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HOMB Home Bancshares

Filed: 6 May 21, 10:54am

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC  20549

FORM 10-Q

(Mark One)

 

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

 

For the Quarterly Period Ended March 31, 2021

or

 

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

 

For the Transition period from           to           

Commission File Number:  000-51904

HOME BANCSHARES, INC.

(Exact Name of Registrant as Specified in Its Charter)

 

Arkansas

 

71-0682831

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

719 Harkrider, Suite 100, Conway, Arkansas

 

72032

(Address of principal executive offices)

 

(Zip Code)

 

 

 

(501) 339-2929

(Registrant's telephone number, including area code)

 

Not Applicable

Former name, former address and former fiscal year, if changed since last report

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock, par value $0.01 per share

 

HOMB

 

NASDAQ Global Select Market

 

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 12 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 90 days.    

Yes      No  

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes     No  

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definition of “large 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  

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.  

Common Stock Issued and Outstanding: 164,842,385 shares as of May 5, 2021.


HOME BANCSHARES, INC.

FORM 10-Q

March 31, 2021

 

 

 

INDEX

 

 

 

 

 

Page No.

Part I:

Financial Information

 

 

 

 

Item 1:

Financial Statements

 

 

 

 

 

Consolidated Balance Sheets –

 

 

March 31, 2021 (Unaudited) and December 31, 2020

4

 

 

 

 

Consolidated Statements of Income (Unaudited) –

 

 

Three months ended March 31, 2021 and 2020

5

 

 

 

 

Consolidated Statements of Comprehensive Income (Unaudited) –

 

 

Three months ended March 31, 2021 and 2020

6

 

 

 

 

Consolidated Statements of Stockholders’ Equity (Unaudited) –

 

 

Three months ended March 31, 2021 and 2020

7-8

 

 

 

 

Consolidated Statements of Cash Flows (Unaudited) –

 

 

Three months ended March 31, 2021 and 2020

9

 

 

 

 

Condensed Notes to Consolidated Financial Statements (Unaudited)

10-48

 

 

 

 

Report of Independent Registered Public Accounting Firm

49

 

 

 

Item 2:

Management’s Discussion and Analysis of Financial Condition and Results of Operations

50-86

 

 

 

Item 3:

Quantitative and Qualitative Disclosures About Market Risk

86-89

 

 

 

Item 4:

Controls and Procedures

89

 

 

 

Part II:

Other Information

 

 

 

 

Item 1:

Legal Proceedings

90

 

 

 

Item 1A:

Risk Factors

90

 

 

 

Item 2:

Unregistered Sales of Equity Securities and Use of Proceeds

90

 

 

 

Item 3:

Defaults Upon Senior Securities

90

 

 

 

Item 4:

Mine Safety Disclosures

90

 

 

 

Item 5:

Other Information

90

 

 

 

Item 6:

Exhibits

91-92

 

 

 

Signatures

 

93

 

 

 

 

 


 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Some of our statements contained in this document, including matters discussed under the caption “Management's Discussion and Analysis of Financial Condition and Results of Operation,” are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements relate to future events or our future financial performance and include statements about the competitiveness of the banking industry, potential regulatory obligations, our entrance and expansion into other markets, including through potential acquisitions, our other business strategies and other statements that are not historical facts. Forward-looking statements are not guarantees of performance or results. When we use words like “may,” “plan,” “contemplate,” “anticipate,” “believe,” “intend,” “continue,” “expect,” “project,” “predict,” “estimate,” “could,” “should,” “would,” and similar expressions, you should consider them as identifying forward-looking statements, although we may use other phrasing. These forward-looking statements involve risks and uncertainties and are based on our beliefs and assumptions, and on the information available to us at the time that these disclosures were prepared. These forward-looking statements involve risks and uncertainties and may not be realized due to a variety of factors, including, but not limited to, the following:

