million in the ACL which included a decrease of $56.9 million in the ACL on non-PCD loans, partially offset by an increase of $19.0 million in the ACL on PCD loans. The decrease in the ACL on non-PCD loans was primarily in the commercial segments as these portfolios have exhibited strong historical credit performance and have relatively short average lives. This decrease was partially offset by an increase in the consumer segments due to their longer average lives. The increase in the ACL on PCD loans was primarily the result of reallocating credit discount from loan balances into ACL.

The ACL is calculated using a variety of factors, including, but not limited to, charge-off and recovery activity, loan growth, changes in macroeconomic factors, collateral type, estimated loan life and changes in credit quality. For the period ended June 30, 2020 the primary reason for the ACL change since the adoption of ASC 326, was a $36.1 million reserve build due to the potential economic impact of COVID-19 and its estimated impact on credit losses. Forecasted economic conditions are developed using third party macroeconomic scenarios adjusted based on management’s expectations over a forecast period of two years. Assumptions revert to long term historic averages over a one year period. Significant macroeconomic factors used in estimating the expected losses include unemployment, gross domestic product, home price index and commercial real estate index. Our model results included baseline, adverse and upside scenarios, as well as management’s expectation of borrower performance based upon COVID-19 residual risk by industry and geography. Expected loss estimates considered the potential impact of slower economic activity and elevated unemployment, as well as mitigating impacts from the government stimulus and loan modification programs. These loss estimates were also influenced by BancShares strong credit quality, historically low net charge-offs and recent credit trends, which remained stable through the quarter ended June 30, 2020.

At June 30, 2020, the ACL allocated to non-PCD loans and leases was $195.5 million, or 0.61% of non-PCD loans and leases, compared to $217.6 million, or 0.77%, at December 31, 2019. The ACL as a percentage of non-PCD loans and leases excluding SBA-PPP loans was 0.68% at June 30, 2020. The decrease of 16 basis points since December 31, 2019 was primarily due to the adoption of ASC 326, partially offset by the forecasted potential economic impacts of the COVID-19 pandemic on expected credit losses. The adoption of ASC 326 resulted in a decrease of 18 basis points, while the COVID-19 impacts resulted in an increase of 11 basis points.

At June 30, 2020, the ACL for PCD loans totaled $26.9 million compared to $7.5 million at December 31, 2019. The increase was primarily due the adoption of ASC 326.

Net charge-offs for loans and leases were $7.4 million during the second quarter of 2020, compared to $7.4 million during the second quarter of 2019. On an annualized basis, total net charge-offs as a percentage of total average loans and leases was 0.09% and 0.11% for the second quarter of 2020 and 2019, respectively. The net charge-off ratio was 0.10% and 0.11% for the six months ended June 30, 2020 and 2019, respectively. The ACL as of June 30, 2020, excluding SBA-PPP loans, covered approximately 7.5 times annualized year to date net charge-offs compared to 6.5 times at January 1, 2020 CECL adoption.

As part of ASC 326 adoption, BancShares made a policy not to measure an ACL for accrued interest receivable as our accounting policies and credit monitoring provide that uncollectible accrued interest is reversed or written off against interest income in a timely manner. Management reviewed this policy election during the second quarter of 2020 in light of the increase in accrued interest receivable and concluded the policy election remained appropriate due to trends in payments and extension activity.

Accrued interest receivable at June 30, 2020 was $175.5 million compared to $123.2 million at December 31, 2019 of which $139.8 million and $88.0 million related to outstanding accrued interest on the loan portfolio at June 30, 2020 and December 31, 2019, respectively. The $51.8 million increase in accrued receivable on loans was due in part to the increases in loan balances, as well the volume of loans in deferred payment status. At June 30, 2020 there were approximately $5.6 billion in active COVID-19 related loan extensions with an accrued interest receivable balance of approximately $63 million. The first wave of loans with payment deferrals have completed their extension period and the volume of extension requests declined during the second quarter. As of July 31, 2020, COVID-19 related loan extensions decreased to approximately $1.5 billion in outstanding loan balances with an accrued interest receivable balance of approximately $15 million as a significant portion of the original payment extensions moved to active status.

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Table 10

ALLOWANCE FOR CREDIT LOSSES

	Three months ended June 30, 2020
(Dollars in thousands)	Construction and land development - commercial		Owner occupied commercial mortgage		Non-owner occupied commercial mortgage		Commercial and industrial and leases		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer auto		Consumer other		PCD		Total
Allowance for credit losses:
Balance at April 1	$	2,290	$	22,970	$	16,531	$	30,619	$	38,366	$	24,557	$	1,140	$	5,769	$	40,101	$	26,916	$	209,259
Provision (credits)	4,705		(721)		5,542		(2,898)		4,909		2,211		486		4,042		2,034		242		20,552
Charge-offs	(138)		—		(8)		(3,869)		(460)		(495)		—		(1,255)		(4,447)		(1,392)		(12,064)
Recoveries	49		240		84		781		57		367		14		342		1,607		1,162		4,703
Balance at June 30	$	6,906	$	22,489	$	22,149	$	24,633	$	42,872	$	26,640	$	1,640	$	8,898	$	39,295	$	26,928	$	222,450
	Three months ended June 30, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer		PCD		Total
Balance at April 1	$	37,476	$	45,281	$	2,399	$	57,025	$	2,167	$	16,987	$	21,495	$	2,473	$	34,492	$	8,980	$	228,775
Provision (credits)	(5,544)		3,714		(57)		2,699		(174)		371		(328)		277		4,877		(637)		5,198
Charge-offs	(28)		(89)		—		(3,422)		(31)		(478)		(493)		—		(6,061)		—		(10,602)
Recoveries	40		56		—		599		221		52		447		—		1,797		—		3,212
Balance at June 30	$	31,944	$	48,962	$	2,342	$	56,901	$	2,183	$	16,932	$	21,121	$	2,750	$	35,105	$	8,343	$	226,583
	Six months ended June 30, 2020
(Dollars in thousands)	Construction and land development - commercial		Owner occupied commercial mortgage		Non-owner occupied commercial mortgage		Commercial and industrial and leases		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer auto		Consumer other		PCD		Total
Balance at December 31	$	33,213	$	36,444	$	11,102	$	61,610	$	18,232	$	19,702	$	2,709	$	4,292	$	30,301	$	7,536	$	225,141
Adoption of ASC 326	(31,061)		(19,316)		460		(37,637)		17,118		3,665		(1,291)		1,100		10,037		19,001		(37,924)
Balance at January 1	$	2,152	$	17,128	$	11,562	$	23,973	$	35,350	$	23,367	$	1,418	$	5,392	$	40,338	$	26,537	$	187,217
Provision (credits)	4,756		5,386		10,498		7,525		8,502		3,515		263		5,000		5,808		(2,346)		48,907
Initial allowance on PCD loans	—		—		—		—		—		—		—		—		—		1,193		1,193
Charge-offs	(138)		(320)		(8)		(8,918)		(1,260)		(1,080)		(70)		(2,199)		(9,817)		(2,515)		(26,325)
Recoveries	136		295		97		2,053		280		838		29		705		2,966		4,059		11,458
Balance at June 30	$	6,906	$	22,489	$	22,149	$	24,633	$	42,872	$	26,640	$	1,640	$	8,898	$	39,295	$	26,928	$	222,450
	Six months ended June 30, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - non - commercial		Consumer		PCI		Total
Balance at January 1	$	35,270	$	43,451	$	2,481	$	55,620	$	2,221	$	15,472	$	21,862	$	2,350	$	35,841	$	9,144	$	223,712
Provision (credits)	(3,425)		6,085		(140)		5,424		(672)		1,879		(119)		400		8,317		(801)		16,948
Charge-offs	(72)		(850)		—		(5,280)		(31)		(644)		(1,456)		—		(12,423)		—		(20,756)
Recoveries	171		276		1		1,137		665		225		834		—		3,370		—		6,679
Balance at June 30	$	31,944	$	48,962	$	2,342	$	56,901	$	2,183	$	16,932	$	21,121	$	2,750	$	35,105	$	8,343	$	226,583

The reserve for unfunded loan commitments was $13.7 million and $1.1 million at June 30, 2020 and December 31, 2019, respectively. The increase was primarily due to increases in the scope of off-balance sheet exposures considered due to the provisions of ASC 326.

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Table 11

ALLOWANCE FOR CREDIT LOSSES RATIOS

	Three months ended June 30						Six months ended June 30
(Dollars in thousands)	2020			2019			2020			2019
Average loans and leases:
PCD	$	546,998		$	544,250		$	538,543		$	561,574
Non-PCD	30,992,001			25,995,212			29,747,116			25,448,455
Loans and leases at period-end:
PCD	530,651			551,447			530,651			551,447
Non-PCD	31,887,774			26,176,790			31,887,774			26,176,790
Allowance for credit losses allocated to:
PCD	26,928			8,343			26,928			8,343
Non-PCD	195,522			218,240			195,522			218,240
Total	$	222,450		$	226,583		$	222,450		$	226,583
Net charge-offs (recoveries) to average loans and leases:
PCD	0.17		%	—		%	(0.58)		%	—		%
Non-PCD	0.09			0.11			0.11			0.11
Total	0.09			0.11			0.10			0.11
Allowance for credit losses to total loans and leases(1):
PCD	5.07			1.51			5.07			1.51
Non-PCD	0.61			0.83			0.61			0.83
Total	0.69			0.85			0.69			0.85
(1) Loans originated in relation to the SBA-PPP ($3,08 billion as of June 30, 2020) do not have a recorded ACL. As of June 30, 2020, the ratio of ACL to total Non-PCD loans excluding SBA-PPP loans is 0.68% while the ratio of ACL to total loans excluding SBA-PPP loans is 0.76%.

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NONPERFORMING ASSETS

Nonperforming assets include nonaccrual loans and leases and other real estate owned (“OREO”). At June 30, 2020, BancShares’ nonperforming assets totaled $251.6 million, an increase of $83.4 million since December 31, 2019.

Nonaccrual loans and leases at June 30, 2020 were $197.8 million, reflecting an increase of $76.1 million since December 31, 2019. Nonaccrual loans and leases as a percentage of total loans and leases was 0.61% and 0.42% at June 30, 2020 and December 31, 2019, respectively. The increase was primarily due to the dissolution of PCI loan pools under the adoption of ASC 326 as those nonaccrual loans within performing PCI pools were previously excluded from reporting. As of June 30, 2020, there were $35.9 million of nonaccrual loans that had been released from performing PCI pools. The remaining increase in nonaccrual loans was primarily due to increases within our acquired loan portfolios. The credit quality of the portfolio remains in line with our risk tolerances and management is actively monitoring any potential increases in portfolio risk due to COVID-19. At June 30, 2020, OREO totaled $53.9 million, representing an increase of $7.3 million since December 31, 2019 primarily due to additions from Community Financial of $9.8 million. Nonperforming assets as a percentage of total loans was 0.77% as of June 30, 2020 compared to 0.58% as of December 31, 2019. The additional PCI nonaccrual loans and acquired OREO resulted in an increase of 14 basis points to the nonperforming assets ratio at June 30, 2020.

Table 12

NONPERFORMING ASSETS

	2020						2019
	Second			First			Fourth			Third			Second
(Dollars in thousands)	Quarter			Quarter			Quarter			Quarter			Quarter
Nonaccrual loans and leases:
Non-PCD	$	135,280		$	121,337		$	114,946		$	108,816		$	100,701
PCD	62,511			53,234			6,743			829			4,274
Other real estate owned	53,850			55,707			46,591			46,253			46,236
Total nonperforming assets	$	251,641		$	230,278		$	168,280		$	155,898		$	151,211
Accruing loans and leases 90 days or more past due
Non-PCD	$	3,644		$	2,933		$	3,291		$	4,247		$	3,468
PCD	152			37			24,257			23,287			29,319
Ratio of total nonperforming assets to total loans, leases and other real estate owned	0.77		%	0.79		%	0.58		%	0.57		%	0.56		%

TROUBLED DEBT RESTRUCTURINGS

We selectively agree to modify existing loan terms to provide relief to customers who are experiencing financial difficulties or other circumstances that could affect their ability to meet debt obligations. Typical modifications include short-term deferral of interest or modification of payment terms. Troubled debt restructurings (“TDRs”) not accruing interest at the time of restructure are included as nonperforming loans. TDRs accruing at the time of restructure and continuing to perform based on the restructured terms are considered performing loans.

The Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus was published by banking regulators in April 2020 to clarify expectations around loan modifications and the determination of TDRs for borrowers experiencing COVID-19-related financial difficulty. BancShares applied this regulatory guidance during its TDR identification process for short-term loan forbearance agreements as a result of COVID-19 and in most cases is not recording these as TDRs.

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Table 13

TROUBLED DEBT RESTRUCTURINGS

(Dollars in thousands)	June 30, 2020		December 31, 2019
Accruing TDRs:
Non-PCD	$	136,174	$	111,676
PCD	18,639		17,074
Total accruing TDRs	154,813		128,750
Nonaccruing TDRs:
Non-PCD	40,668		42,331
PCD	6,024		111
Total nonaccruing TDRs	46,692		42,442
All TDRs:
Non-PCD	176,842		154,007
PCD	24,663		17,185
Total TDRs	$	201,505	$	171,192

INTEREST-BEARING LIABILITIES

Interest-bearing liabilities include interest-bearing deposits, securities sold under customer repurchase agreements, FHLB borrowings, subordinated debt, and other borrowings. Interest-bearing liabilities totaled $25.33 billion at June 30, 2020, compared to $22.83 billion at December 31, 2019. The $2.50 billion increase was due to an increase in interest-bearing deposits of $1.83 billion and an increase in total borrowings of $672.1 million.

Deposits

Due to our focus on maintaining a strong liquidity position, core deposit retention remains a key business objective. We believe traditional bank deposit products remain an attractive option for many customers but, as economic conditions improve, we recognize that our liquidity position could be adversely affected as bank deposits are withdrawn and invested elsewhere. Our ability to fund future loan growth is significantly dependent on our success at retaining existing deposits and generating new deposits at a reasonable cost.

At June 30, 2020, total deposits were $41.48 billion, an increase of $7.05 billion, representing annualized growth of 41.2% since December 31, 2019. Excluding SBA-PPP reciprocal deposits of $2.99 billion, consumer stimulus deposits of $526.0 million and acquired deposits totaling $43.0 million, deposits increased $3.49 billion, or by 20.4% annualized, over the same time period. This organic growth was primarily the result of increases in demand and money market accounts partially offset by a decline in time deposits.

Table 14

DEPOSITS

(Dollars in thousands)	June 30, 2020		December 31, 2019
Demand	$	18,149,466	$	12,926,796
Checking with interest	9,056,063		8,284,302
Money market	8,013,942		6,817,752
Savings	2,983,138		2,564,777
Time	3,276,636		3,837,609
Total deposits	$	41,479,245	$	34,431,236

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Borrowings

At June 30, 2020, total borrowings were $2.00 billion compared to $1.33 billion at December 31, 2019. The $672.1 million increase was primarily due to an increase in subordinated debt of $340.8 million due to new debt issuance in 2020, an increase in securities sold under customer repurchase agreements of $297.3 million as a result of increased customer deposit balances, and an increase in FHLB borrowings of $85.5 million, partially offset by a decrease in other borrowings of $51.5 million.

Table 15

BORROWINGS

(Dollars in thousands)	June 30, 2020		December 31, 2019
Securities sold under customer repurchase agreements	$	740,276	$	442,956
Federal Home Loan Bank borrowings	657,682		572,185
Subordinated debt
SCB Capital Trust I	9,759		9,739
FCB/SC Capital Trust II	17,597		17,532
FCB/NC Capital Trust III	88,145		88,145
Capital Trust debentures assumed in acquisitions	14,433		14,433
Other subordinated debt	374,312		33,563
Total subordinated debt	504,246		163,412
Other borrowings	96,791		148,318
Total borrowings	$	1,998,995	$	1,326,871

BancShares owns five special purpose entities – SCB Capital Trust I, FCB/SC Capital Trust II, FCB/NC Capital Trust III, CCBI Capital Trust I, and Macon Capital Trust I (the “Trusts”), which mature in 2036, 2034, 2034, 2036, and 2034, respectively. Subordinated debt included junior subordinated debentures representing obligations to the Trusts, which may be redeemed at par in whole or in part at any time. BancShares has guaranteed all obligations of the Trusts.

SHAREHOLDERS’ EQUITY AND CAPITAL ADEQUACY

On March 4, 2020, BancShares completed its public offering of $350 million aggregate principal amount of its 3.375% Fixed-to-Floating Rate Subordinated Notes due 2030. On March 12, 2020, BancShares issued and sold an aggregate of 13,800,000 depositary shares, each representing a 1/40th interest in a share of 5.375% Non-Cumulative Perpetual Preferred Stock, Series A, par value $0.01 per share, with a liquidation preference of $25 per Depositary Share (equivalent to $1,000 per share of Series A Preferred Stock) for a total of $345 million.

The capital raise provides liquidity for general corporate purposes, which may include, but is not limited to, providing capital to support our growth organically or through strategic acquisitions, financing investments and capital expenditures, for funding investments in FCB as regulatory capital, and redeeming or repurchasing our common stock.

The table below shows Class A common stock repurchase activity for the three and six months ended June 30, 2020 and 2019. All Class A common stock repurchases completed in 2020 and 2019 were consummated under previously approved authorizations.

Table 16

CLASS A COMMON STOCK REPURCHASE ACTIVITY

	Three months ended June 30				Six months ended June 30
($ in thousands, expect per share data)	June 30		June 30		June 30		June 30
Number of shares repurchased	346,000		205,500		695,390		448,500
Total cost	$	126,974	$	89,765	$	286,664	$	190,508
Average price per share	$	366.98	$	436.81	$	412.23	$	424.77

Subsequent to quarter-end through July 31, 2020, BancShares repurchased an additional 117,700 shares of Class A common stock for $47.1 million at an average cost per share of $399.77. Upon completion of the current authorization on July 31, 2020, share repurchase activity has been suspended and will be reevaluated in subsequent periods.

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The table below shows activities that caused the change in outstanding Class A common stock over the past five quarters.

Table 16

CHANGES IN SHARES OF CLASS A COMMON STOCK OUTSTANDING

	2020		2019
	Second	First	Fourth	Third	Second
(in thousands)	Quarter	Quarter	Quarter	Quarter	Quarter
Class A shares outstanding at beginning of period	9,275	9,624	9,879	10,175	10,380
Share repurchases	(346)	(349)	(255)	(296)	(205)
Class A shares outstanding at end of period	8,929	9,275	9,624	9,879	10,175

We are committed to effectively managing our capital to protect our depositors, creditors and shareholders. We continually monitor the capital levels and ratios for BancShares and FCB to ensure they exceed the minimum requirements imposed by regulatory authorities and to ensure they are appropriate given growth projections, risk profile and potential changes in the regulatory or external environment. Failure to meet certain capital requirements may result in actions by regulatory agencies that could have a material impact on our consolidated financial statements.

In accordance with accounting principles generally accepted in the United States of America (“GAAP”), the unrealized gains and losses on certain assets and liabilities, net of deferred taxes, are included in accumulated other comprehensive loss within shareholders’ equity. These amounts are excluded from shareholders’ equity in the calculation of our capital ratios under current regulatory guidelines.

Table 18

ANALYSIS OF CAPITAL ADEQUACY

	Requirements to be well-capitalized		June 30, 2020				December 31, 2019
(Dollars in thousands)			Amount		Ratio		Amount		Ratio
BancShares
Risk-based capital ratios
Tier 1 risk-based capital	8.00	%	$	3,634,050	11.38	%	$	3,344,305	10.86	%
Common equity Tier 1	6.50		3,294,113		10.32		3,344,305		10.86
Total risk-based capital	10.00		4,351,169		13.63		3,731,501		12.12
Tier 1 leverage ratio(1)	5.00		3,634,050		8.07		3,344,305		8.81
FCB
Risk-based capital ratios
Tier 1 risk-based capital	8.00	%	$	4,015,721	12.58	%	$	3,554,974	11.54	%
Common equity Tier 1	6.50		4,015,721		12.58		3,554,974		11.54
Total risk-based capital	10.00		4,278,340		13.40		3,837,670		12.46
Tier 1 leverage ratio(2)	5.00		4,015,721		8.93		3,554,974		9.38
(1)The SBA PPP program, with $3.1 billion in outstanding balances, has decreased BancShares’ Tier 1 leverage ratio by 48 bps; BancShares’ Tier 1 leverage ratio would be estimated at 8.55% at June 30, 2020 without the impact the SBA PPP program. (2) The SBA PPP program, with $3.1 billion in outstanding balances, has decreased FCB’s Tier 1 leverage ratio by 53 bps; FCB’s Tier 1 leverage ratio would be estimated at 9.46% at June 30, 2020 without the impact the SBA PPP program.

As of June 30, 2020, BancShares and FCB continued to exceed minimum capital standards and remained well-capitalized under Basel III guidelines. Trust preferred capital securities continue to be a component of total risk-based capital.

BancShares and FCB had capital conservation buffers of 5.38% and 5.40%, respectively, at June 30, 2020, which exceeded the 2.50% requirement and, therefore, result in no limit on distributions.

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RISK MANAGEMENT

Risk is inherent in any business. BancShares has defined a moderate risk appetite, a conservative approach to risk taking, with a philosophy that does not preclude higher risk business activities balanced with acceptable returns while meeting regulatory objectives. Through the comprehensive Enterprise Risk Management Framework and Risk Appetite Framework, senior management has primary responsibility for day-to-day management of the risks we face with accountability of and support from all associates. Senior management applies various strategies to reduce the risks to which BancShares activities may be exposed, with effective challenge and oversight by management committees. In addition, the Board of Directors strives to ensure that the business culture is integrated with the enterprise risk management program and that policies, procedures and metrics for identifying, assessing, measuring, monitoring and managing risk are part of the decision-making process. The Board of Directors’ role in risk oversight is an integral part of our overall Enterprise Risk Management Framework and Risk Appetite Framework. The Board of Directors administers its risk oversight function primarily through the Board Risk Committee.

The Board Risk Committee structure is designed to allow for information flow, effective challenge and timely escalation of risk-related issues. The Board Risk Committee is directed to monitor and advise the Board of Directors regarding risk exposures, including credit, market, capital, liquidity, operational, compliance, strategic and reputational risks; review, approve, and monitor adherence to the risk appetite and supporting risk tolerance levels via a series of established metrics; and evaluate, monitor and oversee the adequacy and effectiveness of the Risk Management Framework and Risk Appetite Framework. The Board Risk Committee also reviews: reports of examination by and communications from regulatory agencies; the results of internal and third party testing and qualitative and quantitative assessments related to risk management; and any other matters within the scope of the Committee’s oversight responsibilities. The Board Risk Committee monitors management’s response to certain risk-related regulatory and audit issues. In addition, the Board Risk Committee may coordinate with the Audit Committee and the Compensation, Nominations and Governance Committee for the review of financial statements and related risks, information security and other areas of joint responsibility.

In combination with other risk management and monitoring practices, enterprise-wide stress testing activities are part of the Risk Management Framework and conducted within a defined framework. Stress tests are performed for various risks to ensure the financial institution can support continued operations during stressed periods.

In response to COVID-19, BancShares assembled a cross-functional leadership team to identify and manage newly identified risks and provide effective risk oversight through this pandemic. New or elevated risks have been identified in multiple areas, including but not limited to, operational risk, credit risk, market risk, liquidity risk, capital adequacy risk, compliance risk, and financial reporting risk. As such, we have incorporated changes to Item 1A. Risk Factors within this Quarterly Report on Form 10-Q to capture these changes. These new or increased areas of risk are being actively managed by senior leadership, and have been incorporated into reporting for key management committees and regular updates are being provided to the Board of Directors.

Credit risk management

Credit risk is the risk of not collecting payments pursuant to the contractual terms of loans, leases and certain investment securities. Loans and leases we originate are underwritten in accordance with our credit policies and procedures and are subject to periodic ongoing reviews. Acquired loans, regardless of whether PCD or non-PCD, are recorded at fair value as of the acquisition date and are subject to periodic reviews to identify any further credit deterioration. Our independent credit review function conducts risk reviews and analyses of both originated and acquired loans to ensure compliance with credit policies and to monitor asset quality trends and borrower financial strength. These reviews include portfolio analysis by geographic location, industry, collateral type and product. We strive to identify potential problem loans as early as possible, to record charge-offs or write-downs as appropriate and to maintain an adequate ACL that accounts for losses inherent in the loan and lease portfolio.

We are actively monitoring our loan portfolio for areas of increased risk as a result of COVID-19. As of July 31, 2020, COVID-19 related loan extensions decreased to approximately $1.5 billion in outstanding loan balances, representing approximately $43 million in payment deferrals. The first wave of loans with payment deferrals have completed their extension period and the volume of extension requests declined during the second quarter. A significant portion of the original payment extensions, approximately $5.5 billion, have moved to active status as of July 31, 2020. To date, we have not seen significant shifts in credit line utilization or declines in overall credit quality.

Additionally, we are participating in the SBA-PPP program, which provided much needed funds to our existing small business customers, and we continue to assess both the credit and operational risks this program presents. BancShares originated approximately 23,000 SBA-PPP loan requests with an outstanding balance of $3.08 billion at June 30, 2020.

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Our ACL estimate for the quarter ended June 30, 2020 included extensive reviews of the changes in credit risk associated with the loan portfolio and uncertainties around economic forecasts and the overall economic impact of COVID-19. Expected loss estimates within each portfolio considered the potential impact of slower economic activity with increasing unemployment, as well as potential mitigating impacts from the government stimulus and loan modification programs. These loss estimates additionally considered BancShares industry and geography risk, historically strong credit quality and actual net losses incurred during prior periods of economic stress, as well as recent credit trends, which have not seen deterioration from COVID-19 as of June 30, 2020.

Interest rate risk management

Interest rate risk (“IRR”) results principally from: assets and liabilities maturing or repricing at different points in time, assets and liabilities repricing at the same point in time but in different amounts, and short-term and long-term interest rates changing in different magnitudes.

We assess our short-term IRR by forecasting net interest income over 24 months under various interest rate scenarios and comparing those results to forecasted net interest income, assuming stable rates. IRR scenarios modeled include, but are not limited to, immediate, parallel rate shocks, interest rate ramps, changes in the shape of the yield curve and changes in the relationships of our rates to market rates. Market interest rates declined significantly from year-end driven by economic uncertainty brought on by COVID-19. Net interest income deterioration in down rate shocks will remain muted due to the low absolute value of market interest rates. Assumptions that incorporate customer migration from low rate deposit instruments to intermediate term fixed rate instruments as rates rise have been adjusted based on actual deposit behavior over the last 3 years during a rising rate cycle.

Table 19 provides the impact on net interest income over 24 months resulting from various instantaneous interest rate shock scenarios as of June 30, 2020 and December 31, 2019.

Table 19

NET INTEREST INCOME SENSITIVITY ANALYSIS

	Estimated percentage increase (decrease) in net interest income
Change in interest rate (basis points)	June 30, 2020		December 31, 2019
-100	(3.12)	%	(8.00)	%
+100	4.91		1.30
+200	6.68		0.01

The increased asset sensitivity in net interest income sensitivity metrics as of June 30, 2020 compared to December 31, 2019 were primarily affected by a significant influx of non-maturity deposits during the second quarter of 2020 related to participation in the SBA-PPP as well as consumer stimulus payments generating large overnight cash balances.

Long-term interest rate risk exposure is measured using the economic value of equity (“EVE”) sensitivity analysis to study the impact of long-term cash flows on earnings and capital. EVE represents the difference between the sum of the present value of all asset cash flows and the sum of the present value of the liability cash flows. EVE sensitivity analysis involves discounting cash flows of balance sheet items under different interest rate scenarios. Cash flows will vary by interest rate scenario, resulting in variations in EVE. The base-case measurement and its sensitivity to shifts in the yield curve allow management to measure longer-term repricing and option risk in the balance sheet.

Table 20 table presents the EVE profile as of June 30, 2020 and December 31, 2019.

Table 20

ECONOMIC VALUE OF EQUITY MODELING ANALYSIS

	Estimated percentage increase (decrease) in EVE
Change in interest rate (basis points)	June 30, 2020		December 31, 2019
-100	(22.56)	%	(8.25)	%
+100	8.10		(0.03)
+200	9.21		(4.80)

The economic value of equity metrics at June 30, 2020 compared to December 31, 2019 were primarily affected by substantial growth in demand deposits of nearly $6.5 billion during the second quarter of 2020. We do not typically utilize interest rate swaps, floors, collars or other derivative financial instruments to hedge our overall balance sheet interest rate sensitivity and risk.

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Liquidity risk management

Liquidity risk is the risk that an institution will be unable to generate or obtain sufficient cash or its equivalents on a cost-effective basis to meet commitments as they fall due. The most common sources of liquidity risk arise from mismatches in the timing and value of on-balance sheet and off-balance sheet cash inflows and outflows. In general, on-balance sheet mismatches generate liquidity risk when the effective maturity of assets exceeds the effective maturity of liabilities. A commonly cited example of a balance sheet liquidity mismatch is when long-term loans (assets) are funded with short-term borrowings (liabilities). Other forms of liquidity risk include market constraints on the ability to convert assets into cash at expected levels, an inability to access funding sources at sufficient levels at a reasonable cost, and changes in economic conditions or exposure to credit, market, operational, legal and reputation risks that can affect an institution’s liquidity risk profile.

We utilize various limit-based measures to monitor, measure and control three different categories of liquidity risk:

•Tactical - Measures the risk of a negative cash flow position whereby cash outflows exceed cash inflows over a short-term horizon out to nine weeks;

•Structural - Measures the amount by which illiquid assets are supported by long-term funding; and

•Contingent - Measures the risk of having insufficient liquidity sources to support cash needs under potential future stressed market conditions or having an inability to access wholesale funding sources in a timely and cost effective manner.

We aim to maintain a diverse mix of liquidity sources to support the liquidity management function, while aiming to avoid funding concentrations by diversifying our external funding with respect to maturities, counterparties and nature. Our primary source of liquidity is our retail deposit book due to the generally stable balances and low cost it offers. Additional sources include cash in excess of our reserve requirement at the Federal Reserve Bank, and various other corresponding bank accounts and unencumbered securities, which totaled $8.04 billion at June 30, 2020 compared to $3.57 billion at December 31, 2019. Another source of available funds was advances from the FHLB of Atlanta and Chicago. Outstanding FHLB advances were $657.7 million as of June 30, 2020, and we had sufficient collateral pledged to secure $7.86 billion of additional borrowings from the FHLB of Atlanta. Also, at June 30, 2020, $3.93 billion in non-PCD loans with a lendable collateral value of $3.14 billion were used to create additional borrowing capacity at the Federal Reserve Bank. We also maintain Federal Funds lines and other credit lines, which had $623.0 million of available capacity at June 30, 2020.

CRITICAL ACCOUNTING ESTIMATES

Except as described below, there have been no significant changes in our Critical Accounting Estimates as described in our 2019 Annual Report on Form 10-K.

Allowance for credit losses - The allowance for credit losses on loans and leases replaces the allowance for loan and leases losses as a critical accounting estimate, as of January 1, 2020 with the adoption of ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.

The allowance for credit losses represents management’s best estimate of current expected credit losses over the life of the portfolio of loan and leases. Estimating credit losses requires judgment in determining loan specific attributes impacting the borrower’s ability to repay contractual obligations. Other factors such as economic forecasts used to determine a reasonable and supportable forecast, prepayment assumptions, the value of underlying collateral, and changes in size composition and risks within the portfolio are also considered.

The allowance for credit losses is assessed at each balance sheet date and adjustments are recorded in the provision for credit losses. The allowance is estimated based on loan level characteristics using historical loss rates, a reasonable and supportable economic forecast with reversion to historical assumptions. Loan losses are estimated using the fair value of collateral for collateral-dependent loans, or when the borrower is experiencing financial difficulty such that repayment of the loan is expected to be made through the operation or sale of the collateral. Loan balances considered uncollectible are charged-off against the ACL. Recoveries of amounts previously charged-off are credited to the ACL.

PCD assets represent assets that are acquired with evidence of more than insignificant credit quality deterioration since origination at the acquisition date. At acquisition, the allowance for credit losses on PCD assets is booked directly the ACL. Any subsequent changes in the ACL on PCD assets is recorded through the provision for credit losses.

Management believes that the ACL is adequate to absorb the expected life of loan credit losses on the portfolio of loans and leases as of the balance sheet date. Actual losses incurred may differ materially from our estimates. Particularly, the impact of COVID-19 on both borrower credit and the greater macroeconomic environment is uncertain and changes in the duration, spread and severity of the virus will affect our loss experience.

64

FORWARD-LOOKING STATEMENTS

Statements in this Quarterly Report on Form 10-Q and Exhibits relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments, expectations or beliefs about future events or results and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors which include, but are not limited to, factors discussed in our Annual Report on Form 10-K and in other documents filed by us from time to time with the Securities and Exchange Commission.

Forward-looking statements may be identified by terms such as “may,” “will,” “should,” “could,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “forecasts,” “projects,” “potential” or “continue,” or similar terms or the negative of these terms, or other statements concerning opinions or judgments of BancShares’ management about future events.

Factors that could influence the accuracy of those forward-looking statements include, but are not limited to, the impacts of COVID-19 on our business and the economy, the financial success or changing strategies of our customers, customer acceptance of our services, products and fee structure, the competitive nature of the financial services industry, our ability to compete effectively against other financial institutions in our banking markets, actions of government regulators, the level of market interest rates and our ability to manage our interest rate risk, changes in general economic conditions that affect our loan and lease portfolio, the abilities of our borrowers to repay their loans and leases, the values of real estate and other collateral, the impact of the acquisitions, the risks discussed in Part II, Item 1A. Risk Factors and other developments or changes in our business that we do not expect.

Actual results may differ materially from those expressed in or implied by any forward-looking statements. Except to the extent required by applicable law or regulation, BancShares undertakes no obligation to revise or update publicly any forward-looking statements for any reason.

Item 3.Quantitative and Qualitative Disclosures about Market Risk

Market risk is the potential economic loss resulting from changes in market prices and interest rates. This risk can either result in diminished current fair values of financial instruments or reduced net interest income in future periods. As of June 30, 2020, BancShares’ market risk profile has changed since December 31, 2019 as discussed in the Form 10-K as a result of the outbreak of COVID-19 during 2020. See section Risk Management within Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations for discussion of changes. Changes in fair value that result from movement in market rates cannot be predicted with any degree of certainty. Therefore, the impact that future changes in market rates will have on the fair values of financial instruments is uncertain.

Item 4. Controls and Procedures

BancShares’ management, with the participation of its Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of BancShares’ disclosure controls and procedures as of the end of the period covered by this Quarterly Report, in accordance with Rule 13a-15 of the Securities Exchange Act of 1934 (“Exchange Act”). Based upon that evaluation, as of the end of the period covered by this report, the Chief Executive Officer and the Chief Financial Officer concluded that BancShares’ disclosure controls and procedures were effective to provide reasonable assurance that it is able to record, process, summarize and report in a timely manner the information required to be disclosed in the reports it files under the Exchange Act.

During the first quarter of 2020, BancShares adopted ASC 326 which resulted in a material change to our methodology for estimating credit losses on the loan portfolio. As a result, the Company implemented changes to policies, processes, and controls over estimating the allowance for credit losses. Many of these controls are similar to those previously used for estimating the allowance for loan and lease losses under legacy GAAP, however, there were changes implemented to account for the additional complexity of the credit loss models, review of economic forecasts and other assumptions used in the estimation process.

During the second quarter of 2020, BancShares originated over $3.2 billion of loans as part of the SBA-PPP. As a result, BancShares enhanced existing as well as implemented new controls over financial reporting related to the origination, disbursement, recording and reporting processes involving this portfolio.

Except as noted above, no changes in BancShares’ internal control over financial reporting occurred during the second quarter of 2020 that have materially affected, or are reasonably likely to materially affect, BancShares’ internal control over financial reporting.

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PART II

Item 1. Legal Proceedings

BancShares and various subsidiaries have been named as defendants in various legal actions arising from our normal business activities in which damages in various amounts were claimed. Although the amount of any ultimate liability with respect to those matters cannot be determined, in the opinion of management, no legal actions currently exist that are expected to have a material effect on BancShares’ consolidated financial statements. Additional information relating to legal proceedings is set forth in Note N - Commitments and Contingencies.

Item 1A. Risk Factors

The following paragraphs describe changes in the risk factors described in our Annual Report on Form 10-K for the year ended December 31, 2019.

An outbreak of COVID-19 has adversely affected BancShares' business, financial condition and results of operations.

A novel strain of coronavirus (“COVID-19”) has spread across most of the world, including the United States beginning in the first quarter of 2020. It has caused severe disruptions to the US economy, regional quarantines, business shutdowns, high unemployment, disruptions to supply chains, and overall economic instability that has adversely impacted the operations, activities and business of BancShares and its customers. Effects have generally been felt across all industries; however, the industries that have been the most negatively impacted to date include hospitality, travel and tourism, retail, medical and dental, and financial services.

In response to the national public health crisis, Federal, State and Local governments continue to impose an array of restrictions on the way all businesses conduct their operations and on our customers, business partners, vendors and employees. These restrictions, along with other economic factors including inflation risks, oil price volatility, and changes in interest rates have and may continue to destabilize financial markets and negatively impact our customers’ business activities and operations, making it difficult for them to satisfy existing debt obligations. They also have led to increasing unemployment and slower consumer spending which in turn will increase our collection risk as deteriorating economic conditions correlate with lower credit quality metrics and higher customer defaults on loans. Economic pressures and uncertainty has and may continue to change consumer and business behaviors, which, in the short and long term, could affect borrowers’ creditworthiness and the demand for loans and other products and services we offer. BancShares is actively monitoring the loan portfolio to identify changes in credit risk within a specific geography, loan class, or within a particular industry concentration. Therefore, provision expense could increase as we incorporate these changes into our estimate on the allowance for credit losses.

Additionally, our operations have experienced disruptions as we transitioned to a remote working environment for most corporate employees and we adjusted branch operations and corporate processes. While we have begun a phased return to work plan based on outbreak severity within impact areas, there may be increased absenteeism, and lost productivity as a result of the remote workforce. We may see an increased incidence of cybersecurity threats or fraud as cyber-criminals look to profit from the disruption and potential strain on information technology and the fear of the general public. There may be disruption in critical third party services as they adjust to the new operating environment. BancShares has a comprehensive business continuity and data security plan in place but may not be able to mitigate all of the issues identified above.

Market volatility and general uncertainty in the capital markets may also impact our business. Our access to capital and liquidity could be limited by market disruptions which could be exacerbated by delays in customer payments or significant withdrawals from customer deposit accounts. In addition, the fair value of our assets and liabilities will be impacted by the changing market environment. This could also increase liquidity and capital adequacy risks, as well as long-lived asset impairment risk.

As the government and its regulatory bodies respond to the crisis, it increases the burden on our associates to quickly respond to changing regulatory guidance. This could increase the risk of noncompliance.

66

The impacts laid out above and others will be felt across all of the following categories of risk identified by BancShares in our Annual Report on Form 10-K:

•Operational Risk

•Credit Risk

•Market Risk

•Liquidity Risk

•Capital Adequacy Risk

•Compliance Risk

•Strategic Risk

•Financial Reporting Risk

The effects of the COVID-19 pandemic will heighten specific risk factors and could impact substantially all risk factors described in our Annual Report on Form 10-K under the risk categories listed above. Those effects will adversely affect our business operations and results at least until the outbreak has subsided, and the negative effects on the economy, our customers and our business and results likely will continue to be felt for some time afterwards. The full extent of the impact will depend on future developments that are highly uncertain including the duration and spread of the outbreak, its severity, governmental actions to contain the virus, and the long term economic impact, both globally, as well as in our banking markets, which includes a potential recession. As a result, we currently cannot fully assess the risk and adverse impact of the COVID-19 pandemic, but the effects may have a material impact on our business and financial results and heighten many of the individual risk factors identified in our Annual Report on Form 10-K for the year ended December 31, 2019.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Information concerning BancShares’ repurchases of outstanding common stock during the three month period ended June 30, 2020, is included in the following table:

Class A common stock	Total Number of Class A Shares Repurchased	Average Price Paid per Share		Total Number of Shares Repurchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet be Repurchased Under the Plans or Programs
Repurchases from April 1, 2020 to April 30, 2020	111,700	$	333.71	111,700	131,500
Repurchases from May 1, 2020 to May 31, 2020	117,000	360.91		117,000	383,000
Repurchases from June 1, 2020 to June 30, 2020	117,300	404.70		117,300	265,700
Total	346,000	$	366.98	346,000	265,700
The Board authorized the repurchase of up to 500,000 shares of Class A common stock for the period of February 1, 2020 through April 30, 2020, superseding all previous authorities. The authorization was publicly announced on February 7, 2020. The Board authorized the repurchase of up to 500,000 shares of Class A common stock for the period May 1, 2020 through July 31, 2020. The authorization was publicly announced on April 28, 2020.

Subsequent to quarter-end and through July 31, 2020, BancShares repurchased an additional 117,700 shares of Class A common stock for $47.1 million at an average cost per share of $399.77. Upon completion of the current authorization on July 31, 2020, share repurchase activity has been suspended and will be reevaluated in subsequent periods.

67

Item 6. Exhibits

31.1	Certification of Chief Executive Officer (filed herewith)
31.2	Certification of Chief Financial Officer (filed herewith)
32.1	Certification of Chief Executive Officer (filed herewith)
32.2	Certification of Chief Financial Officer (filed herewith)
101.INS	Inline XBRL Instance Document (filed herewith)
101.SCH	Inline XBRL Taxonomy Extension Schema (filed herewith)
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase (filed herewith)
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase (filed herewith)
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase (filed herewith)
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase (filed herewith)
104	Cover Page Interactive Data File (embedded within the Inline XBRL document filed as Exhibit 101)

68

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. 

Date:	August 4, 2020		FIRST CITIZENS BANCSHARES, INC.
			(Registrant)
		By:	/s/ CRAIG L. NIX
			Craig L. Nix
			Chief Financial Officer

69

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Frank B. Holding, Jr., certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of First Citizens BancShares, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(i)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(ii)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(iii)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(iv)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(i)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(ii)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4, 2020

/s/ Frank B. Holding, Jr.

Frank B. Holding, Jr.

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Craig L. Nix, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of First Citizens BancShares, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(i)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(ii)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(iii)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(iv)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(i)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(ii)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4, 2020

/s/ Craig L. Nix

Craig L. Nix

Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION

The undersigned hereby certifies that (i) the Form 10-Q filed by First Citizens BancShares, Inc. (the “Issuer”) for the period ended June 30, 2020, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and (ii) the information contained in that report fairly presents, in all material respects, the financial condition and results of operations of the Issuer on the dates and for the periods presented therein.

August 4, 2020

/s/ Frank B. Holding, Jr.

Frank B. Holding, Jr.

Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION

The undersigned hereby certifies that (i) the Form 10-Q filed by First Citizens BancShares, Inc. (the “Issuer”) for the period ended June 30, 2020, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and (ii) the information contained in that report fairly presents, in all material respects, the financial condition and results of operations of the Issuer on the dates and for the periods presented therein.

August 4, 2020

/s/ Craig L. Nix

Craig L. Nix

Chief Financial Officer

XML

Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2020	Jul. 31, 2020
Entity Central Index Key	0000798941
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q2
Amendment Flag	false
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2020
Document Transition Report	false
Entity File Number	001-16715
Entity Registrant Name	FIRST CITIZENS BANCSHARES INC /DE/
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	56-1528994
Entity Address, Address Line One	4300 Six Forks Road
Entity Address, City or Town	Raleigh
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	27609
City Area Code	(919)
Local Phone Number	716-7000
Title of 12(g) Security	Class B Common Stock, Par Value $1
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Class A Common Stock
Title of 12(b) Security	Class A Common Stock, Par Value $1
Trading Symbol	FCNCA
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		8,811,220
Class B Common Stock
Entity Common Stock, Shares Outstanding		1,005,185
Preferred Stock
Title of 12(b) Security	Depositary Shares, Each Representing a 1/40th Interest in a Share of 5.375% Non-Cumulative Perpetual Preferred Stock, Series A
Trading Symbol	FCNCP
Security Exchange Name	NASDAQ

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Assets
Cash and due from banks	$ 389,233	$ 376,719
Overnight investments	3,107,575	1,107,844
Investment in marketable equity securities	114,316	82,333
Debt Securities, Available-for-sale	8,619,282	7,059,674
Investment securities held to maturity at cost	774,878	30,996
Loans held for sale	107,881	67,869
Loans and leases	32,418,425	28,881,496
Allowance for loan and lease losses	(222,450)	(225,141)
Total loan and leases	32,195,975	28,656,355
Premises and equipment	1,255,688	1,244,396
Other real estate owned	53,850	46,591
Income earned not collected	175,496	123,154
Goodwill recorded for Community Financial	350,298	349,398
Other intangible assets	58,606	68,276
Other assets	663,116	610,891
Total assets	47,866,194	39,824,496
Deposits [Abstract]
Noninterest-bearing deposits	18,149,466	12,926,796
Interest-bearing deposits	23,329,779	21,504,440
Total deposits	41,479,245	34,431,236
Securities sold under customer repurchase agreements	740,276	442,956
Federal Home Loan Bank borrowings	657,682	572,185
Subordinated Debt	504,246	163,412
Other Borrowings	96,791	148,318
FDIC shared-loss payable	15,025	112,395
Other liabilities	381,485	367,810
Total liabilities	43,874,750	36,238,312
Shareholders' Equity
Preferred stock	339,937	0
Surplus	0	44,081
Retained earnings	3,651,237	3,658,197
Accumulated other comprehensive loss	(9,664)	(126,723)
Total shareholders' equity	3,991,444	3,586,184
Total liabilities and shareholders' equity	47,866,194	39,824,496
Class A Common Stock
Shareholders' Equity
Common stock	8,929	9,624
Class B Common Stock
Shareholders' Equity
Common stock	$ 1,005	$ 1,005

XML

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Investment in marketable equity securities at cost	$ 116,322	$ 59,262
Investment securities available for sale at cost	8,472,398	7,052,152
Investment securities held to maturity at fair value	$ 791,325	$ 30,996
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	345,000	0
Preferred stock, shares outstanding	345,000	0
Class A Common Stock
Common stock, par value (in dollars per share)	$ 1	$ 1
Common stock, shares authorized	16,000,000	16,000,000
Common stock, shares issued	8,928,920	9,624,310
Common stock, shares outstanding	8,928,920	9,624,310
Class B Common Stock
Common stock, par value (in dollars per share)	$ 1	$ 1
Common stock, shares authorized	2,000,000	2,000,000
Common stock, shares issued	1,005,185	1,005,185
Common stock, shares outstanding	1,005,185	1,005,185

XML

Consolidated Statements of Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Interest income
Loans and leases	$ 326,099	$ 303,233	$ 651,647	$ 594,155
Investment securities interest and dividend income	36,605	40,209	76,098	79,821
Overnight investments	553	7,279	5,071	13,669
Total interest income	363,257	350,721	732,816	687,645
Interest expense
Deposits	17,916	19,158	42,110	32,084
Securities sold under customer repurchase agreements	399	515	841	974
Federal Home Loan Bank borrowings	2,472	1,586	5,456	2,871
Subordinated debt	4,677	1,952	7,432	3,624
Interest Expense, Other	399	162	1,183	272
Total interest expense	25,863	23,373	57,022	39,825
Net interest income	337,394	327,348	675,794	647,820
Provision (credit) for loan and lease losses	20,552	5,198	48,907	16,948
Net interest income after provision for loan and lease losses	316,842	322,150	626,887	630,872
Noninterest income
Mortgage income	9,811	5,038	15,035	8,696
Insurance commissions	64,570	3,144	13,162	14,472
Realized gains on investment securities available for sale, net	13,752	5,719	33,547	5,719
Other	2,697	5,034	3,322	8,953
Total noninterest income	165,402	106,875	229,413	210,538
Noninterest expense
Salaries and wages	146,633	136,526	291,888	268,947
Employee benefits	30,364	30,197	68,875	62,732
Occupancy expense	29,556	26,886	57,036	54,647
Equipment expense	28,774	28,489	56,624	55,229
Processing fees paid to third parties	10,186	6,641	20,558	13,730
FDIC insurance expense	3,731	2,757	7,197	5,417
Collection and foreclosure-related expenses	3,949	3,659	8,003	6,681
Merger-related expenses	4,369	4,084	8,601	5,803
Other	34,117	34,158	72,868	67,868
Total noninterest expense	291,679	273,397	591,650	541,054
Income before income taxes	190,565	155,628	264,650	300,356
Income taxes	36,779	36,269	53,695	69,638
Net income	153,786	119,359	210,955	230,718
Less: Preferred stock dividends	4,790	0	4,790	0
Net income available to common shareholders	$ 148,996	$ 119,359	$ 206,165	$ 230,718
Average shares outstanding (in shares)	10,105,520	11,286,520	10,289,320	11,402,112
Net income per share	$ 14.74	$ 10.56	$ 20.04	$ 20.23
Wealth management services
Noninterest income
Revenue from contract with customers	$ 17,587	$ 18,479	$ 35,747	$ 35,112
Cardholder services, net
Noninterest income
Revenue from contract with customers	5,363	6,455	11,251	12,290
Other service charges and fees
Noninterest income
Revenue from contract with customers	17,522	25,790	43,935	50,855
Merchant services, net
Noninterest income
Revenue from contract with customers	22,371	24,573	48,783	49,574
ATM income
Noninterest income
Revenue from contract with customers	7,145	8,164	14,937	15,586
Realized gains on investment securities available for sale, net
Noninterest income
Revenue from contract with customers	3,189	2,854	6,877	6,145
Gain on extinguishment of debt
Noninterest income
Revenue from contract with customers	$ 1,395	$ 1,625	$ 2,817	$ 3,136

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Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Statement of Comprehensive Income [Abstract]
Net income	$ 153,786	$ 119,359	$ 210,955	$ 230,718
Unrealized (losses) gains on securities available for sale:
Unrealized gains on securities available for sale arising during the period	28,066	30,971	172,909	59,042
Tax effect	(6,455)	(7,123)	(39,768)	(13,579)
Reclassification adjustment for realized gains on securities available for sale included in income before income taxes	(13,752)	(5,719)	(33,547)	(5,719)
Tax effect	3,163	1,315	7,716	1,315
Total change in unrealized (losses) gains on securities available for sale, net of tax	11,022	19,444	107,310	41,059
Unrealized losses on securities available for sale transferred to held to maturity:
Reclassification adjustment for accretion of unrealized losses on securities available for sale transferred to held to maturity	0	5,947	0	11,909
Tax effect	0	(1,368)	0	(2,739)
Total change in unrealized losses on securities available for sale transferred to held to maturity, net of tax	0	4,579	0	9,170
Change in pension obligation:
Amortization of actuarial losses and prior service cost	6,398	2,735	12,662	5,490
Tax effect	(1,472)	(629)	(2,913)	(1,263)
Total change in pension obligation, net of tax	4,926	2,106	9,749	4,227
Net current period other comprehensive income	15,948	26,129	117,059	54,456
Total comprehensive income	$ 169,734	$ 145,488	$ 328,014	$ 285,174

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Consolidated Statements of Changes In Shareholders' Equity - USD ($) $ in Thousands	Total	Class A Common Stock	Class B Common Stock	Common Stock Class A Common Stock	Common Stock Class B Common Stock	Preferred Stock	Surplus	Retained Earnings	Retained Earnings Class A Common Stock	Retained Earnings Class B Common Stock	Accumulated Other Comprehensive (Loss) Income
Beginning balance, shareholders' equity at Dec. 31, 2018	$ 3,488,954			$ 10,623	$ 1,005	$ 0	$ 493,962	$ 3,218,551			$ (235,187)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	230,718							230,718
Other comprehensive income (loss), net of tax	54,456										54,456
Stock repurchased during period	(190,500)	$ (190,530)		(448)			(190,082)
Cash dividends		(8,181)	$ (804)						$ (8,181)	$ (804)
Preferred stock dividends declared			(4,790)							(4,790)
Ending balance, shareholders' equity at Jun. 30, 2019	$ 3,574,613			$ 10,175	1,005	0	303,880	3,440,284			(180,731)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock repurchased during period (in shares)	448,500			448,500
Cash dividends (in dollars per share)	$ 0.80
Beginning balance, shareholders' equity at Mar. 31, 2019	$ 3,523,309			$ 10,380	1,005	0	393,449	3,325,335			(206,860)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	119,359							119,359
Other comprehensive income (loss), net of tax	26,129										26,129
Stock repurchased during period	(89,800)	(89,774)		(205)			(89,569)
Cash dividends		(4,008)	(402)						(4,008)	(402)
Ending balance, shareholders' equity at Jun. 30, 2019	$ 3,574,613			$ 10,175	1,005	0	303,880	3,440,284			(180,731)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock repurchased during period (in shares)	205,500			205,500
Cash dividends (in dollars per share)	$ 0.40
Beginning balance, shareholders' equity at Dec. 31, 2019	$ 3,586,184			$ 9,624	1,005	$ 0	$ 44,081	3,658,197			(126,723)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	210,955							210,955
Other comprehensive income (loss), net of tax	$ 117,059										117,059
Issuance of preferred stock	339,937,000					339,937,000	0
Stock repurchased during period	$ (286,695)			(695)			$ (44,081)	(241,919)
Cash dividends		(7,345)	(804)						(7,345)	(804)
Ending balance, shareholders' equity at Jun. 30, 2020	$ 3,991,444			$ 8,929	1,005	$ 339,937	0	3,651,237			(9,664)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock repurchased during period (in shares)	695,390			695,390
Cash dividends (in dollars per share)	$ 0.80
Beginning balance, shareholders' equity at Mar. 31, 2020	$ 3,957,520			$ 9,275	1,005	$ 339,958	$ 0	3,632,894			(25,612)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	153,786							153,786
Other comprehensive income (loss), net of tax	$ 15,948										15,948
Issuance of preferred stock	(21,000)					(21,000)	0
Stock repurchased during period	$ (126,991)			(346)			$ 0	(126,645)
Cash dividends		$ (3,606)	(402)						$ (3,606)	(402)
Preferred stock dividends declared			$ (4,790)							$ (4,790)
Ending balance, shareholders' equity at Jun. 30, 2020	$ 3,991,444			$ 8,929	$ 1,005	$ 339,937	$ 0	$ 3,651,237			$ (9,664)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock repurchased during period (in shares)	346,000			346,000
Cash dividends (in dollars per share)	$ 0.40

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Consolidated Statements of Changes In Shareholders' Equity (Parenthetical) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Stock repurchased during period (in shares)	346,000	205,500	695,390	448,500
Statement of Stockholders' Equity [Abstract]
Cash dividends (in dollars per share)	$ 0.40	$ 0.40	$ 0.80	$ 0.80
Common Stock | Class A Common Stock
Stock repurchased during period (in shares)	346,000	205,500	695,390	448,500

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
OPERATING ACTIVITIES
Net income	$ 210,955	$ 230,718
Adjustments to reconcile net income to cash provided by operating activities:
Provision (credit) for loan and lease losses	48,907	16,948
Deferred tax expense (benefit)	17,774	5,126
Net change in current taxes	12,122	(23,826)
Depreciation	53,806	50,574
Net (decrease) increase in accrued interest payable	(4,012)	10,485
Net (increase) decrease in income earned not collected	(51,784)	(1,747)
Contribution to pension plans	(100,000)	0
Contribution to pension plans	(33,547)	(5,719)
Marketable equity securities gain (loss), net	(13,162)	(14,472)
Origination of loans held for sale	(503,190)	(328,481)
Origination of loans held for sale	474,153	326,640
Gain on sale of loans held for sale	(15,578)	(6,395)
Net writedowns/losses on other real estate	2,475	1,417
Net accretion of premiums and discounts	20,889	(16,491)
Amortization of intangible assets	12,464	12,019
Net change in mortgage servicing rights	357	(2,283)
Net change in other assets	(17,459)	(12,375)
Net change in other liabilities	(14,380)	(22,373)
Net cash provided by operating activities	100,790	219,765
INVESTING ACTIVITIES
Net increase in loans outstanding	(3,488,854)	(168,572)
Purchases of investment securities available for sale	(5,659,704)	(1,553,876)
Purchases of investment securities held to maturity	(803,307)	(183,288)
Purchases of marketable equity securities	(331,952)	(14,108)
Proceeds from maturities/calls of investment securities held to maturity	57,057	190,644
Proceeds from maturities/calls of investment securities available for sale	1,139,291	1,061,895
Proceeds from sales of investment securities available for sale	3,122,454	610,787
Proceeds from sales of marketable equity securities	313,131	10,694
Net increase in overnight investments	(1,964,602)	(840,371)
Proceeds from sales of portfolio loans	0	24,247
Repayment of FDIC Shared-Loss Payable	(99,468)	0
Proceeds from sales of other real estate	9,263	11,884
Proceeds from sales of premises and equipment	37	75
Purchases of premises and equipment	(62,721)	(54,873)
Business acquisitions, net of cash acquired	(59,999)	(73,792)
Net cash used in investing activities	(7,829,374)	(978,654)
FINANCING ACTIVITIES
Net decrease in time deposits	(623,833)	291,930
Net increase in demand and other interest-bearing deposits	7,649,120	762,021
Net decrease in short-term borrowings	2,043	(109,109)
Repayments of Other Long-term Debt	(75,908)	(33,008)
Origination of long-term obligations	400,000	0
Proceeds from Debt, Net of Issuance Costs	345,850	0
Proceeds from issuance of preferred stock, net of issuance costs	339,937
Proceeds from Issuance of Preferred Stock and Preference Stock	345,000	0
Repurchase of common stock	(282,923)	(186,995)
Cash dividends paid	(13,188)	(9,243)
Net cash (used in) provided by financing activities	7,741,098	715,596
Change in cash and due from banks	12,514	(43,293)
Cash and due from banks at beginning of period	376,719	327,440
Cash and due from banks at end of period	389,233	284,147
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES:
Transfers of loans to other real estate	7,138	5,710
Dividends declared but not paid	4,007	4,410
Unsettled maturities of investment securities	0	150,122
Unsettled purchases of investment securities	0	1,126
Net reclassification of portfolio loans (to) from loans held for sale	(3,027)	23,343
Transfers of premises and equipment to other real estate	2,046	2,184
Unsettled common stock repurchases	$ 3,772	$ 3,535

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Accounting Policies and Basis of Presentation

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Accounting Policies and Basis of Presentation

ACCOUNTING POLICIES AND BASIS OF PRESENTATION

First Citizens BancShares, Inc. (“BancShares”) is a financial holding company organized under the laws of Delaware and conducts operations through its banking subsidiary, First-Citizens Bank & Trust Company (“FCB”), which is headquartered in Raleigh, North Carolina.

General

These consolidated financial statements and notes thereto are presented in accordance with instructions for Form 10-Q and Article 10 of Regulation S-X and, therefore, do not include all information and notes necessary for a complete presentation of financial position, results of operations and cash flow activity required in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, all normal recurring adjustments necessary for a fair presentation of the consolidated financial position and consolidated results of operations have been made. The unaudited interim consolidated financial statements included in this Form 10-Q should be read in conjunction with the Consolidated Financial Statements and Notes to the Consolidated Financial Statements included in BancShares’ Annual Report on Form 10-K for the year ended December 31, 2019.

Reclassifications

In certain instances, amounts reported in prior periods’ consolidated financial statements have been reclassified to conform to the current financial statement presentation. Such reclassifications had no effect on previously reported cash flows, shareholders’ equity or net income.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions which affect the amounts reported. Actual results could differ from those estimates. The estimates BancShares considers significant are the allowance for credit losses, fair value measurements, and income taxes.

Issuance of Preferred Stock and Subordinated Debt

On March 4, 2020, BancShares completed its public offering of $350 million aggregate principal amount of its 3.375% Fixed-to-Floating Rate Subordinated Notes due 2030 and redeemable at the option of BancShares starting in 2025. On March 12, 2020, BancShares issued and sold an aggregate of 13,800,000 depositary shares, each representing a 1/40th interest in a share of 5.375% Non-Cumulative Perpetual Preferred Stock, Series A, par value $0.01 per share, with a liquidation preference of $25 per Depositary Share (equivalent to $1,000 per share of Series A Preferred Stock) for a total of $345 million. The capital raise provides liquidity for general corporate purposes, which may include, but is not limited to, providing capital to support our growth organically or through strategic acquisitions, financing investments and capital expenditures, for funding investments in First Citizens Bank as regulatory capital, and redeeming or repurchasing our common stock.

Share Repurchases

During the second quarter of 2020, BancShares repurchased 346,000 shares of Class A common stock for $127.0 million at an average cost per share of $366.98. During the second quarter of 2019, BancShares purchased a total of 205,500 shares of Class A common stock for $89.8 million at an average cost per share of $436.81. During the six months ended June 30, 2020, BancShares repurchased 695,390 shares of Class A common stock for $286.7 million at an average cost per share of $412.23. During the six months ended June 30, 2019, BancShares repurchased a total of 448,500 shares of Class A common stock for $190.5 million at an average cost per share of $424.77. All Class A common stock repurchases were consummated under previously approved authorizations.

The share repurchases during 2020 included 45,000 shares of Class A common stock repurchased from Ella Ann Holding, as trustee of her revocable trust. Pursuant to the existing share repurchase authorization and BancShares’ related person transaction policy, the Board of Director’s (the “Board”) independent Audit Committee reviewed and approved the repurchase of up to 250,000 shares held by Mrs. Holding on or before April 30, 2020.

Subsequent to quarter-end through July 31, 2020, BancShares repurchased an additional 117,700 shares of Class A common stock for $47.1 million at an average cost per share of $399.77. Upon completion of the current authorization on July 31, 2020, share repurchase activity has been suspended and will be reevaluated in subsequent periods.

Small Business Administration Paycheck Protection Program

The Small Business Administration Paycheck Protection Program (“SBA-PPP”) is one of the centerpieces of the Coronavirus Aid Relief and Economic Security Act (the “CARES Act”), which was passed on March 27, 2020 in response to the outbreak of coronavirus (“COVID-19”) and was supplemented with subsequent legislation. Overseen by the United States (“U.S.”) Treasury Department, the SBA-PPP offers cash-flow assistance to nonprofit and small business employers through guaranteed loans for expenses incurred between February 15, 2020, and August 8, 2020. Borrowers are eligible for forgiveness of principal and accrued interest on SBA-PPP loans to the extent that the proceeds are used to cover eligible payroll costs, interest costs, rent, and utility costs over a period between eight and 24-weeks after the loan is made as long as the borrower retains its employees and their compensation levels. The CARES Act authorized the SBA to temporarily guarantee these loans.

Due to the unique nature of these provisions, SBA-PPP loans have been disclosed as a separate loan class. Origination fees received by the SBA are capitalized into the carrying amount of the loans. The deferred fee income, net of origination costs, is recognized over the life of the loan as an adjustment to yield using the effective interest method. Loans outstanding as of June 30, 2020 totaled $3.08 billion and generated $19.0 million of interest income during the second quarter of 2020.

Recently Adopted Accounting Pronouncements

Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2018-13 - Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement

This ASU modifies the disclosure requirements on fair value measurements by eliminating the requirements to disclose (1) the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy (2) the policy for timing of transfers between levels and (3) the valuation processes for Level 3 fair value measurements. This ASU also added specific disclosure requirements for fair value measurements for public business entities including the requirement to disclose the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements.

BancShares adopted this ASU during the first quarter of 2020 and have made all applicable updates to the disclosure within the Notes to the Unaudited Consolidated Financial Statements.

FASB ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment

This ASU eliminates Step 2 from the goodwill impairment test. Under Step 2, an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, under the amendments in this ASU, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. This ASU eliminates the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative test.

BancShares adopted this ASU during the first quarter 2020 with no impact to our consolidated financial position or consolidated results of operations as a result of the adoption.

FASB ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments

This ASU (and all subsequent ASUs on this topic) introduce the current expected credit loss (“CECL”) model, a new credit loss methodology, replacing multiple existing impairment methods in current GAAP, which generally require that a loss be incurred before it is recognized. The amendments in this ASU require loss estimates be determined over the lifetime of the asset and broaden the information that an entity must consider in developing its expected credit losses. The ASU does not specify a method for measuring expected credit losses and allows an entity to apply methods that reasonably reflect its expectations of the credit loss estimate based on the entity's size, complexity and risk profile. In addition, the disclosures of credit quality indicators in relation to the amortized cost of financing receivables, a current disclosure requirement, are further disaggregated by year of origination.

BancShares adopted this ASU (and all subsequent ASUs on this topic) as of January 1, 2020 using the modified retrospective approach for all loans, leases, debt securities designated as held to maturity, and unfunded loan commitments. BancShares adopted the ASU using the prospective approach for debt securities available for sale and purchased credit deteriorated (“PCD”) loans previously accounted for under Accounting Standard Codification (“ASC”) ASC 310-30. Results for reporting periods beginning after January 1, 2020 are presented under ASC 326, while prior period amounts continue to be reported in accordance with previously applicable GAAP. BancShares made changes to loan classifications and segmentation in order to align with ASC 326 requirements and facilitate CECL modeling. Using this updated segmentation, BancShares developed new loan level models to estimate the allowance for credit losses (“ACL”) and facilitate revised disclosures.

The information presented below represents changes from Note A, Accounting Policies and Basis of Presentation, included in BancShares’ Annual Report on Form 10-K for the year ended December 31, 2019, as well as information on the impact of adoption.

Accounting Policy - Debt Securities

BancShares classifies debt securities as held to maturity (“HTM”) or available for sale (“AFS”). Debt securities are classified as HTM when BancShares has the intent and ability to hold the securities to maturity and are reported at amortized cost. Other debt securities are classified as AFS and reported at estimated fair value, with unrealized gains and losses, net of income taxes, reported in Accumulated Other Comprehensive Income (“AOCI”). Amortization of premiums and accretion of discounts for debt securities are included in interest income. Realized gains and losses from the sale of debt securities are determined by specific identification on a trade date basis and are included in noninterest income.

BancShares performs pre-purchase due diligence and evaluates the credit risk of AFS and HTM securities purchased directly into our portfolio or via acquisition. If securities have evidence of more than insignificant credit deterioration since issuance, they are designated as PCD. PCD securities are recorded at fair value at the date of acquisition which includes an associated allowance that is added to the purchase price or fair value to arrive at the Day 1 amortized cost basis. The difference between the purchase price and the Day 1 amortized cost is amortized or accreted to interest income over the contractual life of the securities using the effective interest method.

For AFS securities, management performs a quarterly analysis of the investment portfolio to evaluate securities currently in an unrealized loss position for potential credit-related impairment. If BancShares intends to sell a security, or does not have the intent and ability to hold a security before recovering the amortized cost, the entirety of the unrealized loss is immediately recorded in earnings. For the remaining securities, an analysis is performed to determine if any portion of the unrealized loss recorded relates to credit impairment. If credit related impairment exists, the amount is recorded through the ACL and related provision. This review includes indicators such as changes in credit rating, delinquency, bankruptcy or other significant news event impacting the issuer.

BancShares’ portfolio of HTM debt securities is made up of mortgage-backed securities issued by government agencies and government sponsored entities. Given the historically strong credit rating of the U.S. Treasury and the long history of no credit losses on debt securities issued by government agencies and government sponsored entities, we determined zero expected credit losses on the HTM portfolio.

Accounting Policy - Loans and Leases

BancShares’ accounting methods for loans and leases depends on whether they are originated or purchased, and if purchased, whether or not the loans reflect more than insignificant credit deterioration since origination as of the date of acquisition.

Non-Purchased Credit Deteriorated (“Non-PCD”) Loans

Non-PCD loans consist of loans originated by BancShares and loans purchased from other institutions that do not reflect more than insignificant credit deterioration at acquisition.

Originated loans for which management has the intent and ability to hold for the foreseeable future are classified as held for investment and carried at the principal amount outstanding net of any unearned income, charge-offs and unamortized fees and costs. Nonrefundable fees collected and certain direct costs incurred related to loan originations are deferred and recorded as an adjustment to loans outstanding. The net amount of the nonrefundable fees and costs is amortized to interest income over the contractual lives using methods that approximate a constant yield.

Purchased loans which do not reflect more than insignificant credit deterioration at acquisition are classified as non-PCD loans. These loans are recorded at fair value at the date of acquisition and an initial allowance is recorded on these assets as provision expense at the date of acquisition. The difference between the fair value and the unpaid principal balance at the acquisition date is amortized or accreted to interest income over the contractual life of the loan using the effective interest method.

Purchased Credit Deteriorated Loans

Purchased loans which reflect a more than insignificant credit deterioration since origination as of the date of acquisition are classified as PCD and are recorded at acquisition date amortized cost, which is the purchase price or fair value in a business combination, plus our initial estimate of expected credit losses. The difference between the unpaid principal balance and the acquisition date amortized cost is amortized or accreted to interest income over the contractual life of the loan using the effective interest method.

The performance of all loans within the BancShares portfolio is subject to a number of external risks, including but not limited to changes in the overall health of the economy, declines in real estate or other collateral values, changes in the demand for products and services and personal events, such as death, disability or change in marital status. BancShares evaluates and reports its non-PCD and PCD loan portfolios separately, and each non-PCD portfolio is further divided into commercial and consumer segments based on the type of borrower, purpose, collateral and/or our underlying credit management processes. Additionally, non-PCD commercial and consumer loans are assigned to loan classes, which further disaggregate the loan portfolio. PCD loans are reported as a single loan segment and class.

Upon adoption of ASC 326, owner occupied and non-owner occupied commercial real estate were segregated into separate classes within the commercial segment. Similarly, consumer auto was segregated into its own class within the consumer segment. These enhancements were made to capture the unique credit characteristics used in our CECL models. Information for reporting periods beginning after January 1, 2020 are presented in accordance with ASC 326 and reflect changes to the respective classes, while prior period amounts continue to be reported in accordance with previously applicable GAAP and have not been reclassified to conform to the current financial statement presentation.

The following represent our classes of loans as of January 1, 2020 upon adoption of ASC 326 (with the exception of SBA-PPP, which was added during second quarter 2020):

Commercial loans and leases

Construction and land development - Construction and land development consists of loans to finance land for development of commercial or residential real property and construction of multifamily apartments or other commercial properties. These loans are highly dependent on the supply and demand for commercial real estate as well as the demand for newly constructed residential homes and lots acquired for development. Deterioration in demand could result in decreased collateral values, which could make repayments of outstanding loans difficult for customers.

Owner occupied commercial mortgage - Owner occupied commercial mortgages consists of loans to purchase or re-finance owner occupied nonresidential properties. This includes office buildings, other commercial facilities, and farmland. Commercial mortgages secured by owner occupied properties are primarily dependent on the ability of borrowers to achieve business results consistent with those projected at loan origination. While these loans and leases are collateralized by real property in an effort to mitigate risk, it is possible the liquidation of collateral will not fully satisfy the obligation.

Non-owner occupied commercial mortgage - Non-owner occupied commercial mortgage consists of loans to purchase or refinance investment nonresidential properties. This includes office buildings and other facilities rented or leased to unrelated parties, as well as farmland and multifamily properties. The primary risk associated with income producing commercial mortgage loans is the ability of the income-producing property that collateralizes the loan to produce adequate cash flow to service the debt. While these loans and leases are collateralized by real property in an effort to mitigate risk, it is possible the liquidation of collateral will not fully satisfy the obligation.

Commercial and industrial and leases - Commercial and industrial loans consist of loans or lines of credit to finance accounts receivable, inventory or other general business needs, business credit cards, and lease financing agreements for equipment, vehicles, or other assets. The primary risk associated with commercial and industrial and lease financing loans is the ability of borrowers to achieve business results consistent with those projected at origination. Failure to achieve these projections presents risk the borrower will be unable to service the debt consistent with the contractual terms of the loan or lease.

SBA-PPP - These loans were originated as part of the SBA-PPP to finance payroll and other costs for nonprofit and small businesses impacted by the COVID-19 pandemic. These loans are guaranteed by the SBA and borrowers have the ability to qualify for loan forgiveness through the U.S. Treasury.

Consumer loans

Residential mortgage - Residential mortgage consists of loans to purchase or refinance the borrower’s primary dwelling, second residence or vacation home and are often secured by 1-4 family residential property. Significant and rapid declines in real estate values can result in borrowers having debt levels in excess of the current market value of the collateral.

Revolving mortgage - Revolving mortgage consists of home equity lines of credit and other lines of credit secured by first or second liens on the borrower’s primary residence. These loans are secured by both senior and junior liens on the residential real estate and are particularly susceptible to declining collateral values. This risk is elevated for loans secured by junior lines as a substantial decline in value could render a the junior lien position effectively unsecured.

Construction and land development - Construction and land development consists of loans to construct a borrower’s primary or secondary residence or vacant land upon which the owner intends to construct a dwelling at a future date. These loans are typically secured by undeveloped or partially developed land in anticipation of completing construction of a 1-4 family residential property. There is risk these construction and development projects can experience delays and cost overruns exceeding the borrower’s financial ability to complete the project. Such cost overruns can result in foreclosure of partially completed and unmarketable collateral.

Consumer auto loans - Consumer auto loans consist of installment loans to finance purchases of vehicles. These loans include direct auto loans originated in bank branches, as well indirect auto loans originated through agreements with auto dealerships. The value of the underlying collateral within this class is at risk of potential rapid depreciation which could result in unpaid balances in excess of the collateral.

Other consumer - Other consumer loans consist of loans to finance unsecured home improvements, student loans and revolving lines of credit that can be secured or unsecured, including personal credit cards. The value of the underlying collateral within this class is at risk of potential rapid depreciation which could result in unpaid balances in excess of the collateral.

Accounting Policy - Nonperforming Assets and Troubled Debt Restructurings

Nonperforming Assets (“NPA”)

NPAs include nonaccrual loans, past due securities and foreclosed property. Foreclosed property consists of real estate and other assets acquired as a result of loan defaults and is discussed below.

All loans are classified as past due when the payment of principal and interest based upon contractual terms is greater than 30 days delinquent. Loans are generally placed on nonaccrual when principal or interest becomes 90 days past due or when it is probable the principal or interest is not fully collectible. When loans are placed on nonaccrual, all previously uncollected accrued interest is reversed from interest income and the ongoing accrual of interest is discontinued. All payments received thereafter are applied as a reduction of the remaining principal balance as long as doubt exists as to the ultimate collection of the principal. Loans and leases are generally removed from nonaccrual status when they become current for a sustained period of time and there is no longer concern as to the collectability of principal and interest.

Securities are also classified as past due when the payment of principal and interest based upon contractual terms is greater than 30 days delinquent. Missed interest payments on securities are rare. We review all securities with delinquent interest and immediately charge off any accrued interest determined to be uncollectible.

Troubled Debt Restructurings (“TDR”)

A loan is considered a TDR when both of the following occur: (1) a modification to a borrower’s debt agreement is made and (2) a concession is granted for economic or legal reasons related to a borrower’s financial difficulties that otherwise would not be granted. TDR concessions could include short-term deferrals of interest, modifications of payment terms, or (in certain limited instances) forgiveness of principal or interest. Loans restructured as a TDR are treated and reported as such for the remaining life of the loan. TDR loans can be nonaccrual or accrual, depending on the individual facts and circumstances of the borrower. In circumstances where a portion of the loan balance is charged-off, the remaining balance is typically classified as nonaccrual.

Accounting Policy - Allowance for Credit Losses (“ACL”)

Loans

Loans within the various reporting classes are segregated into pools with similar risk characteristics and models are built to estimate the ACL. These loan level ACL models estimate the probability of default and loss given default for individual loans within the risk pool based on historical loss experience, borrower characteristics, collateral type, forecasts of relevant economic conditions, expected future recoveries and other factors. Pools for estimating the ACL are aggregated into loan classes, as described above, which roll up into commercial and consumer loan segments. Non-PCD and PCD loans are modeled together within the loan level models using acquired and PCD indicator variables to provide differentiation of individual loan risk. BancShares uses a two year reasonable and supportable forecast period which incorporates economic forecasts at the time of evaluation. For most pools, BancShares uses a 12-month straight-line reversion period to historical averages for model inputs; however for the consumer other, consumer card and commercial card pools, immediate reversion to historical net loss rates is utilized.

The ACL for SBA-PPP loans originated during the second quarter of 2020 were separately evaluated given the explicit government guarantee. This analysis, which incorporated historical experience with similar SBA guarantees and underwriting, concluded the likelihood of loss was remote and therefore these loans were assigned a zero expected credit loss in the ACL.

The ACL represents management’s best estimate of credit losses expected over the life of the loan, adjusted for expected contractual payments and the impact of prepayment expectations. Prepayment assumptions were developed through a review of BancShares’ historical prepayment activity and began with a review of prepayment assumptions utilized in other modeling activities. Estimates for loan losses are determined by analyzing quantitative and qualitative components present as of the evaluation date. Adjustments to the ACL are recorded with a corresponding entry to provision for credit losses. Loan balances considered uncollectible are charged-off against the ACL. Recoveries of amounts previously charged-off are credited to the ACL.

A primary component of determining the ACL on loans is the actual net loss history of the various loan pools. For commercial pools, key factors utilized in the models include delinquency trends as well as macroeconomic variables such as unemployment and commercial real estate price index. For consumer pools, key factors include delinquency trends and the borrower’s original credit score, as well as other macroeconomic variables such as unemployment, gross domestic product, home price index, and commercial real estate index. As the models project losses over the life of the loans, prepayment assumptions also serve as significant inputs. Model outputs may be adjusted through a qualitative assessment to reflect economic conditions and trends not captured within the models including credit quality, concentrations, and significant policy and underwriting changes.

Within our ACL model, TDRs meet the definition of default and are given a 100% probability of default rating. TDRs are not individually evaluated unless determined to be collateral-dependent. Therefore, loss given default is calculated based on the individual risk characteristics of the loan as defined in the model.

When loans do not share risk characteristics similar to others in the pool, the ACL is evaluated on an individual basis. Given that BancShares' CECL models are loan level models, the population of loans evaluated individually is minimal and consists primarily of loans greater than $500 thousand and determined to be collateral-dependent. BancShares elected the practical expedient allowed under ASC 326 to assess the collectability of these loans, where repayment is expected to be provided substantially through operation or sale of collateral, based on the fair value of the underlying collateral. The fair value of the collateral is estimated using appraised and market values (appropriately adjusted for an assessment of the sales and marketing costs when applicable). A specific allowance is established, or partial charge-off is recorded, for the difference between the excess amortized cost of loan and the collateral’s estimated fair value.

Accrued Interest Receivable

BancShares has elected not to measure an ACL for accrued interest receivable and has excluded it from the amortized cost basis of loans and held to maturity debt securities as our accounting policies and credit monitoring provide that uncollectible accrued interest is reversed or written off against interest income in a timely manner.

Unfunded Commitments

A reserve for unfunded commitments is established for off-balance sheet exposures such as unfunded balances for existing lines of credit, commitments to extend future credit, as well a both standby and commercial letters of credit when there is a contractual obligation to extend credit and when this extension of credit is not unconditionally cancellable (i.e. commitment cannot canceled at any time). These unfunded commitments are assessed to determine both the probability of funding as well the expectation of future losses. The expected funding balance is used in the probability of default and loss given default models to determine the reserve. The reserve for unfunded commitments was $13.7 million at June 30, 2020, and is recorded within other liabilities with changes recorded through other expense.

Adoption Impact

Upon adoption, BancShares recorded a net decrease of $37.9 million in the ACL which included a reduction of $56.9 million in the ACL on non-PCD loans, offset by an increase of $19.0 million in the ACL on PCD loans. The $56.9 million reduction in the ACL on non-PCD loans, as well as an $8.9 million increase in the reserve for unfunded commitments, net of deferred taxes, resulted in an increase in retained earnings of $36.9 million. The $19.0 million increase in the ACL on PCD loans was a reclassification of the PCD credit discount and resulted in a gross up of loan balances by this same amount and did not have any effect on retained earnings. Impact to total capital and capital ratios was not significant and we did not elect the capital phase-in option allowable for regulatory reporting purposes. There was no ACL recorded on debt securities held to maturity at adoption.

The largest changes in the ACL, affecting beginning retained earnings as a result of the adoption, were decreases in the ACL on commercial loan segments as these portfolios have exhibited strong historical credit performance and have relatively short average lives. The reduction in ACL on these segments was partially offset by increases in ACL on our consumer loan segments primarily due to their longer average lives. The increase in the reserve for unfunded commitments was primarily due to increases in the scope of off-balance sheet exposures considered in this estimate due to the provisions in ASU 2016-13.

BancShares adopted this ASU using the prospective transition approach for PCD loans previously accounted for under ASC 310-30. In accordance with the standard, we did not assess whether purchased credit impaired (“PCI”) loans met the criteria of PCD as of the date of adoption and all loans previously classified as PCI were updated to the PCD classification. Pools utilized for PCI accounting under ASC 310-30 were dissolved upon adoption. Loans from performing PCI pools, not previously considered nonaccrual of $47.0 million, were reclassified into nonaccrual status as a result of adoption. PCD loans were assessed using the loan level probability of default and loss given default models, as well as utilizing prior specific loan reviews to inform the initial PCD loan ACL. The ACL for PCD loans increased as a result of adoption and the amortized cost basis of these loans was adjusted to reflect the transfer of this amount from credit discount to ACL. The remaining noncredit discount will be accreted into interest income at the effective interest rate as of January 1, 2020. At the date of adoption, no securities were determined to be PCD.

BancShares also adopted this ASU under the prospective transition approach for debt securities available for sale. No previously recorded other than temporary impairment was reported on the portfolio of debt securities.