 

the effects of future local, regional, national and international economic conditions, including inflation, a decrease in commercial real estate and residential housing values and unemployment;

 

changes in the level of nonperforming assets and charge-offs, and credit risk generally; 

 

the risks of changes in interest rates or the level and composition of deposits, loan demand and the values of loan collateral, securities and interest-sensitive assets and liabilities;

 

disruptions, uncertainties and related effects on our business and operations as a result of the ongoing COVID-19 pandemic and measures that have been or may be implemented or imposed in response to the pandemic, including the impact on, among other things, credit quality and liquidity;

 

the effect of any mergers, acquisitions or other transactions to which we or our bank subsidiary may from time to time be a party, including our ability to successfully integrate any businesses that we acquire;

 

the risk that expected cost savings and other benefits from acquisitions may not be fully realized or may take longer to realize than expected;

 

the possibility that an acquisition does not close when expected or at all because required regulatory, shareholder or other approvals and other conditions to closing are not received or satisfied on a timely basis or at all;

 

the reaction to a proposed acquisition transaction of the respective companies’ customers, employees and counterparties;

 

diversion of management time on acquisition-related issues;

 

the ability to enter into and/or close additional acquisitions;

 

the availability of and access to capital on terms acceptable to us;

 

increased regulatory requirements and supervision that applies as a result of our exceeding $10 billion in total assets;

 

legislation and regulation affecting the financial services industry as a whole, and the Company and its subsidiaries in particular, including the effects resulting from the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), recent reforms to the Dodd-Frank Act, legislation and regulations in response to the COVID-19 pandemic and other future legislative and regulatory changes;

 

changes in governmental monetary and fiscal policies;

 

the effects of terrorism and efforts to combat it;

 

political instability;

 

risks associated with our customer relationship with the Cuban government and our correspondent banking relationship with Banco Internacional de Comercio, S.A. (BICSA), a Cuban commercial bank;

 

adverse weather events, including hurricanes, and other natural disasters;

 

the ability to keep pace with technological changes, including changes regarding cybersecurity;

 

an increase in the incidence or severity of fraud, illegal payments, cybersecurity breaches or other illegal acts impacting our bank subsidiary, our vendors or our customers;

 

the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market area and elsewhere, including institutions operating regionally, nationally and internationally, together with competitors offering banking products and services by mail, telephone and the Internet;

 


 

potential claims, expenses and other adverse effects related to current or future litigation, regulatory examinations or other government actions;

 

the effect of changes in accounting policies and practices and auditing requirements, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board, and other accounting standard setters;

 

higher defaults on our loan portfolio than we expect; and

 

the failure of assumptions underlying the establishment of our allowance for credit losses or changes in our estimate of the adequacy of the allowance for credit losses.

All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this Cautionary Note. Our actual results may differ significantly from those we discuss in these forward-looking statements. For other factors, risks and uncertainties that could cause our actual results to differ materially from estimates and projections contained in these forward-looking statements, see the “Risk Factors” section of our Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 26, 2021.

 

 

 


 

 

PART I: FINANCIAL INFORMATION

Item 1: Financial Statements

Home BancShares, Inc.

Consolidated Balance Sheets

 

(In thousands, except share data)

 

March 31, 2021

 

 

December 31, 2020

 

 

 

(Unaudited)

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

218,814

 

 

$

242,173

 

Interest-bearing deposits with other banks

 

 

2,259,734

 

 

 

1,021,615

 

Cash and cash equivalents

 

 

2,478,548

 

 

 

1,263,788

 

Investment securities – available-for-sale, net of allowance for credit losses

 

 

2,539,123

 

 

 

2,473,781

 

Loans receivable

 

 

10,778,493

 

 

 

11,220,721

 

Allowance for credit losses

 

 

(242,932

)

 

 

(245,473

)

Loans receivable, net

 

 

10,535,561

 

 

 

10,975,248

 

Bank premises and equipment, net

 

 