Recently Issued Accounting Pronouncements

FASB ASU 2018-14 - Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans

This ASU modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans by eliminating the requirement to disclose the amounts in accumulated other comprehensive income expected to be recognized as components of net periodic benefit cost over the next fiscal year and adding a requirement to disclose an explanation of the reasons for significant gains and losses related to changes in the benefit obligation for the period.

The amendments in this ASU are effective for public entities for fiscal years ending after December 15, 2020. Early adoption is permitted for all entities. BancShares will adopt all applicable amendments and update the disclosures as appropriate during the fourth quarter of 2020.

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Business Combinations

6 Months Ended

Jun. 30, 2020

Business Combinations [Abstract]

Business Combinations

BUSINESS COMBINATIONS

BancShares evaluated the financial statement significance for all business combinations completed during 2020 and concluded the completed business combinations noted below are not material to its consolidated financial statements, individually or in aggregate, and therefore, pro forma financial data is not included.

Each transaction is accounted for under the acquisition method of accounting and, accordingly, assets acquired and liabilities assumed are recorded at their estimated fair values as of the acquisition date. Fair values are preliminary and subject to refinement for up to one year after the closing date of the acquisition as additional information regarding closing date fair value becomes available.

As part of the accounting for each acquisition, we perform an analysis of the acquired bank’s loan portfolio and based on such credit factors as past due status, nonaccrual status, life-to-date charge-offs and other quantitative and qualitative considerations segregate the acquired loans into PCD loans and non-PCD loans. PCD loans are accounted for under ASC 326-20, and non-PCD loans which do not meet this criteria are accounted for under ASC 310-20. Additionally, we perform an analysis of the acquired bank’s portfolio of debt securities to determine if any debt securities should be designated PCD.

Community Financial Holding Company, Inc.

On February 1, 2020, FCB completed the merger of Duluth, Georgia-based Community Financial Holding Company, Inc. (“Community Financial”) and its bank subsidiary, Gwinnett Community Bank. Under the terms of the agreement, total cash consideration of $2.3 million was paid to the shareholders of Community Financial. The merger allows FCB to expand its presence and enhance banking efforts in Georgia.

The fair value of the assets acquired was $221.4 million, including $110.6 million in non-PCD loans, $23.4 million in PCD loans, net of an ACL of $1.2 million, and $536 thousand in a core deposit intangible. No debt securities purchased in the transaction were designated PCD. Liabilities assumed were $219.8 million, of which $209.3 million were deposits. As a result of the transaction, FCB recorded $686 thousand of goodwill. The amount of goodwill represents the excess purchase price over the estimated fair value of the net assets acquired. The premium paid reflects the increased market share and related synergies expected to result from the acquisition. None of the goodwill was deductible for income tax purposes as the merger was accounted for as a qualified stock purchase.

The following table provides the purchase price as of the acquisition date and the identifiable assets acquired and liabilities assumed at their estimated fair values:

(Dollars in thousands)	As recorded by FCB
Purchase price			$	2,320
Assets
Cash and due from banks	$	1,085
Overnight investments	35,129
Investment securities	30,146
Loans	133,989
Premises and equipment	7,624
Other real estate owned	9,813
Income earned not collected	558
Intangible assets	536
Other assets	2,520
Total assets acquired	221,400
Liabilities
Deposits	209,340
Borrowings	9,925
Other liabilities	501
Total liabilities assumed	$	219,766
Fair value of net assets acquired			1,634
Goodwill recorded for Community Financial			$	686

Merger-related expenses of $495 thousand and $1.7 million were recorded for the three and six months ended June 30, 2020, respectively. Loan-related interest income generated from Community Financial was approximately $2.7 million since the acquisition date. The ongoing contribution of this transaction to BancShares’ financial statements is not considered material, and therefore pro forma financial data is not included.

Entegra Financial Corp.

On December 31, 2019, FCB completed the merger of Franklin, North Carolina-based Entegra Financial Corp. (“Entegra”) and its bank subsidiary, Entegra Bank. In order to obtain regulatory approval, FCB entered into an agreement for Select Bank & Trust Company (“Select Bank”) to purchase three North Carolina branches, located in Highlands, Sylva and Franklin. On April 17, 2020, FCB completed the divestiture of the branches including loans and leases, premises and equipment and total deposits with fair values of $110.1 million, $2.1 million and $184.8 million, respectively. The Select Bank purchase price for the divested branches included an 8% premium for deposits acquired that was applied against goodwill generated as part of the merger with Entegra Bank.

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Investments

6 Months Ended

Jun. 30, 2020

Investments [Abstract]

Investments

INVESTMENTSInformation for reporting periods beginning after January 1, 2020 are presented in accordance with ASC 326 and reflect changes required by the adoption of this standard which includes evaluating held to maturity and available for sale debt securities to determine the need to record a related allowance for credit losses. Prior period information continues to be reported in accordance with previously applicable GAAP. See Note A - Accounting Policies and Basis for Presentation for more detail on our policies and adoption.

The amortized cost and fair value of investment securities at June 30, 2020 and December 31, 2019, were as follows:

	June 30, 2020
(Dollars in thousands)	Cost		Gross unrealized gains		Gross unrealized losses		Allowance for credit losses		Fair value
Investment securities available for sale
U.S. Treasury	$	754,350	$	236	$	—	$	—	$	754,586
Government agency	549,673		292		4,256		—		545,709
Residential mortgage-backed securities	5,671,151		119,935		694		—		5,790,392
Commercial mortgage-backed securities	1,047,601		32,221		—		—		1,079,822
Corporate bonds	449,623		4,387		5,237		—		448,773
Total investment securities available for sale	$	8,472,398	$	157,071	$	10,187	$	—	$	8,619,282
Investment in marketable equity securities	116,322		6,297		8,303				114,316
Investment securities held to maturity
Residential mortgage-backed securities	693,143		16,196		—		—		709,339
Commercial mortgage-backed securities	78,729		251		—				78,980
Other	3,006		—		—		—		3,006
Total investment securities held to maturity	774,878		16,447		—		—		791,325
Total investment securities	$	9,363,598	$	179,815	$	18,490	$	—	$	9,524,923
			December 31, 2019
(Dollars in thousands)			Cost		Gross unrealized gains		Gross unrealized losses		Fair value
Investment securities available for sale
U.S. Treasury			$	409,397	$	602	$	—	$	409,999
Government agency			684,085		928		2,241		682,772
Residential mortgage-backed securities			5,269,060		13,417		15,387		5,267,090
Commercial mortgage-backed securities			373,105		6,974		59		380,020
Corporate bonds			198,278		3,420		132		201,566
State, county and municipal			118,227		—		—		118,227
Total investment securities available for sale			$	7,052,152	$	25,341	$	17,819	$	7,059,674
Investment in marketable equity securities			59,262		23,304		233		82,333
Investment securities held to maturity
Other			30,996		—		—		30,996
Total investment securities held to maturity			30,996		—		—		30,996
Total investment securities			$	7,142,410	$	48,645	$	18,052	$	7,173,003

Investments in residential and commercial mortgage-backed securities represent securities issued by the Government National Mortgage Association, Federal National Mortgage Association and Federal Home Loan Mortgage Corporation. Investments in government agency securities represent securities issued by the United States Small Business Administration. Investments in corporate bonds and marketable equity securities represent positions in securities of other financial institutions. Other held to maturity investments include certificates of deposit with other financial institutions.

BancShares also holds approximately 354,000 shares of Visa Class B common stock. BancShares’ Visa Class B shares are not considered to have a readily determinable fair value and are recorded at $0. BancShares held FHLB stock of $45.4 million and $43.0 million and other non-marketable equity securities of $13.1 million and $12.5 million at June 30, 2020 and December 31, 2019, respectively. These securities are recorded in other assets.

As of June 30, 2020 and January 1, 2020, no ACL was required for available for sale and held to maturity debt securities. Accrued interest receivable on debt securities at June 30, 2020 was $21.3 million and was excluded from the estimate of credit losses. During the three and six months ended June 30, 2020, no accrued interest was deemed uncollectible and written off against interest income.

The following table provides the amortized cost and fair value by contractual maturity for investment securities available for sale and held to maturity. Expected maturities will differ from contractual maturities on certain securities because issuers and borrowers of underlying collateral may have the right to call or prepay obligations with or without prepayment penalties.

	June 30, 2020				December 31, 2019
(Dollars in thousands)	Cost		Fair value		Cost		Fair value
Investment securities available for sale
Non-amortizing securities maturing in:
One year or less	$	754,350	$	754,586	$	406,325	$	406,927
One through five years	51,589		51,887		24,496		24,971
Five through 10 years	369,075		368,281		185,209		187,868
Over 10 years	28,959		28,605		109,872		110,026
Government agency	549,673		545,709		684,085		682,772
Residential mortgage-backed securities	5,671,151		5,790,392		5,269,060		5,267,090
Commercial mortgage-backed securities	1,047,601		1,079,822		373,105		380,020
Total investment securities available for sale	$	8,472,398	$	8,619,282	$	7,052,152	$	7,059,674
Investment securities held to maturity
Non-amortizing securities maturing in:
One year or less	2,257		2,257		30,746		30,746
One through five years	749		749		250		250
Residential mortgage-backed securities	693,143		709,339		—		—
Commercial mortgage-backed securities	78,729		78,980		—		—
Total investment securities held to maturity	$	774,878	$	791,325	$	30,996	$	30,996

There were gross gains of $13.8 million on sales of investment securities available for sale during the three months ended June 30, 2020 and no gross losses. There were gross gains of $34.2 million and gross losses of $679 thousand on sales of investment securities available for sale during the six months ended June 30, 2020. There were $5.7 million gross gains on sales of investment securities available for sale for the three and six months ended June 30, 2019 and no gross losses.

The following table provides the realized and unrealized gains and losses on marketable equity securities for the six months ended June 30, 2020 and 2019:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Marketable equity securities gains, net	$	64,570	$	3,144	$	13,162	$	14,472
Less net gains recognized on marketable equity securities sold	36,993		2,271		37,316		2,315
Unrealized gains (losses) recognized on marketable equity securities held	$	27,577	$	873	$	(24,154)	$	12,157

The following table provides information regarding securities with unrealized losses as of June 30, 2020 and December 31, 2019:

	June 30, 2020
	Less than 12 months				12 months or more				Total
(Dollars in thousands)	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Investment securities available for sale
Government agency	$	447,983	$	3,709	$	58,806	$	547	$	506,789	$	4,256
Residential mortgage-backed securities	172,628		302		149,170		392		321,798		694
Corporate bonds	112,172		5,120		9,451		117		121,623		5,237
Total	$	732,783	$	9,131	$	217,427	$	1,056	$	950,210	$	10,187
	December 31, 2019
	Less than 12 months				12 months or more				Total
(Dollars in thousands)	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Investment securities available for sale
Government agency	$	347,081	$	1,827	$	63,947	$	414	$	411,028	$	2,241
Residential mortgage-backed securities	2,387,293		14,016		264,257		1,371		2,651,550		15,387
Commercial mortgage-backed securities	35,926		59		—		—		35,926		59
Corporate bonds	7,714		123		4,749		9		12,463		132
Total	$	2,778,014	$	16,025	$	332,953	$	1,794	$	3,110,967	$	17,819

As of June 30, 2020, there were 47 investment securities available for sale with continuous losses for more than 12 months, of which 45 were government sponsored enterprise-issued mortgage-backed securities or government agency securities and two were corporate bonds.

None of the unrealized losses identified as of June 30, 2020, or December 31, 2019, relate to the marketability of the securities or the issuers’ ability to honor redemption obligations. Rather, the unrealized losses relate to changes in interest rates relative to when the investment securities were purchased, and do not indicate credit-related impairment. BancShares considered other factors including changes in credit ratings, delinquencies, and other macroeconomic factors in this determination. As a result, none of the securities were deemed to require an allowance for credit losses. BancShares has the ability and intent to retain these securities for a period of time sufficient to recover all unrealized losses.

Investment securities having an aggregate carrying value of $4.53 billion at June 30, 2020, and $3.93 billion at December 31, 2019, were pledged as collateral to secure public funds on deposit and certain short-term borrowings, and for other purposes as required by law.

BancShares’ portfolio of held to maturity debt securities consists of mortgage-backed securities issued by government agencies and government sponsored entities. Given the consistently strong credit rating of the U.S. Treasury and the long history of no credit losses on debt securities issued by government agencies and government sponsored entities, no further credit monitoring is performed on these portfolios. Should there be downgrades to the credit rating of the U.S. Treasury or losses reported on securities issued by government agencies and government sponsored entities, BancShares will reevaluate its determination of zero expected credit losses on held to maturity debt securities.

There were no debt securities held to maturity on nonaccrual status as of June 30, 2020.

A security is considered past due once it is 30 days contractually past due under the terms of the agreement. There were no securities past due as of June 30, 2020.

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Loans and Leases

6 Months Ended

Jun. 30, 2020

Loans and Leases Receivable Disclosure [Abstract]

Loans and Leases

LOANS AND LEASES

BancShares’ accounting methods for loans and leases depends on whether they are originated or purchased, and if purchased, whether or not the loans reflect more than insignificant credit deterioration since origination, which is determined as of the acquisition date. Non-PCD loans consist of loans originated by BancShares and loans purchased from other institutions, that do not reflect more than insignificant credit deterioration at acquisition and are reported by loan segments and classes as defined in Note A - Accounting Polices and Basis of Presentation. Purchased loans which reflect more than insignificant credit deterioration are classified as PCD and reported as a single loan segment or class. At the date of acquisition, all acquired loans are recorded at fair value.

Loans and leases outstanding included the following at June 30, 2020 and December 31, 2019:

(Dollars in thousands)	June 30, 2020
Commercial:
Construction and land development	$	1,012,365
Owner occupied commercial mortgage	10,352,793
Non-owner occupied commercial mortgage	3,056,328
Commercial and industrial and leases	4,650,839
SBA-PPP	3,084,549
Total commercial loans	22,156,874
Consumer:
Residential mortgage	5,404,682
Revolving mortgage	2,233,977
Construction and land development	353,382
Consumer auto	1,195,771
Consumer other	543,088
Total consumer loans	9,730,900
Total non-PCD loans and leases	31,887,774
PCD loans	530,651
Total loans and leases	$	32,418,425

(Dollars in thousands)	December 31, 2019
Commercial:
Construction and land development	$	1,013,454
Commercial mortgage	12,282,635
Other commercial real estate	542,028
Commercial and industrial and leases	4,403,792
Other	310,093
Total commercial loans	18,552,002
Noncommercial:
Residential mortgage	5,293,917
Revolving mortgage	2,339,072
Construction and land development	357,385
Consumer	1,780,404
Total noncommercial loans	9,770,778
Total non-PCI loans and leases	28,322,780
PCI loans	558,716
Total loans and leases	$	28,881,496

Accrued interest receivable on loans at June 30, 2020 was $139.8 million and was excluded from the estimate of credit losses. Management reviewed this policy election during the second quarter of 2020 due to the increase in accrued interest receivable and concluded the policy election remained appropriate.

At June 30, 2020, $11.78 billion in non-PCD loans with a lendable collateral value of $8.52 billion were used to secure $653.7 million in Federal Home Loan Bank (“FHLB”) of Atlanta advances, resulting in additional borrowing capacity of $7.86 billion. At December 31, 2019, $9.41 billion in non-PCD loans with a lendable collateral value of $6.57 billion were used to secure $563.7 million in FHLB of Atlanta advances, resulting in additional borrowing capacity of $6.01 billion. At June 30, 2020, $3.93 billion in non-PCD loans with a lendable collateral value of $3.14 billion were used to secure additional borrowing capacity at the Federal Reserve Bank (“FRB”). At December 31, 2019, $3.68 billion in non-PCD loans with a lendable collateral value of $2.98 billion were used to secure additional borrowing capacity at the FRB.

Certain residential real estate loans are originated to be sold to investors and are recorded in loans held for sale at fair value. In addition, we may change our strategy for certain portfolio loans and decide to sell them in the secondary market. At that time, portfolio loans are transferred to loans held for sale at fair value. Loans held for sale totaled $107.9 million and $67.9 million at June 30, 2020 and December 31, 2019, respectively.

Net deferred fees on non-PCD loans and leases, including unearned and unamortized costs and fees, were $100.7 million and $927 thousand at June 30, 2020 and December 31, 2019, respectively. Of the amount outstanding as of June 30, 2020, $96.6 million relates to net deferred fees and costs on SBA-PPP loans. The net unamortized discount related to purchased non-PCD loans and leases was $25.8 million at June 30, 2020 and $30.9 million at December 31, 2019. The net unamortized discount related to PCD loans and leases was $54.7 million at June 30, 2020 and $88.2 million at December 31, 2019.

The aging of the outstanding loans and leases, by class, at June 30, 2020 and December 31, 2019 is provided in the tables below. Loans and leases past due 30 days or less are considered current as various grace periods allow borrowers to make payments within a stated period after the due date and still remain in compliance with the loan agreement.

	June 30, 2020
(Dollars in thousands)	30-59 days past due		60-89 days past due		90 days or greater		Total past due		Current		Total loans and leases
Commercial:
Construction and land development	$	1,618	$	14	$	1,721	$	3,353	$	1,009,012	$	1,012,365
Owner occupied commercial mortgage	14,360		2,518		12,820		29,698		10,323,095		10,352,793
Non-owner occupied commercial mortgage	7,914		982		8,520		17,416		3,038,912		3,056,328
Commercial and industrial and leases	10,464		3,196		4,215		17,875		4,632,964		4,650,839
SBA-PPP	—		—		—		—		3,084,549		3,084,549
Total commercial loans	34,356		6,710		27,276		68,342		22,088,532		22,156,874
Consumer:
Residential mortgage	25,243		7,082		35,044		67,369		5,337,313		5,404,682
Revolving mortgage	8,874		4,615		9,006		22,495		2,211,482		2,233,977
Construction and land development	1,735		127		57		1,919		351,463		353,382
Consumer auto	3,093		1,124		976		5,193		1,190,578		1,195,771
Consumer other	2,433		1,691		1,835		5,959		537,129		543,088
Total consumer loans	41,378		14,639		46,918		102,935		9,627,965		9,730,900
PCD loans	18,850		4,694		33,483		57,027		473,624		530,651
Total loans and leases	$	94,584	$	26,043	$	107,677	$	228,304	$	32,190,121	$	32,418,425
	December 31, 2019
(Dollars in thousands)	30-59 days past due		60-89 days past due		90 days or greater		Total past due		Current		Total loans and leases
Commercial:
Construction and land development	$	3,146	$	195	$	2,702	$	6,043	$	1,007,411	$	1,013,454
Commercial mortgage	20,389		8,774		8,319		37,482		12,245,153		12,282,635
Other commercial real estate	861		331		698		1,890		540,138		542,028
Commercial and industrial and leases	18,269		4,842		5,032		28,143		4,375,649		4,403,792
Other	51		411		126		588		309,505		310,093
Total commercial loans	42,716		14,553		16,877		74,146		18,477,856		18,552,002
Noncommercial:
Residential mortgage	45,839		18,289		24,409		88,537		5,205,380		5,293,917
Revolving mortgage	9,729		3,468		9,865		23,062		2,316,010		2,339,072
Construction and land development	977		218		1,797		2,992		354,393		357,385
Consumer	10,481		3,746		3,571		17,798		1,762,606		1,780,404
Total noncommercial loans	67,026		25,721		39,642		132,389		9,638,389		9,770,778
PCI loans	26,478		10,784		28,973		66,235		492,481		558,716
Total loans and leases	$	136,220	$	51,058	$	85,492	$	272,770	$	28,608,726	$	28,881,496

The amortized cost, by class, of loans and leases on nonaccrual status, and loans and leases greater than 90 days past due and still accruing at June 30, 2020 and December 31, 2019, were as follows:

	January 1, 2020(1)		June 30, 2020
(Dollars in thousands)	Nonaccrual loans and leases		Nonaccrual loans and leases		Loans and leases > 90 days and accruing
Commercial:
Construction and land development	$	4,281	$	2,938	$	69
Owner occupied commercial mortgage	24,476		28,283		111
Non-owner occupied commercial mortgage	5,965		8,491		615
Commercial and industrial and leases	7,685		7,239		1,399
Total commercial loans	42,407		46,951		2,194
Consumer:
Residential mortgage	44,357		59,352		—
Revolving mortgage	22,411		23,600		—
Construction and land development	2,828		1,699		—
Consumer auto	2,145		2,677		—
Consumer other	798		1,001		1,450
Total consumer loans	72,539		88,329		1,450
PCD loans	53,771		62,511		152
Total loans and leases	$	168,717	$	197,791	$	3,796
(1)Upon the adoption of ASC 326, BancShares eliminated the pooling of PCI loans and as a result $47.0 million in additional PCD loans were recognized as nonaccrual loans at January 1, 2020. As of June 30, 2020, $35.9 million of these loans remained outstanding.

	December 31, 2019
(Dollars in thousands)	Nonaccrual loans and leases		Loans and leases > 90 days and accruing
Commercial:
Construction and land development	$	4,281	$	—
Commercial mortgage	29,733		—
Commercial and industrial and leases	7,365		1,094
Other commercial real estate	708		—
Other	320		—
Total commercial loans	42,407		1,094
Noncommercial:
Construction and land development	2,828		—
Residential mortgage	44,357		45
Revolving mortgage	22,411		—
Consumer	2,943		2,152
Total noncommercial loans	72,539		2,197
PCI loans	6,743		24,257
Total loans and leases	$	121,689	$	27,548

Credit Quality

Loans and leases are monitored for credit quality on a recurring basis. Commercial and consumer loans and leases have different credit quality indicators as a result of the unique characteristics of the loan segments being evaluated. The credit quality indicators for commercial loans and leases are borrower risk classifications developed through a review of individual borrowers on an ongoing basis. Commercial loans are evaluated at least annually, with more frequent evaluations done on criticized loans. Commercial loans are also updated if there is evidence of potential credit deterioration, such as delinquency. Commercial credit cards are included in the Commercial and industrial and leases segment, but are evaluated based primarily upon delinquency status. The risk classifications as of the date presented are based on the most recent assessment performed and are defined below:

Pass – A pass rated asset is not adversely classified because it does not display any of the characteristics for adverse classification.

Special mention – A special mention asset has potential weaknesses that deserve management’s close attention. If left uncorrected, such potential weaknesses may result in deterioration of the repayment prospects or collateral position at some future date. Special mention assets are not adversely classified and do not warrant adverse classification.

Substandard – A substandard asset is inadequately protected by the current net worth and paying capacity of the borrower or of the collateral pledged, if any. Assets classified as substandard generally have a well-defined weakness, or weaknesses, that jeopardize the liquidation of the debt. These assets are characterized by the distinct possibility of loss if the deficiencies are not corrected.

Doubtful – An asset classified as doubtful has all the weaknesses inherent in an asset classified substandard with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable on the basis of currently existing facts, conditions and values.

Loss – Assets classified as loss are considered uncollectible and of such little value that it is inappropriate to be carried as an asset. This classification is not necessarily equivalent to any potential for recovery or salvage value, but rather that it is not appropriate to defer a full charge-off even though partial recovery may be affected in the future.

Ungraded – Ungraded loans represent loans that are not included in the individual credit grading process due to their relatively small balances or borrower type. The majority of ungraded loans at June 30, 2020 relate to business credit cards. Business credit card loans are subject to automatic charge-off when they become 120 days past due in the same manner as unsecured consumer lines of credit. The remaining balance is comprised of a small amount of commercial mortgage, lease financing and other commercial real estate loans.

The credit quality indicators for consumer and PCD loans are based on delinquency status of the borrower as of the date presented. As the borrower becomes more delinquent, the likelihood of loss increases.

The following tables represent current credit quality indicators by origination year as of June 30, 2020.

	Commercial Loans Amortized Cost Basis by Origination Year
Classification:	2020		2019		2018		2017		2016		Prior		Revolving		Revolving converted to term loans		Total
(Dollars in thousands)
Construction and land development
Pass	$	175,302	$	404,898	$	217,555	$	132,753	$	31,599	$	14,453	$	25,141	$	—	$	1,001,701
Special Mention	88		—		334		5,507		—		93		—		—		6,022
Substandard	1,405		1,221		1,813		29		8		166		—		—		4,642
Total	176,795		406,119		219,702		138,289		31,607		14,712		25,141		—		1,012,365
Owner occupied commercial mortgage
Pass	1,345,296		2,218,595		1,850,128		1,452,273		1,203,335		1,943,057		106,274		137		10,119,095
Special Mention	2,296		11,164		29,941		13,089		17,795		30,315		2,742		—		107,342
Substandard	9,186		12,309		16,886		24,063		14,255		40,331		9,254		72		126,356
Total	1,356,778		2,242,068		1,896,955		1,489,425		1,235,385		2,013,703		118,270		209		10,352,793
Non-owner occupied commercial mortgage
Pass	380,269		685,067		490,693		452,152		360,096		595,139		36,723		—		3,000,139
Special Mention	—		2,048		20,236		872		5,885		7,658		787		—		37,486
Substandard	1,237		1,094		3,653		1,642		6,513		3,085		1,479		—		18,703
Total	381,506		688,209		514,582		454,666		372,494		605,882		38,989		—		3,056,328
Commercial and industrial and leases
Pass	750,806		1,207,639		630,297		401,635		301,561		401,284		805,691		5,565		4,504,478
Special Mention	1,431		3,426		6,387		5,534		3,159		2,518		13,928		243		36,626
Substandard	11,847		3,794		4,323		5,608		2,790		4,941		22,084		696		56,083
Doubtful	—		—		39		—		—		—		2		—		41
Ungraded	—		—		—		—		—		—		53,611		—		53,611
Total	764,084		1,214,859		641,046		412,777		307,510		408,743		895,316		6,504		4,650,839
SBA-PPP
Pass	3,084,549		—		—		—		—		—		—		—		3,084,549
Total	3,084,549		—		—		—		—		—		—		—		3,084,549
Total commercial	$	5,763,712	$	4,551,255	$	3,272,285	$	2,495,157	$	1,946,996	$	3,043,040	$	1,077,716	$	6,713	$	22,156,874

	Consumer and PCD Loans Amortized Cost Basis by Origination Year
Days Past Due:	2020		2019		2018		2017		2016		Prior		Revolving		Revolving converted to term loans		Total
(Dollars in thousands)
Residential mortgage
Current	$	891,796	$	1,105,486	$	837,530	$	755,457	$	591,255	$	1,132,116	$	23,673	$	—	$	5,337,313
30-59 days	488		2,760		2,985		4,612		2,594		11,685		119		—		25,243
60-89 days	26		158		326		265		1,851		4,456		—		—		7,082
90 days or greater	23		738		5,815		6,054		6,203		13,239		2,972		—		35,044
Total	892,333		1,109,142		846,656		766,388		601,903		1,161,496		26,764		—		5,404,682
Revolving mortgage
Current	—		—		—		—		—		—		2,054,864		156,618		2,211,482
30-59 days	—		—		—		—		—		—		4,622		4,252		8,874
60-89 days	—		—		—		—		—		—		452		4,163		4,615
90 days or greater	—		—		—		—		—		—		3,150		5,856		9,006
Total	—		—		—		—		—		—		2,063,088		170,889		2,233,977
Construction and land development
Current	88,063		174,326		52,270		16,909		8,123		7,881		3,891		—		351,463
30-59 days	245		1,312		91		—		—		87		—		—		1,735
60-89 days	—		—		—		11		—		116		—		—		127
90 days or greater	—		—		—		—		—		57		—		—		57
Total	88,308		175,638		52,361		16,920		8,123		8,141		3,891		—		353,382
Consumer auto
Current	245,264		421,363		284,557		142,512		74,782		22,100		—		—		1,190,578
30-59 days	172		1,070		654		710		319		168		—		—		3,093
60-89 days	75		432		239		215		132		31		—		—		1,124
90 days or greater	22		312		306		206		76		54		—		—		976
Total	245,533		423,177		285,756		143,643		75,309		22,353		—		—		1,195,771
Consumer other
Current	27,655		40,769		17,093		9,585		10,595		31,275		400,157		—		537,129
30-59 days	78		33		79		31		13		22		2,177		—		2,433
60-89 days	31		67		70		—		5		—		1,518		—		1,691
90 days or greater	1		97		5		—		74		—		1,658		—		1,835
Total	27,765		40,966		17,247		9,616		10,687		31,297		405,510		—		543,088
Total consumer	$	1,253,939	$	1,748,923	$	1,202,020	$	936,567	$	696,022	$	1,223,287	$	2,499,253	$	170,889	$	9,730,900
PCD loans
Current	$	21,462	$	28,900	$	32,863	$	39,973	$	33,294	$	278,266	$	14,999	$	23,867	$	473,624
30-59 days	1,005		546		199		132		808		15,591		182		387		18,850
60-89 days	117		141		37		34		—		3,669		72		624		4,694
90 days or greater	454		3,075		8,152		1,469		1,101		17,135		516		1,581		33,483
Total	$	23,038	$	32,662	$	41,251	$	41,608	$	35,203	$	314,661	$	15,769	$	26,459	$	530,651
Total loans and leases	$	7,040,689	$	6,332,840	$	4,515,556	$	3,473,332	$	2,678,221	$	4,580,988	$	3,592,738	$	204,061	$	32,418,425

Loans and leases outstanding at December 31, 2019 by credit quality indicator are provided below:

	December 31, 2019
	Commercial loans and leases
(Dollars in thousands)	Construction and land development		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		PCI		Total commercial loans and leases
Grade:
Pass	$	1,004,922	$	12,050,799	$	536,682	$	4,256,456	$	308,796	$	148,412	$	18,157,655
Special mention	2,577		115,164		3,899		44,604		622		44,290		166,866
Substandard	5,955		116,672		1,447		34,148		675		87,970		158,897
Doubtful	—		—		—		3		—		3,657		3
Ungraded	—		—		—		68,581		—		—		68,581
Total	$	1,013,454	$	12,282,635	$	542,028	$	4,403,792	$	310,093	$	284,329	$	18,552,002

	December 31, 2019
	Noncommercial loans and leases
(Dollars in thousands)	Residential mortgage		Revolving mortgage		Construction and land development		Consumer		PCI		Total noncommercial loans and leases
Days past due:
Current	$	5,205,380	$	2,316,010	$	354,393	$	1,762,606	$	240,995	$	9,638,389
30-59 days past due	45,839		9,729		977		10,481		13,764		67,026
60-89 days past due	18,289		3,468		218		3,746		5,608		25,721
90 days or greater past due	24,409		9,865		1,797		3,571		14,020		39,642
Total	$	5,293,917	$	2,339,072	$	357,385	$	1,780,404	$	274,387	$	9,770,778

Purchased loans and leases

The following table summarizes PCD loans acquired in the Community Financial transaction and provides the contractually required payments, less the initial allowance for credit losses and discount to produce the fair value of acquired loans with evidence of more than insignificant credit quality deterioration since origination at the acquisition date:

(Dollars in thousands)	Community Financial
Contractually required payments	$	25,635
Initial PCD allowance	1,193
Discount	1,055
Fair value at acquisition date	$	23,387

The recorded fair values of purchased non-PCD loans acquired in the Community Financial transaction as of the acquisition date are as follows:

(Dollars in thousands)	Community Financial
Commercial:
Construction and land development	$	9,428
Owner occupied commercial mortgage	31,473
Non-owner occupied commercial mortgage	25,143
Commercial and industrial and leases	15,065
Total commercial loans	81,109
Consumer:
Residential mortgage	21,168
Revolving mortgage	2,084
Construction and land development	5,254
Consumer auto	294
Consumer other	693
Total consumer loans	29,493
Total non-PCD loans	$	110,602

XML

Allowance for Loan and Lease Losses

6 Months Ended

Jun. 30, 2020

Receivables [Abstract]

Allowance

NOTE E - ALLOWANCE FOR CREDIT LOSSES (“ACL”)

As noted in Note A - Accounting Polices and Basis of Presentation, BancShares determined SBA-PPP loans have zero expected credit losses and as such these are excluded from ACL disclosures included in the following tables.

Activity in the ACL by class of loans is summarized as follows:

	Three months ended June 30, 2020
(Dollars in thousands)	Construction and land development - commercial		Owner occupied commercial mortgage		Non-owner occupied commercial mortgage		Commercial and industrial and leases		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer auto		Consumer other		PCD		Total
Allowance for credit losses:
Balance at April 1	$	2,290	$	22,970	$	16,531	$	30,619	$	38,366	$	24,557	$	1,140	$	5,769	$	40,101	$	26,916	$	209,259
Provision (credits)	4,705		(721)		5,542		(2,898)		4,909		2,211		486		4,042		2,034		242		20,552
Charge-offs	(138)		—		(8)		(3,869)		(460)		(495)		—		(1,255)		(4,447)		(1,392)		(12,064)
Recoveries	49		240		84		781		57		367		14		342		1,607		1,162		4,703
Balance at June 30	$	6,906	$	22,489	$	22,149	$	24,633	$	42,872	$	26,640	$	1,640	$	8,898	$	39,295	$	26,928	$	222,450
	Three months ended June 30, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer		PCD		Total
Balance at April 1	$	37,476	$	45,281	$	2,399	$	57,025	$	2,167	$	16,987	$	21,495	$	2,473	$	34,492	$	8,980	$	228,775
Provision (credits)	(5,544)		3,714		(57)		2,699		(174)		371		(328)		277		4,877		(637)		5,198
Charge-offs	(28)		(89)		—		(3,422)		(31)		(478)		(493)		—		(6,061)		—		(10,602)
Recoveries	40		56		—		599		221		52		447		—		1,797		—		3,212
Balance at June 30	$	31,944	$	48,962	$	2,342	$	56,901	$	2,183	$	16,932	$	21,121	$	2,750	$	35,105	$	8,343	$	226,583
	Six months ended June 30, 2020
(Dollars in thousands)	Construction and land development - commercial		Owner occupied commercial mortgage		Non-owner occupied commercial mortgage		Commercial and industrial and leases		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer auto		Consumer other		PCD		Total
Balance at December 31	$	33,213	$	36,444	$	11,102	$	61,610	$	18,232	$	19,702	$	2,709	$	4,292	$	30,301	$	7,536	$	225,141
Adoption of ASC 326	(31,061)		(19,316)		460		(37,637)		17,118		3,665		(1,291)		1,100		10,037		19,001		(37,924)
Balance at January 1	2,152		17,128		11,562		23,973		35,350		23,367		1,418		5,392		40,338		26,537		187,217
Provision (credits)	4,756		5,386		10,498		7,525		8,502		3,515		263		5,000		5,808		(2,346)		48,907
Initial allowance on PCD loans	—		—		—		—		—		—		—		—		—		1,193		1,193
Charge-offs	(138)		(320)		(8)		(8,918)		(1,260)		(1,080)		(70)		(2,199)		(9,817)		(2,515)		(26,325)
Recoveries	136		295		97		2,053		280		838		29		705		2,966		4,059		11,458
Balance at June 30	$	6,906	$	22,489	$	22,149	$	24,633	$	42,872	$	26,640	$	1,640	$	8,898	$	39,295	$	26,928	$	222,450
	Six months ended June 30, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - non - commercial		Consumer		PCI		Total
Balance at January 1	$	35,270	$	43,451	$	2,481	$	55,620	$	2,221	$	15,472	$	21,862	$	2,350	$	35,841	$	9,144	$	223,712
Provision (credits)	(3,425)		6,085		(140)		5,424		(672)		1,879		(119)		400		8,317		(801)		16,948
Charge-offs	(72)		(850)		—		(5,280)		(31)		(644)		(1,456)		—		(12,423)		—		(20,756)
Recoveries	171		276		1		1,137		665		225		834		—		3,370		—		6,679
Balance at June 30	$	31,944	$	48,962	$	2,342	$	56,901	$	2,183	$	16,932	$	21,121	$	2,750	$	35,105	$	8,343	$	226,583

Upon adoption of ASC 326, BancShares recorded a net decrease of $37.9 million in the ACL which included a decrease of $56.9 million in the ACL on non-PCD loans, offset by an increase of $19.0 million in the ACL on PCD loans. The largest changes as a result of adoption were decreases in the ACL on commercial loan segments as these portfolios have exhibited strong historical credit performance and have relatively short average lives. The reduction in ACL on these segments was partially offset by increases in ACL on our consumer loan segments primarily due to their longer average lives. The increase in the ACL on PCD loans was primarily the result of reallocating credit discount from loan balances into ACL.

The ACL is calculated using a variety of factors, including, but not limited to, charge-off and recovery activity, loan growth, changes in macroeconomic factors, collateral type, estimated loan life and changes in credit quality. For the period ended June 30, 2020 the primary reason for the ACL change since the adoption of ASC 326, was a $36.1 million reserve build due to the potential economic impact of COVID-19 and its estimated impact on credit losses. Forecasted economic conditions are developed using third party macroeconomic scenarios adjusted based on management’s expectations over a forecast period of two years. Assumptions revert to long term historic averages over a one year period. Significant macroeconomic factors used in estimating the expected losses include unemployment, gross domestic product, home price index and commercial real estate index. Our model results included baseline, adverse and upside scenarios, as well as management’s expectation of borrower performance based upon COVID-19 residual risk by industry and geography. Expected loss estimates considered the potential impact of slower economic activity and elevated unemployment, as well as mitigating impacts from the government stimulus and loan modification programs. These loss estimates were also influenced by BancShares strong credit quality, historically low net charge-offs and recent credit trends, which remained stable through the quarter ended June 30, 2020.

BancShares individually reviews loans greater than $500 thousand that are determined to be collateral-dependent. These collateral-dependent loans are evaluated based on the fair value of the underlying collateral as repayment of the loan is expected to be made through the operation or sale of the collateral. Commercial and industrial loans and leases are collateralized by business assets, while the remaining loan classes are collateralized by real property.

The following table presents information on collateral-dependent loans by class and includes the amortized cost of collateral-dependent loans and leases, the net realizable value of the collateral, the extent to which collateral secures collateral-dependent loans and the associated ACL as of June 30, 2020 were as follows:

(Dollars in thousands)	Collateral-Dependant Loans		Net Realizable Value of Collateral		Collateral Coverage		Allowance for Credit Losses
Commercial loans:
Construction and land development	$	2,862	$	3,224	112.6	%	$	—
Owner occupied commercial mortgage	10,690		24,546		229.6		—
Non-owner occupied commercial mortgage	6,995		11,133		159.2		—
Commercial and industrial and leases	—		—		—		—
Total commercial loans	20,547		38,903		189.3		—
Consumer:
Residential mortgage	19,445		25,599		131.6		75
Revolving mortgage	310		310		100.0		—
Construction and land development	—		—		—		—
Total consumer loans	19,755		25,909		131.2		75
Total non-PCD loans	40,302		64,812		160.8		75
PCD	22,013		33,821		153.6		235
Total collateral-dependent loans	$	62,315	$	98,633	158.3	%	$	310

Collateral-dependent nonaccrual loans with no recorded allowance totaled $58.8 million as of June 30, 2020. All other nonaccrual loans have a recorded allowance.

The following tables present the allowance and recorded investment in loans and leases by class of loans, as well as the associated impairment method at December 31, 2019:

	December 31, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - non- commercial		Consumer		Total
Non-PCI Loans
Allowance for loan and lease losses:
ALLL for loans and leases individually evaluated for impairment	$	463	$	3,650	$	39	$	1,379	$	103	$	3,278	$	2,722	$	174	$	1,107	$	12,915
ALLL for loans and leases collectively evaluated for impairment	32,750		41,685		2,172		57,995		2,133		14,954		16,980		2,535		33,486		204,690
Total allowance for loan and lease losses	$	33,213	$	45,335	$	2,211	$	59,374	$	2,236	$	18,232	$	19,702	$	2,709	$	34,593	$	217,605
Loans and leases:
Loans and leases individually evaluated for impairment	$	4,655	$	70,149	$	1,268	$	12,182	$	639	$	60,442	$	28,869	$	3,882	$	3,513	$	185,599
Loans and leases collectively evaluated for impairment	1,008,799		12,212,486		540,760		4,391,610		309,454		5,233,475		2,310,203		353,503		1,776,891		28,137,181
Total loan and leases	$	1,013,454	$	12,282,635	$	542,028	$	4,403,792	$	310,093	$	5,293,917	$	2,339,072	$	357,385	$	1,780,404	$	28,322,780

The following table presents the PCI allowance and recorded investment in loans at December 31, 2019:

(Dollars in thousands)	December 31, 2019
ALLL for loans acquired with deteriorated credit quality	$	7,536
Loans acquired with deteriorated credit quality	558,716

At December 31, 2019, $139.4 million of PCI loans experienced an adverse change in expected cash flows since the date of acquisition.