278,620

 

 

 

278,614

 

Foreclosed assets held for sale

 

 

3,004

 

 

 

4,420

 

Cash value of life insurance

 

 

103,599

 

 

 

103,519

 

Accrued interest receivable

 

 

55,495

 

 

 

60,528

 

Deferred tax asset, net

 

 

77,145

 

 

 

70,249

 

Goodwill

 

��

973,025

 

 

 

973,025

 

Core deposit and other intangibles

 

 

29,307

 

 

 

30,728

 

Other assets

 

 

166,814

 

 

 

164,904

 

Total assets

 

$

17,240,241

 

 

$

16,398,804

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

Demand and non-interest-bearing

 

$

3,859,722

 

 

$

3,266,753

 

Savings and interest-bearing transaction accounts

 

 

8,477,208

 

 

 

8,212,240

 

Time deposits

 

 

1,175,664

 

 

 

1,246,797

 

Total deposits

 

 

13,512,594

 

 

 

12,725,790

 

Federal funds purchased

 

 

 

 

 

 

Securities sold under agreements to repurchase

 

 

162,929

 

 

 

168,931

 

FHLB and other borrowed funds

 

 

400,000

 

 

 

400,000

 

Accrued interest payable and other liabilities

 

 

148,999

 

 

 

127,999

 

Subordinated debentures

 

 

370,515

 

 

 

370,326

 

Total liabilities

 

 

14,595,037

 

 

 

13,793,046

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

Common stock, par value $0.01; shares authorized 300,000,000 in 2021 and

   2020; shares issued and outstanding 165,141,370 in 2021 and 165,095,252 in 2020

 

 

1,651

 

 

 

1,651

 

Capital surplus

 

 

1,516,286

 

 

 

1,520,617

 

Retained earnings

 

 

1,107,818

 

 

 

1,039,370

 

Accumulated other comprehensive income

 

 

19,449

 

 

 

44,120

 

Total stockholders’ equity

 

 

2,645,204

 

 

 

2,605,758

 

Total liabilities and stockholders’ equity

 

$

17,240,241

 

 

$

16,398,804

 

 

See Condensed Notes to Consolidated Financial Statements.

 

4

 


 

Home BancShares, Inc.

Consolidated Statements of Income

 

 

 

Three Months Ended

March 31,

 

(In thousands, except per share data)

 

2021

 

 

2020

 

 

 

(Unaudited)

 

Interest income:

 

 

 

 

 

 

 

 

Loans

 

$

150,917

 

 

$

158,148

 

Investment securities

 

 

 

 

 

 

 

 

Taxable

 

 

6,253

 

 

 

9,776

 

Tax-exempt

 

 

5,071

 

 

 

3,114

 

Deposits – other banks

 

 

410

 

 

 

1,116

 

Federal funds sold

 

 

 

 

 

21

 

Total interest income

 

 

162,651

 

 

 

172,175

 

Interest expense:

 

 

 

 

 

 

 

 

Interest on deposits

 

 

7,705

 

 

 

24,198

 

Federal funds purchased

 

 

 

 

 

13

 

FHLB and other borrowed funds

 

 

1,875

 

 

 

2,698

 

Securities sold under agreements to repurchase

 

 

190

 

 

 

462

 

Subordinated debentures

 

 

4,793

 

 

 

5,079

 

Total interest expense

 

 

14,563

 

 

 

32,450

 

Net interest income

 

 

148,088

 

 

 

139,725

 

Provision for credit losses

 

 

 

 

 

94,598

 

Net interest income after provision for credit losses

 

 

148,088

 

 

 

45,127

 

Non-interest income:

 

 

 

 

 

 

 

 

Service charges on deposit accounts

 

 

5,002

 

 

 

6,631

 

Other service charges and fees

 

 

7,608

 

 

 

6,056

 

Trust fees

 

 

522

 

 

 

438

 

Mortgage lending income

 