The following tables provide information on non-PCI impaired loans and leases, exclusive of loans and leases collectively evaluated:

	December 31, 2019
(Dollars in thousands)	With a recorded allowance		With no recorded allowance		Total		Unpaid principal balance		Related allowance recorded
Non-PCI impaired loans and leases:
Commercial:
Construction and land development	$	1,851	$	2,804	$	4,655	$	5,109	$	463
Commercial mortgage	42,394		27,755		70,149		74,804		3,650
Other commercial real estate	318		950		1,268		1,360		39
Commercial and industrial and leases	7,547		4,635		12,182		13,993		1,379
Other	406		233		639		661		103
Total commercial loans	52,516		36,377		88,893		95,927		5,634
Noncommercial:
Residential mortgage	48,796		11,646		60,442		64,741		3,278
Revolving mortgage	26,104		2,765		28,869		31,960		2,722
Construction and land development	2,470		1,412		3,882		4,150		174
Consumer	3,472		41		3,513		3,821		1,107
Total noncommercial loans	80,842		15,864		96,706		104,672		7,281
Total non-PCI impaired loans and leases	$	133,358	$	52,241	$	185,599	$	200,599	$	12,915

Non-PCI impaired loans less than $500,000 that were collectively evaluated for impairment totaled $41.0 million at December 31, 2019.

The following tables show the average non-PCI impaired loan balance and the interest income recognized by loan class for the six months ended June 30, 2019:

	Three months ended June 30, 2019				Six months ended June 30, 2019
(Dollars in thousands)	Average balance		Interest income recognized		Average balance		Interest income recognized
Non-PCI impaired loans and leases:
Commercial:
Construction and land development	$	2,102	$	6	$	2,125	$	34
Commercial mortgage	58,906		538		57,768		1,102
Other commercial real estate	519		6		602		14
Commercial and industrial and leases	11,348		113		10,674		213
Other	328		2		322		4
Total commercial	73,203		665		71,491		1,367
Noncommercial:
Residential mortgage	48,490		317		45,558		642
Revolving mortgage	29,623		256		29,183		503
Construction and land development	3,547		32		3,647		68
Consumer	3,014		31		3,007		60
Total noncommercial	84,674		636		81,395		1,273
Total non-PCI impaired loans and leases	$	157,877	$	1,301	$	152,886	$	2,640

Troubled Debt Restructurings

BancShares accounts for certain loan modifications or restructurings as TDRs. In general, the modification or restructuring of a loan is considered a TDR if, for economic or legal reasons related to a borrower’s financial difficulties, a concession is granted to the borrower that creditors would not otherwise consider. Concessions may relate to the contractual interest rate, maturity date, payment structure or other actions. Within our allowance for credit loss models, TDRs are not individually evaluated unless determined to be collateral-dependent and are included in the definition of default which provides for a 100% probability of default applied within the models. As a result, subsequent changes in default status do not impact the calculation of the allowance for credit losses on TDR loans.

The Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus was published by banking regulators in April 2020 to clarify expectations around loan modifications and the determination of TDRs for borrowers experiencing COVID-19-related financial difficulty. BancShares applied this regulatory guidance during its TDR identification process for short-term loan forbearance agreements as a result of COVID-19 and in most cases is not recording these as TDRs.

The following tables provides a summary of total TDRs by accrual status:

	June 30, 2020
(Dollars in thousands)	Accruing		Nonaccruing		Total
Commercial loans:
Construction and land development	$	1,072	$	1,304	$	2,376
Owner occupied commercial mortgage	35,080		12,682		47,762
Non-owner occupied commercial mortgage	7,343		313		7,656
Commercial and industrial and leases	29,463		2,803		32,266
Total commercial loans	72,958		17,102		90,060
Consumer:
Residential mortgage	35,439		14,167		49,606
Revolving mortgage	22,342		7,012		29,354
Construction and land development	2,355		1,452		3,807
Consumer auto	1,989		796		2,785
Consumer other	1,091		139		1,230
Total consumer loans	63,216		23,566		86,782
PCD loans	18,639		6,024		24,663
Total loans	$	154,813	$	46,692	$	201,505

	December 31, 2019
(Dollars in thousands)	Accruing		Nonaccruing		Total
Commercial loans:
Construction and land development	$	487	$	2,279	$	2,766
Commercial mortgage	50,819		11,116		61,935
Other commercial real estate	571		—		571
Commercial and industrial and leases	9,430		2,409		11,839
Other	320		105		425
Total commercial loans	61,627		15,909		77,536
Noncommercial:
Residential mortgage	41,813		16,048		57,861
Revolving mortgage	21,032		7,367		28,399
Construction and land development	1,452		2,430		3,882
Consumer	2,826		688		3,514
Total noncommercial loans	67,123		26,533		93,656
Total loans	$	128,750	$	42,442	$	171,192

Total TDRs included $17.2 million of PCI TDRs at December 31, 2019.

The following table provides the types of modifications designated as TDRs during the six months ended June 30, 2020 and June 30, 2019, as well as a summary of loans modified as a TDR during the twelve month periods ended June 30, 2020 and June 30, 2019 that subsequently defaulted during the six months ended June 30, 2020 and June 30, 2019. BancShares defines payment default as movement of the TDR to nonaccrual status, which is generally 90 days past due for TDRs, foreclosure or charge-off, whichever occurs first.

	Three months ended June 30, 2020						Three months ended June 30, 2019
	All restructurings			Restructurings with payment default			All restructurings			Restructurings with payment default
(Dollars in thousands)	Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end
Loans and leases
Interest only	7	$	15,352	3	$	3,398	4	$	4,343	—	$	—
Loan term extension	27	2,925		13	1,459		4	998		2	183
Below market interest rate	69	17,291		18	1,069		67	6,979		30	2,612
Discharged from bankruptcy	43	1,472		9	311		40	5,054		30	3,106
Total restructurings	146	$	37,040	43	$	6,237	115	$	17,374	62	$	5,901
	Six months ended June 30, 2020						Six months ended June 30, 2019
	All restructurings			Restructurings with payment default			All restructurings			Restructurings with payment default
(Dollars in thousands)	Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end
Loans and leases
Interest only	17	$	19,328	3	$	3,398	4	$	4,343	2	$	3,203
Loan term extension	33	3,657		16	1,667		8	1,437		4	534
Below market interest rate	157	25,389		46	2,324		125	11,063		61	4,645
Discharged from bankruptcy	110	5,640		44	1,507		102	7,679		53	3,948
Total restructurings	317	$	54,014	109	$	8,896	239	$	24,522	120	$	12,330

For the six months ended June 30, 2020 and June 30, 2019, the pre-modification and post-modification outstanding amortized cost of loans modified as TDRs were not materially different.

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Other Real Estate Owned

6 Months Ended

Jun. 30, 2020

Banking and Thrift [Abstract]

Other Real Estate Owned

NOTE F - OTHER REAL ESTATE OWNED

The following table explains changes in OREO during the six months ended June 30, 2020 and 2019:

(Dollars in thousands)	OREO
Balance at December 31, 2019	$	46,591
Additions	9,184
Acquired in business combinations	9,813
Sales	(9,497)
Write-downs/losses	(2,241)
Balance at June 30, 2020	$	53,850
Balance at December 31, 2018	$	48,030
Additions	7,894
Acquired in business combinations	3,613
Sales	(11,012)
Write-downs/losses	(2,289)
Balance at June 30, 2019	$	46,236

At June 30, 2020 and December 31, 2019, BancShares had $11.7 million and $14.5 million, respectively, of foreclosed residential real estate property in OREO. The recorded investment in consumer mortgage loans collateralized by residential real estate property in the process of foreclosure was $25.5 million and $23.0 million at June 30, 2020 and December 31, 2019, respectively. Net gains and losses recorded on the sale of OREO properties were losses of $234 thousand and gains of $872 thousand for the six months ended June 30, 2020 and June 30, 2019

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Servicing Rights

6 Months Ended

Jun. 30, 2020

Mortgage Servicing Rights [Abstract]

Servicing Rights

SERVICING RIGHTS

Mortgage Servicing Rights

Our portfolio of residential mortgage loans serviced for third parties was $3.37 billion and $3.38 billion as of June 30, 2020 and December 31, 2019, respectively. These loans are originated and sold to third parties on a non-recourse basis with servicing rights retained. The retained servicing rights were recorded as a servicing asset and are reported in other intangible assets. The associated amortization expense and any valuation allowance recognized were included as a reduction of mortgage income. Mortgage servicing rights are initially recorded at fair value and then carried at the lower of amortized cost or fair value.

Contractually specified mortgage servicing fees, late fees and ancillary fees earned for the three months ended June 30, 2020 and 2019 were $2.1 million and $2.0 million, respectively, and are reported in mortgage income. For the six months ended June 30, 2020 and 2019, contractually specified mortgage servicing fees, late fees, and ancillary fees earned were $4.3 million and $3.9 million, respectively.

The following table presents changes in the servicing asset during the three and six months ended June 30, 2020 and 2019:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Beginning balance	$	19,756	$	20,647	$	22,963	$	21,396
Servicing rights originated	2,096		1,552		3,679		2,411
Amortization	(2,119)		(1,567)		(3,942)		(3,014)
Valuation allowance (increase) decrease	(1,069)		33		(4,036)		(128)
Ending balance	$	18,664	$	20,665	$	18,664	$	20,665

The following table presents the activity in the servicing asset valuation allowance for the three and six months ended June 30, 2020 and 2019:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Beginning balance	$	3,189	$	161	$	222	$	—
Valuation allowance increase (decrease)	1,069		(33)		4,036		128
Ending balance	$	4,258	$	128	$	4,258	$	128

Mortgage servicing rights valuations are performed using a pooling methodology where loans with similar risk characteristics are grouped together and evaluated using discounted cash flows to estimate the present value of future earnings. Key economic assumptions used to value mortgage servicing rights were as follows:

	June 30, 2020			December 31, 2019
Discount rate - conventional fixed loans	7.66		%	8.92		%
Discount rate - all loans excluding conventional fixed loans	8.66		%	9.92		%
Weighted average constant prepayment rate	20.19		%	13.72		%
Weighted average cost to service a loan	$	87.30		$	87.09

The fair value of mortgage servicing rights is sensitive to changes in assumptions and is determined by estimating the present value of the asset’s future cash flows by utilizing discount rates, prepayment rates, and other inputs. The discount rate is based on the 10-year U.S. Treasury rate plus a risk premium of 700 basis points for conventional fixed loans and 800 basis points for all other loans. The prepayment rate is derived from the Public Securities Association Standard Prepayment model. Generally, as interest rates decline, mortgage loan prepayments accelerate due to increased refinance activity, which results in a decrease in the fair value and may result in the recognition of a valuation allowance. The average cost to service a loan is based on the number of loans serviced and the total cost to service the loans.

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Repurchase Agreements

6 Months Ended

Jun. 30, 2020

Repurchase Agreements [Abstract]

Repurchase Agreements, Resale Agreements, Securities Borrowed, and Securities Loaned Disclosure [Text Block]

REPURCHASE AGREEMENTS

BancShares utilizes securities sold under agreements to repurchase to facilitate the needs of customers and secure wholesale funding needs. Repurchase agreements are transactions whereby BancShares offers to sell to a counterparty an undivided interest in an eligible security at an agreed upon price, and which obligates BancShares to repurchase the security at an agreed upon date, repurchase price, and interest rate. These agreements are recorded at the amount of cash received in connection with the transaction and are reflected as securities sold under customer repurchase agreements.

BancShares monitors collateral levels on a continuous basis and maintains records of each transaction specifically describing the applicable security and the counterparty’s interest in that security, and segregates the security from general assets in accordance with regulations governing custodial holdings of securities. The primary risk with repurchase agreements is market risk associated with the investments securing the transactions, as additional collateral may be required based on fair value changes of the underlying investments. Securities pledged as collateral under repurchase agreements are maintained with safekeeping agents. The carrying value of investment securities available for sale pledged as collateral under repurchase agreements was $766.8 million and $477.6 million at June 30, 2020 and December 31, 2019, respectively.

At June 30, 2020, BancShares held $740.3 million of securities sold under agreements to repurchase, with overnight and continuous remaining contractual maturities, made up of $470.8 million collateralized by government agency securities and $269.5 million collateralized by commercial mortgage-backed securities. At December 31, 2019, BancShares held securities sold under agreements to repurchase of $443.0 million, with overnight and continuous remaining contractual maturities collateralized by government agency securities.

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FDIC Shared-Loss Payable

6 Months Ended

Jun. 30, 2020

FDIC Shared-Loss Receivable [Abstract]

FDIC Shared-Loss Receivable

FDIC SHARED-LOSS PAYABLE

At June 30, 2020, shared-loss protection remains for single family residential loans acquired in the amount of $38.0 million. The shared-loss agreement for two of the FDIC-assisted transactions include a provision related to a payment that may be owed to the FDIC at the termination of the agreement if actual cumulative losses on acquired covered assets are lower than the cumulative losses originally estimated by the FDIC at the time of acquisition (the “clawback liability”). BancShares issued a payment to the FDIC in the first quarter of 2020 for $99.5 million related to one of the transactions. The remaining clawback liability payment date is March 2021.

The following table provides changes in the FDIC shared-loss payable since December 31, 2019:

(Dollars in thousands)	Total
Balance at December 31, 2019	$	112,395
Accretion	2,098
Payment made to the FDIC to settle shared-loss agreement	(99,468)
Balance at June 30, 2020	$	15,025

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Accumulated Other Comprehensive Income (Loss)

6 Months Ended

Jun. 30, 2020

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Loss

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Accumulated other comprehensive income (loss) included the following as of June 30, 2020 and December 31, 2019:

	June 30, 2020						December 31, 2019
(Dollars in thousands)	Accumulated other comprehensive income (loss)		Deferred tax expense (benefit)		Accumulated other comprehensive income (loss), net of tax		Accumulated other comprehensive income (loss)		Deferred tax expense (benefit)		Accumulated other comprehensive income (loss), net of tax
Unrealized gains on securities available for sale	$	146,884	$	33,782	$	113,102	$	7,522	$	1,730	$	5,792
Defined benefit pension items	(159,436)		(36,670)		(122,766)		(172,098)		(39,583)		(132,515)
Total	$	(12,552)	$	(2,888)	$	(9,664)	$	(164,576)	$	(37,853)	$	(126,723)

The following table highlights changes in accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2020 and 2019:

	Three months ended June 30, 2020
(Dollars in thousands, net of tax)	Unrealized gains (losses) on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	102,080	$	—	$	(127,692)	$	(25,612)
Net unrealized gains arising during period	21,611		—		—		21,611
Amounts reclassified from accumulated other comprehensive loss	(10,589)		—		4,926		(5,663)
Net current period other comprehensive income	11,022		—		4,926		15,948
Ending balance	$	113,102	$	—	$	(122,766)	$	(9,664)
	Three months ended June 30, 2019
(Dollars in thousands, net of tax)	Unrealized gains (losses) on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	(16,890)	$	(66,558)	$	(123,412)	$	(206,860)
Net unrealized gains arising during period	23,848		—		—		23,848
Amounts reclassified from accumulated other comprehensive loss	(4,404)		4,579		2,106		2,281
Net current period other comprehensive income	19,444		4,579		2,106		26,129
Ending balance	$	2,554	$	(61,979)	$	(121,306)	$	(180,731)

	Six months ended June 30, 2020
(Dollars in thousands, net of tax)	Unrealized gains on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	5,792	$	—	$	(132,515)	$	(126,723)
Net unrealized gains arising during period	133,141		—		—		133,141
Amounts reclassified from accumulated other comprehensive loss	(25,831)		—		9,749		(16,082)
Net current period other comprehensive income	107,310		—		9,749		117,059
Ending balance	$	113,102	$	—	$	(122,766)	$	(9,664)
	Six months ended June 30, 2019
(Dollars in thousands, net of tax)	Unrealized gains on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	(38,505)	$	(71,149)	$	(125,533)	$	(235,187)
Net unrealized gains arising during period	45,463		—		—		45,463
Amounts reclassified from accumulated other comprehensive loss	(4,404)		9,170		4,227		8,993
Net current period other comprehensive income	41,059		9,170		4,227		54,456
Ending balance	$	2,554	$	(61,979)	$	(121,306)	$	(180,731)

The following table presents the amounts reclassified from accumulated other comprehensive income (loss) and the line item affected in the statement where net income is presented for the three and six months ended June 30, 2020 and 2019:

(Dollars in thousands)	Three months ended June 30, 2020
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	13,752	Realized gains on investment securities available for sale, net
	(3,163)		Income taxes
	$	10,589
Amortization of defined benefit pension actuarial losses	(6,398)		Other
	1,472		Income taxes
	$	(4,926)
Total reclassifications for the period	$	5,663
	Three months ended June 30, 2019
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	5,719	Realized gains on investment securities available for sale, net
	(1,315)		Income taxes
	$	4,404
Amortization of unrealized losses on securities available for sale transferred to held to maturity	$	(5,947)	Net interest income
	1,368		Income taxes
	$	(4,579)
Amortization of defined benefit pension items
Prior service costs	$	(14)	Salaries and wages
Actuarial losses	(2,721)		Other
	(2,735)		Income before income taxes
	629		Income taxes
	$	(2,106)
Total reclassifications for the period	$	(2,281)

	Six months ended June 30, 2020
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	33,547	Realized gains on investment securities available for sale, net
	(7,716)		Income taxes
	$	25,831
Amortization of defined benefit pension items
Actuarial losses	$	(12,662)	Other
	2,913		Income taxes
	$	(9,749)
Total reclassifications for the period	$	16,082
	Six months ended June 30, 2019
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	5,719	Realized gains on investment securities available for sale, net
	(1,315)		Income taxes
	$	4,404	Net income
Amortization of unrealized losses on securities available for sale transferred to held to maturity	$	(11,909)	Net interest income
	2,739		Income taxes
	$	(9,170)
Amortization of defined benefit pension items
Prior service costs	$	(28)	Salaries and wages
Actuarial losses	(5,462)		Other
	(5,490)		Income before income taxes
	1,263		Income taxes
	$	(4,227)
Total reclassifications for the period	$	(8,993)

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Estimated Fair Values

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Estimated Fair Values

ESTIMATED FAIR VALUES

Fair value estimates are intended to represent the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. Where there is no active market for a financial instrument, BancShares has made estimates using discounted cash flows or other valuation techniques. Inputs used in these valuation techniques are subjective in nature, involve uncertainties and require significant judgment and therefore can only be derived within a range of precision. Accordingly, the derived fair value estimates presented below are not necessarily indicative of the amounts BancShares would realize in a current market exchange.

ASC 820, Fair Value Measurements and Disclosures, indicates that assets and liabilities are recorded at fair value according to a fair value hierarchy comprised of three levels. The levels are based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. The level within the fair value hierarchy for an asset or liability is based on the highest level of input that is significant to the fair value measurement (with Level 1 considered highest and Level 3 considered lowest). A brief description of each level follows:

•Level 1 values are based on quoted prices for identical instruments in active markets.

•Level 2 values are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market.

•Level 3 values are derived from valuation techniques in which one or more significant inputs or assumptions are not observable in the market. These unobservable inputs and assumptions reflect estimates that market participants would use in pricing the asset or liability. Valuation techniques include the use of discounted cash flow models and similar techniques.

BancShares’ management reviews any changes to its valuation methodologies to ensure they are appropriate and supportable, and refines valuation methodologies as more market-based data becomes available. Accuracy of the levels of the fair value hierarchy are validated at the end of the reporting period.

The methodologies used to estimate the fair value of financial assets and financial liabilities are discussed below:

Investment securities available for sale and held to maturity. The fair value of U.S. Treasury, government agency and mortgage-backed securities, municipal securities, as well as a portion of corporate bonds, is generally estimated using a third party pricing service. The third party provider evaluates securities based on comparable investments with trades and market data and will utilize pricing models that use a variety of inputs, such as benchmark yields, reported trades, broker-dealer quotes, issuer spreads, benchmark securities, bids and offers as needed. These securities are generally classified as Level 2. The remaining corporate bonds held are generally measured at fair value based on indicative bids from broker-dealers and are not directly observable. These securities are considered Level 3.

Investment in marketable equity securities. Equity securities are measured at fair value using observable closing prices and the market activity. Equity securities are classified as Level 1 if they are traded in an active market and as Level 2 if the observable closing price is from a less than active market.

Loans held for sale. Management elects the fair value option on certain residential real estate loans originated to be sold to investors. The loans are carried at fair value based on quoted market prices for similar types of loans. Accordingly, the inputs used to calculate fair value of originated residential real estate loans held for sale are classified as Level 2 inputs. Loans held for investment subsequently transferred to held for sale are carried at fair value when a firm commitment to purchase from a counterparty exists. The fair value of the transferred loans is based on the quoted prices and is considered a Level 1 input.

Net loans and leases. Fair value is estimated based on discounted future cash flows using the current interest rates at which loans with similar terms would be made to borrowers of similar credit quality. The inputs used in the fair value measurements for loans and leases are considered Level 3 inputs.

FHLB stock. The carrying amount of FHLB stock is a reasonable estimate of fair value as these securities are not readily marketable and are evaluated for impairment based on the ultimate recoverability of the par value. BancShares considers positive and negative evidence, including the profitability and asset quality of the issuer, dividend payment history and recent redemption experience, when determining the ultimate recoverability of the par value. BancShares believes its investment in FHLB stock is ultimately recoverable at par. The inputs used in the fair value measurement for the FHLB stock are considered Level 2 inputs.

Mortgage and other servicing rights. Mortgage and other servicing rights are carried at the lower of amortized cost or market value and are, therefore, carried at fair value only when fair value is less than the amortized cost. The fair value of mortgage and other servicing rights is performed using a pooling methodology. Similar loans are pooled together and a model that relies on discount rates, estimates of prepayment rates and the weighted average cost to service the loans is used to determine the fair value. The inputs used in the fair value measurement for mortgage and other servicing rights are considered Level 3 inputs.

Deposits. For non-time deposits, carrying value is a reasonable estimate of fair value. The fair value of time deposits is estimated by discounting future cash flows using the interest rates currently offered for deposits with similar remaining maturities. The inputs used in the fair value measurement for deposits are considered Level 2 inputs.    

Borrowings. For borrowings, the fair values are determined based on recent trades or sales of the actual security if available. Otherwise, fair values are estimated by discounting future cash flows using current interest rates for similar financial instruments. The inputs used in the fair value measurement for FHLB borrowings, subordinated debentures, and other borrowings are considered Level 2 inputs.

Payable to the FDIC for shared-loss agreements. The fair value of the payable to the FDIC for shared-loss agreements is determined based on expected payments to the FDIC in accordance with the shared-loss agreements. Cash flows are discounted using current discount rates to reflect the timing of the estimated amounts due to the FDIC. The inputs used in the fair value measurement for the payable to the FDIC are considered Level 3 inputs.

Off-balance-sheet commitments and contingencies. Carrying amounts are reasonable estimates of the fair values for such financial instruments. Carrying amounts include unamortized fee income and, in some cases, reserves for any credit losses from those financial instruments. These amounts are not material to BancShares’ financial position.

For all other financial assets and liabilities, the carrying value is a reasonable estimate of the fair value as of June 30, 2020 and December 31, 2019. The carrying value and fair value for these assets and liabilities are equivalent because they are relatively short term in nature and there is no interest rate or credit risk that would cause the fair value to differ from the carrying value. Cash and due from banks is classified on the fair value hierarchy as Level 1. Overnight investments, income earned not collected, securities sold under customer repurchase agreements, and accrued interest payable are considered Level 2.

The table presents the carrying values and estimated fair values for financial instruments as of June 30, 2020 and December 31, 2019:

(Dollars in thousands)	June 30, 2020				December 31, 2019
	Carrying value		Fair value		Carrying value		Fair value
Cash and due from banks	$	389,233	$	389,233	$	376,719	$	376,719
Overnight investments	3,107,575		3,107,575		1,107,844		1,107,844
Investment in marketable equity securities	114,316		114,316		82,333		82,333
Investment securities available for sale	8,619,282		8,619,282		7,059,674		7,059,674
Investment securities held to maturity	774,878		791,325		30,996		30,996
Loans held for sale	107,881		107,881		67,869		67,869
Net loans and leases	32,195,975		32,604,388		28,656,355		28,878,550
Income earned not collected	175,496		175,496		123,154		123,154
Federal Home Loan Bank stock	45,392		45,392		43,039		43,039
Mortgage and other servicing rights	20,167		21,163		24,891		26,927
Deposits with no stated maturity	38,202,609		38,202,609		30,593,627		30,593,627
Time deposits	3,276,636		3,303,841		3,837,609		3,842,162
Securities sold under customer repurchase agreements	740,276		740,276		442,956		442,956
Federal Home Loan Bank borrowings	657,682		679,993		572,185		577,362
Subordinated debt	504,246		506,089		163,412		173,685
Other borrowings	96,791		95,861		148,318		149,232
FDIC shared-loss payable	15,025		15,730		112,395		114,252
Accrued interest payable	14,085		14,085		18,124		18,124

For assets and liabilities carried at fair value on a recurring basis, the following table provides fair value information as of June 30, 2020 and December 31, 2019:

	June 30, 2020
			Fair value measurements using:
(Dollars in thousands)	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Assets measured at fair value
Investment securities available for sale
U.S. Treasury	$	754,586	$	—	$	754,586	$	—
Government agency	545,709		—		545,709		—
Residential mortgage-backed securities	5,790,392		—		5,790,392		—
Commercial mortgage-backed securities	1,079,822		—		1,079,822		—
Corporate bonds	448,773		—		278,796		169,977
Total investment securities available for sale	$	8,619,282	$	—	$	8,449,305	$	169,977
Marketable equity securities	$	114,316	$	50,352	$	63,964	$	—
Loans held for sale	$	107,881	$	—	$	107,881	$	—
	December 31, 2019
			Fair value measurements using:
	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Assets measured at fair value
Investment securities available for sale
U.S. Treasury	$	409,999	$	—	$	409,999	$	—
Government agency	682,772		—		682,772		—
Residential mortgage-backed securities	5,267,090		—		5,267,090		—
Commercial mortgage-backed securities	380,020		—		380,020		—
Corporate bonds	201,566		—		131,881		69,685
State, county and municipal	118,227		—		118,227		—
Total investment securities available for sale	$	7,059,674	$	—	$	6,989,989	$	69,685
Marketable equity securities	$	82,333	$	29,458	$	52,875	$	—
Loans held for sale	$	67,869	$	—	$	67,869	$	—

The following tables summarize activity for Level 3 assets:

	Corporate bonds
	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Beginning balance	$	67,016	$	146,287	$	69,685	$	143,226
Purchases	100,595		991		100,595		3,991
Unrealized net gains (losses) included in other comprehensive income	2,449		1,822		(1,917)		1,838
Amounts included in net income	(83)		37		(168)		82
Transfers in	—		—		1,782		—
Ending balance	$	169,977	$	149,137	$	169,977	$	149,137

During the three months ended June 30, 2020, there were no transfers between levels. During the six months ended June 30, 2020, there were transfers from Level 2 to Level 3 of $1.8 million in corporate bonds available for sale. The transfers were due to a lack of observable inputs and trade activity for those securities. During the three and six months ended June 30, 2019, there were no transfers between levels.

The following table presents quantitative information about Level 3 fair value measurements for fair value on a recurring basis at June 30, 2020:

(Dollars in thousands)			June 30, 2020
Level 3 assets	Valuation technique	Significant unobservable input	Fair Value
Corporate bonds	Indicative bid provided by broker	Multiple factors, including but not limited to, current operations, financial condition, cash flows, and recently executed financing transactions related to the issuer	$	169,977

Fair Value Option

BancShares has elected the fair value option for residential real estate loans originated to be sold. This election reduces certain timing differences in the Consolidated Statement of Income and better aligns with the management of the portfolio from a business perspective. The changes in fair value were recorded as a component of mortgage income and included a gain of $2.4 million and a loss of $82 thousand for the three months ended June 30, 2020 and 2019, respectively. The changes in fair value included gains of $3.6 million and $167 thousand for the six months ended June 30, 2020 and 2019, respectively.

The following table summarizes the difference between the aggregate fair value and the aggregate unpaid principal balance for residential real estate originated for sale measured at fair value as of June 30, 2020 and December 31, 2019:

	June 30, 2020
(Dollars in thousands)	Fair value		Aggregate unpaid principal balance		Difference
Originated loans held for sale	$	107,881	$	102,189	$	5,692
	December 31, 2019
	Fair value		Aggregate unpaid principal balance		Difference
Originated loans held for sale	$	67,869	$	65,697	$	2,172

No originated loans held for sale were 90 or more days past due or on nonaccrual status as of June 30, 2020 or December 31, 2019.

We may be required to measure certain financial assets at fair value on a nonrecurring basis. These adjustments to fair value usually result from the application of lower of amortized cost or fair value accounting or write-downs of individual assets due to impairment.

Following the adoption of ASC 326, the population of loans measured at fair value on a non-recurring basis has greatly diminished and is limited to collateral-dependent loans evaluated individually. These collateral-dependent loans are deemed to be at fair value if there is an associated allowance for credit losses or if a charge-off has been recorded in the previous 12 months. Collateral values are determined using appraisals or other third-party value estimates of the subject property discounted based on estimated selling costs, generally between 6% and 10%, and immaterial adjustments for other external factors that may impact the marketability of the collateral. The weighted average discount for estimated selling costs applied was 7.81%.

Prior to the adoption of ASC 326, impaired loans were deemed to be at fair value if an associated allowance or current period charge-off had been recorded. The value of impaired loans was determined by either collateral valuations or discounted present value of the expected cash flow calculations. Collateral values were determined using appraisals or other third-party value estimates of the subject property with discounts, generally between 6% and 11%, applied for estimated selling costs and other external factors that may impact the marketability of the property. Expected cash flows were determined using expected payment information at the individual loan level, discounted using the effective interest rate. The effective interest rate for impaired loans generally ranges between 3% and 7%.

OREO acquired or written down within the previous 12 months is deemed to be at fair value. Asset valuations are determined by using appraisals or other third-party value estimates of the subject property with with discounts generally between 7% and 16% applied for estimated selling costs and other external factors that may impact the marketability of the property. At June 30, 2020, the weighted average discount applied was 8.16%. Changes to the value of the assets between scheduled valuation dates are monitored through continued communication with brokers and monthly reviews by the asset manager assigned to each asset. If there are any significant changes in the market or the subject property, valuations are adjusted or new appraisals ordered to ensure the reported values reflect the most current information.

For financial assets and liabilities carried at fair value on a nonrecurring basis, the following table provides fair value information as of June 30, 2020 and December 31, 2019:

	June 30, 2020
			Fair value measurements using:
(Dollars in thousands)	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Collateral-dependent loans	$	14,341	$	—	$	—	$	14,341
Other real estate owned	44,465		—		—		44,465
Mortgage servicing rights	17,992		—		—		17,992
	December 31, 2019
			Fair value measurements using:
	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Impaired loans	$	132,336	$	—	$	—	$	132,336
Other real estate owned	38,310		—		—		38,310
Mortgage servicing rights	3,757		—		—		3,757

No financial liabilities were carried at fair value on a nonrecurring basis as of June 30, 2020 and December 31, 2019.

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Employee Benefit Plans

6 Months Ended

Jun. 30, 2020

Retirement Benefits, Description [Abstract]

Employee Benefit Plans

EMPLOYEE BENEFIT PLANS

BancShares sponsors noncontributory defined benefit pension plans for its qualifying employees. The service cost component of net periodic benefit cost is included in salaries and wages while all other non-service cost components are included in other noninterest expense.

For the three and six months ended June 30, 2020 and 2019, the components of net periodic benefit cost are as follows:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Service cost	$	3,682	$	3,271	$	7,139	$	6,384
Interest cost	8,568		9,338		17,099		18,629
Expected return on assets	(16,435)		(15,661)		(32,844)		(31,296)
Amortization of prior service cost	—		14		—		28
Amortization of net actuarial loss	6,398		2,721		12,662		5,462
Net periodic cost (benefit)	$	2,213	$	(317)	$	4,056	$	(793)

A discretionary contribution of $100.0 million was made to the pension plans during the six months ended June 30, 2020. Management evaluates the need for its pension plan contributions on a periodic basis based upon numerous factors including, but not limited to, the funded status of the plans, returns on plan assets, discount rates and the current economic environment.

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Leases

6 Months Ended

Jun. 30, 2020

Leases [Abstract]

Leases

LEASES

The following table presents lease assets and liabilities as of June 30, 2020 and December 31, 2019:

(Dollars in thousands)	Classification	June 30, 2020		December 31, 2019
Assets:
Operating	Other assets	$	73,488	$	77,115
Finance	Premises and equipment	7,547		8,820
Total leased assets		$	81,035	$	85,935
Liabilities:
Operating	Other liabilities	$	73,481	$	76,746
Finance	Other borrowings	7,463		8,230
Total lease liabilities		$	80,944	$	84,976

Leases

LEASES

The following table presents lease assets and liabilities as of June 30, 2020 and December 31, 2019:

(Dollars in thousands)	Classification	June 30, 2020		December 31, 2019
Assets:
Operating	Other assets	$	73,488	$	77,115
Finance	Premises and equipment	7,547		8,820
Total leased assets		$	81,035	$	85,935
Liabilities:
Operating	Other liabilities	$	73,481	$	76,746
Finance	Other borrowings	7,463		8,230
Total lease liabilities		$	80,944	$	84,976

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

COMMITMENTS AND CONTINGENCIES

To meet the financing needs of its customers, BancShares and its subsidiaries have financial instruments with off-balance sheet risk. These financial instruments involve elements of credit, interest rate or liquidity risk and include commitments to extend credit and standby letters of credit.

Commitments to extend credit are legally binding agreements to lend to customers. These commitments generally have fixed expiration dates or other termination clauses and may require payment of fees. Since many of these commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future liquidity requirements. Established credit standards control the credit risk exposure associated with these commitments. In some cases, BancShares requires collateral be pledged to secure the commitment, including cash deposits, securities and other assets.

Standby letters of credit are commitments guaranteeing performance of a customer to a third party. Those commitments are primarily issued to support public and private borrowing arrangements. To mitigate its risk, BancShares’ credit policies govern the issuance of standby letters of credit. The credit risk related to the issuance of these letters of credit is essentially the same as in extending loans to clients and, therefore, these letters of credit are collateralized when necessary.

The following table presents the commitments to extend credit and standby letters of credit as of June 30, 2020 and December 31, 2019:

(Dollars in thousands)	June 30, 2020		December 31, 2019
Unused commitments to extend credit	$	11,705,547	$	10,682,378
Standby letters of credit	104,655		99,601

BancShares has investments in qualified affordable housing projects primarily for the purposes of fulfilling Community Reinvestment Act requirements and obtaining tax credits. Affordable housing project investments were $169.3 million and $167.8 million as of June 30, 2020 and December 31, 2019, respectively, and were recorded in other assets. Unfunded commitments to fund future investments in affordable housing projects totaled $68.3 million and $70.0 million as of June 30, 2020 and December 31, 2019, respectively, and were recorded in other liabilities.

BancShares and various subsidiaries have been named as defendants in legal actions arising from their normal business activities in which damages in various amounts were claimed. BancShares has also been exposed to litigation risk relating to the prior business activities of banks from which assets were acquired and liabilities assumed in the various merger transactions. Although the amount of any ultimate liability with respect to such matters cannot be determined, in the opinion of management, any such liability will not have a material effect on BancShares’ consolidated financial statements.

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Accounting Policies and Basis of Presentation Policies (Policies)

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Reclassifications

Reclassifications

In certain instances, amounts reported in prior periods’ consolidated financial statements have been reclassified to conform to the current financial statement presentation. Such reclassifications had no effect on previously reported cash flows, shareholders’ equity or net income.

Use of Estimates

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions which affect the amounts reported. Actual results could differ from those estimates. The estimates BancShares considers significant are the allowance for credit losses, fair value measurements, and income taxes.

New Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2018-13 - Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement

This ASU modifies the disclosure requirements on fair value measurements by eliminating the requirements to disclose (1) the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy (2) the policy for timing of transfers between levels and (3) the valuation processes for Level 3 fair value measurements. This ASU also added specific disclosure requirements for fair value measurements for public business entities including the requirement to disclose the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements.

BancShares adopted this ASU during the first quarter of 2020 and have made all applicable updates to the disclosure within the Notes to the Unaudited Consolidated Financial Statements.

FASB ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment

This ASU eliminates Step 2 from the goodwill impairment test. Under Step 2, an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, under the amendments in this ASU, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. This ASU eliminates the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative test.

BancShares adopted this ASU during the first quarter 2020 with no impact to our consolidated financial position or consolidated results of operations as a result of the adoption.

FASB ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments

This ASU (and all subsequent ASUs on this topic) introduce the current expected credit loss (“CECL”) model, a new credit loss methodology, replacing multiple existing impairment methods in current GAAP, which generally require that a loss be incurred before it is recognized. The amendments in this ASU require loss estimates be determined over the lifetime of the asset and broaden the information that an entity must consider in developing its expected credit losses. The ASU does not specify a method for measuring expected credit losses and allows an entity to apply methods that reasonably reflect its expectations of the credit loss estimate based on the entity's size, complexity and risk profile. In addition, the disclosures of credit quality indicators in relation to the amortized cost of financing receivables, a current disclosure requirement, are further disaggregated by year of origination.

BancShares adopted this ASU (and all subsequent ASUs on this topic) as of January 1, 2020 using the modified retrospective approach for all loans, leases, debt securities designated as held to maturity, and unfunded loan commitments. BancShares adopted the ASU using the prospective approach for debt securities available for sale and purchased credit deteriorated (“PCD”) loans previously accounted for under Accounting Standard Codification (“ASC”) ASC 310-30. Results for reporting periods beginning after January 1, 2020 are presented under ASC 326, while prior period amounts continue to be reported in accordance with previously applicable GAAP. BancShares made changes to loan classifications and segmentation in order to align with ASC 326 requirements and facilitate CECL modeling. Using this updated segmentation, BancShares developed new loan level models to estimate the allowance for credit losses (“ACL”) and facilitate revised disclosures.

The information presented below represents changes from Note A, Accounting Policies and Basis of Presentation, included in BancShares’ Annual Report on Form 10-K for the year ended December 31, 2019, as well as information on the impact of adoption.

Accounting Policy - Debt Securities

BancShares classifies debt securities as held to maturity (“HTM”) or available for sale (“AFS”). Debt securities are classified as HTM when BancShares has the intent and ability to hold the securities to maturity and are reported at amortized cost. Other debt securities are classified as AFS and reported at estimated fair value, with unrealized gains and losses, net of income taxes, reported in Accumulated Other Comprehensive Income (“AOCI”). Amortization of premiums and accretion of discounts for debt securities are included in interest income. Realized gains and losses from the sale of debt securities are determined by specific identification on a trade date basis and are included in noninterest income.

BancShares performs pre-purchase due diligence and evaluates the credit risk of AFS and HTM securities purchased directly into our portfolio or via acquisition. If securities have evidence of more than insignificant credit deterioration since issuance, they are designated as PCD. PCD securities are recorded at fair value at the date of acquisition which includes an associated allowance that is added to the purchase price or fair value to arrive at the Day 1 amortized cost basis. The difference between the purchase price and the Day 1 amortized cost is amortized or accreted to interest income over the contractual life of the securities using the effective interest method.

For AFS securities, management performs a quarterly analysis of the investment portfolio to evaluate securities currently in an unrealized loss position for potential credit-related impairment. If BancShares intends to sell a security, or does not have the intent and ability to hold a security before recovering the amortized cost, the entirety of the unrealized loss is immediately recorded in earnings. For the remaining securities, an analysis is performed to determine if any portion of the unrealized loss recorded relates to credit impairment. If credit related impairment exists, the amount is recorded through the ACL and related provision. This review includes indicators such as changes in credit rating, delinquency, bankruptcy or other significant news event impacting the issuer.

BancShares’ portfolio of HTM debt securities is made up of mortgage-backed securities issued by government agencies and government sponsored entities. Given the historically strong credit rating of the U.S. Treasury and the long history of no credit losses on debt securities issued by government agencies and government sponsored entities, we determined zero expected credit losses on the HTM portfolio.

Accounting Policy - Loans and Leases

BancShares’ accounting methods for loans and leases depends on whether they are originated or purchased, and if purchased, whether or not the loans reflect more than insignificant credit deterioration since origination as of the date of acquisition.

Non-Purchased Credit Deteriorated (“Non-PCD”) Loans

Non-PCD loans consist of loans originated by BancShares and loans purchased from other institutions that do not reflect more than insignificant credit deterioration at acquisition.

Originated loans for which management has the intent and ability to hold for the foreseeable future are classified as held for investment and carried at the principal amount outstanding net of any unearned income, charge-offs and unamortized fees and costs. Nonrefundable fees collected and certain direct costs incurred related to loan originations are deferred and recorded as an adjustment to loans outstanding. The net amount of the nonrefundable fees and costs is amortized to interest income over the contractual lives using methods that approximate a constant yield.

Purchased loans which do not reflect more than insignificant credit deterioration at acquisition are classified as non-PCD loans. These loans are recorded at fair value at the date of acquisition and an initial allowance is recorded on these assets as provision expense at the date of acquisition. The difference between the fair value and the unpaid principal balance at the acquisition date is amortized or accreted to interest income over the contractual life of the loan using the effective interest method.

Purchased Credit Deteriorated Loans

Purchased loans which reflect a more than insignificant credit deterioration since origination as of the date of acquisition are classified as PCD and are recorded at acquisition date amortized cost, which is the purchase price or fair value in a business combination, plus our initial estimate of expected credit losses. The difference between the unpaid principal balance and the acquisition date amortized cost is amortized or accreted to interest income over the contractual life of the loan using the effective interest method.

The performance of all loans within the BancShares portfolio is subject to a number of external risks, including but not limited to changes in the overall health of the economy, declines in real estate or other collateral values, changes in the demand for products and services and personal events, such as death, disability or change in marital status. BancShares evaluates and reports its non-PCD and PCD loan portfolios separately, and each non-PCD portfolio is further divided into commercial and consumer segments based on the type of borrower, purpose, collateral and/or our underlying credit management processes. Additionally, non-PCD commercial and consumer loans are assigned to loan classes, which further disaggregate the loan portfolio. PCD loans are reported as a single loan segment and class.

Upon adoption of ASC 326, owner occupied and non-owner occupied commercial real estate were segregated into separate classes within the commercial segment. Similarly, consumer auto was segregated into its own class within the consumer segment. These enhancements were made to capture the unique credit characteristics used in our CECL models. Information for reporting periods beginning after January 1, 2020 are presented in accordance with ASC 326 and reflect changes to the respective classes, while prior period amounts continue to be reported in accordance with previously applicable GAAP and have not been reclassified to conform to the current financial statement presentation.

The following represent our classes of loans as of January 1, 2020 upon adoption of ASC 326 (with the exception of SBA-PPP, which was added during second quarter 2020):

Commercial loans and leases

Construction and land development - Construction and land development consists of loans to finance land for development of commercial or residential real property and construction of multifamily apartments or other commercial properties. These loans are highly dependent on the supply and demand for commercial real estate as well as the demand for newly constructed residential homes and lots acquired for development. Deterioration in demand could result in decreased collateral values, which could make repayments of outstanding loans difficult for customers.

Owner occupied commercial mortgage - Owner occupied commercial mortgages consists of loans to purchase or re-finance owner occupied nonresidential properties. This includes office buildings, other commercial facilities, and farmland. Commercial mortgages secured by owner occupied properties are primarily dependent on the ability of borrowers to achieve business results consistent with those projected at loan origination. While these loans and leases are collateralized by real property in an effort to mitigate risk, it is possible the liquidation of collateral will not fully satisfy the obligation.

Non-owner occupied commercial mortgage - Non-owner occupied commercial mortgage consists of loans to purchase or refinance investment nonresidential properties. This includes office buildings and other facilities rented or leased to unrelated parties, as well as farmland and multifamily properties. The primary risk associated with income producing commercial mortgage loans is the ability of the income-producing property that collateralizes the loan to produce adequate cash flow to service the debt. While these loans and leases are collateralized by real property in an effort to mitigate risk, it is possible the liquidation of collateral will not fully satisfy the obligation.

Commercial and industrial and leases - Commercial and industrial loans consist of loans or lines of credit to finance accounts receivable, inventory or other general business needs, business credit cards, and lease financing agreements for equipment, vehicles, or other assets. The primary risk associated with commercial and industrial and lease financing loans is the ability of borrowers to achieve business results consistent with those projected at origination. Failure to achieve these projections presents risk the borrower will be unable to service the debt consistent with the contractual terms of the loan or lease.

SBA-PPP - These loans were originated as part of the SBA-PPP to finance payroll and other costs for nonprofit and small businesses impacted by the COVID-19 pandemic. These loans are guaranteed by the SBA and borrowers have the ability to qualify for loan forgiveness through the U.S. Treasury.

Consumer loans

Residential mortgage - Residential mortgage consists of loans to purchase or refinance the borrower’s primary dwelling, second residence or vacation home and are often secured by 1-4 family residential property. Significant and rapid declines in real estate values can result in borrowers having debt levels in excess of the current market value of the collateral.

Revolving mortgage - Revolving mortgage consists of home equity lines of credit and other lines of credit secured by first or second liens on the borrower’s primary residence. These loans are secured by both senior and junior liens on the residential real estate and are particularly susceptible to declining collateral values. This risk is elevated for loans secured by junior lines as a substantial decline in value could render a the junior lien position effectively unsecured.

Construction and land development - Construction and land development consists of loans to construct a borrower’s primary or secondary residence or vacant land upon which the owner intends to construct a dwelling at a future date. These loans are typically secured by undeveloped or partially developed land in anticipation of completing construction of a 1-4 family residential property. There is risk these construction and development projects can experience delays and cost overruns exceeding the borrower’s financial ability to complete the project. Such cost overruns can result in foreclosure of partially completed and unmarketable collateral.

Consumer auto loans - Consumer auto loans consist of installment loans to finance purchases of vehicles. These loans include direct auto loans originated in bank branches, as well indirect auto loans originated through agreements with auto dealerships. The value of the underlying collateral within this class is at risk of potential rapid depreciation which could result in unpaid balances in excess of the collateral.

Other consumer - Other consumer loans consist of loans to finance unsecured home improvements, student loans and revolving lines of credit that can be secured or unsecured, including personal credit cards. The value of the underlying collateral within this class is at risk of potential rapid depreciation which could result in unpaid balances in excess of the collateral.

Accounting Policy - Nonperforming Assets and Troubled Debt Restructurings

Nonperforming Assets (“NPA”)

NPAs include nonaccrual loans, past due securities and foreclosed property. Foreclosed property consists of real estate and other assets acquired as a result of loan defaults and is discussed below.

All loans are classified as past due when the payment of principal and interest based upon contractual terms is greater than 30 days delinquent. Loans are generally placed on nonaccrual when principal or interest becomes 90 days past due or when it is probable the principal or interest is not fully collectible. When loans are placed on nonaccrual, all previously uncollected accrued interest is reversed from interest income and the ongoing accrual of interest is discontinued. All payments received thereafter are applied as a reduction of the remaining principal balance as long as doubt exists as to the ultimate collection of the principal. Loans and leases are generally removed from nonaccrual status when they become current for a sustained period of time and there is no longer concern as to the collectability of principal and interest.

Securities are also classified as past due when the payment of principal and interest based upon contractual terms is greater than 30 days delinquent. Missed interest payments on securities are rare. We review all securities with delinquent interest and immediately charge off any accrued interest determined to be uncollectible.

Troubled Debt Restructurings (“TDR”)

A loan is considered a TDR when both of the following occur: (1) a modification to a borrower’s debt agreement is made and (2) a concession is granted for economic or legal reasons related to a borrower’s financial difficulties that otherwise would not be granted. TDR concessions could include short-term deferrals of interest, modifications of payment terms, or (in certain limited instances) forgiveness of principal or interest. Loans restructured as a TDR are treated and reported as such for the remaining life of the loan. TDR loans can be nonaccrual or accrual, depending on the individual facts and circumstances of the borrower. In circumstances where a portion of the loan balance is charged-off, the remaining balance is typically classified as nonaccrual.

Accounting Policy - Allowance for Credit Losses (“ACL”)

Loans

Loans within the various reporting classes are segregated into pools with similar risk characteristics and models are built to estimate the ACL. These loan level ACL models estimate the probability of default and loss given default for individual loans within the risk pool based on historical loss experience, borrower characteristics, collateral type, forecasts of relevant economic conditions, expected future recoveries and other factors. Pools for estimating the ACL are aggregated into loan classes, as described above, which roll up into commercial and consumer loan segments. Non-PCD and PCD loans are modeled together within the loan level models using acquired and PCD indicator variables to provide differentiation of individual loan risk. BancShares uses a two year reasonable and supportable forecast period which incorporates economic forecasts at the time of evaluation. For most pools, BancShares uses a 12-month straight-line reversion period to historical averages for model inputs; however for the consumer other, consumer card and commercial card pools, immediate reversion to historical net loss rates is utilized.

The ACL for SBA-PPP loans originated during the second quarter of 2020 were separately evaluated given the explicit government guarantee. This analysis, which incorporated historical experience with similar SBA guarantees and underwriting, concluded the likelihood of loss was remote and therefore these loans were assigned a zero expected credit loss in the ACL.

The ACL represents management’s best estimate of credit losses expected over the life of the loan, adjusted for expected contractual payments and the impact of prepayment expectations. Prepayment assumptions were developed through a review of BancShares’ historical prepayment activity and began with a review of prepayment assumptions utilized in other modeling activities. Estimates for loan losses are determined by analyzing quantitative and qualitative components present as of the evaluation date. Adjustments to the ACL are recorded with a corresponding entry to provision for credit losses. Loan balances considered uncollectible are charged-off against the ACL. Recoveries of amounts previously charged-off are credited to the ACL.

A primary component of determining the ACL on loans is the actual net loss history of the various loan pools. For commercial pools, key factors utilized in the models include delinquency trends as well as macroeconomic variables such as unemployment and commercial real estate price index. For consumer pools, key factors include delinquency trends and the borrower’s original credit score, as well as other macroeconomic variables such as unemployment, gross domestic product, home price index, and commercial real estate index. As the models project losses over the life of the loans, prepayment assumptions also serve as significant inputs. Model outputs may be adjusted through a qualitative assessment to reflect economic conditions and trends not captured within the models including credit quality, concentrations, and significant policy and underwriting changes.

Within our ACL model, TDRs meet the definition of default and are given a 100% probability of default rating. TDRs are not individually evaluated unless determined to be collateral-dependent. Therefore, loss given default is calculated based on the individual risk characteristics of the loan as defined in the model.

When loans do not share risk characteristics similar to others in the pool, the ACL is evaluated on an individual basis. Given that BancShares' CECL models are loan level models, the population of loans evaluated individually is minimal and consists primarily of loans greater than $500 thousand and determined to be collateral-dependent. BancShares elected the practical expedient allowed under ASC 326 to assess the collectability of these loans, where repayment is expected to be provided substantially through operation or sale of collateral, based on the fair value of the underlying collateral. The fair value of the collateral is estimated using appraised and market values (appropriately adjusted for an assessment of the sales and marketing costs when applicable). A specific allowance is established, or partial charge-off is recorded, for the difference between the excess amortized cost of loan and the collateral’s estimated fair value.

Accrued Interest Receivable

BancShares has elected not to measure an ACL for accrued interest receivable and has excluded it from the amortized cost basis of loans and held to maturity debt securities as our accounting policies and credit monitoring provide that uncollectible accrued interest is reversed or written off against interest income in a timely manner.

Unfunded Commitments

A reserve for unfunded commitments is established for off-balance sheet exposures such as unfunded balances for existing lines of credit, commitments to extend future credit, as well a both standby and commercial letters of credit when there is a contractual obligation to extend credit and when this extension of credit is not unconditionally cancellable (i.e. commitment cannot canceled at any time). These unfunded commitments are assessed to determine both the probability of funding as well the expectation of future losses. The expected funding balance is used in the probability of default and loss given default models to determine the reserve. The reserve for unfunded commitments was $13.7 million at June 30, 2020, and is recorded within other liabilities with changes recorded through other expense.

Adoption Impact

Upon adoption, BancShares recorded a net decrease of $37.9 million in the ACL which included a reduction of $56.9 million in the ACL on non-PCD loans, offset by an increase of $19.0 million in the ACL on PCD loans. The $56.9 million reduction in the ACL on non-PCD loans, as well as an $8.9 million increase in the reserve for unfunded commitments, net of deferred taxes, resulted in an increase in retained earnings of $36.9 million. The $19.0 million increase in the ACL on PCD loans was a reclassification of the PCD credit discount and resulted in a gross up of loan balances by this same amount and did not have any effect on retained earnings. Impact to total capital and capital ratios was not significant and we did not elect the capital phase-in option allowable for regulatory reporting purposes. There was no ACL recorded on debt securities held to maturity at adoption.

The largest changes in the ACL, affecting beginning retained earnings as a result of the adoption, were decreases in the ACL on commercial loan segments as these portfolios have exhibited strong historical credit performance and have relatively short average lives. The reduction in ACL on these segments was partially offset by increases in ACL on our consumer loan segments primarily due to their longer average lives. The increase in the reserve for unfunded commitments was primarily due to increases in the scope of off-balance sheet exposures considered in this estimate due to the provisions in ASU 2016-13.

BancShares adopted this ASU using the prospective transition approach for PCD loans previously accounted for under ASC 310-30. In accordance with the standard, we did not assess whether purchased credit impaired (“PCI”) loans met the criteria of PCD as of the date of adoption and all loans previously classified as PCI were updated to the PCD classification. Pools utilized for PCI accounting under ASC 310-30 were dissolved upon adoption. Loans from performing PCI pools, not previously considered nonaccrual of $47.0 million, were reclassified into nonaccrual status as a result of adoption. PCD loans were assessed using the loan level probability of default and loss given default models, as well as utilizing prior specific loan reviews to inform the initial PCD loan ACL. The ACL for PCD loans increased as a result of adoption and the amortized cost basis of these loans was adjusted to reflect the transfer of this amount from credit discount to ACL. The remaining noncredit discount will be accreted into interest income at the effective interest rate as of January 1, 2020. At the date of adoption, no securities were determined to be PCD.

BancShares also adopted this ASU under the prospective transition approach for debt securities available for sale. No previously recorded other than temporary impairment was reported on the portfolio of debt securities.

Recently Issued Accounting Pronouncements

FASB ASU 2018-14 - Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans

This ASU modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans by eliminating the requirement to disclose the amounts in accumulated other comprehensive income expected to be recognized as components of net periodic benefit cost over the next fiscal year and adding a requirement to disclose an explanation of the reasons for significant gains and losses related to changes in the benefit obligation for the period.

The amendments in this ASU are effective for public entities for fiscal years ending after December 15, 2020. Early adoption is permitted for all entities. BancShares will adopt all applicable amendments and update the disclosures as appropriate during the fourth quarter of 2020.

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Business Combinations (Tables)

6 Months Ended

Jun. 30, 2020

Business Combinations [Abstract]

Schedule of assets acquired and liabilities assumed

The following table provides the purchase price as of the acquisition date and the identifiable assets acquired and liabilities assumed at their estimated fair values:

(Dollars in thousands)	As recorded by FCB
Purchase price			$	2,320
Assets
Cash and due from banks	$	1,085
Overnight investments	35,129
Investment securities	30,146
Loans	133,989
Premises and equipment	7,624
Other real estate owned	9,813
Income earned not collected	558
Intangible assets	536
Other assets	2,520
Total assets acquired	221,400
Liabilities
Deposits	209,340
Borrowings	9,925
Other liabilities	501
Total liabilities assumed	$	219,766
Fair value of net assets acquired			1,634
Goodwill recorded for Community Financial			$	686

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Investments (Tables)

6 Months Ended

Jun. 30, 2020

Investments [Abstract]

Aggregate Values And Unrealized Gains And Losses Of Investment Securities

The amortized cost and fair value of investment securities at June 30, 2020 and December 31, 2019, were as follows:

	June 30, 2020
(Dollars in thousands)	Cost		Gross unrealized gains		Gross unrealized losses		Allowance for credit losses		Fair value
Investment securities available for sale
U.S. Treasury	$	754,350	$	236	$	—	$	—	$	754,586
Government agency	549,673		292		4,256		—		545,709
Residential mortgage-backed securities	5,671,151		119,935		694		—		5,790,392
Commercial mortgage-backed securities	1,047,601		32,221		—		—		1,079,822
Corporate bonds	449,623		4,387		5,237		—		448,773
Total investment securities available for sale	$	8,472,398	$	157,071	$	10,187	$	—	$	8,619,282
Investment in marketable equity securities	116,322		6,297		8,303				114,316
Investment securities held to maturity
Residential mortgage-backed securities	693,143		16,196		—		—		709,339
Commercial mortgage-backed securities	78,729		251		—				78,980
Other	3,006		—		—		—		3,006
Total investment securities held to maturity	774,878		16,447		—		—		791,325
Total investment securities	$	9,363,598	$	179,815	$	18,490	$	—	$	9,524,923
			December 31, 2019
(Dollars in thousands)			Cost		Gross unrealized gains		Gross unrealized losses		Fair value
Investment securities available for sale
U.S. Treasury			$	409,397	$	602	$	—	$	409,999
Government agency			684,085		928		2,241		682,772
Residential mortgage-backed securities			5,269,060		13,417		15,387		5,267,090
Commercial mortgage-backed securities			373,105		6,974		59		380,020
Corporate bonds			198,278		3,420		132		201,566
State, county and municipal			118,227		—		—		118,227
Total investment securities available for sale			$	7,052,152	$	25,341	$	17,819	$	7,059,674
Investment in marketable equity securities			59,262		23,304		233		82,333
Investment securities held to maturity
Other			30,996		—		—		30,996
Total investment securities held to maturity			30,996		—		—		30,996
Total investment securities			$	7,142,410	$	48,645	$	18,052	$	7,173,003

Investment Securities Maturity Information

The following table provides the amortized cost and fair value by contractual maturity for investment securities available for sale and held to maturity. Expected maturities will differ from contractual maturities on certain securities because issuers and borrowers of underlying collateral may have the right to call or prepay obligations with or without prepayment penalties.

	June 30, 2020				December 31, 2019
(Dollars in thousands)	Cost		Fair value		Cost		Fair value
Investment securities available for sale
Non-amortizing securities maturing in:
One year or less	$	754,350	$	754,586	$	406,325	$	406,927
One through five years	51,589		51,887		24,496		24,971
Five through 10 years	369,075		368,281		185,209		187,868
Over 10 years	28,959		28,605		109,872		110,026
Government agency	549,673		545,709		684,085		682,772
Residential mortgage-backed securities	5,671,151		5,790,392		5,269,060		5,267,090
Commercial mortgage-backed securities	1,047,601		1,079,822		373,105		380,020
Total investment securities available for sale	$	8,472,398	$	8,619,282	$	7,052,152	$	7,059,674
Investment securities held to maturity
Non-amortizing securities maturing in:
One year or less	2,257		2,257		30,746		30,746
One through five years	749		749		250		250
Residential mortgage-backed securities	693,143		709,339		—		—
Commercial mortgage-backed securities	78,729		78,980		—		—
Total investment securities held to maturity	$	774,878	$	791,325	$	30,996	$	30,996

Marketable Securities Gains (Losses)

The following table provides the realized and unrealized gains and losses on marketable equity securities for the six months ended June 30, 2020 and 2019:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Marketable equity securities gains, net	$	64,570	$	3,144	$	13,162	$	14,472
Less net gains recognized on marketable equity securities sold	36,993		2,271		37,316		2,315
Unrealized gains (losses) recognized on marketable equity securities held	$	27,577	$	873	$	(24,154)	$	12,157

Investment Securities With Unrealized Losses

The following table provides information regarding securities with unrealized losses as of June 30, 2020 and December 31, 2019:

	June 30, 2020
	Less than 12 months				12 months or more				Total
(Dollars in thousands)	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Investment securities available for sale
Government agency	$	447,983	$	3,709	$	58,806	$	547	$	506,789	$	4,256
Residential mortgage-backed securities	172,628		302		149,170		392		321,798		694
Corporate bonds	112,172		5,120		9,451		117		121,623		5,237
Total	$	732,783	$	9,131	$	217,427	$	1,056	$	950,210	$	10,187
	December 31, 2019
	Less than 12 months				12 months or more				Total
(Dollars in thousands)	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Investment securities available for sale
Government agency	$	347,081	$	1,827	$	63,947	$	414	$	411,028	$	2,241
Residential mortgage-backed securities	2,387,293		14,016		264,257		1,371		2,651,550		15,387
Commercial mortgage-backed securities	35,926		59		—		—		35,926		59
Corporate bonds	7,714		123		4,749		9		12,463		132
Total	$	2,778,014	$	16,025	$	332,953	$	1,794	$	3,110,967	$	17,819

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Loans and Leases (Tables)

6 Months Ended

Jun. 30, 2020

Loans and Leases Receivable Disclosure [Abstract]

Loans And Leases Outstanding

Loans and leases outstanding included the following at June 30, 2020 and December 31, 2019:

(Dollars in thousands)	June 30, 2020
Commercial:
Construction and land development	$	1,012,365
Owner occupied commercial mortgage	10,352,793
Non-owner occupied commercial mortgage	3,056,328
Commercial and industrial and leases	4,650,839
SBA-PPP	3,084,549
Total commercial loans	22,156,874
Consumer:
Residential mortgage	5,404,682
Revolving mortgage	2,233,977
Construction and land development	353,382
Consumer auto	1,195,771
Consumer other	543,088
Total consumer loans	9,730,900
Total non-PCD loans and leases	31,887,774
PCD loans	530,651
Total loans and leases	$	32,418,425

(Dollars in thousands)	December 31, 2019
Commercial:
Construction and land development	$	1,013,454
Commercial mortgage	12,282,635
Other commercial real estate	542,028
Commercial and industrial and leases	4,403,792
Other	310,093
Total commercial loans	18,552,002
Noncommercial:
Residential mortgage	5,293,917
Revolving mortgage	2,339,072
Construction and land development	357,385
Consumer	1,780,404
Total noncommercial loans	9,770,778
Total non-PCI loans and leases	28,322,780
PCI loans	558,716
Total loans and leases	$	28,881,496

Recorded Investment, By Class, In Loans And Leases On Nonaccrual Status And Loans And Leases Greater Than 90 Days Past Due And Still Accruing

	June 30, 2020
(Dollars in thousands)	30-59 days past due		60-89 days past due		90 days or greater		Total past due		Current		Total loans and leases
Commercial:
Construction and land development	$	1,618	$	14	$	1,721	$	3,353	$	1,009,012	$	1,012,365
Owner occupied commercial mortgage	14,360		2,518		12,820		29,698		10,323,095		10,352,793
Non-owner occupied commercial mortgage	7,914		982		8,520		17,416		3,038,912		3,056,328
Commercial and industrial and leases	10,464		3,196		4,215		17,875		4,632,964		4,650,839
SBA-PPP	—		—		—		—		3,084,549		3,084,549
Total commercial loans	34,356		6,710		27,276		68,342		22,088,532		22,156,874
Consumer:
Residential mortgage	25,243		7,082		35,044		67,369		5,337,313		5,404,682
Revolving mortgage	8,874		4,615		9,006		22,495		2,211,482		2,233,977
Construction and land development	1,735		127		57		1,919		351,463		353,382
Consumer auto	3,093		1,124		976		5,193		1,190,578		1,195,771
Consumer other	2,433		1,691		1,835		5,959		537,129		543,088
Total consumer loans	41,378		14,639		46,918		102,935		9,627,965		9,730,900
PCD loans	18,850		4,694		33,483		57,027		473,624		530,651
Total loans and leases	$	94,584	$	26,043	$	107,677	$	228,304	$	32,190,121	$	32,418,425
	December 31, 2019
(Dollars in thousands)	30-59 days past due		60-89 days past due		90 days or greater		Total past due		Current		Total loans and leases
Commercial:
Construction and land development	$	3,146	$	195	$	2,702	$	6,043	$	1,007,411	$	1,013,454
Commercial mortgage	20,389		8,774		8,319		37,482		12,245,153		12,282,635
Other commercial real estate	861		331		698		1,890		540,138		542,028
Commercial and industrial and leases	18,269		4,842		5,032		28,143		4,375,649		4,403,792
Other	51		411		126		588		309,505		310,093
Total commercial loans	42,716		14,553		16,877		74,146		18,477,856		18,552,002
Noncommercial:
Residential mortgage	45,839		18,289		24,409		88,537		5,205,380		5,293,917
Revolving mortgage	9,729		3,468		9,865		23,062		2,316,010		2,339,072
Construction and land development	977		218		1,797		2,992		354,393		357,385
Consumer	10,481		3,746		3,571		17,798		1,762,606		1,780,404
Total noncommercial loans	67,026		25,721		39,642		132,389		9,638,389		9,770,778
PCI loans	26,478		10,784		28,973		66,235		492,481		558,716
Total loans and leases	$	136,220	$	51,058	$	85,492	$	272,770	$	28,608,726	$	28,881,496

The amortized cost, by class, of loans and leases on nonaccrual status, and loans and leases greater than 90 days past due and still accruing at June 30, 2020 and December 31, 2019, were as follows:

	January 1, 2020(1)		June 30, 2020
(Dollars in thousands)	Nonaccrual loans and leases		Nonaccrual loans and leases		Loans and leases > 90 days and accruing
Commercial:
Construction and land development	$	4,281	$	2,938	$	69
Owner occupied commercial mortgage	24,476		28,283		111
Non-owner occupied commercial mortgage	5,965		8,491		615
Commercial and industrial and leases	7,685		7,239		1,399
Total commercial loans	42,407		46,951		2,194
Consumer:
Residential mortgage	44,357		59,352		—
Revolving mortgage	22,411		23,600		—
Construction and land development	2,828		1,699		—
Consumer auto	2,145		2,677		—
Consumer other	798		1,001		1,450
Total consumer loans	72,539		88,329		1,450
PCD loans	53,771		62,511		152
Total loans and leases	$	168,717	$	197,791	$	3,796
(1)Upon the adoption of ASC 326, BancShares eliminated the pooling of PCI loans and as a result $47.0 million in additional PCD loans were recognized as nonaccrual loans at January 1, 2020. As of June 30, 2020, $35.9 million of these loans remained outstanding.

	December 31, 2019
(Dollars in thousands)	Nonaccrual loans and leases		Loans and leases > 90 days and accruing
Commercial:
Construction and land development	$	4,281	$	—
Commercial mortgage	29,733		—
Commercial and industrial and leases	7,365		1,094
Other commercial real estate	708		—
Other	320		—
Total commercial loans	42,407		1,094
Noncommercial:
Construction and land development	2,828		—
Residential mortgage	44,357		45
Revolving mortgage	22,411		—
Consumer	2,943		2,152
Total noncommercial loans	72,539		2,197
PCI loans	6,743		24,257
Total loans and leases	$	121,689	$	27,548

Composition Of The Loans And Leases Outstanding By Credit Quality Indicator

The following tables represent current credit quality indicators by origination year as of June 30, 2020.

	Commercial Loans Amortized Cost Basis by Origination Year
Classification:	2020		2019		2018		2017		2016		Prior		Revolving		Revolving converted to term loans		Total
(Dollars in thousands)
Construction and land development
Pass	$	175,302	$	404,898	$	217,555	$	132,753	$	31,599	$	14,453	$	25,141	$	—	$	1,001,701
Special Mention	88		—		334		5,507		—		93		—		—		6,022
Substandard	1,405		1,221		1,813		29		8		166		—		—		4,642
Total	176,795		406,119		219,702		138,289		31,607		14,712		25,141		—		1,012,365
Owner occupied commercial mortgage
Pass	1,345,296		2,218,595		1,850,128		1,452,273		1,203,335		1,943,057		106,274		137		10,119,095
Special Mention	2,296		11,164		29,941		13,089		17,795		30,315		2,742		—		107,342
Substandard	9,186		12,309		16,886		24,063		14,255		40,331		9,254		72		126,356
Total	1,356,778		2,242,068		1,896,955		1,489,425		1,235,385		2,013,703		118,270		209		10,352,793
Non-owner occupied commercial mortgage
Pass	380,269		685,067		490,693		452,152		360,096		595,139		36,723		—		3,000,139
Special Mention	—		2,048		20,236		872		5,885		7,658		787		—		37,486
Substandard	1,237		1,094		3,653		1,642		6,513		3,085		1,479		—		18,703
Total	381,506		688,209		514,582		454,666		372,494		605,882		38,989		—		3,056,328
Commercial and industrial and leases
Pass	750,806		1,207,639		630,297		401,635		301,561		401,284		805,691		5,565		4,504,478
Special Mention	1,431		3,426		6,387		5,534		3,159		2,518		13,928		243		36,626
Substandard	11,847		3,794		4,323		5,608		2,790		4,941		22,084		696		56,083
Doubtful	—		—		39		—		—		—		2		—		41
Ungraded	—		—		—		—		—		—		53,611		—		53,611
Total	764,084		1,214,859		641,046		412,777		307,510		408,743		895,316		6,504		4,650,839
SBA-PPP
Pass	3,084,549		—		—		—		—		—		—		—		3,084,549
Total	3,084,549		—		—		—		—		—		—		—		3,084,549
Total commercial	$	5,763,712	$	4,551,255	$	3,272,285	$	2,495,157	$	1,946,996	$	3,043,040	$	1,077,716	$	6,713	$	22,156,874

	Consumer and PCD Loans Amortized Cost Basis by Origination Year
Days Past Due:	2020		2019		2018		2017		2016		Prior		Revolving		Revolving converted to term loans		Total
(Dollars in thousands)
Residential mortgage
Current	$	891,796	$	1,105,486	$	837,530	$	755,457	$	591,255	$	1,132,116	$	23,673	$	—	$	5,337,313
30-59 days	488		2,760		2,985		4,612		2,594		11,685		119		—		25,243
60-89 days	26		158		326		265		1,851		4,456		—		—		7,082
90 days or greater	23		738		5,815		6,054		6,203		13,239		2,972		—		35,044
Total	892,333		1,109,142		846,656		766,388		601,903		1,161,496		26,764		—		5,404,682
Revolving mortgage
Current	—		—		—		—		—		—		2,054,864		156,618		2,211,482
30-59 days	—		—		—		—		—		—		4,622		4,252		8,874
60-89 days	—		—		—		—		—		—		452		4,163		4,615
90 days or greater	—		—		—		—		—		—		3,150		5,856		9,006
Total	—		—		—		—		—		—		2,063,088		170,889		2,233,977
Construction and land development
Current	88,063		174,326		52,270		16,909		8,123		7,881		3,891		—		351,463
30-59 days	245		1,312		91		—		—		87		—		—		1,735
60-89 days	—		—		—		11		—		116		—		—		127
90 days or greater	—		—		—		—		—		57		—		—		57
Total	88,308		175,638		52,361		16,920		8,123		8,141		3,891		—		353,382
Consumer auto
Current	245,264		421,363		284,557		142,512		74,782		22,100		—		—		1,190,578
30-59 days	172		1,070		654		710		319		168		—		—		3,093
60-89 days	75		432		239		215		132		31		—		—		1,124
90 days or greater	22		312		306		206		76		54		—		—		976
Total	245,533		423,177		285,756		143,643		75,309		22,353		—		—		1,195,771
Consumer other
Current	27,655		40,769		17,093		9,585		10,595		31,275		400,157		—		537,129
30-59 days	78		33		79		31		13		22		2,177		—		2,433
60-89 days	31		67		70		—		5		—		1,518		—		1,691
90 days or greater	1		97		5		—		74		—		1,658		—		1,835
Total	27,765		40,966		17,247		9,616		10,687		31,297		405,510		—		543,088
Total consumer	$	1,253,939	$	1,748,923	$	1,202,020	$	936,567	$	696,022	$	1,223,287	$	2,499,253	$	170,889	$	9,730,900
PCD loans
Current	$	21,462	$	28,900	$	32,863	$	39,973	$	33,294	$	278,266	$	14,999	$	23,867	$	473,624
30-59 days	1,005		546		199		132		808		15,591		182		387		18,850
60-89 days	117		141		37		34		—		3,669		72		624		4,694
90 days or greater	454		3,075		8,152		1,469		1,101		17,135		516		1,581		33,483
Total	$	23,038	$	32,662	$	41,251	$	41,608	$	35,203	$	314,661	$	15,769	$	26,459	$	530,651
Total loans and leases	$	7,040,689	$	6,332,840	$	4,515,556	$	3,473,332	$	2,678,221	$	4,580,988	$	3,592,738	$	204,061	$	32,418,425

Loans and leases outstanding at December 31, 2019 by credit quality indicator are provided below:

	December 31, 2019
	Commercial loans and leases
(Dollars in thousands)	Construction and land development		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		PCI		Total commercial loans and leases
Grade:
Pass	$	1,004,922	$	12,050,799	$	536,682	$	4,256,456	$	308,796	$	148,412	$	18,157,655
Special mention	2,577		115,164		3,899		44,604		622		44,290		166,866
Substandard	5,955		116,672		1,447		34,148		675		87,970		158,897
Doubtful	—		—		—		3		—		3,657		3
Ungraded	—		—		—		68,581		—		—		68,581
Total	$	1,013,454	$	12,282,635	$	542,028	$	4,403,792	$	310,093	$	284,329	$	18,552,002

	December 31, 2019
	Noncommercial loans and leases
(Dollars in thousands)	Residential mortgage		Revolving mortgage		Construction and land development		Consumer		PCI		Total noncommercial loans and leases
Days past due:
Current	$	5,205,380	$	2,316,010	$	354,393	$	1,762,606	$	240,995	$	9,638,389
30-59 days past due	45,839		9,729		977		10,481		13,764		67,026
60-89 days past due	18,289		3,468		218		3,746		5,608		25,721
90 days or greater past due	24,409		9,865		1,797		3,571		14,020		39,642
Total	$	5,293,917	$	2,339,072	$	357,385	$	1,780,404	$	274,387	$	9,770,778

Schedule Of Loans And Leases Purchased

The following table summarizes PCD loans acquired in the Community Financial transaction and provides the contractually required payments, less the initial allowance for credit losses and discount to produce the fair value of acquired loans with evidence of more than insignificant credit quality deterioration since origination at the acquisition date:

(Dollars in thousands)	Community Financial
Contractually required payments	$	25,635
Initial PCD allowance	1,193
Discount	1,055
Fair value at acquisition date	$	23,387

The recorded fair values of purchased non-PCD loans acquired in the Community Financial transaction as of the acquisition date are as follows:

(Dollars in thousands)	Community Financial
Commercial:
Construction and land development	$	9,428
Owner occupied commercial mortgage	31,473
Non-owner occupied commercial mortgage	25,143
Commercial and industrial and leases	15,065
Total commercial loans	81,109
Consumer:
Residential mortgage	21,168
Revolving mortgage	2,084
Construction and land development	5,254
Consumer auto	294
Consumer other	693
Total consumer loans	29,493
Total non-PCD loans	$	110,602

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Allowance for Credit Losses (Tables)

6 Months Ended

Jun. 30, 2020

Receivables [Abstract]

Allowance for Loan and Lease Losses

	Three months ended June 30, 2020
(Dollars in thousands)	Construction and land development - commercial		Owner occupied commercial mortgage		Non-owner occupied commercial mortgage		Commercial and industrial and leases		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer auto		Consumer other		PCD		Total
Allowance for credit losses:
Balance at April 1	$	2,290	$	22,970	$	16,531	$	30,619	$	38,366	$	24,557	$	1,140	$	5,769	$	40,101	$	26,916	$	209,259
Provision (credits)	4,705		(721)		5,542		(2,898)		4,909		2,211		486		4,042		2,034		242		20,552
Charge-offs	(138)		—		(8)		(3,869)		(460)		(495)		—		(1,255)		(4,447)		(1,392)		(12,064)
Recoveries	49		240		84		781		57		367		14		342		1,607		1,162		4,703
Balance at June 30	$	6,906	$	22,489	$	22,149	$	24,633	$	42,872	$	26,640	$	1,640	$	8,898	$	39,295	$	26,928	$	222,450
	Three months ended June 30, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer		PCD		Total
Balance at April 1	$	37,476	$	45,281	$	2,399	$	57,025	$	2,167	$	16,987	$	21,495	$	2,473	$	34,492	$	8,980	$	228,775
Provision (credits)	(5,544)		3,714		(57)		2,699		(174)		371		(328)		277		4,877		(637)		5,198
Charge-offs	(28)		(89)		—		(3,422)		(31)		(478)		(493)		—		(6,061)		—		(10,602)
Recoveries	40		56		—		599		221		52		447		—		1,797		—		3,212
Balance at June 30	$	31,944	$	48,962	$	2,342	$	56,901	$	2,183	$	16,932	$	21,121	$	2,750	$	35,105	$	8,343	$	226,583
	Six months ended June 30, 2020
(Dollars in thousands)	Construction and land development - commercial		Owner occupied commercial mortgage		Non-owner occupied commercial mortgage		Commercial and industrial and leases		Residential mortgage		Revolving mortgage		Construction and land development - consumer		Consumer auto		Consumer other		PCD		Total
Balance at December 31	$	33,213	$	36,444	$	11,102	$	61,610	$	18,232	$	19,702	$	2,709	$	4,292	$	30,301	$	7,536	$	225,141
Adoption of ASC 326	(31,061)		(19,316)		460		(37,637)		17,118		3,665		(1,291)		1,100		10,037		19,001		(37,924)
Balance at January 1	2,152		17,128		11,562		23,973		35,350		23,367		1,418		5,392		40,338		26,537		187,217
Provision (credits)	4,756		5,386		10,498		7,525		8,502		3,515		263		5,000		5,808		(2,346)		48,907
Initial allowance on PCD loans	—		—		—		—		—		—		—		—		—		1,193		1,193
Charge-offs	(138)		(320)		(8)		(8,918)		(1,260)		(1,080)		(70)		(2,199)		(9,817)		(2,515)		(26,325)
Recoveries	136		295		97		2,053		280		838		29		705		2,966		4,059		11,458
Balance at June 30	$	6,906	$	22,489	$	22,149	$	24,633	$	42,872	$	26,640	$	1,640	$	8,898	$	39,295	$	26,928	$	222,450
	Six months ended June 30, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - non - commercial		Consumer		PCI		Total
Balance at January 1	$	35,270	$	43,451	$	2,481	$	55,620	$	2,221	$	15,472	$	21,862	$	2,350	$	35,841	$	9,144	$	223,712
Provision (credits)	(3,425)		6,085		(140)		5,424		(672)		1,879		(119)		400		8,317		(801)		16,948
Charge-offs	(72)		(850)		—		(5,280)		(31)		(644)		(1,456)		—		(12,423)		—		(20,756)
Recoveries	171		276		1		1,137		665		225		834		—		3,370		—		6,679
Balance at June 30	$	31,944	$	48,962	$	2,342	$	56,901	$	2,183	$	16,932	$	21,121	$	2,750	$	35,105	$	8,343	$	226,583

The following table presents information on collateral-dependent loans by class and includes the amortized cost of collateral-dependent loans and leases, the net realizable value of the collateral, the extent to which collateral secures collateral-dependent loans and the associated ACL as of June 30, 2020 were as follows:

(Dollars in thousands)	Collateral-Dependant Loans		Net Realizable Value of Collateral		Collateral Coverage		Allowance for Credit Losses
Commercial loans:
Construction and land development	$	2,862	$	3,224	112.6	%	$	—
Owner occupied commercial mortgage	10,690		24,546		229.6		—
Non-owner occupied commercial mortgage	6,995		11,133		159.2		—
Commercial and industrial and leases	—		—		—		—
Total commercial loans	20,547		38,903		189.3		—
Consumer:
Residential mortgage	19,445		25,599		131.6		75
Revolving mortgage	310		310		100.0		—
Construction and land development	—		—		—		—
Total consumer loans	19,755		25,909		131.2		75
Total non-PCD loans	40,302		64,812		160.8		75
PCD	22,013		33,821		153.6		235
Total collateral-dependent loans	$	62,315	$	98,633	158.3	%	$	310

The following tables present the allowance and recorded investment in loans and leases by class of loans, as well as the associated impairment method at December 31, 2019:

	December 31, 2019
(Dollars in thousands)	Construction and land development - commercial		Commercial mortgage		Other commercial real estate		Commercial and industrial and leases		Other		Residential mortgage		Revolving mortgage		Construction and land development - non- commercial		Consumer		Total
Non-PCI Loans
Allowance for loan and lease losses:
ALLL for loans and leases individually evaluated for impairment	$	463	$	3,650	$	39	$	1,379	$	103	$	3,278	$	2,722	$	174	$	1,107	$	12,915
ALLL for loans and leases collectively evaluated for impairment	32,750		41,685		2,172		57,995		2,133		14,954		16,980		2,535		33,486		204,690
Total allowance for loan and lease losses	$	33,213	$	45,335	$	2,211	$	59,374	$	2,236	$	18,232	$	19,702	$	2,709	$	34,593	$	217,605
Loans and leases:
Loans and leases individually evaluated for impairment	$	4,655	$	70,149	$	1,268	$	12,182	$	639	$	60,442	$	28,869	$	3,882	$	3,513	$	185,599
Loans and leases collectively evaluated for impairment	1,008,799		12,212,486		540,760		4,391,610		309,454		5,233,475		2,310,203		353,503		1,776,891		28,137,181
Total loan and leases	$	1,013,454	$	12,282,635	$	542,028	$	4,403,792	$	310,093	$	5,293,917	$	2,339,072	$	357,385	$	1,780,404	$	28,322,780

The following tables provide information on non-PCI impaired loans and leases, exclusive of loans and leases collectively evaluated:

	December 31, 2019
(Dollars in thousands)	With a recorded allowance		With no recorded allowance		Total		Unpaid principal balance		Related allowance recorded
Non-PCI impaired loans and leases:
Commercial:
Construction and land development	$	1,851	$	2,804	$	4,655	$	5,109	$	463
Commercial mortgage	42,394		27,755		70,149		74,804		3,650
Other commercial real estate	318		950		1,268		1,360		39
Commercial and industrial and leases	7,547		4,635		12,182		13,993		1,379
Other	406		233		639		661		103
Total commercial loans	52,516		36,377		88,893		95,927		5,634
Noncommercial:
Residential mortgage	48,796		11,646		60,442		64,741		3,278
Revolving mortgage	26,104		2,765		28,869		31,960		2,722
Construction and land development	2,470		1,412		3,882		4,150		174
Consumer	3,472		41		3,513		3,821		1,107
Total noncommercial loans	80,842		15,864		96,706		104,672		7,281
Total non-PCI impaired loans and leases	$	133,358	$	52,241	$	185,599	$	200,599	$	12,915

Non-PCI impaired loans less than $500,000 that were collectively evaluated for impairment totaled $41.0 million at December 31, 2019.