 

8,167

 

 

 

2,621

 

Insurance commissions

 

 

492

 

 

 

678

 

Increase in cash value of life insurance

 

 

502

 

 

 

560

 

Dividends from FHLB, FRB, FNBB & other

 

 

8,609

 

 

 

7,842

 

Gain on sale of SBA loans

 

 

 

 

 

341

 

(Loss) gain on sale of branches, equipment and other assets, net

 

 

(29

)

 

 

82

 

Gain on OREO, net

 

 

401

 

 

 

277

 

Gain on securities, net

 

 

219

 

 

 

 

Fair value adjustment for marketable securities

 

 

5,782

 

 

 

(5,818

)

Other income

 

 

8,001

 

 

 

3,219

 

Total non-interest income

 

 

45,276

 

 

 

22,927

 

Non-interest expense:

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

42,059

 

 

 

39,329

 

Occupancy and equipment

 

 

9,237

 

 

 

8,873

 

Data processing expense

 

 

5,870

 

 

 

4,326

 

Other operating expenses

 

 

15,700

 

 

 

17,946

 

Total non-interest expense

 

 

72,866

 

 

 

70,474

 

Income (loss) before income taxes

 

 

120,498

 

 

 

(2,420

)

Income tax expense (benefit)

 

 

28,896

 

 

 

(2,927

)

Net income

 

$

91,602

 

 

$

507

 

Basic earnings per share

 

$

0.55

 

 

$

0.00

 

Diluted earnings per share

 

$

0.55

 

 

$

0.00

 

 

See Condensed Notes to Consolidated Financial Statements.

 

5

 


 

Home BancShares, Inc.

Consolidated Statements of Comprehensive Income

 

 

 

Three Months Ended

March 31,

 

(In thousands)

 

2021

 

 

2020

 

 

 

(Unaudited)

 

Net income

 

$

91,602

 

 

$

507

 

Net unrealized (loss) gain on available-for-sale securities

 

 

(33,400

)

 

 

6,430

 

Other comprehensive (loss) income, before tax effect

 

 

(33,400

)

 

 

6,430

 

Tax effect on other comprehensive income (loss)

 

 

8,729

 

 

 

(1,680

)

Other comprehensive (loss) income

 

 

(24,671

)

 

 

4,750

 

Comprehensive income

 

$

66,931

 

 

$

5,257

 

 

See Condensed Notes to Consolidated Financial Statements.

 

 

 

 

 

 

6

 


 

 

Home BancShares, Inc.

Consolidated Statements of Stockholders’ Equity

 

For the Three Months Ended March 31, 2021

 

(In thousands, except share data)

 

Common

Stock

 

 

Capital

Surplus

 

 

Retained

Earnings

 

 

Accumulated

Other

Comprehensive

Income

 

 

Total

 

Balances at January 1, 2021

 

$

1,651

 

 

$

1,520,617

 

 

$

1,039,370

 

 

$

44,120

 

 

$

2,605,758

 

Comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

91,602

 

 

 

 

 

 

91,602

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

(24,671

)

 

 

(24,671

)

Net issuance of 161,434 shares of common stock

   from exercise of stock options

 

 

1

 

 

 

2,321

 

 

 

 

 

 

 

 

 

2,322

 

Repurchase of 330,000 shares of common stock

 

 

(3

)

 

 

(8,767

)

 

 

 

 

 

 

 

 

(8,770

)

Share-based compensation net issuance of 214,684

   shares of restricted common stock

 

 

2

 

 

 

2,115

 

 

 

 

 

 

 

 

 

2,117

 

Cash dividends – Common Stock, $0.14

   per share

 

 

 

 

 

 

 

 

(23,154

)

 

 

 

 

 

(23,154

)

Balances at March 31, 2021 (unaudited)

 

$

1,651

 

 

$

1,516,286

 

 

$

1,107,818

 

 

$

19,449

 

 

$

2,645,204

 

 

See Condensed Notes to Consolidated Financial Statements.