The following tables show the average non-PCI impaired loan balance and the interest income recognized by loan class for the six months ended June 30, 2019:

	Three months ended June 30, 2019				Six months ended June 30, 2019
(Dollars in thousands)	Average balance		Interest income recognized		Average balance		Interest income recognized
Non-PCI impaired loans and leases:
Commercial:
Construction and land development	$	2,102	$	6	$	2,125	$	34
Commercial mortgage	58,906		538		57,768		1,102
Other commercial real estate	519		6		602		14
Commercial and industrial and leases	11,348		113		10,674		213
Other	328		2		322		4
Total commercial	73,203		665		71,491		1,367
Noncommercial:
Residential mortgage	48,490		317		45,558		642
Revolving mortgage	29,623		256		29,183		503
Construction and land development	3,547		32		3,647		68
Consumer	3,014		31		3,007		60
Total noncommercial	84,674		636		81,395		1,273
Total non-PCI impaired loans and leases	$	157,877	$	1,301	$	152,886	$	2,640

Allocation of Allowance for Loan and Lease Losses

The following table presents the PCI allowance and recorded investment in loans at December 31, 2019:

(Dollars in thousands)	December 31, 2019
ALLL for loans acquired with deteriorated credit quality	$	7,536
Loans acquired with deteriorated credit quality	558,716

Troubled Debt Restructurings on Financing Receivables

The following tables provides a summary of total TDRs by accrual status:

	June 30, 2020
(Dollars in thousands)	Accruing		Nonaccruing		Total
Commercial loans:
Construction and land development	$	1,072	$	1,304	$	2,376
Owner occupied commercial mortgage	35,080		12,682		47,762
Non-owner occupied commercial mortgage	7,343		313		7,656
Commercial and industrial and leases	29,463		2,803		32,266
Total commercial loans	72,958		17,102		90,060
Consumer:
Residential mortgage	35,439		14,167		49,606
Revolving mortgage	22,342		7,012		29,354
Construction and land development	2,355		1,452		3,807
Consumer auto	1,989		796		2,785
Consumer other	1,091		139		1,230
Total consumer loans	63,216		23,566		86,782
PCD loans	18,639		6,024		24,663
Total loans	$	154,813	$	46,692	$	201,505

	December 31, 2019
(Dollars in thousands)	Accruing		Nonaccruing		Total
Commercial loans:
Construction and land development	$	487	$	2,279	$	2,766
Commercial mortgage	50,819		11,116		61,935
Other commercial real estate	571		—		571
Commercial and industrial and leases	9,430		2,409		11,839
Other	320		105		425
Total commercial loans	61,627		15,909		77,536
Noncommercial:
Residential mortgage	41,813		16,048		57,861
Revolving mortgage	21,032		7,367		28,399
Construction and land development	1,452		2,430		3,882
Consumer	2,826		688		3,514
Total noncommercial loans	67,123		26,533		93,656
Total loans	$	128,750	$	42,442	$	171,192

The following table provides the types of modifications designated as TDRs during the six months ended June 30, 2020 and June 30, 2019, as well as a summary of loans modified as a TDR during the twelve month periods ended June 30, 2020 and June 30, 2019 that subsequently defaulted during the six months ended June 30, 2020 and June 30, 2019. BancShares defines payment default as movement of the TDR to nonaccrual status, which is generally 90 days past due for TDRs, foreclosure or charge-off, whichever occurs first.

	Three months ended June 30, 2020						Three months ended June 30, 2019
	All restructurings			Restructurings with payment default			All restructurings			Restructurings with payment default
(Dollars in thousands)	Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end
Loans and leases
Interest only	7	$	15,352	3	$	3,398	4	$	4,343	—	$	—
Loan term extension	27	2,925		13	1,459		4	998		2	183
Below market interest rate	69	17,291		18	1,069		67	6,979		30	2,612
Discharged from bankruptcy	43	1,472		9	311		40	5,054		30	3,106
Total restructurings	146	$	37,040	43	$	6,237	115	$	17,374	62	$	5,901
	Six months ended June 30, 2020						Six months ended June 30, 2019
	All restructurings			Restructurings with payment default			All restructurings			Restructurings with payment default
(Dollars in thousands)	Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end		Number of Loans	Recorded investment at period end
Loans and leases
Interest only	17	$	19,328	3	$	3,398	4	$	4,343	2	$	3,203
Loan term extension	33	3,657		16	1,667		8	1,437		4	534
Below market interest rate	157	25,389		46	2,324		125	11,063		61	4,645
Discharged from bankruptcy	110	5,640		44	1,507		102	7,679		53	3,948
Total restructurings	317	$	54,014	109	$	8,896	239	$	24,522	120	$	12,330

For the six months ended June 30, 2020 and June 30, 2019, the pre-modification and post-modification outstanding amortized cost of loans modified as TDRs were not materially different.

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Other Real Estate Owned (Tables)

6 Months Ended

Jun. 30, 2020

Banking and Thrift [Abstract]

Changes in other real estate owned

The following table explains changes in OREO during the six months ended June 30, 2020 and 2019:

(Dollars in thousands)	OREO
Balance at December 31, 2019	$	46,591
Additions	9,184
Acquired in business combinations	9,813
Sales	(9,497)
Write-downs/losses	(2,241)
Balance at June 30, 2020	$	53,850
Balance at December 31, 2018	$	48,030
Additions	7,894
Acquired in business combinations	3,613
Sales	(11,012)
Write-downs/losses	(2,289)
Balance at June 30, 2019	$	46,236

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Servicing Rights (Tables)

6 Months Ended

Jun. 30, 2020

Mortgage Servicing Rights [Abstract]

Mortgage servicing rights

The following table presents changes in the servicing asset during the three and six months ended June 30, 2020 and 2019:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Beginning balance	$	19,756	$	20,647	$	22,963	$	21,396
Servicing rights originated	2,096		1,552		3,679		2,411
Amortization	(2,119)		(1,567)		(3,942)		(3,014)
Valuation allowance (increase) decrease	(1,069)		33		(4,036)		(128)
Ending balance	$	18,664	$	20,665	$	18,664	$	20,665

Schedule of Activity in Servicing Asset Valuation Allowance

The following table presents the activity in the servicing asset valuation allowance for the three and six months ended June 30, 2020 and 2019:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Beginning balance	$	3,189	$	161	$	222	$	—
Valuation allowance increase (decrease)	1,069		(33)		4,036		128
Ending balance	$	4,258	$	128	$	4,258	$	128

Mortgage servicing rights economic assumptions

Mortgage servicing rights valuations are performed using a pooling methodology where loans with similar risk characteristics are grouped together and evaluated using discounted cash flows to estimate the present value of future earnings. Key economic assumptions used to value mortgage servicing rights were as follows:

	June 30, 2020			December 31, 2019
Discount rate - conventional fixed loans	7.66		%	8.92		%
Discount rate - all loans excluding conventional fixed loans	8.66		%	9.92		%
Weighted average constant prepayment rate	20.19		%	13.72		%
Weighted average cost to service a loan	$	87.30		$	87.09

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FDIC Shared-Loss Payable (Tables)

6 Months Ended

Jun. 30, 2020

FDIC Shared-Loss Receivable [Abstract]

Changes In Payable to FDIC

The following table provides changes in the FDIC shared-loss payable since December 31, 2019:

(Dollars in thousands)	Total
Balance at December 31, 2019	$	112,395
Accretion	2,098
Payment made to the FDIC to settle shared-loss agreement	(99,468)
Balance at June 30, 2020	$	15,025

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Accumulated Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2020

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule Of Accumulated Other Comprehensive Income (Loss)

Accumulated other comprehensive income (loss) included the following as of June 30, 2020 and December 31, 2019:

	June 30, 2020						December 31, 2019
(Dollars in thousands)	Accumulated other comprehensive income (loss)		Deferred tax expense (benefit)		Accumulated other comprehensive income (loss), net of tax		Accumulated other comprehensive income (loss)		Deferred tax expense (benefit)		Accumulated other comprehensive income (loss), net of tax
Unrealized gains on securities available for sale	$	146,884	$	33,782	$	113,102	$	7,522	$	1,730	$	5,792
Defined benefit pension items	(159,436)		(36,670)		(122,766)		(172,098)		(39,583)		(132,515)
Total	$	(12,552)	$	(2,888)	$	(9,664)	$	(164,576)	$	(37,853)	$	(126,723)

The following table highlights changes in accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2020 and 2019:

	Three months ended June 30, 2020
(Dollars in thousands, net of tax)	Unrealized gains (losses) on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	102,080	$	—	$	(127,692)	$	(25,612)
Net unrealized gains arising during period	21,611		—		—		21,611
Amounts reclassified from accumulated other comprehensive loss	(10,589)		—		4,926		(5,663)
Net current period other comprehensive income	11,022		—		4,926		15,948
Ending balance	$	113,102	$	—	$	(122,766)	$	(9,664)
	Three months ended June 30, 2019
(Dollars in thousands, net of tax)	Unrealized gains (losses) on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	(16,890)	$	(66,558)	$	(123,412)	$	(206,860)
Net unrealized gains arising during period	23,848		—		—		23,848
Amounts reclassified from accumulated other comprehensive loss	(4,404)		4,579		2,106		2,281
Net current period other comprehensive income	19,444		4,579		2,106		26,129
Ending balance	$	2,554	$	(61,979)	$	(121,306)	$	(180,731)

	Six months ended June 30, 2020
(Dollars in thousands, net of tax)	Unrealized gains on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	5,792	$	—	$	(132,515)	$	(126,723)
Net unrealized gains arising during period	133,141		—		—		133,141
Amounts reclassified from accumulated other comprehensive loss	(25,831)		—		9,749		(16,082)
Net current period other comprehensive income	107,310		—		9,749		117,059
Ending balance	$	113,102	$	—	$	(122,766)	$	(9,664)
	Six months ended June 30, 2019
(Dollars in thousands, net of tax)	Unrealized gains on securities available for sale		Unrealized losses on securities available for sale transferred to held to maturity		Defined benefit pension items		Total
Beginning balance	$	(38,505)	$	(71,149)	$	(125,533)	$	(235,187)
Net unrealized gains arising during period	45,463		—		—		45,463
Amounts reclassified from accumulated other comprehensive loss	(4,404)		9,170		4,227		8,993
Net current period other comprehensive income	41,059		9,170		4,227		54,456
Ending balance	$	2,554	$	(61,979)	$	(121,306)	$	(180,731)

Reclassification out of Accumulated Other Comprehensive Income

The following table presents the amounts reclassified from accumulated other comprehensive income (loss) and the line item affected in the statement where net income is presented for the three and six months ended June 30, 2020 and 2019:

(Dollars in thousands)	Three months ended June 30, 2020
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	13,752	Realized gains on investment securities available for sale, net
	(3,163)		Income taxes
	$	10,589
Amortization of defined benefit pension actuarial losses	(6,398)		Other
	1,472		Income taxes
	$	(4,926)
Total reclassifications for the period	$	5,663
	Three months ended June 30, 2019
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	5,719	Realized gains on investment securities available for sale, net
	(1,315)		Income taxes
	$	4,404
Amortization of unrealized losses on securities available for sale transferred to held to maturity	$	(5,947)	Net interest income
	1,368		Income taxes
	$	(4,579)
Amortization of defined benefit pension items
Prior service costs	$	(14)	Salaries and wages
Actuarial losses	(2,721)		Other
	(2,735)		Income before income taxes
	629		Income taxes
	$	(2,106)
Total reclassifications for the period	$	(2,281)

	Six months ended June 30, 2020
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	33,547	Realized gains on investment securities available for sale, net
	(7,716)		Income taxes
	$	25,831
Amortization of defined benefit pension items
Actuarial losses	$	(12,662)	Other
	2,913		Income taxes
	$	(9,749)
Total reclassifications for the period	$	16,082
	Six months ended June 30, 2019
Details about accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)		Affected line item in the statement where net income is presented
Unrealized gains on securities available for sale	$	5,719	Realized gains on investment securities available for sale, net
	(1,315)		Income taxes
	$	4,404	Net income
Amortization of unrealized losses on securities available for sale transferred to held to maturity	$	(11,909)	Net interest income
	2,739		Income taxes
	$	(9,170)
Amortization of defined benefit pension items
Prior service costs	$	(28)	Salaries and wages
Actuarial losses	(5,462)		Other
	(5,490)		Income before income taxes
	1,263		Income taxes
	$	(4,227)
Total reclassifications for the period	$	(8,993)

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Estimated Fair Values (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Estimated Fair Values For Certain Financial Assets And Financial Liabilities

The table presents the carrying values and estimated fair values for financial instruments as of June 30, 2020 and December 31, 2019:

(Dollars in thousands)	June 30, 2020				December 31, 2019
	Carrying value		Fair value		Carrying value		Fair value
Cash and due from banks	$	389,233	$	389,233	$	376,719	$	376,719
Overnight investments	3,107,575		3,107,575		1,107,844		1,107,844
Investment in marketable equity securities	114,316		114,316		82,333		82,333
Investment securities available for sale	8,619,282		8,619,282		7,059,674		7,059,674
Investment securities held to maturity	774,878		791,325		30,996		30,996
Loans held for sale	107,881		107,881		67,869		67,869
Net loans and leases	32,195,975		32,604,388		28,656,355		28,878,550
Income earned not collected	175,496		175,496		123,154		123,154
Federal Home Loan Bank stock	45,392		45,392		43,039		43,039
Mortgage and other servicing rights	20,167		21,163		24,891		26,927
Deposits with no stated maturity	38,202,609		38,202,609		30,593,627		30,593,627
Time deposits	3,276,636		3,303,841		3,837,609		3,842,162
Securities sold under customer repurchase agreements	740,276		740,276		442,956		442,956
Federal Home Loan Bank borrowings	657,682		679,993		572,185		577,362
Subordinated debt	504,246		506,089		163,412		173,685
Other borrowings	96,791		95,861		148,318		149,232
FDIC shared-loss payable	15,025		15,730		112,395		114,252
Accrued interest payable	14,085		14,085		18,124		18,124

Assets And Liabilities Carried At Fair Value On A Recurring Basis

For assets and liabilities carried at fair value on a recurring basis, the following table provides fair value information as of June 30, 2020 and December 31, 2019:

	June 30, 2020
			Fair value measurements using:
(Dollars in thousands)	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Assets measured at fair value
Investment securities available for sale
U.S. Treasury	$	754,586	$	—	$	754,586	$	—
Government agency	545,709		—		545,709		—
Residential mortgage-backed securities	5,790,392		—		5,790,392		—
Commercial mortgage-backed securities	1,079,822		—		1,079,822		—
Corporate bonds	448,773		—		278,796		169,977
Total investment securities available for sale	$	8,619,282	$	—	$	8,449,305	$	169,977
Marketable equity securities	$	114,316	$	50,352	$	63,964	$	—
Loans held for sale	$	107,881	$	—	$	107,881	$	—
	December 31, 2019
			Fair value measurements using:
	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Assets measured at fair value
Investment securities available for sale
U.S. Treasury	$	409,999	$	—	$	409,999	$	—
Government agency	682,772		—		682,772		—
Residential mortgage-backed securities	5,267,090		—		5,267,090		—
Commercial mortgage-backed securities	380,020		—		380,020		—
Corporate bonds	201,566		—		131,881		69,685
State, county and municipal	118,227		—		118,227		—
Total investment securities available for sale	$	7,059,674	$	—	$	6,989,989	$	69,685
Marketable equity securities	$	82,333	$	29,458	$	52,875	$	—
Loans held for sale	$	67,869	$	—	$	67,869	$	—

Fair Value of Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation

The following tables summarize activity for Level 3 assets:

	Corporate bonds
	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Beginning balance	$	67,016	$	146,287	$	69,685	$	143,226
Purchases	100,595		991		100,595		3,991
Unrealized net gains (losses) included in other comprehensive income	2,449		1,822		(1,917)		1,838
Amounts included in net income	(83)		37		(168)		82
Transfers in	—		—		1,782		—
Ending balance	$	169,977	$	149,137	$	169,977	$	149,137

Fair Value Level 3 Significant Unobservable Input Assumptions

(Dollars in thousands)			June 30, 2020
Level 3 assets	Valuation technique	Significant unobservable input	Fair Value
Corporate bonds	Indicative bid provided by broker	Multiple factors, including but not limited to, current operations, financial condition, cash flows, and recently executed financing transactions related to the issuer	$	169,977

Fair Value Option

The following table summarizes the difference between the aggregate fair value and the aggregate unpaid principal balance for residential real estate originated for sale measured at fair value as of June 30, 2020 and December 31, 2019:

	June 30, 2020
(Dollars in thousands)	Fair value		Aggregate unpaid principal balance		Difference
Originated loans held for sale	$	107,881	$	102,189	$	5,692
	December 31, 2019
	Fair value		Aggregate unpaid principal balance		Difference
Originated loans held for sale	$	67,869	$	65,697	$	2,172

No originated loans held for sale were 90 or more days past due or on nonaccrual status as of June 30, 2020 or December 31, 2019.

We may be required to measure certain financial assets at fair value on a nonrecurring basis. These adjustments to fair value usually result from the application of lower of amortized cost or fair value accounting or write-downs of individual assets due to impairment.

Following the adoption of ASC 326, the population of loans measured at fair value on a non-recurring basis has greatly diminished and is limited to collateral-dependent loans evaluated individually. These collateral-dependent loans are deemed to be at fair value if there is an associated allowance for credit losses or if a charge-off has been recorded in the previous 12 months. Collateral values are determined using appraisals or other third-party value estimates of the subject property discounted based on estimated selling costs, generally between 6% and 10%, and immaterial adjustments for other external factors that may impact the marketability of the collateral. The weighted average discount for estimated selling costs applied was 7.81%.

Prior to the adoption of ASC 326, impaired loans were deemed to be at fair value if an associated allowance or current period charge-off had been recorded. The value of impaired loans was determined by either collateral valuations or discounted present value of the expected cash flow calculations. Collateral values were determined using appraisals or other third-party value estimates of the subject property with discounts, generally between 6% and 11%, applied for estimated selling costs and other external factors that may impact the marketability of the property. Expected cash flows were determined using expected payment information at the individual loan level, discounted using the effective interest rate. The effective interest rate for impaired loans generally ranges between 3% and 7%.OREO acquired or written down within the previous 12 months is deemed to be at fair value. Asset valuations are determined by using appraisals or other third-party value estimates of the subject property with with discounts generally between 7% and 16% applied for estimated selling costs and other external factors that may impact the marketability of the property. At June 30, 2020, the weighted average discount applied was 8.16%. Changes to the value of the assets between scheduled valuation dates are monitored through continued communication with brokers and monthly reviews by the asset manager assigned to each asset. If there are any significant changes in the market or the subject property, valuations are adjusted or new appraisals ordered to ensure the reported values reflect the most current information.

Assets And Liabilities Carried At Fair Value On A Nonrecurring Basis

For financial assets and liabilities carried at fair value on a nonrecurring basis, the following table provides fair value information as of June 30, 2020 and December 31, 2019:

	June 30, 2020
			Fair value measurements using:
(Dollars in thousands)	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Collateral-dependent loans	$	14,341	$	—	$	—	$	14,341
Other real estate owned	44,465		—		—		44,465
Mortgage servicing rights	17,992		—		—		17,992
	December 31, 2019
			Fair value measurements using:
	Fair value		Level 1 inputs		Level 2 inputs		Level 3 inputs
Impaired loans	$	132,336	$	—	$	—	$	132,336
Other real estate owned	38,310		—		—		38,310
Mortgage servicing rights	3,757		—		—		3,757

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Employee Benefit Plans (Tables)

6 Months Ended

Jun. 30, 2020

Retirement Benefits, Description [Abstract]

Schedule of Net Benefit Costs

For the three and six months ended June 30, 2020 and 2019, the components of net periodic benefit cost are as follows:

	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2020		2019		2020		2019
Service cost	$	3,682	$	3,271	$	7,139	$	6,384
Interest cost	8,568		9,338		17,099		18,629
Expected return on assets	(16,435)		(15,661)		(32,844)		(31,296)
Amortization of prior service cost	—		14		—		28
Amortization of net actuarial loss	6,398		2,721		12,662		5,462
Net periodic cost (benefit)	$	2,213	$	(317)	$	4,056	$	(793)

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Leases (Tables)

6 Months Ended

Jun. 30, 2020

Leases [Abstract]

Schedule of Operating and Finance Lease Assets and Liabilities

The following table presents lease assets and liabilities as of June 30, 2020 and December 31, 2019:

(Dollars in thousands)	Classification	June 30, 2020		December 31, 2019
Assets:
Operating	Other assets	$	73,488	$	77,115
Finance	Premises and equipment	7,547		8,820
Total leased assets		$	81,035	$	85,935
Liabilities:
Operating	Other liabilities	$	73,481	$	76,746
Finance	Other borrowings	7,463		8,230
Total lease liabilities		$	80,944	$	84,976

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Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]

Schedule of fair falue for off-balance sheet risks

The following table presents the commitments to extend credit and standby letters of credit as of June 30, 2020 and December 31, 2019:

(Dollars in thousands)	June 30, 2020		December 31, 2019
Unused commitments to extend credit	$	11,705,547	$	10,682,378
Standby letters of credit	104,655		99,601

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Accounting Policies and Basis of Presentation Accounting Policies and Basis of Presentation (Recently Adopted Accounting Standards) (Details) - USD ($)		1 Months Ended	3 Months Ended		6 Months Ended
	Mar. 12, 2020	Jul. 31, 2020	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Mar. 31, 2020	Jan. 01, 2020	Dec. 31, 2019	Mar. 31, 2019	Dec. 31, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Stock issued (in shares)			(21,000)		339,937,000
Preferred stock, par value (in dollars per share)			$ 0.01		$ 0.01				$ 0.01
Proceeds from Issuance of Preferred Stock and Preference Stock					$ 345,000,000	$ 0
Stock repurchased during period (in shares)			346,000	205,500	695,390	448,500
Stock repurchased during period			$ 126,991,000	$ 89,800,000	$ 286,695,000	$ 190,500,000
Stock repurchased during period (in USD per share)			$ 366.98	$ 436.81	$ 412.23	$ 424.77
Forecast period (years)					2 years
Expected credit losses on SBA-PPP loans			$ 0		$ 0
Reserve for unfunded commitments			13,700,000		13,700,000
Retained earnings			3,651,237,000		3,651,237,000				$ 3,658,197,000
Allowance for credit loss			222,450,000	$ 226,583,000	222,450,000	$ 226,583,000	$ 209,259,000		225,141,000	$ 228,775,000	$ 223,712,000
Allowance for credit loss on debt securities held to maturity			0		0
Loans and leases, not acquired in a transfer accounted for as debt securities			31,887,774,000		31,887,774,000				28,322,780,000
Loans and leases			326,099,000	303,233,000	651,647,000	594,155,000
Commercial
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Loans and leases, not acquired in a transfer accounted for as debt securities			22,156,874,000		22,156,874,000				$ 18,552,002,000
SBA-PPP | Commercial
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Loans and leases, not acquired in a transfer accounted for as debt securities			3,084,549,000		3,084,549,000
Loans and leases			19,000,000.0
Held-to-maturity Securities
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Expected allowance for credit loss			0		0
Subsequent Event
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Stock repurchased during period		$ 47,100,000
Stock repurchased during period (in USD per share)		$ 399.77
Fixed-to-Floating Rate Subordinated Notes Due 2030
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Debt instrument face amount			$ 350,000,000		$ 350,000,000
Interest rate (percentage)			3.375%		3.375%
Shares issued on conversion (in shares)			0.025000		0.025000
Liquidation preference per share (in USD per share)			$ 25		$ 25
Non-Cumulative Perpetual Preferred Stock, Series A
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Dividend rate (percentage)					5.375%
Preferred stock, par value (in dollars per share)			0.01		$ 0.01
Liquidation preference per share (in USD per share)			$ 1,000		$ 1,000
Depositary Shares
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Stock issued (in shares)	13,800,000
Class A Common Stock
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Stock repurchased during period				$ 89,774,000		$ 190,530,000
Class A Common Stock | Subsequent Event
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Stock repurchased during period (in shares)		117,700
Class A Common Stock | Repurchases From Ella Ann Holding
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Stock repurchased during period (in shares)					45,000
Number of shares authorized to be repurchased (in shares)			250,000		250,000
Cumulative effect of adoption of ASC 326
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Reserve for unfunded commitments								$ 8,900,000
Retained earnings								36,900,000
Allowance for credit loss								(37,900,000)
Allowance for credit loss on debt securities held to maturity								0
Cumulative effect of adoption of ASC 326 | Non-PCD Loans
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit loss								(56,900,000)
Cumulative effect of adoption of ASC 326 | PCD Loans
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit loss								$ 19,000,000.0

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Business Combinations (Details) - USD ($) $ in Thousands		2 Months Ended	3 Months Ended		6 Months Ended
	Feb. 01, 2020	Mar. 31, 2020	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Business Acquisition [Line Items]
Merger-related expenses			$ 4,369	$ 4,084	$ 8,601	$ 5,803
Goodwill recorded for Community Financial			350,298		$ 350,298		$ 349,398
Premium for deposits sold (percent)					8.00%
Community Financial
Business Acquisition [Line Items]
Cash consideration	$ 2,300
Merger-related expenses			495		$ 1,700
Interest income		$ 2,700
Purchase price	2,320
Assets	221,400
PCD Loans	23,400
Non-PCD Loans	110,600
Allowance for credit losses	1,200
Deposits	209,340
Intangible assets	536
Liabilities assumed	219,766
Goodwill recorded for Community Financial	$ 686
Entegra Financial
Business Acquisition [Line Items]
Loans and leases divested			110,100		110,100
Premises and equipment divested			2,100		2,100
Deposits divested			$ 184,800		$ 184,800

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Business Combinations - Assets and Liabilities Assumed (Details) - USD ($) $ in Thousands	Feb. 01, 2020	Jun. 30, 2020	Dec. 31, 2019
Business Acquisition [Line Items]
Goodwill recorded for Community Financial		$ 350,298	$ 349,398
Community Financial
Business Acquisition [Line Items]
Purchase price	$ 2,320
Cash and due from banks	1,085
Overnight investments	35,129
Investment securities	30,146
Loans	133,989
Premises and equipment	7,624
Other real estate owned	9,813
Income earned not collected	558
Intangible assets	536
Other assets	2,520
Total assets acquired	221,400
Deposits	209,340
Borrowings	9,925
Other liabilities	501
Total liabilities assumed	219,766
Fair value of net assets acquired	1,634
Goodwill recorded for Community Financial	$ 686

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Investments (Aggregate Values and Unrealized Gains and Losses) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Investment securities available for sale
Cost	$ 8,472,398	$ 7,052,152
Gross unrealized losses	10,187	17,819
Debt Securities, Available-for-sale, Allowance for Credit Loss	0
Fair value	8,619,282	7,059,674
Investment in marketable equity securities at cost	116,322	59,262
Available-for-sale Equity Securities, Accumulated Gross Unrealized Gain, before Tax	6,297	23,304
Available-for-sale Equity Securities, Accumulated Gross Unrealized Loss, before Tax	8,303	233
Fair value	114,316	82,333
Investment securities held to maturity
Cost	774,878	30,996
Gross unrealized gains	16,447
Gross unrealized losses	0
Allowance for credit loss on debt securities held to maturity	0
Fair value	791,325	30,996
Cost	9,363,598	7,142,410
Gross unrealized gains	179,815	48,645
Gross unrealized losses	18,490	18,052
Debt Securities, Available-for-sale, Held-to-maturity and Equity Securities, Allowance for Credit Losses	0
Fair value	9,524,923	7,173,003
Investment securities available for sale at cost	8,472,398	7,052,152
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax	157,071	25,341
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax	10,187	17,819
Debt Securities, Available-for-sale	8,619,282	7,059,674
U.S. Treasury
Investment securities available for sale
Debt Securities, Available-for-sale, Allowance for Credit Loss	0
Investment securities held to maturity
Investment securities available for sale at cost	754,350	409,397
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax	236	602
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax	0	0
Debt Securities, Available-for-sale	754,586	409,999
Government agency
Investment securities available for sale
Gross unrealized losses	4,256	2,241
Debt Securities, Available-for-sale, Allowance for Credit Loss	0
Investment securities held to maturity
Investment securities available for sale at cost	549,673	684,085
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax	292	928
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax	4,256	2,241
Debt Securities, Available-for-sale	545,709	682,772
Residential Mortgage Backed Securities
Investment securities available for sale
Gross unrealized losses	694	15,387
Debt Securities, Available-for-sale, Allowance for Credit Loss	0
Investment securities held to maturity
Cost	693,143	0
Gross unrealized gains	16,196
Gross unrealized losses	0
Allowance for credit loss on debt securities held to maturity	0
Fair value	709,339
Investment securities available for sale at cost	5,671,151	5,269,060
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax	119,935	13,417
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax	694	15,387
Debt Securities, Available-for-sale	5,790,392	5,267,090
Commercial Mortgage Backed Securities
Investment securities available for sale
Cost	1,047,601	373,105
Gross unrealized gains	32,221	6,974
Gross unrealized losses	0	59
Debt Securities, Available-for-sale, Allowance for Credit Loss	0
Fair value	1,079,822	380,020
Investment securities held to maturity
Cost	78,729	0
Gross unrealized gains	251
Gross unrealized losses	0
Allowance for credit loss on debt securities held to maturity
Fair value	78,980
Residential mortgage-backed securities
Investment securities held to maturity
Cost		30,996
Gross unrealized gains		0
Gross unrealized losses		0
Fair value		30,996
Commercial mortgage-backed securities
Investment securities available for sale
Gross unrealized losses	5,237
Debt Securities, Available-for-sale, Allowance for Credit Loss	0
Investment securities held to maturity
Investment securities available for sale at cost	449,623	198,278
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax	4,387	3,420
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax	5,237	132
Debt Securities, Available-for-sale	448,773	201,566
US States and Political Subdivisions Debt Securities [Member]
Investment securities available for sale
Cost		118,227
Gross unrealized gains		0
Gross unrealized losses		0
Fair value		118,227
Other
Investment securities held to maturity
Cost	3,006	30,996
Gross unrealized gains	0	0
Gross unrealized losses	0	0
Allowance for credit loss on debt securities held to maturity	0
Fair value	$ 3,006	$ 30,996

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Investments (Maturity Information) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Investment securities available for sale
Total investment securities available for sale, cost	$ 8,472,398	$ 7,052,152
Total investment securities available for sale, fair value	8,619,282	7,059,674
Investment securities held to maturity
Investment securities held to maturity at cost	774,878	30,996
Investment securities held to maturity at fair value	791,325	30,996
Investment securities available for sale at cost	8,472,398	7,052,152
Debt Securities, Available-for-sale	8,619,282	7,059,674
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, within One Year, Amortized Cost	2,257	30,746
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, within One Year, Fair Value	2,257	30,746
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, after One Through Five Years, Amortized Cost	749	250
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, after One Through Five Years, Fair Value	749	250
Debt Securities
Investment securities available for sale
Maturing in one year or less, cost	754,350	406,325
Maturing in one through five years, cost	51,589	24,496
Maturing in five through ten years, cost	369,075	185,209
Maturing in over ten years, cost	28,959	109,872
Maturing in one year or less, fair value	754,586	406,927
Maturing in one through five years, fair value	51,887	24,971
Maturing in five through ten yeas, fair value	368,281	187,868
Maturing in over ten years, fair value	28,605	110,026
Agency Securities
Investment securities held to maturity
Investment securities available for sale at cost	549,673	684,085
Debt Securities, Available-for-sale	545,709	682,772
Residential Mortgage Backed Securities
Investment securities held to maturity
Investment securities held to maturity at cost	693,143	0
Commercial mortgage-backed securities	709,339	0
Investment securities held to maturity at fair value	709,339
Investment securities available for sale at cost	5,671,151	5,269,060
Debt Securities, Available-for-sale	5,790,392	5,267,090
Commercial Mortgage Backed Securities
Investment securities available for sale
Total investment securities available for sale, cost	1,047,601	373,105
Total investment securities available for sale, fair value	1,079,822	380,020
Investment securities held to maturity
Investment securities held to maturity at cost	78,729	0
Commercial mortgage-backed securities	78,980	0
Investment securities held to maturity at fair value	$ 78,980
Residential mortgage-backed securities
Investment securities held to maturity
Investment securities held to maturity at cost		30,996
Investment securities held to maturity at fair value		$ 30,996

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Investments (Unrealized Losses) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Investment securities available for sale:
Fair Value, Less than 12 months	$ 732,783	$ 2,778,014
Unrealized Losses, Less than 12 months	9,131	16,025
Fair Value, 12 months or more	217,427	332,953
Unrealized Losses, Greater than 12 months	1,056	1,794
Fair Value, Total	950,210	3,110,967
Unrealized Losses, Total	10,187	17,819
Investment securities held to maturity
Unrealized Losses, Total	0
Agency Securities
Investment securities available for sale:
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months	447,983	347,081
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss	3,709	1,827
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer	58,806	63,947
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss	547	414
Fair Value, Total	506,789	411,028
Unrealized Losses, Total	4,256	2,241
Residential Mortgage Backed Securities
Investment securities available for sale:
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months	172,628	2,387,293
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss	302	14,016
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer	149,170	264,257
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss	392	1,371
Fair Value, Total	321,798	2,651,550
Unrealized Losses, Total	694	15,387
Investment securities held to maturity
Unrealized Losses, Total	0
Commercial Mortgage Backed Securities
Investment securities available for sale:
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months		35,926
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss		59
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer		0
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss		0
Fair Value, Total		35,926
Unrealized Losses, Total	0	59
Investment securities held to maturity
Unrealized Losses, Total	0
Residential mortgage-backed securities
Investment securities held to maturity
Unrealized Losses, Total		0
Corporate bonds
Investment securities available for sale:
Fair Value, Total		12,463
Unrealized Losses, Total		132
Corporate Bonds
Investment securities available for sale:
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months	112,172	7,714
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss	5,120	123
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer	9,451	4,749
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss	117	9
Fair Value, Total	121,623
Unrealized Losses, Total	5,237
Other
Investment securities held to maturity
Unrealized Losses, Total	$ 0	$ 0

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Investments Marketable Equity Securities Gains (Losses) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Marketable Equity Securities Gains (Losses) [Abstract]
Marketable equity securities gains, net	$ 64,570	$ 3,144	$ 13,162	$ 14,472
Less net gains recognized on marketable equity securities sold	36,993	2,271	37,316	2,315
Unrealized gains (losses) recognized on marketable equity securities held	$ 27,577	$ 873	$ (24,154)	$ 12,157

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Investments (Narrative) (Details) shares in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020 USD ($) investments investment shares	Jun. 30, 2019 USD ($)	Jun. 30, 2020 USD ($) investments investment shares	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)	Dec. 31, 2019 USD ($)
Schedule of Investments [Line Items]
Stock issued by Federal Home Loan Bank	$ 45,400,000		$ 45,400,000			$ 43,000,000.0
Non-marketable equity securities	13,100,000		13,100,000			12,500,000
Accrued Interest receivable excluded from estimate of credit losses	21,300,000		21,300,000
Available for sale securities, realized gains	13,800,000		34,200,000
Available for sale securities, realized loss	0	$ 0	679,000	$ 0
Available for sale securities, realized gain (loss)	$ 13,752,000	$ 5,719,000	$ 33,547,000	$ 5,719,000	$ 5,700,000
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, number of positions | investment	47		47
Unrealized losses related to marketability of securities or issuer's ability to honor redemption obligations	$ 0		$ 0
Investment value deemed to be OTTI			0
Investment securities, aggregate carrying value, pledged as collateral	4,530,000,000		4,530,000,000			$ 3,930,000,000
Debt Securities, Accrued Interest, WriteOff	0		0
Held-to-maturity securities	0		0
Past due securities	$ 0		$ 0
Residential mortgage-backed securities
Schedule of Investments [Line Items]
Available-for-sale, securities in unrealized loss positions, number of positions, greater than or equal to one year | investments	45		45
Corporate Bonds
Schedule of Investments [Line Items]
Available-for-sale, securities in unrealized loss positions, number of positions, greater than or equal to one year | investments	2		2
Visa Class B Common Stock
Schedule of Investments [Line Items]
Investment owned (in shares) | shares	354		354
Investment owned	$ 0		$ 0

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Loans and Leases (Loans and Leases Outstanding) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Loans and leases, not acquired in a transfer accounted for as debt securities	$ 31,887,774	$ 28,322,780
Loans acquired with deteriorated credit quality	530,651	558,716
Total loans and leases	32,418,425	28,881,496
Commercial
Loans and leases, not acquired in a transfer accounted for as debt securities	22,156,874	18,552,002
Commercial | Construction and land development
Loans and leases, not acquired in a transfer accounted for as debt securities	1,012,365	1,013,454
Commercial | Owner occupied commercial mortgage
Loans and leases, not acquired in a transfer accounted for as debt securities	10,352,793
Commercial | Non-owner occupied commercial mortgage
Loans and leases, not acquired in a transfer accounted for as debt securities	3,056,328
Commercial | Commercial and industrial and leases
Loans and leases, not acquired in a transfer accounted for as debt securities	4,650,839	4,403,792
Commercial | Commercial mortgage
Loans and leases, not acquired in a transfer accounted for as debt securities		12,282,635
Commercial | Other commercial real estate
Loans and leases, not acquired in a transfer accounted for as debt securities		542,028
Commercial | Other
Loans and leases, not acquired in a transfer accounted for as debt securities		310,093
Commercial | SBA-PPP
Loans and leases, not acquired in a transfer accounted for as debt securities	3,084,549
Consumer
Loans and leases, not acquired in a transfer accounted for as debt securities	9,730,900	9,770,778
Consumer | Construction and land development
Loans and leases, not acquired in a transfer accounted for as debt securities	353,382	357,385
Consumer | Consumer auto
Loans and leases, not acquired in a transfer accounted for as debt securities	1,195,771
Consumer | Residential mortgage
Loans and leases, not acquired in a transfer accounted for as debt securities	5,404,682	5,293,917
Consumer | Revolving mortgage
Loans and leases, not acquired in a transfer accounted for as debt securities	2,233,977
Consumer | Consumer other
Loans and leases, not acquired in a transfer accounted for as debt securities	$ 543,088
Consumer | Consumer
Loans and leases, not acquired in a transfer accounted for as debt securities		$ 1,780,404

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Loans and Leases (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Financing Receivable, Credit Quality Indicator [Line Items]
Interest receivable	$ 139,800		$ 139,800
Federal Home Loan Bank, Advances, General Debt Obligations, Disclosures, Collateral Pledged	8,520,000		8,520,000		$ 6,570,000
Advances from Federal Home Loan Banks					563,700
Federal Home Loan Bank Advances, Current Borrowing Capacity	7,860,000		7,860,000		6,010,000
Federal Reserve Bank, Advances, General Debt Obligations, Disclosures, Collateral Pledged	3,140,000		3,140,000		2,980,000
Loans held for sale	107,900		107,900		67,900
Unamortized Loan Commitment and Origination Fees and Unamortized Discounts or Premiums	100,700		100,700		927
Loans and leases	326,099	$ 303,233	651,647	$ 594,155
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Purchase Discount Remaining	25,800		25,800		30,900
SBA-PPP
Financing Receivable, Credit Quality Indicator [Line Items]
Unamortized Loan Commitment and Origination Fees and Unamortized Discounts or Premiums	96,600		96,600
PCD Loans
Financing Receivable, Credit Quality Indicator [Line Items]
Remaining discount	54,700		54,700		88,200
Federal Home Loan Bank of Atlanta
Financing Receivable, Credit Quality Indicator [Line Items]
Loans Pledged as Collateral	11,780,000		11,780,000		9,410,000
Advances from Federal Home Loan Banks	653,700		653,700
Federal Reserve Bank
Financing Receivable, Credit Quality Indicator [Line Items]
Loans Pledged as Collateral	$ 3,930,000		$ 3,930,000		$ 3,680,000

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Loans and Leases (Aging Of The Outstanding Loans and Leases By Class) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Financing Receivable, Past Due [Line Items]
Past due loans	$ 228,304	$ 272,770
Current loans	32,190,121	28,608,726
Total loans and leases	32,418,425	28,881,496
Commercial
Financing Receivable, Past Due [Line Items]
Total loans and leases	22,156,874
Commercial | Construction and land development
Financing Receivable, Past Due [Line Items]
Total loans and leases	1,012,365
Commercial | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Total loans and leases	4,650,839
Commercial | SBA-PPP
Financing Receivable, Past Due [Line Items]
Total loans and leases	3,084,549
Consumer
Financing Receivable, Past Due [Line Items]
Total loans and leases	9,730,900
Consumer | Construction and land development
Financing Receivable, Past Due [Line Items]
Total loans and leases	353,382
Consumer | Residential mortgage
Financing Receivable, Past Due [Line Items]
Total loans and leases	5,404,682
Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Total loans and leases	2,233,977
Non-PCI Loans | Commercial
Financing Receivable, Past Due [Line Items]
Past due loans		74,146
Current loans		18,477,856
Total loans and leases		18,552,002
Non-PCI Loans | Commercial | Construction and land development
Financing Receivable, Past Due [Line Items]
Past due loans	3,353	6,043
Current loans	1,009,012	1,007,411
Total loans and leases	1,012,365	1,013,454
Non-PCI Loans | Commercial | Mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	29,698	37,482
Current loans	10,323,095	12,245,153
Total loans and leases	10,352,793	12,282,635
Non-PCI Loans | Commercial | Other commercial real estate
Financing Receivable, Past Due [Line Items]
Past due loans	17,416	1,890
Current loans	3,038,912	540,138
Total loans and leases	3,056,328	542,028
Non-PCI Loans | Commercial | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Past due loans	17,875	28,143
Current loans	4,632,964	4,375,649
Total loans and leases	4,650,839	4,403,792
Non-PCI Loans | Commercial | Other
Financing Receivable, Past Due [Line Items]
Past due loans	68,342	588
Current loans	22,088,532	309,505
Total loans and leases	22,156,874	310,093
Non-PCI Loans | Commercial | SBA-PPP
Financing Receivable, Past Due [Line Items]
Past due loans	0
Current loans	3,084,549
Total loans and leases	3,084,549
Non-PCI Loans | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans	102,935	132,389
Current loans	9,627,965	9,638,389
Total loans and leases	9,730,900	9,770,778
Non-PCI Loans | Consumer | Construction and land development
Financing Receivable, Past Due [Line Items]
Past due loans	5,193	2,992
Current loans	1,190,578	354,393
Total loans and leases	1,195,771	357,385
Non-PCI Loans | Consumer | Mortgage
Financing Receivable, Past Due [Line Items]
Past due loans		88,537
Current loans		5,205,380
Total loans and leases		5,293,917
Non-PCI Loans | Consumer | Residential mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	67,369
Current loans	5,337,313
Total loans and leases	5,404,682
Non-PCI Loans | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	22,495
Current loans	2,211,482
Total loans and leases	2,233,977
Non-PCI Loans | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	1,919	23,062
Current loans	351,463	2,316,010
Total loans and leases	353,382	2,339,072
Non-PCI Loans | Consumer | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans	5,959	17,798
Current loans	537,129	1,762,606
Total loans and leases	543,088	1,780,404
PCD Loans
Financing Receivable, Past Due [Line Items]
Past due loans	57,027	66,235
Current loans	473,624	492,481
Total loans and leases	530,651	558,716
PCD Loans | Consumer
Financing Receivable, Past Due [Line Items]
Current loans		240,995
30 to 59 Days past due
Financing Receivable, Past Due [Line Items]
Past due loans	94,584	136,220
30 to 59 Days past due | Consumer | Construction and land development
Financing Receivable, Past Due [Line Items]
Total loans and leases	1,735
30 to 59 Days past due | Consumer | Residential mortgage
Financing Receivable, Past Due [Line Items]
Total loans and leases	25,243
30 to 59 Days past due | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Total loans and leases	8,874
30 to 59 Days past due | Non-PCI Loans | Commercial
Financing Receivable, Past Due [Line Items]
Past due loans		42,716
30 to 59 Days past due | Non-PCI Loans | Commercial | Construction and land development
Financing Receivable, Past Due [Line Items]
Past due loans	1,618	3,146
30 to 59 Days past due | Non-PCI Loans | Commercial | Mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	14,360	20,389
30 to 59 Days past due | Non-PCI Loans | Commercial | Other commercial real estate
Financing Receivable, Past Due [Line Items]
Past due loans	7,914	861
30 to 59 Days past due | Non-PCI Loans | Commercial | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Past due loans	10,464	18,269
30 to 59 Days past due | Non-PCI Loans | Commercial | Other
Financing Receivable, Past Due [Line Items]
Past due loans	34,356	51
30 to 59 Days past due | Non-PCI Loans | Commercial | SBA-PPP
Financing Receivable, Past Due [Line Items]
Past due loans	0
30 to 59 Days past due | Non-PCI Loans | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans	41,378	67,026
30 to 59 Days past due | Non-PCI Loans | Consumer | Construction and land development
Financing Receivable, Past Due [Line Items]
Past due loans	3,093	977
30 to 59 Days past due | Non-PCI Loans | Consumer | Mortgage
Financing Receivable, Past Due [Line Items]
Past due loans		45,839
30 to 59 Days past due | Non-PCI Loans | Consumer | Residential mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	25,243
30 to 59 Days past due | Non-PCI Loans | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	8,874
30 to 59 Days past due | Non-PCI Loans | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	1,735	9,729
30 to 59 Days past due | Non-PCI Loans | Consumer | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans	2,433	10,481
30 to 59 Days past due | PCD Loans
Financing Receivable, Past Due [Line Items]
Past due loans	18,850	26,478
Total loans and leases	18,850
30 to 59 Days past due | PCD Loans | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans		13,764
60 to 89 Days past due
Financing Receivable, Past Due [Line Items]
Past due loans	26,043	51,058
60 to 89 Days past due | Consumer | Construction and land development
Financing Receivable, Past Due [Line Items]
Total loans and leases	127
60 to 89 Days past due | Consumer | Residential mortgage
Financing Receivable, Past Due [Line Items]
Total loans and leases	7,082
60 to 89 Days past due | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Total loans and leases	4,615
60 to 89 Days past due | Non-PCI Loans | Commercial
Financing Receivable, Past Due [Line Items]
Past due loans		14,553
60 to 89 Days past due | Non-PCI Loans | Commercial | Construction and land development
Financing Receivable, Past Due [Line Items]
Past due loans	14	195
60 to 89 Days past due | Non-PCI Loans | Commercial | Mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	2,518	8,774
60 to 89 Days past due | Non-PCI Loans | Commercial | Other commercial real estate
Financing Receivable, Past Due [Line Items]
Past due loans	982	331
60 to 89 Days past due | Non-PCI Loans | Commercial | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Past due loans	3,196	4,842
60 to 89 Days past due | Non-PCI Loans | Commercial | Other
Financing Receivable, Past Due [Line Items]
Past due loans	6,710	411
60 to 89 Days past due | Non-PCI Loans | Commercial | SBA-PPP
Financing Receivable, Past Due [Line Items]
Past due loans	0
60 to 89 Days past due | Non-PCI Loans | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans	14,639	25,721
60 to 89 Days past due | Non-PCI Loans | Consumer | Construction and land development
Financing Receivable, Past Due [Line Items]
Past due loans	1,124	218
60 to 89 Days past due | Non-PCI Loans | Consumer | Mortgage
Financing Receivable, Past Due [Line Items]
Past due loans		18,289
60 to 89 Days past due | Non-PCI Loans | Consumer | Residential mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	7,082
60 to 89 Days past due | Non-PCI Loans | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	4,615
60 to 89 Days past due | Non-PCI Loans | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	127	3,468
60 to 89 Days past due | Non-PCI Loans | Consumer | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans	1,691	3,746
60 to 89 Days past due | PCD Loans
Financing Receivable, Past Due [Line Items]
Past due loans	4,694	10,784
Total loans and leases	4,694
60 to 89 Days past due | PCD Loans | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans		5,608
90 Days or greater
Financing Receivable, Past Due [Line Items]
Past due loans	107,677	85,492
90 Days or greater | Consumer | Construction and land development
Financing Receivable, Past Due [Line Items]
Total loans and leases	57
90 Days or greater | Consumer | Residential mortgage
Financing Receivable, Past Due [Line Items]
Total loans and leases	35,044
90 Days or greater | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Total loans and leases	9,006
90 Days or greater | Non-PCI Loans | Commercial
Financing Receivable, Past Due [Line Items]
Past due loans		16,877
90 Days or greater | Non-PCI Loans | Commercial | Construction and land development
Financing Receivable, Past Due [Line Items]
Past due loans	1,721	2,702
90 Days or greater | Non-PCI Loans | Commercial | Mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	12,820	8,319
90 Days or greater | Non-PCI Loans | Commercial | Other commercial real estate
Financing Receivable, Past Due [Line Items]
Past due loans	8,520	698
90 Days or greater | Non-PCI Loans | Commercial | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Past due loans	4,215	5,032
90 Days or greater | Non-PCI Loans | Commercial | Other
Financing Receivable, Past Due [Line Items]
Past due loans	27,276	126
90 Days or greater | Non-PCI Loans | Commercial | SBA-PPP
Financing Receivable, Past Due [Line Items]
Past due loans	0
90 Days or greater | Non-PCI Loans | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans	46,918	39,642
90 Days or greater | Non-PCI Loans | Consumer | Construction and land development
Financing Receivable, Past Due [Line Items]
Past due loans	976	1,797
90 Days or greater | Non-PCI Loans | Consumer | Mortgage
Financing Receivable, Past Due [Line Items]
Past due loans		24,409
90 Days or greater | Non-PCI Loans | Consumer | Residential mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	35,044
90 Days or greater | Non-PCI Loans | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	9,006
90 Days or greater | Non-PCI Loans | Consumer | Revolving mortgage
Financing Receivable, Past Due [Line Items]
Past due loans	57	9,865
90 Days or greater | Non-PCI Loans | Consumer | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans	1,835	3,571
90 Days or greater | PCD Loans
Financing Receivable, Past Due [Line Items]
Past due loans	33,483	28,973
Total loans and leases	$ 33,483
90 Days or greater | PCD Loans | Consumer
Financing Receivable, Past Due [Line Items]
Past due loans		$ 14,020

XML

Loans and Leases (Recorded Investment, By Class, In Loans And Leases On Nonaccrual Status And Loans And Leases Greater Than 90 Days Past Due And Still Accruing) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Jan. 01, 2020	Dec. 31, 2019
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	$ 197,791	$ 168,717	$ 121,689
Loans and leases greater than 90 days and accruing	3,796		27,548
Non-PCI Loans | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	46,951	42,407	42,407
Loans and leases greater than 90 days and accruing	2,194		1,094
Non-PCI Loans | Commercial | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	2,938	4,281	4,281
Loans and leases greater than 90 days and accruing	69		0
Non-PCI Loans | Commercial | Owner occupied commercial mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	28,283	24,476
Loans and leases greater than 90 days and accruing	111
Non-PCI Loans | Commercial | Non-owner occupied commercial mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	8,491	5,965
Loans and leases greater than 90 days and accruing	615
Non-PCI Loans | Commercial | Commercial and industrial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	7,239	7,685	7,365
Loans and leases greater than 90 days and accruing	1,399		1,094
Non-PCI Loans | Commercial | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing			29,733
Loans and leases greater than 90 days and accruing			0
Non-PCI Loans | Commercial | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing			708
Loans and leases greater than 90 days and accruing			0
Non-PCI Loans | Commercial | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing			320
Loans and leases greater than 90 days and accruing			0
Non-PCI Loans | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	88,329	72,539	72,539
Loans and leases greater than 90 days and accruing	1,450		2,197
Non-PCI Loans | Consumer | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	1,699	2,828	2,828
Loans and leases greater than 90 days and accruing	0		0
Non-PCI Loans | Consumer | Residential mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	59,352	44,357	44,357
Loans and leases greater than 90 days and accruing	0		45
Non-PCI Loans | Consumer | Revolving mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	23,600	22,411
Loans and leases greater than 90 days and accruing	0
Non-PCI Loans | Consumer | Consumer auto
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	2,677	2,145
Loans and leases greater than 90 days and accruing	0
Non-PCI Loans | Consumer | Consumer other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	1,001	798
Loans and leases greater than 90 days and accruing	1,450
Non-PCI Loans | Consumer | Revolving mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing			22,411
Loans and leases greater than 90 days and accruing			0
Non-PCI Loans | Consumer | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing			2,943
Loans and leases greater than 90 days and accruing			2,152
PCD Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	62,511	53,771	6,743
Loans and leases greater than 90 days and accruing	152		$ 24,257
Adoption of ASC 326 | PCD Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Nonaccruing	$ 35,900	$ 47,000

XML

Loans and Leases Loans and Leases (Credit Rating) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	$ 32,418,425	$ 28,881,496
Commercial
Financing Receivable, Credit Quality Indicator [Line Items]
2020	5,763,712
2019	4,551,255
2018	3,272,285
2017	2,495,157
2016	1,946,996
Prior	3,043,040
Revolving loans	1,077,716
Revolving loans converted to term loans	6,713
Total loans and leases	22,156,874
Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	1,253,939
2019	1,748,923
2018	1,202,020
2017	936,567
2016	696,022
Prior	1,223,287
Revolving loans	2,499,253
Revolving loans converted to term loans	170,889
Total loans and leases	9,730,900
Consumer And PCD Portfolio Segments
Financing Receivable, Credit Quality Indicator [Line Items]
2020	7,040,689
2019	6,332,840
2018	4,515,556
2017	3,473,332
2016	2,678,221
Prior	4,580,988
Revolving loans	3,592,738
Revolving loans converted to term loans	204,061
Total loans and leases	32,418,425
Construction and land development | Commercial
Financing Receivable, Credit Quality Indicator [Line Items]
2020	176,795
2019	406,119
2018	219,702
2017	138,289
2016	31,607
Prior	14,712
Revolving loans	25,141
Revolving loans converted to term loans	0
Total loans and leases	1,012,365
Construction and land development | Commercial | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	175,302
2019	404,898
2018	217,555
2017	132,753
2016	31,599
Prior	14,453
Revolving loans	25,141
Revolving loans converted to term loans	0
Total loans and leases	1,001,701
Construction and land development | Commercial | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	88
2019	0
2018	334
2017	5,507
2016	0
Prior	93
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	6,022
Construction and land development | Commercial | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	1,405
2019	1,221
2018	1,813
2017	29
2016	8
Prior	166
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	4,642
Construction and land development | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	88,308
2019	175,638
2018	52,361
2017	16,920
2016	8,123
Prior	8,141
Revolving loans	3,891
Revolving loans converted to term loans	0
Total loans and leases	353,382
Owner occupied commercial mortgage | Commercial
Financing Receivable, Credit Quality Indicator [Line Items]
2020	1,356,778
2019	2,242,068
2018	1,896,955
2017	1,489,425
2016	1,235,385
Prior	2,013,703
Revolving loans	118,270
Revolving loans converted to term loans	209
Total loans and leases	10,352,793
Owner occupied commercial mortgage | Commercial | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	1,345,296
2019	2,218,595
2018	1,850,128
2017	1,452,273
2016	1,203,335
Prior	1,943,057
Revolving loans	106,274
Revolving loans converted to term loans	137
Total loans and leases	10,119,095
Owner occupied commercial mortgage | Commercial | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	2,296
2019	11,164
2018	29,941
2017	13,089
2016	17,795
Prior	30,315
Revolving loans	2,742
Revolving loans converted to term loans	0
Total loans and leases	107,342
Owner occupied commercial mortgage | Commercial | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	9,186
2019	12,309
2018	16,886
2017	24,063
2016	14,255
Prior	40,331
Revolving loans	9,254
Revolving loans converted to term loans	72
Total loans and leases	126,356
Non-owner occupied commercial mortgage | Commercial
Financing Receivable, Credit Quality Indicator [Line Items]
2020	381,506
2019	688,209
2018	514,582
2017	454,666
2016	372,494
Prior	605,882
Revolving loans	38,989
Revolving loans converted to term loans	0
Total loans and leases	3,056,328
Non-owner occupied commercial mortgage | Commercial | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	380,269
2019	685,067
2018	490,693
2017	452,152
2016	360,096
Prior	595,139
Revolving loans	36,723
Revolving loans converted to term loans	0
Total loans and leases	3,000,139
Non-owner occupied commercial mortgage | Commercial | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	2,048
2018	20,236
2017	872
2016	5,885
Prior	7,658
Revolving loans	787
Revolving loans converted to term loans	0
Total loans and leases	37,486
Non-owner occupied commercial mortgage | Commercial | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	1,237
2019	1,094
2018	3,653
2017	1,642
2016	6,513
Prior	3,085
Revolving loans	1,479
Revolving loans converted to term loans	0
Total loans and leases	18,703
Commercial and industrial | Commercial
Financing Receivable, Credit Quality Indicator [Line Items]
2020	764,084
2019	1,214,859
2018	641,046
2017	412,777
2016	307,510
Prior	408,743
Revolving loans	895,316
Revolving loans converted to term loans	6,504
Total loans and leases	4,650,839
Commercial and industrial | Commercial | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	750,806
2019	1,207,639
2018	630,297
2017	401,635
2016	301,561
Prior	401,284
Revolving loans	805,691
Revolving loans converted to term loans	5,565
Total loans and leases	4,504,478
Commercial and industrial | Commercial | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	1,431
2019	3,426
2018	6,387
2017	5,534
2016	3,159
Prior	2,518
Revolving loans	13,928
Revolving loans converted to term loans	243
Total loans and leases	36,626
Commercial and industrial | Commercial | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	11,847
2019	3,794
2018	4,323
2017	5,608
2016	2,790
Prior	4,941
Revolving loans	22,084
Revolving loans converted to term loans	696
Total loans and leases	56,083
Commercial and industrial | Commercial | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	39
2017	0
2016	0
Prior	0
Revolving loans	2
Revolving loans converted to term loans	0
Total loans and leases	41
Commercial and industrial | Commercial | Ungraded
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving loans	53,611
Revolving loans converted to term loans	0
Total loans and leases	53,611
Residential mortgage | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	892,333
2019	1,109,142
2018	846,656
2017	766,388
2016	601,903
Prior	1,161,496
Revolving loans	26,764
Revolving loans converted to term loans	0
Total loans and leases	5,404,682
Revolving mortgage | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving loans	2,063,088
Revolving loans converted to term loans	170,889
Total loans and leases	2,233,977
Consumer auto | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	245,533
2019	423,177
2018	285,756
2017	143,643
2016	75,309
Prior	22,353
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	1,195,771
Consumer other | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	27,765
2019	40,966
2018	17,247
2017	9,616
2016	10,687
Prior	31,297
Revolving loans	405,510
Revolving loans converted to term loans	0
Total loans and leases	543,088
SBA-PPP | Commercial
Financing Receivable, Credit Quality Indicator [Line Items]
2020	3,084,549
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	3,084,549
SBA-PPP | Commercial | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	3,084,549
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	3,084,549
PCD Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2020	23,038
2019	32,662
2018	41,251
2017	41,608
2016	35,203
Prior	314,661
Revolving loans	15,769
Revolving loans converted to term loans	26,459
Total loans and leases	530,651	$ 558,716
Current | Construction and land development | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	88,063
2019	174,326
2018	52,270
2017	16,909
2016	8,123
Prior	7,881
Revolving loans	3,891
Revolving loans converted to term loans	0
Total loans and leases	351,463
Current | Residential mortgage | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	891,796
2019	1,105,486
2018	837,530
2017	755,457
2016	591,255
Prior	1,132,116
Revolving loans	23,673
Revolving loans converted to term loans	0
Total loans and leases	5,337,313
Current | Revolving mortgage | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving loans	2,054,864
Revolving loans converted to term loans	156,618
Total loans and leases	2,211,482
Current | Consumer auto | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	245,264
2019	421,363
2018	284,557
2017	142,512
2016	74,782
Prior	22,100
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	1,190,578
Current | Consumer other | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	27,655
2019	40,769
2018	17,093
2017	9,585
2016	10,595
Prior	31,275
Revolving loans	400,157
Revolving loans converted to term loans	0
Total loans and leases	537,129
Current | PCD Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2020	21,462
2019	28,900
2018	32,863
2017	39,973
2016	33,294
Prior	278,266
Revolving loans	14,999
Revolving loans converted to term loans	23,867
Total loans and leases	473,624
30 to 59 Days past due | Construction and land development | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	245
2019	1,312
2018	91
2017	0
2016	0
Prior	87
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	1,735
30 to 59 Days past due | Residential mortgage | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	488
2019	2,760
2018	2,985
2017	4,612
2016	2,594
Prior	11,685
Revolving loans	119
Revolving loans converted to term loans	0
Total loans and leases	25,243
30 to 59 Days past due | Revolving mortgage | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving loans	4,622
Revolving loans converted to term loans	4,252
Total loans and leases	8,874
30 to 59 Days past due | Consumer auto | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	172
2019	1,070
2018	654
2017	710
2016	319
Prior	168
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	3,093
30 to 59 Days past due | Consumer other | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	78
2019	33
2018	79
2017	31
2016	13
Prior	22
Revolving loans	2,177
Revolving loans converted to term loans	0
Total loans and leases	2,433
30 to 59 Days past due | PCD Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2020	1,005
2019	546
2018	199
2017	132
2016	808
Prior	15,591
Revolving loans	182
Revolving loans converted to term loans	387
Total loans and leases	18,850
60 to 89 Days past due | Construction and land development | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	11
2016	0
Prior	116
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	127
60 to 89 Days past due | Residential mortgage | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	26
2019	158
2018	326
2017	265
2016	1,851
Prior	4,456
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	7,082
60 to 89 Days past due | Revolving mortgage | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving loans	452
Revolving loans converted to term loans	4,163
Total loans and leases	4,615
60 to 89 Days past due | Consumer auto | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	75
2019	432
2018	239
2017	215
2016	132
Prior	31
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	1,124
60 to 89 Days past due | Consumer other | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	31
2019	67
2018	70
2017	0
2016	5
Prior	0
Revolving loans	1,518
Revolving loans converted to term loans	0
Total loans and leases	1,691
60 to 89 Days past due | PCD Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2020	117
2019	141
2018	37
2017	34
2016	0
Prior	3,669
Revolving loans	72
Revolving loans converted to term loans	624
Total loans and leases	4,694
90 Days or greater | Construction and land development | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	57
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	57
90 Days or greater | Residential mortgage | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	23
2019	738
2018	5,815
2017	6,054
2016	6,203
Prior	13,239
Revolving loans	2,972
Revolving loans converted to term loans	0
Total loans and leases	35,044
90 Days or greater | Revolving mortgage | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving loans	3,150
Revolving loans converted to term loans	5,856
Total loans and leases	9,006
90 Days or greater | Consumer auto | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	22
2019	312
2018	306
2017	206
2016	76
Prior	54
Revolving loans	0
Revolving loans converted to term loans	0
Total loans and leases	976
90 Days or greater | Consumer other | Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	1
2019	97
2018	5
2017	0
2016	74
Prior	0
Revolving loans	1,658
Revolving loans converted to term loans	0
Total loans and leases	1,835
90 Days or greater | PCD Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2020	454
2019	3,075
2018	8,152
2017	1,469
2016	1,101
Prior	17,135
Revolving loans	516
Revolving loans converted to term loans	1,581
Total loans and leases	$ 33,483

XML

Loans and Leases (Composition of the Loans and Leases Outstanding By Credit Quality Indicator) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans	$ 31,887,774	$ 28,322,780
Past due loans	228,304	272,770
Current loans	32,190,121	28,608,726
Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans	22,156,874	18,552,002
Commercial | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		12,282,635
Commercial | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		542,028
Commercial | Commercial and industrial and leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans	4,650,839	4,403,792
Commercial | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		310,093
Commercial | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans	1,012,365	1,013,454
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans	9,730,900	9,770,778
Consumer | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans	353,382	357,385
Consumer | Revolving mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		2,339,072
Consumer | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		1,780,404
Non-PCI Loans | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		18,552,002
Past due loans		74,146
Current loans		18,477,856
Non-PCI Loans | Commercial | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		12,282,635
Past due loans	29,698	37,482
Current loans	10,323,095	12,245,153
Non-PCI Loans | Commercial | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		542,028
Past due loans	17,416	1,890
Current loans	3,038,912	540,138
Non-PCI Loans | Commercial | Commercial and industrial and leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		4,403,792
Past due loans	17,875	28,143
Current loans	4,632,964	4,375,649
Non-PCI Loans | Commercial | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		310,093
Past due loans	68,342	588
Current loans	22,088,532	309,505
Non-PCI Loans | Commercial | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		1,013,454
Past due loans	3,353	6,043
Current loans	1,009,012	1,007,411
Non-PCI Loans | Commercial | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		18,157,655
Non-PCI Loans | Commercial | Pass | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		12,050,799
Non-PCI Loans | Commercial | Pass | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		536,682
Non-PCI Loans | Commercial | Pass | Commercial and industrial and leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		4,256,456
Non-PCI Loans | Commercial | Pass | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		308,796
Non-PCI Loans | Commercial | Pass | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		1,004,922
Non-PCI Loans | Commercial | Special Mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		166,866
Non-PCI Loans | Commercial | Special Mention | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		115,164
Non-PCI Loans | Commercial | Special Mention | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		3,899
Non-PCI Loans | Commercial | Special Mention | Commercial and industrial and leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		44,604
Non-PCI Loans | Commercial | Special Mention | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		622
Non-PCI Loans | Commercial | Special Mention | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		2,577
Non-PCI Loans | Commercial | Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		158,897
Non-PCI Loans | Commercial | Substandard | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		116,672
Non-PCI Loans | Commercial | Substandard | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		1,447
Non-PCI Loans | Commercial | Substandard | Commercial and industrial and leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		34,148
Non-PCI Loans | Commercial | Substandard | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		675
Non-PCI Loans | Commercial | Substandard | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		5,955
Non-PCI Loans | Commercial | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		3
Non-PCI Loans | Commercial | Doubtful | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		0
Non-PCI Loans | Commercial | Doubtful | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		0
Non-PCI Loans | Commercial | Doubtful | Commercial and industrial and leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		3
Non-PCI Loans | Commercial | Doubtful | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		0
Non-PCI Loans | Commercial | Doubtful | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		0
Non-PCI Loans | Commercial | Ungraded
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		68,581
Non-PCI Loans | Commercial | Ungraded | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		0
Non-PCI Loans | Commercial | Ungraded | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		0
Non-PCI Loans | Commercial | Ungraded | Commercial and industrial and leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		68,581
Non-PCI Loans | Commercial | Ungraded | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		0
Non-PCI Loans | Commercial | Ungraded | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		0
Non-PCI Loans | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		9,770,778
Past due loans	102,935	132,389
Current loans	9,627,965	9,638,389
Non-PCI Loans | Consumer | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		5,293,917
Past due loans		88,537
Current loans		5,205,380
Non-PCI Loans | Consumer | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		357,385
Past due loans	5,193	2,992
Current loans	1,190,578	354,393
Non-PCI Loans | Consumer | Revolving mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		2,339,072
Past due loans	1,919	23,062
Current loans	351,463	2,316,010
Non-PCI Loans | Consumer | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		1,780,404
Past due loans	5,959	17,798
Current loans	537,129	1,762,606
PCD Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	57,027	66,235
Current loans	473,624	492,481
PCD Loans | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		284,329
PCD Loans | Commercial | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		148,412
PCD Loans | Commercial | Special Mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		44,290
PCD Loans | Commercial | Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		87,970
PCD Loans | Commercial | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		3,657
PCD Loans | Commercial | Ungraded
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		0
PCD Loans | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-PCI loans		274,387
Current loans		240,995
30 to 59 Days past due
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	94,584	136,220
30 to 59 Days past due | Non-PCI Loans | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans		42,716
30 to 59 Days past due | Non-PCI Loans | Commercial | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	14,360	20,389
30 to 59 Days past due | Non-PCI Loans | Commercial | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	7,914	861
30 to 59 Days past due | Non-PCI Loans | Commercial | Commercial and industrial and leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	10,464	18,269
30 to 59 Days past due | Non-PCI Loans | Commercial | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	34,356	51
30 to 59 Days past due | Non-PCI Loans | Commercial | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	1,618	3,146
30 to 59 Days past due | Non-PCI Loans | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	41,378	67,026
30 to 59 Days past due | Non-PCI Loans | Consumer | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans		45,839
30 to 59 Days past due | Non-PCI Loans | Consumer | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	3,093	977
30 to 59 Days past due | Non-PCI Loans | Consumer | Revolving mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	1,735	9,729
30 to 59 Days past due | Non-PCI Loans | Consumer | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	2,433	10,481
30 to 59 Days past due | PCD Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	18,850	26,478
30 to 59 Days past due | PCD Loans | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans		13,764
60 to 89 Days past due
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	26,043	51,058
60 to 89 Days past due | Non-PCI Loans | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans		14,553
60 to 89 Days past due | Non-PCI Loans | Commercial | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	2,518	8,774
60 to 89 Days past due | Non-PCI Loans | Commercial | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	982	331
60 to 89 Days past due | Non-PCI Loans | Commercial | Commercial and industrial and leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	3,196	4,842
60 to 89 Days past due | Non-PCI Loans | Commercial | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	6,710	411
60 to 89 Days past due | Non-PCI Loans | Commercial | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	14	195
60 to 89 Days past due | Non-PCI Loans | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	14,639	25,721
60 to 89 Days past due | Non-PCI Loans | Consumer | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans		18,289
60 to 89 Days past due | Non-PCI Loans | Consumer | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	1,124	218
60 to 89 Days past due | Non-PCI Loans | Consumer | Revolving mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	127	3,468
60 to 89 Days past due | Non-PCI Loans | Consumer | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	1,691	3,746
60 to 89 Days past due | PCD Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	4,694	10,784
60 to 89 Days past due | PCD Loans | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans		5,608
90 Days or greater
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	107,677	85,492
90 Days or greater | Non-PCI Loans | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans		16,877
90 Days or greater | Non-PCI Loans | Commercial | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	12,820	8,319
90 Days or greater | Non-PCI Loans | Commercial | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	8,520	698
90 Days or greater | Non-PCI Loans | Commercial | Commercial and industrial and leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	4,215	5,032
90 Days or greater | Non-PCI Loans | Commercial | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	27,276	126
90 Days or greater | Non-PCI Loans | Commercial | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	1,721	2,702
90 Days or greater | Non-PCI Loans | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	46,918	39,642
90 Days or greater | Non-PCI Loans | Consumer | Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans		24,409
90 Days or greater | Non-PCI Loans | Consumer | Construction and land development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	976	1,797
90 Days or greater | Non-PCI Loans | Consumer | Revolving mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	57	9,865
90 Days or greater | Non-PCI Loans | Consumer | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	1,835	3,571
90 Days or greater | PCD Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans	$ 33,483	28,973
90 Days or greater | PCD Loans | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due loans		$ 14,020

XML

Loans and Leases (Purchased Loans and Leases) (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2020 USD ($)
Business Acquisition [Line Items]
Initial PCD allowance	$ 1,193
Discount	1,055
Community Financial
Business Acquisition [Line Items]
Contractually required payments	25,635
Initial PCD allowance	1,193
Fair value at acquisition date	23,387
Non-PCD loans purchased	110,602
Commercial | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	81,109
Consumer | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	29,493
Construction and land development | Commercial
Business Acquisition [Line Items]
Initial PCD allowance	0
Construction and land development | Commercial | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	9,428
Construction and land development | Consumer
Business Acquisition [Line Items]
Initial PCD allowance	0
Construction and land development | Consumer | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	5,254
Owner occupied commercial mortgage | Commercial
Business Acquisition [Line Items]
Initial PCD allowance	0
Owner occupied commercial mortgage | Commercial | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	31,473
Non-owner occupied commercial mortgage | Commercial
Business Acquisition [Line Items]
Initial PCD allowance	0
Non-owner occupied commercial mortgage | Commercial | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	25,143
Commercial and industrial | Commercial
Business Acquisition [Line Items]
Initial PCD allowance	0
Commercial and industrial | Commercial | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	15,065
Residential mortgage | Consumer
Business Acquisition [Line Items]
Initial PCD allowance	0
Residential mortgage | Consumer | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	21,168
Revolving mortgage | Consumer
Business Acquisition [Line Items]
Initial PCD allowance	0
Revolving mortgage | Consumer | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	2,084
Consumer auto | Consumer
Business Acquisition [Line Items]
Initial PCD allowance	0
Consumer auto | Consumer | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	294
Consumer other | Consumer
Business Acquisition [Line Items]
Initial PCD allowance	0
Consumer other | Consumer | Community Financial
Business Acquisition [Line Items]
Non-PCD loans purchased	$ 693

XML

Allowance for Credit Losses (Summary of Activity In Allowance for Loan and Lease Losses) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jan. 01, 2020
Receivables [Abstract]
Expected credit losses on SBA-PPP loans					$ 0
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	$ 209,259,000	$ 228,775,000	$ 225,141,000	$ 223,712,000
Provision (credits)	20,552,000	5,198,000	48,907,000	16,948,000
Initial PCD allowance			1,193,000
Charge-offs	(12,064,000)	(10,602,000)	(26,325,000)	(20,756,000)
Recoveries	4,703,000	3,212,000	11,458,000	6,679,000
Ending balance	222,450,000	226,583,000	222,450,000	226,583,000
Increase (decrease) in allowance	222,450,000	226,583,000	222,450,000	226,583,000	222,450,000
Decrease in allowance due to COVID-19			$ 36,100,000
Forecast period (years)			2 years
Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			$ (37,924,000)
Increase (decrease) in allowance			(37,924,000)			$ (37,900,000)
Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			187,217,000
Increase (decrease) in allowance			187,217,000
Commercial | Construction and land development
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	2,290,000	37,476,000	33,213,000	35,270,000
Provision (credits)	4,705,000	(5,544,000)	4,756,000	(3,425,000)
Initial PCD allowance			0
Charge-offs	(138,000)	(28,000)	(138,000)	(72,000)
Recoveries	49,000	40,000	136,000	171,000
Ending balance	6,906,000	31,944,000	6,906,000	31,944,000
Increase (decrease) in allowance	6,906,000	31,944,000	33,213,000	31,944,000	6,906,000
Commercial | Construction and land development | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			(31,061,000)
Increase (decrease) in allowance			(31,061,000)
Commercial | Construction and land development | Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			2,152,000
Increase (decrease) in allowance			2,152,000
Commercial | Owner occupied commercial mortgage
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	22,970,000		36,444,000
Provision (credits)	(721,000)		5,386,000
Initial PCD allowance			0
Charge-offs	0		(320,000)
Recoveries	240,000		295,000
Ending balance	22,489,000		22,489,000
Increase (decrease) in allowance	22,489,000		22,489,000		22,489,000
Commercial | Owner occupied commercial mortgage | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			(19,316,000)
Increase (decrease) in allowance			(19,316,000)
Commercial | Owner occupied commercial mortgage | Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			17,128,000
Increase (decrease) in allowance			17,128,000
Commercial | Non-owner occupied commercial mortgage
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	16,531,000		11,102,000
Provision (credits)	5,542,000		10,498,000
Initial PCD allowance			0
Charge-offs	(8,000)		(8,000)
Recoveries	84,000		97,000
Ending balance	22,149,000		22,149,000
Increase (decrease) in allowance	22,149,000		11,102,000		22,149,000
Commercial | Non-owner occupied commercial mortgage | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			460,000
Increase (decrease) in allowance			460,000
Commercial | Non-owner occupied commercial mortgage | Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			11,562,000
Increase (decrease) in allowance			11,562,000
Commercial | Commercial and industrial
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	30,619,000	57,025,000	61,610,000	55,620,000
Provision (credits)	(2,898,000)	2,699,000	7,525,000	5,424,000
Initial PCD allowance			0
Charge-offs	(3,869,000)	(3,422,000)	(8,918,000)	(5,280,000)
Recoveries	781,000	599,000	2,053,000	1,137,000
Ending balance	24,633,000	56,901,000	24,633,000	56,901,000
Increase (decrease) in allowance	24,633,000	56,901,000	24,633,000	55,620,000	24,633,000
Commercial | Commercial and industrial | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			(37,637,000)
Increase (decrease) in allowance			(37,637,000)
Commercial | Commercial and industrial | Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			23,973,000
Increase (decrease) in allowance			23,973,000
Commercial | Mortgage
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance		45,281,000		43,451,000
Provision (credits)		3,714,000		6,085,000
Charge-offs		(89,000)		(850,000)
Recoveries		56,000		276,000
Ending balance		48,962,000		48,962,000
Increase (decrease) in allowance		48,962,000		48,962,000
Commercial | Other commercial real estate
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance		2,399,000		2,481,000
Provision (credits)		(57,000)		(140,000)
Charge-offs		0		0
Recoveries		0		1,000
Ending balance		2,342,000		2,342,000
Increase (decrease) in allowance		2,342,000		2,342,000
Commercial | Other
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance		2,167,000		2,221,000
Provision (credits)		(174,000)		(672,000)
Charge-offs		(31,000)		(31,000)
Recoveries		221,000		665,000
Ending balance		2,183,000		2,183,000
Increase (decrease) in allowance		2,183,000		2,221,000
Consumer | Construction and land development
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	1,140,000	2,473,000	2,709,000	2,350,000
Provision (credits)	486,000	277,000	263,000	400,000
Initial PCD allowance			0
Charge-offs	0	0	(70,000)	0
Recoveries	14,000	0	29,000	0
Ending balance	1,640,000	2,750,000	1,640,000	2,750,000
Increase (decrease) in allowance	1,640,000	2,750,000	1,640,000	2,750,000	1,640,000
Consumer | Construction and land development | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			(1,291,000)
Increase (decrease) in allowance			(1,291,000)
Consumer | Construction and land development | Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			1,418,000
Increase (decrease) in allowance			1,418,000
Consumer | Residential mortgage
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	38,366,000	16,987,000	18,232,000	15,472,000
Provision (credits)	4,909,000	371,000	8,502,000	1,879,000
Initial PCD allowance			0
Charge-offs	(460,000)	(478,000)	(1,260,000)	(644,000)
Recoveries	57,000	52,000	280,000	225,000
Ending balance	42,872,000	16,932,000	42,872,000	16,932,000
Increase (decrease) in allowance	42,872,000	16,932,000	42,872,000	15,472,000	42,872,000
Consumer | Residential mortgage | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			17,118,000
Increase (decrease) in allowance			17,118,000
Consumer | Residential mortgage | Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			35,350,000
Increase (decrease) in allowance			35,350,000
Consumer | Revolving mortgage
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	24,557,000	21,495,000	19,702,000	21,862,000
Provision (credits)	2,211,000	(328,000)	3,515,000	(119,000)
Initial PCD allowance			0
Charge-offs	(495,000)	(493,000)	(1,080,000)	(1,456,000)
Recoveries	367,000	447,000	838,000	834,000
Ending balance	26,640,000	21,121,000	26,640,000	21,121,000
Increase (decrease) in allowance	26,640,000	21,121,000	26,640,000	21,121,000	26,640,000
Consumer | Revolving mortgage | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			3,665,000
Increase (decrease) in allowance			3,665,000
Consumer | Revolving mortgage | Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			23,367,000
Increase (decrease) in allowance			23,367,000
Consumer | Consumer auto
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	5,769,000		4,292,000
Provision (credits)	4,042,000		5,000,000
Initial PCD allowance			0
Charge-offs	(1,255,000)		(2,199,000)
Recoveries	342,000		705,000
Ending balance	8,898,000		8,898,000
Increase (decrease) in allowance	8,898,000		4,292,000		8,898,000
Consumer | Consumer auto | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			1,100,000
Increase (decrease) in allowance			1,100,000
Consumer | Consumer auto | Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			5,392,000
Increase (decrease) in allowance			5,392,000
Consumer | Consumer other
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	40,101,000		30,301,000
Provision (credits)	2,034,000		5,808,000
Initial PCD allowance			0
Charge-offs	(4,447,000)		(9,817,000)
Recoveries	1,607,000		2,966,000
Ending balance	39,295,000		39,295,000
Increase (decrease) in allowance	39,295,000		39,295,000		39,295,000
Consumer | Consumer other | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			10,037,000
Increase (decrease) in allowance			10,037,000
Consumer | Consumer other | Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			40,338,000
Increase (decrease) in allowance			40,338,000
Consumer | Consumer
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance		34,492,000		35,841,000
Provision (credits)		4,877,000		8,317,000
Charge-offs		(6,061,000)		(12,423,000)
Recoveries		1,797,000		3,370,000
Ending balance		35,105,000		35,105,000
Increase (decrease) in allowance		35,105,000		35,105,000
Non-PCD Loans
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			217,605,000
Increase (decrease) in allowance			217,605,000
Non-PCD Loans | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Increase (decrease) in allowance						(56,900,000)
Non-PCD Loans | Commercial | Construction and land development
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			33,213,000
Increase (decrease) in allowance			33,213,000
Non-PCD Loans | Commercial | Commercial and industrial
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			59,374,000
Increase (decrease) in allowance			59,374,000
Non-PCD Loans | Commercial | Mortgage
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			45,335,000
Increase (decrease) in allowance			45,335,000
Non-PCD Loans | Commercial | Other commercial real estate
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			2,211,000
Increase (decrease) in allowance			2,211,000
Non-PCD Loans | Commercial | Other
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			2,236,000
Increase (decrease) in allowance			2,236,000
Non-PCD Loans | Consumer | Construction and land development
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			2,709,000
Increase (decrease) in allowance			2,709,000
Non-PCD Loans | Consumer | Mortgage
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			18,232,000
Increase (decrease) in allowance			18,232,000
Non-PCD Loans | Consumer | Consumer
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			34,593,000
Increase (decrease) in allowance			34,593,000
PCD Loans
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	26,916,000	8,980,000	7,536,000	9,144,000
Provision (credits)	242,000	(637,000)	(2,346,000)	(801,000)
Initial PCD allowance			1,193,000
Charge-offs	(1,392,000)	0	(2,515,000)	0
Recoveries	1,162,000	0	4,059,000	0
Ending balance	26,928,000	8,343,000	26,928,000	8,343,000
Increase (decrease) in allowance	$ 26,928,000	$ 8,343,000	7,536,000	$ 8,343,000	$ 26,928,000
PCD Loans | Adoption of ASC 326
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			19,001,000
Increase (decrease) in allowance			19,001,000			$ 19,000,000.0
PCD Loans | Adjusted Balance
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance			26,537,000
Increase (decrease) in allowance			$ 26,537,000

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Allowance for Credit Losses (Collateral Dependent Loans) (Details)	Jun. 30, 2020 USD ($)
Financing Receivable, Allowance for Credit Loss [Line Items]
Threshold balance for collateral-dependent loans to be individually reviewed for impairment	$ 500,000
Collateral-Dependant Loans	62,315,000
Net Realizable Value of Collateral	$ 98,633,000
Collateral Coverage	158.30%
Allowance for Credit Losses	$ 310,000
Non-PCD Loans
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	40,302,000
Net Realizable Value of Collateral	$ 64,812,000
Collateral Coverage	160.80%
Allowance for Credit Losses	$ 75,000
Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	20,547,000
Net Realizable Value of Collateral	$ 38,903,000
Collateral Coverage	189.30%
Allowance for Credit Losses	$ 0
Non-PCD Loans | Consumer
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	19,755,000
Net Realizable Value of Collateral	$ 25,909,000
Collateral Coverage	131.20%
Allowance for Credit Losses	$ 75,000
PCD Loans
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	22,013,000
Net Realizable Value of Collateral	$ 33,821,000
Collateral Coverage	153.60%
Allowance for Credit Losses	$ 235,000
Construction and land development | Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	2,862,000
Net Realizable Value of Collateral	$ 3,224,000
Collateral Coverage	112.60%
Allowance for Credit Losses	$ 0
Construction and land development | Non-PCD Loans | Consumer
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	0
Net Realizable Value of Collateral	$ 0
Collateral Coverage	0.00%
Allowance for Credit Losses	$ 0
Owner occupied commercial mortgage | Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	10,690,000
Net Realizable Value of Collateral	$ 24,546,000
Collateral Coverage	229.60%
Allowance for Credit Losses	$ 0
Non-owner occupied commercial mortgage | Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	6,995,000
Net Realizable Value of Collateral	$ 11,133,000
Collateral Coverage	159.20%
Allowance for Credit Losses	$ 0
Commercial and industrial | Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	0
Net Realizable Value of Collateral	$ 0
Collateral Coverage	0.00%
Allowance for Credit Losses	$ 0
Residential mortgage | Non-PCD Loans | Consumer
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	19,445,000
Net Realizable Value of Collateral	$ 25,599,000
Collateral Coverage	131.60%
Allowance for Credit Losses	$ 75,000
Revolving mortgage | Non-PCD Loans | Consumer
Financing Receivable, Allowance for Credit Loss [Line Items]
Collateral-Dependant Loans	310,000
Net Realizable Value of Collateral	$ 310,000
Collateral Coverage	100.00%
Allowance for Credit Losses	$ 0

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Allowance for Credit Losses (Allocation of Allowance for Loan and Lease Losses) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018
Financing Receivable, Allowance for Credit Loss [Line Items]
Total allowance for loan and lease losses	$ 222,450	$ 209,259	$ 225,141	$ 226,583	$ 228,775	$ 223,712
Total loan and leases	32,195,975		28,656,355
Loans acquired with deteriorated credit quality	530,651		558,716
Commercial | Construction and land development
Financing Receivable, Allowance for Credit Loss [Line Items]
Total allowance for loan and lease losses	6,906	2,290	33,213	31,944	37,476	35,270
Commercial | Mortgage
Financing Receivable, Allowance for Credit Loss [Line Items]
Total allowance for loan and lease losses				48,962	45,281	43,451
Commercial | Other commercial real estate
Financing Receivable, Allowance for Credit Loss [Line Items]
Total allowance for loan and lease losses				2,342	2,399	2,481
Commercial | Commercial and industrial
Financing Receivable, Allowance for Credit Loss [Line Items]
Total allowance for loan and lease losses	24,633	30,619	61,610	56,901	57,025	55,620
Commercial | Other
Financing Receivable, Allowance for Credit Loss [Line Items]
Total allowance for loan and lease losses				2,183	2,167	2,221
Consumer | Construction and land development
Financing Receivable, Allowance for Credit Loss [Line Items]
Total allowance for loan and lease losses	1,640	1,140	2,709	2,750	2,473	2,350
Consumer | Consumer
Financing Receivable, Allowance for Credit Loss [Line Items]
Total allowance for loan and lease losses				35,105	34,492	35,841
Non-PCD Loans
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			12,915
ALLL for loans and leases collectively evaluated for impairment			204,690
Total allowance for loan and lease losses			217,605
Loans and leases individually evaluated for impairment			185,599
Loans and leases collectively evaluated for impairment			28,137,181
Total loan and leases			28,322,780
Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			5,634
Loans and leases individually evaluated for impairment			88,893
Non-PCD Loans | Commercial | Construction and land development
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			463
ALLL for loans and leases collectively evaluated for impairment			32,750
Total allowance for loan and lease losses			33,213
Loans and leases individually evaluated for impairment			4,655
Loans and leases collectively evaluated for impairment			1,008,799
Total loan and leases			1,013,454
Non-PCD Loans | Commercial | Mortgage
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			3,650
ALLL for loans and leases collectively evaluated for impairment			41,685
Total allowance for loan and lease losses			45,335
Loans and leases individually evaluated for impairment			70,149
Loans and leases collectively evaluated for impairment			12,212,486
Total loan and leases			12,282,635
Non-PCD Loans | Commercial | Other commercial real estate
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			39
ALLL for loans and leases collectively evaluated for impairment			2,172
Total allowance for loan and lease losses			2,211
Loans and leases individually evaluated for impairment			1,268
Loans and leases collectively evaluated for impairment			540,760
Total loan and leases			542,028
Non-PCD Loans | Commercial | Commercial and industrial
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			1,379
ALLL for loans and leases collectively evaluated for impairment			57,995
Total allowance for loan and lease losses			59,374
Loans and leases individually evaluated for impairment			12,182
Loans and leases collectively evaluated for impairment			4,391,610
Total loan and leases			4,403,792
Non-PCD Loans | Commercial | Other
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			103
ALLL for loans and leases collectively evaluated for impairment			2,133
Total allowance for loan and lease losses			2,236
Loans and leases individually evaluated for impairment			639
Loans and leases collectively evaluated for impairment			309,454
Total loan and leases			310,093
Non-PCD Loans | Consumer | Construction and land development
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			174
ALLL for loans and leases collectively evaluated for impairment			2,535
Total allowance for loan and lease losses			2,709
Loans and leases individually evaluated for impairment			3,882
Loans and leases collectively evaluated for impairment			353,503
Total loan and leases			357,385
Non-PCD Loans | Consumer | Mortgage
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			3,278
ALLL for loans and leases collectively evaluated for impairment			14,954
Total allowance for loan and lease losses			18,232
Loans and leases individually evaluated for impairment			60,442
Loans and leases collectively evaluated for impairment			5,233,475
Total loan and leases			5,293,917
Non-PCD Loans | Consumer | Revolving mortgage
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			2,722
ALLL for loans and leases collectively evaluated for impairment			16,980
Total allowance for loan and lease losses			19,702
Loans and leases individually evaluated for impairment			28,869
Loans and leases collectively evaluated for impairment			2,310,203
Total loan and leases			2,339,072
Non-PCD Loans | Consumer | Consumer
Financing Receivable, Allowance for Credit Loss [Line Items]
ALLL for loans and leases individually evaluated for impairment			1,107
ALLL for loans and leases collectively evaluated for impairment			33,486
Total allowance for loan and lease losses			34,593
Loans and leases individually evaluated for impairment			3,513
Loans and leases collectively evaluated for impairment			1,776,891
Total loan and leases			1,780,404
PCD Loans
Financing Receivable, Allowance for Credit Loss [Line Items]
Total allowance for loan and lease losses	$ 26,928	$ 26,916	7,536	$ 8,343	$ 8,980	$ 9,144
PCD Loans
Financing Receivable, Allowance for Credit Loss [Line Items]
Acquired loans which have adverse change in expected cash flows			$ 139,400

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Allowance for Credit Losses (Non-PCI Impaired Loans and Leases) (Details) - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019	Dec. 31, 2019
Financing Receivable, Allowance for Credit Loss [Line Items]
Non-PCI impaired loans collective maximum balance collectively evaluated for impairment			$ 500,000
Impaired financing receivable, collectively evaluated			41,000,000.0
Non-PCD Loans
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			133,358,000
With no recorded allowance			52,241,000
Loans and leases individually evaluated for impairment			185,599,000
Unpaid principal balance			200,599,000
Related allowance recorded			12,915,000
Average balance	$ 157,877,000	$ 152,886,000
Interest income recognized	1,301,000	2,640,000
Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			52,516,000
With no recorded allowance			36,377,000
Loans and leases individually evaluated for impairment			88,893,000
Unpaid principal balance			95,927,000
Related allowance recorded			5,634,000
Average balance	73,203,000	71,491,000
Interest income recognized	665,000	1,367,000
Non-PCD Loans | Noncommercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			80,842,000
With no recorded allowance			15,864,000
Loans and leases individually evaluated for impairment			96,706,000
Unpaid principal balance			104,672,000
Related allowance recorded			7,281,000
Average balance	84,674,000	81,395,000
Interest income recognized	636,000	1,273,000
Construction and land development | Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			1,851,000
With no recorded allowance			2,804,000
Loans and leases individually evaluated for impairment			4,655,000
Unpaid principal balance			5,109,000
Related allowance recorded			463,000
Average balance	2,102,000	2,125,000
Interest income recognized	6,000	34,000
Construction and land development | Non-PCD Loans | Noncommercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			2,470,000
With no recorded allowance			1,412,000
Loans and leases individually evaluated for impairment			3,882,000
Unpaid principal balance			4,150,000
Related allowance recorded			174,000
Average balance	3,547,000	3,647,000
Interest income recognized	32,000	68,000
Mortgage | Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			42,394,000
With no recorded allowance			27,755,000
Loans and leases individually evaluated for impairment			70,149,000
Unpaid principal balance			74,804,000
Related allowance recorded			3,650,000
Average balance	58,906,000	57,768,000
Interest income recognized	538,000	1,102,000
Mortgage | Non-PCD Loans | Noncommercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			48,796,000
With no recorded allowance			11,646,000
Loans and leases individually evaluated for impairment			60,442,000
Unpaid principal balance			64,741,000
Related allowance recorded			3,278,000
Average balance	48,490,000	45,558,000
Interest income recognized	317,000	642,000
Revolving mortgage | Non-PCD Loans | Noncommercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			26,104,000
With no recorded allowance			2,765,000
Loans and leases individually evaluated for impairment			28,869,000
Unpaid principal balance			31,960,000
Related allowance recorded			2,722,000
Average balance	29,623,000	29,183,000
Interest income recognized	256,000	503,000
Consumer | Non-PCD Loans | Noncommercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			3,472,000
With no recorded allowance			41,000
Loans and leases individually evaluated for impairment			3,513,000
Unpaid principal balance			3,821,000
Related allowance recorded			1,107,000
Average balance	3,014,000	3,007,000
Interest income recognized	31,000	60,000
Other | Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			406,000
With no recorded allowance			233,000
Loans and leases individually evaluated for impairment			639,000
Unpaid principal balance			661,000
Related allowance recorded			103,000
Average balance	328,000	322,000
Interest income recognized	2,000	4,000
Other commercial real estate | Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			318,000
With no recorded allowance			950,000
Loans and leases individually evaluated for impairment			1,268,000
Unpaid principal balance			1,360,000
Related allowance recorded			39,000
Average balance	519,000	602,000
Interest income recognized	6,000	14,000
Commercial and industrial and leases | Non-PCD Loans | Commercial
Financing Receivable, Allowance for Credit Loss [Line Items]
With a recorded allowance			7,547,000
With no recorded allowance			4,635,000
Loans and leases individually evaluated for impairment			12,182,000
Unpaid principal balance			13,993,000
Related allowance recorded			$ 1,379,000
Average balance	11,348,000	10,674,000
Interest income recognized	$ 113,000	$ 213,000

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Allowance for Credit Losses (Troubled Debt Restructuring) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Jan. 01, 2020	Dec. 31, 2019
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	$ 201,505		$ 171,192
Nonaccruing	197,791	$ 168,717	121,689
Commercial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			77,536
Commercial | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			2,766
Commercial | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			61,935
Commercial | Other commercial real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			571
Commercial | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			11,839
Commercial | Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			425
Consumer
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			93,656
Consumer | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			3,882
Consumer | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	49,606		57,861
Consumer | Revolving mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			28,399
Consumer | Consumer and Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			3,514
Accruing
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	154,813		128,750
Accruing | Commercial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			61,627
Accruing | Commercial | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			487
Accruing | Commercial | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			50,819
Accruing | Commercial | Other commercial real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			571
Accruing | Commercial | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			9,430
Accruing | Commercial | Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			320
Accruing | Consumer
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			67,123
Accruing | Consumer | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			1,452
Accruing | Consumer | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	35,439		41,813
Accruing | Consumer | Revolving mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			21,032
Accruing | Consumer | Consumer and Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			2,826
Nonaccruing
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	46,692		42,442
Nonaccruing | Commercial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			15,909
Nonaccruing | Commercial | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing			2,279
Nonaccruing | Commercial | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing			11,116
Nonaccruing | Commercial | Other commercial real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing			0
Nonaccruing | Commercial | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing			2,409
Nonaccruing | Commercial | Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing			105
Nonaccruing | Consumer
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring			26,533
Nonaccruing | Consumer | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing			2,430
Nonaccruing | Consumer | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing	14,167		16,048
Nonaccruing | Consumer | Revolving mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing			7,367
Nonaccruing | Consumer | Consumer and Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing			688
Non-PCD Loans | Commercial | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	2,376
Non-PCD Loans | Commercial | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	47,762
Non-PCD Loans | Commercial | Other commercial real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	7,656
Non-PCD Loans | Commercial | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	32,266
Non-PCD Loans | Commercial | Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	90,060
Non-PCD Loans | Consumer
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	86,782
Non-PCD Loans | Consumer | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	2,785
Non-PCD Loans | Consumer | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	29,354
Non-PCD Loans | Consumer | Revolving mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	3,807
Non-PCD Loans | Consumer | Consumer and Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	1,230
Non-PCD Loans | Accruing | Commercial | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	1,072
Non-PCD Loans | Accruing | Commercial | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	35,080
Non-PCD Loans | Accruing | Commercial | Other commercial real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	7,343
Non-PCD Loans | Accruing | Commercial | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	29,463
Non-PCD Loans | Accruing | Commercial | Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	72,958
Non-PCD Loans | Accruing | Consumer
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	63,216
Non-PCD Loans | Accruing | Consumer | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	1,989
Non-PCD Loans | Accruing | Consumer | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	22,342
Non-PCD Loans | Accruing | Consumer | Revolving mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	2,355
Non-PCD Loans | Accruing | Consumer | Consumer and Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	1,091
Non-PCD Loans | Nonaccruing | Commercial | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing	1,304
Non-PCD Loans | Nonaccruing | Commercial | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing	12,682
Non-PCD Loans | Nonaccruing | Commercial | Other commercial real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing	313
Non-PCD Loans | Nonaccruing | Commercial | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing	2,803
Non-PCD Loans | Nonaccruing | Commercial | Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing	17,102
Non-PCD Loans | Nonaccruing | Consumer
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	23,566
Non-PCD Loans | Nonaccruing | Consumer | Construction and land development
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing	796
Non-PCD Loans | Nonaccruing | Consumer | Mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing	7,012
Non-PCD Loans | Nonaccruing | Consumer | Revolving mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing	1,452
Non-PCD Loans | Nonaccruing | Consumer | Consumer and Other
Financing Receivable, Troubled Debt Restructuring [Line Items]
Nonaccruing	139
PCD Loans
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	24,663		$ 17,200
PCD Loans | Accruing
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	18,639
PCD Loans | Nonaccruing
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructuring	$ 6,024

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Allowance for Credit Losses (Note Restructurings During Period) (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020 USD ($) loans	Jun. 30, 2019 USD ($) loans	Jun. 30, 2020 USD ($) loans	Jun. 30, 2019 USD ($) loans
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loans	146	115	317	239
Recorded investment at period end | $	$ 37,040	$ 17,374	$ 54,014	$ 24,522
Number of Loans | loans	43	62	109	120
Recorded investment at period end | $	$ 6,237	$ 5,901	$ 8,896	$ 12,330
Interest only period provided
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loans	7	4	17	4
Recorded investment at period end | $	$ 15,352	$ 4,343	$ 19,328	$ 4,343
Number of Loans | loans	3	0	3	2
Recorded investment at period end | $	$ 3,398	$ 0	$ 3,398	$ 3,203
Loan term extension
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loans	27	4	33	8
Recorded investment at period end | $	$ 2,925	$ 998	$ 3,657	$ 1,437
Number of Loans | loans	13	2	16	4
Recorded investment at period end | $	$ 1,459	$ 183	$ 1,667	$ 534
Below market interest rate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loans	69	67	157	125
Recorded investment at period end | $	$ 17,291	$ 6,979	$ 25,389	$ 11,063
Number of Loans | loans	18	30	46	61
Recorded investment at period end | $	$ 1,069	$ 2,612	$ 2,324	$ 4,645
Discharged from bankruptcy
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loans	43	40	110	102
Recorded investment at period end | $	$ 1,472	$ 5,054	$ 5,640	$ 7,679
Number of Loans | loans	9	30	44	53
Recorded investment at period end | $	$ 311	$ 3,106	$ 1,507	$ 3,948

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Other Real Estate Owned (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Real Estate Properties [Line Items]
Mortgage Loans in Process of Foreclosure, Amount	$ 25,500		$ 23,000
Gains (losses) on sales of OREO	(234)	$ 872
OREO
Beginning balance	46,591	48,030
Additions	9,184	7,894
Sales	(9,497)	(11,012)
Write-downs/losses	(2,241)	(2,289)
Ending balance	53,850	46,236
Mortgage
OREO
Beginning balance	14,500
Ending balance	11,700
2019 Acquisitions
OREO
Additions	$ 9,813	$ 3,613

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Servicing Rights (MSR Carrying Value) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Servicing Asset at Amortized Cost, Balance [Roll Forward]
Beginning balance	$ 19,756,000	$ 20,647,000	$ 22,963,000	$ 21,396,000
Servicing rights originated	2,096,000	1,552,000	3,679,000	2,411,000
Amortization	(2,119,000)	(1,567,000)	(3,942,000)	(3,014,000)
Valuation allowance (increase) decrease	(1,069,000)	33,000	(4,036,000)	(128,000)
Ending balance	$ 18,664,000	$ 20,665,000	$ 18,664,000	$ 20,665,000

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Servicing Rights (Valuation allowance) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Valuation Allowance for Impairment of Recognized Servicing Assets [Roll Forward]
Beginning balance	$ 3,189,000	$ 161,000	$ 222,000	$ 0
Valuation allowance increase	1,069,000	(33,000)	4,036,000	128,000
Ending balance	$ 4,258,000	$ 128,000	$ 4,258,000	$ 128,000

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Servicing Rights (Economic Assumptions) (Details) - USD ($)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Servicing Asset Key Economic Assumptions [Line Items]
Weighted average constant prepayment rate	20.19%	13.72%
Weighted average cost to service a loan	$ 87.30	$ 87.09
Fixed Rate Residential Mortgage
Servicing Asset Key Economic Assumptions [Line Items]
Discount rate	7.66%	8.92%
Discount rate, basis spread on Treasury rate	700.00%
All Loans and Leases, Excluding Conventional Fixed Loans
Servicing Asset Key Economic Assumptions [Line Items]
Discount rate	8.66%	9.92%
Discount rate, basis spread on Treasury rate	800.00%

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Servicing Rights (Narrative) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Mortgage Servicing Rights [Abstract]
Residential Mortgage Loans Serviced	$ 3,370,000,000		$ 3,370,000,000		$ 3,380,000,000
Contractually Specified Servicing Fee, Late Fee, and Ancillary Fee Earned in Exchange for Servicing Financial Asset	2,100,000	$ 2,000,000.0	4,300,000	$ 3,900,000
Valuation allowance increase	$ 1,069,000	$ (33,000)	$ 4,036,000	$ 128,000

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Repurchase Agreements (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Assets Sold under Agreements to Repurchase [Line Items]
Securities Sold under Agreements to Repurchase, Fair Value of Collateral	$ 766,800
Securities sold under customer repurchase agreements	740,276	$ 442,956
Available-for-sale Securities
Assets Sold under Agreements to Repurchase [Line Items]
Securities Sold under Agreements to Repurchase, Fair Value of Collateral		477,600
Overnight and continuous
Assets Sold under Agreements to Repurchase [Line Items]
Securities sold under customer repurchase agreements	740,300
Overnight and continuous | US Government Agencies Debt Securities
Assets Sold under Agreements to Repurchase [Line Items]
Securities sold under customer repurchase agreements	470,800	$ 443,000
Overnight and continuous | Commercial Mortgage Backed Securities
Assets Sold under Agreements to Repurchase [Line Items]
Securities sold under customer repurchase agreements	$ 269,500

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FDIC Shared-Loss Payable (Narrative) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
FDIC Shared-Loss Receivable [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount, Covered	$ 38,000
FDIC shared-loss payable	$ 15,025	$ 112,395

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FDIC Shared-Loss Payable FDIC Shared-Loss Payable (Changes in Payable to FDIC) (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2020 USD ($)
FDIC Shared-Payable [Abstract]
FDIC shared-loss payable	$ 112,395
Accretion	2,098
Payment made to the FDIC to settle shared-loss agreement	(99,468)
FDIC shared-loss payable	$ 15,025

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Accumulated Other Comprehensive Income (Loss) (Schedule Of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Accumulated Other Comprehensive Income (Loss), before Tax	$ (12,552)		$ (12,552)		$ (164,576)
Deferred tax expense (benefit)	(2,888)		(2,888)		(37,853)
Accumulated other comprehensive income (loss), net of tax	(9,664)		(9,664)		(126,723)
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	5,663	$ (2,281)	16,082	$ (8,993)
Unrealized Losses on Investment Securities Available for Sale
Accumulated Other Comprehensive Income (Loss), before Tax	146,884		146,884		7,522
Deferred tax expense (benefit)	33,782		33,782		1,730
Accumulated other comprehensive income (loss), net of tax	113,102		113,102		5,792
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	10,589	4,404	25,831	4,404
Unrealized Losses On Securities Available For Sale Transferred To Held To Maturity
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	0	(4,579)	0	(9,170)
Funded Status of Defined Benefit Plan
Accumulated Other Comprehensive Income (Loss), before Tax	(159,436)		(159,436)		(172,098)
Deferred tax expense (benefit)	(36,670)		(36,670)		(39,583)
Accumulated other comprehensive income (loss), net of tax	(122,766)		(122,766)		$ (132,515)
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	(4,926)	(2,106)	(9,749)	(4,227)
Amortization of actuarial losses and prior service cost		(2,721)		(5,462)
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, before Tax	$ 6,398	$ 2,735	$ 12,662	$ 5,490

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Accumulated Other Comprehensive Income (Loss) (Components of AOCI) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Accumulated Other Comprehensive Income (Loss) [Line Items]
Amounts reclassified from accumulated other comprehensive loss	$ (5,663)	$ 2,281	$ (16,082)	$ 8,993
Net current period other comprehensive income	15,948	26,129	117,059	54,456
Unrealized Losses on Investment Securities Available for Sale
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	102,080		5,792
Net unrealized gains arising during period	21,611	23,848	133,141	45,463
Amounts reclassified from accumulated other comprehensive loss	(10,589)	(4,404)	(25,831)	(4,404)
Net current period other comprehensive income	11,022	19,444	107,310	41,059
Ending balance	113,102	2,554	113,102	2,554
Unrealized Losses On Securities Available For Sale Transferred To Held To Maturity
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	0		0
Net unrealized gains arising during period	0	0	0	0
Amounts reclassified from accumulated other comprehensive loss	0	4,579	0	9,170
Net current period other comprehensive income	0	4,579	0	9,170
Ending balance	0	(61,979)	0	(61,979)
Defined Benefit Pension Items
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(127,692)		(132,515)
Net unrealized gains arising during period	0	0	0	0
Amounts reclassified from accumulated other comprehensive loss	4,926	2,106	9,749	4,227
Net current period other comprehensive income	4,926	2,106	9,749	4,227
Ending balance	(122,766)	(121,306)	(122,766)	(121,306)
Accumulated Other Comprehensive (Loss) Income
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(25,612)		(126,723)
Net unrealized gains arising during period	21,611	23,848	133,141	45,463
Amounts reclassified from accumulated other comprehensive loss	(5,663)	2,281	(16,082)	8,993
Net current period other comprehensive income	15,948	26,129	117,059	54,456
Ending balance	$ (9,664)	(180,731)	$ (9,664)	(180,731)
Previously Reported | Unrealized Losses on Investment Securities Available for Sale
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance		(16,890)		(38,505)
Previously Reported | Unrealized Losses On Securities Available For Sale Transferred To Held To Maturity
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance		(66,558)		(71,149)
Previously Reported | Defined Benefit Pension Items
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance		(123,412)		(125,533)
Previously Reported | Accumulated Other Comprehensive (Loss) Income
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance		$ (206,860)		$ (235,187)

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Accumulated Other Comprehensive Income (Loss) (Reclassifications out of AOCI) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, before Tax	$ 13,752	$ 5,719	$ 33,547	$ 5,719
Amounts reclassified from accumulated other comprehensive income, net of tax	(5,663)	2,281	(16,082)	8,993
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, Tax	1,472	629	2,913	1,263
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, after Tax	(4,926)	(2,106)	(9,749)	(4,227)
Tax effect	3,163	1,315	7,716	1,315
Unrealized Losses on Investment Securities Available for Sale
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, before Tax	13,752	5,719	33,547	5,719
Amounts reclassified from accumulated other comprehensive income, net of tax	(10,589)	(4,404)	(25,831)	(4,404)
Tax effect	3,163	1,315	7,716	1,315
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax	10,589	4,404	25,831	4,404
Defined Benefit Pension Items
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Amortization of actuarial losses and prior service cost		(2,721)		(5,462)
Total before taxes	(6,398)	(2,735)	(12,662)	(5,490)
Amounts reclassified from accumulated other comprehensive income, net of tax	4,926	2,106	9,749	4,227
Other Comprehensive (Income) Loss, Defined Benefit Plan, Prior Service Cost (Credit), Reclassification Adjustment from AOCI, before Tax		(14)		(28)
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, Tax	1,472	629	2,913	1,263
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, after Tax	(4,926)	(2,106)	(9,749)	(4,227)
Unrealized Losses On Securities Available For Sale Transferred To Held To Maturity
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Amounts reclassified from accumulated other comprehensive income, net of tax	$ 0	4,579	$ 0	9,170
Other Comprehensive Income (Loss) Reclassification Adjustment Of Unrealized Losses From AOCI For Securities Available For Sale Transferred To Held To Maturity Before Tax		(5,947)		(11,909)
Other Comprehensive Income (Loss) Reclassification Adjustment Of Unrealized Losses From AOCI For Securities Available For Sale Transferred To Held To Maturity Tax		1,368		2,739
Other Comprehensive Income (Loss) Reclassification Adjustment Of Unrealized Losses From AOCI For Securities Available For Sale Transferred To Held To Maturity Net Of Tax		$ (4,579)		$ (9,170)

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Estimated Fair Values (Estimated Fair Values For Certain Financial Assets And Financial Liabilities) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and due from banks	$ 389,233	$ 376,719
Overnight investments	3,107,575	1,107,844
Debt Securities, Available-for-sale	8,619,282	7,059,674
Investment securities held to maturity at cost	774,878	30,996
Investment in marketable equity securities	114,316	82,333
Loans held for sale	107,900	67,900
Loans and Leases Receivable, Net Amount	32,195,975	28,656,355
Income earned not collected	175,496	123,154
Stock issued by Federal Home Loan Bank	45,400	43,000
Deposits	41,479,245	34,431,236
Securities sold under customer repurchase agreements	740,276	442,956
FDIC shared-loss payable	15,025	112,395
Subordinated Debt	504,246	163,412
Other Borrowings	96,791	148,318
Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Federal Home Loan Bank Advances	657,682	572,185
Cash and due from banks	389,233	376,719
Overnight investments	3,107,575	1,107,844
Debt Securities, Available-for-sale	8,619,282	7,059,674
Investment securities held to maturity at cost	774,878	30,996
Investment in marketable equity securities	114,316	82,333
Loans held for sale	107,881	67,869
Loans and Leases Receivable, Net Amount	32,195,975	28,656,355
Income earned not collected	175,496	123,154
Stock issued by Federal Home Loan Bank	45,392	43,039
Mortgage servicing rights	20,167	24,891
Deposits	38,202,609	30,593,627
Time deposits	3,276,636	3,837,609
Securities sold under customer repurchase agreements	740,276	442,956
FDIC shared-loss payable	15,025	112,395
Accrued interest payable	14,085	18,124
Subordinated Debt	504,246	163,412
Other Borrowings	96,791	148,318
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Federal Home Loan Bank Advances	679,993	577,362
Cash and due from banks	389,233	376,719
Overnight investments	3,107,575	1,107,844
Debt Securities, Available-for-sale	8,619,282	7,059,674
Investment securities held to maturity at cost	791,325	30,996
Investment in marketable equity securities	114,316	82,333
Loans held for sale	107,881	67,869
Loans and Leases Receivable, Net Amount	32,604,388	28,878,550
Income earned not collected	175,496	123,154
Stock issued by Federal Home Loan Bank	45,392	43,039
Mortgage servicing rights	21,163	26,927
Deposits	38,202,609	30,593,627
Time deposits	3,303,841	3,842,162
Securities sold under customer repurchase agreements	740,276	442,956
FDIC shared-loss payable	15,730	114,252
Accrued interest payable	14,085	18,124
Subordinated Debt	506,089	173,685
Other Borrowings	$ 95,861	$ 149,232

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Estimated Fair Values (Assets And Liabilities Carried At Fair Value On A Recurring Basis) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	$ 8,619,282	$ 7,059,674
Investment securities available for sale	8,619,282	7,059,674
Investment in marketable equity securities	114,316	82,333
Loans held for sale	107,881	67,869
Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	8,619,282
Investment securities available for sale		7,059,674
Loans held for sale	107,881	67,869
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available for sale	0	0
Loans held for sale	0	0
Fair Value, Measurements, Recurring | Quoted Prices for Similar Assets and Liabilities (Level 2 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	8,449,305
Investment securities available for sale		6,989,989
Loans held for sale	107,881	67,869
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available for sale	169,977	69,685
Loans held for sale	0	0
Fair Value, Measurements, Recurring | U.S. Treasury
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	754,586
Investment securities available for sale		409,999
Fair Value, Measurements, Recurring | U.S. Treasury | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0
Investment securities available for sale		0
Fair Value, Measurements, Recurring | U.S. Treasury | Quoted Prices for Similar Assets and Liabilities (Level 2 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	754,586
Investment securities available for sale		409,999
Fair Value, Measurements, Recurring | U.S. Treasury | Significant Unobservable Inputs (Level 3 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0
Investment securities available for sale		0
Fair Value, Measurements, Recurring | Agency Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	545,709
Investment securities available for sale		682,772
Fair Value, Measurements, Recurring | Agency Securities | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0
Investment securities available for sale		0
Fair Value, Measurements, Recurring | Agency Securities | Quoted Prices for Similar Assets and Liabilities (Level 2 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	545,709
Investment securities available for sale		682,772
Fair Value, Measurements, Recurring | Agency Securities | Significant Unobservable Inputs (Level 3 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0
Investment securities available for sale		0
Fair Value, Measurements, Recurring | Commercial Mortgage Backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	1,079,822
Investment securities available for sale		380,020
Fair Value, Measurements, Recurring | Commercial Mortgage Backed Securities | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0
Investment securities available for sale		0
Fair Value, Measurements, Recurring | Commercial Mortgage Backed Securities | Quoted Prices for Similar Assets and Liabilities (Level 2 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	1,079,822
Investment securities available for sale		380,020
Fair Value, Measurements, Recurring | Commercial Mortgage Backed Securities | Significant Unobservable Inputs (Level 3 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0
Investment securities available for sale		0
Fair Value, Measurements, Recurring | Residential Mortgage Backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	5,790,392
Investment securities available for sale		5,267,090
Fair Value, Measurements, Recurring | Residential Mortgage Backed Securities | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0
Investment securities available for sale		0
Fair Value, Measurements, Recurring | Residential Mortgage Backed Securities | Quoted Prices for Similar Assets and Liabilities (Level 2 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	5,790,392
Investment securities available for sale		5,267,090
Fair Value, Measurements, Recurring | Residential Mortgage Backed Securities | Significant Unobservable Inputs (Level 3 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0
Investment securities available for sale		0
Fair Value, Measurements, Recurring | Equity Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment in marketable equity securities	114,316	82,333
Fair Value, Measurements, Recurring | Equity Securities | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment in marketable equity securities	50,352	29,458
Fair Value, Measurements, Recurring | Equity Securities | Quoted Prices for Similar Assets and Liabilities (Level 2 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment in marketable equity securities	63,964	52,875
Fair Value, Measurements, Recurring | Equity Securities | Significant Unobservable Inputs (Level 3 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment in marketable equity securities	0	0
Fair Value, Measurements, Recurring | Corporate Bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	448,773
Investment securities available for sale		201,566
Fair Value, Measurements, Recurring | Corporate Bonds | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0
Investment securities available for sale		0
Fair Value, Measurements, Recurring | Corporate Bonds | Quoted Prices for Similar Assets and Liabilities (Level 2 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	278,796
Investment securities available for sale		131,881
Fair Value, Measurements, Recurring | Corporate Bonds | Significant Unobservable Inputs (Level 3 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	$ 169,977
Investment securities available for sale		69,685
Fair Value, Measurements, Recurring | US States and Political Subdivisions Debt Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available for sale		118,227
Fair Value, Measurements, Recurring | US States and Political Subdivisions Debt Securities [Member] | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available for sale		0
Fair Value, Measurements, Recurring | US States and Political Subdivisions Debt Securities [Member] | Quoted Prices for Similar Assets and Liabilities (Level 2 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available for sale		118,227
Fair Value, Measurements, Recurring | US States and Political Subdivisions Debt Securities [Member] | Significant Unobservable Inputs (Level 3 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available for sale		$ 0

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Estimated Fair Values (Assets and Liabilities Carried at Fair Value on a Recurring Basis Significant Unobservable Inputs) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value, Measurement with Unobservable Inputs Reconciliation, Liability, Transfers Into Level 3	$ 0		$ 1,800,000
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Investment securities available for sale	8,619,282,000		8,619,282,000		$ 7,059,674,000
Corporate Bonds
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	67,016,000	$ 146,287,000	69,685,000	$ 143,226,000
Purchases	100,595,000	991,000	100,595,000	3,991,000
Amounts included in net income	2,449,000	1,822,000	(1,917,000)	1,838,000
Unrealized net (losses) gains included in other comprehensive income	(83,000)	37,000	(168,000)	82,000
Transfers in	0	0	1,782,000	0
Ending balance	169,977,000	$ 149,137,000	169,977,000	$ 149,137,000
Fair Value, Measurements, Recurring
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Investment securities available for sale					7,059,674,000
Fair Value, Measurements, Recurring | Corporate Bonds
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Investment securities available for sale					201,566,000
Significant Unobservable Inputs (Level 3 Inputs) | Fair Value, Measurements, Recurring
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Investment securities available for sale	$ 169,977,000		$ 169,977,000		69,685,000
Significant Unobservable Inputs (Level 3 Inputs) | Fair Value, Measurements, Recurring | Corporate Bonds
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Investment securities available for sale					$ 69,685,000

XML

Estimated Fair Values (Assets And Liabilities Carried At Fair Value On A Nonrecurring Basis) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019	Jun. 30, 2019	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other real estate remeasured during current year	$ 53,850	$ 46,591	$ 46,236	$ 48,030
Fair Value, Measurements, Nonrecurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	14,341	132,336
Other real estate remeasured during current year	44,465	38,310
Mortgage servicing rights	17,992	3,757
Fair Value, Measurements, Nonrecurring | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	0	0
Other real estate remeasured during current year	0	0
Mortgage servicing rights	0	0
Fair Value, Measurements, Nonrecurring | Quoted Prices for Similar Assets and Liabilities (Level 2 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	0	0
Other real estate remeasured during current year	0	0
Mortgage servicing rights	0	0
Fair Value, Measurements, Nonrecurring | Significant Unobservable Inputs (Level 3 Inputs)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	14,341	132,336
Other real estate remeasured during current year	44,465	38,310
Mortgage servicing rights	$ 17,992	$ 3,757

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Estimated Fair Values (Fair Value Option) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Fair Value, Option, Quantitative Disclosures [Line Items]
Gains (Losses) from fair value changes on originated loans held for sale	$ 2,400	$ (82)	$ 3,600	$ 167
Loans Held For Sale
Fair Value, Option, Quantitative Disclosures [Line Items]
Fair value of originated loans held for sale	107,881		107,881		$ 67,869
Aggregate unpaid principle balance of originated loans held for sale	102,189		102,189		65,697
Difference between fair value and aggregate unpaid principle balance of originated loans held for sale	$ 5,692		$ 5,692		$ 2,172

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Estimated Fair Values (Narrative) (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2020 USD ($)	Jun. 30, 2019 USD ($)	Jun. 30, 2020 USD ($)	Jun. 30, 2019 USD ($)	Dec. 31, 2019 USD ($)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Transfers from level 2 to level 3	$ 0		$ 1,800,000
Transfers between levels		$ 0		$ 0
Gains (Losses) from fair value changes on originated loans held for sale	2,400,000	$ (82,000)	3,600,000	$ 167,000
Originated loans held for sale, 90 days or more past due	0		0		$ 0
Fair Value, Measurements, Nonrecurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability measured at fair value on nonrecurring basis	$ 0		$ 0		$ 0
Discount Rate | Minimum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans held-for-sale, measurement input	0.06		0.06		0.06
OREO, measurement input	0.07		0.07
Discount Rate | Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans held-for-sale, measurement input	0.10		0.10		0.11
OREO, measurement input	0.16		0.16
Discount Rate | Weighted Average
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans held-for-sale, measurement input	0.0781		0.0781
OREO, measurement input	0.0816		0.0816
Effective Interest Rate | Minimum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans held-for-sale, measurement input	0.03		0.03
Effective Interest Rate | Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans held-for-sale, measurement input	0.07		0.07

XML

Employee Benefit Plans (Components Of Pension Expense) (Details) - BancShares Plan - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Service cost	$ 3,682	$ 3,271	$ 7,139	$ 6,384
Interest cost	8,568	9,338	17,099	18,629
Expected return on assets	(16,435)	(15,661)	(32,844)	(31,296)
Amortization of prior service cost	0	14	0	28
Amortization of net actuarial loss	6,398	2,721	12,662	5,462
Total pension expense	$ 2,213	$ (317)	$ 4,056	$ (793)

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Employee Benefit Plans (Narrative) (Details) $ in Millions	3 Months Ended
	Jun. 30, 2020 USD ($)
BancShares Plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Defined Benefit Plan, Plan Assets, Contributions by Employer	$ 100.0

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Leases (Operating and Finance Lease Assets and Liabilities) (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Leases [Abstract]
Asset, operating	$ 73,488	$ 77,115
Asset, finance	7,547	8,820
Total leased assets	81,035	85,935
Present value of lease liabilities	73,481	76,746
Present value of lease liabilities	7,463	8,230
Total lease liabilities	$ 80,944	$ 84,976

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Commitments and Contingencies (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Standby Letters of Credit
Guarantor Obligations [Line Items]
Guarantor Obligations, Maximum Exposure, Undiscounted	$ 169,300	$ 167,800
Qualified Affordable Housing Project Investments, Commitment	104,655	99,601
Commitments to Extend Credit
Guarantor Obligations [Line Items]
Unused Commitments to Extend Credit	11,705,547	10,682,378
Qualified Affordable Housing Project Investments	$ 68,300	$ 70,000

XML

Label	Element	Value
Accounting Standards Update 2016-13 [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ 36,943,000
Accounting Standards Update 2016-13 [Member] | Retained Earnings [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ 36,943,000