 

7

 


 

Home BancShares, Inc.

Consolidated Statements of Stockholders’ Equity

 

For the Three Months Ended March 31, 2020

 

(In thousands, except share data)

 

Common

Stock

 

 

Capital

Surplus

 

 

Retained

Earnings

 

 

Accumulated

Other

Comprehensive

Income (Loss)

 

 

Total

 

Balances at January 1, 2020

 

$

1,664

 

 

$

1,537,091

 

 

$

956,555

 

 

$

16,221

 

 

$

2,511,531

 

Cumulative change in accounting principle (adoption of ASC 326)

 

 

 

 

 

 

 

 

(43,956

)

 

 

 

 

 

(43,956

)

Balance at January 1, 2020 (as adjusted for change in accounting principle)

 

$

1,664

 

 

$

1,537,091

 

 

$

912,599

 

 

$

16,221

 

 

$

2,467,575

 

Comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

507

 

 

 

 

 

 

507

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

4,750

 

 

 

4,750

 

Net issuance of 22,864 shares of common

   stock from exercise of stock options

 

 

 

 

 

422

 

 

 

 

 

 

 

 

 

422

 

Repurchase of 1,423,560 shares of common

   stock

 

 

(14

)

 

 

(23,843

)

 

 

 

 

 

 

 

 

(23,857

)

Share-based compensation net issuance of

   175,249 shares of restricted common stock

 

 

1

 

 

 

2,481

 

 

 

 

 

 

 

 

 

2,482

 

Cash dividends – Common Stock, $0.13 per

   share

 

 

 

 

 

 

 

 

(21,608

)

 

 

 

 

 

(21,608

)

Balances at March 31, 2020 (unaudited)

 

$

1,651

 

 

$

1,516,151

 

 

$

891,498

 

 

$

20,971

 

 

$

2,430,271

 

 

See Condensed Notes to Consolidated Financial Statements.

 

8

 


 

Home BancShares, Inc.

Consolidated Statements of Cash Flows

 

 

 

Three Months Ended

March 31,

 

(In thousands)

 

2021

 

 

2020

 

 

 

(Unaudited)

 

Operating Activities

 

 

 

 

 

 

 

 

Net income

 

$

91,602

 

 

$

507

 

Adjustments to reconcile net income to net cash provided by operating

   activities:

 

 

 

 

 

 

 

 

Depreciation & amortization

 

 

4,728

 

 

 

4,750

 

(Increase) decrease in value of equity securities

 

 

(5,782

)

 

 

5,818

 

Amortization of securities, net

 

 

6,618

 

 

 

3,936

 

Accretion of purchased loans

 

 

(5,485

)

 

 

(7,647

)

Share-based compensation

 

 

2,117

 

 

 

2,482

 

Gain on assets

 

 

(591

)

 

 

(700

)

Provision for credit losses

 

 

 

 

 

94,598

 

Deferred income tax effect

 

 

(13,078

)

 

 

(32,809

)

Increase in cash value of life insurance

 

 

(502

)

 

 

(560

)

Originations of mortgage loans held for sale

 

 

(202,455

)

 

 

(137,945

)

Proceeds from sales of mortgage loans held for sale

 

 

203,936

 

 

 

139,915

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

Accrued interest receivable

 

 

5,033

 

 

 

(4,979

)

Other assets

 

 

13,943

 

 

 

16,458

 

Accrued interest payable and other liabilities

 

 

21,000

 

 

 

28,294

 

Net cash provided by operating activities

 

 

121,084

 

 

 

112,118

 

Investing Activities

 

 

 

 

 

 

 

 

Net decrease (increase) in loans, excluding purchased loans

 

 

441,905

 

 

 

(111,479

)

Purchases of investment securities – available-for-sale

 

 

(299,058

)

 

 

(157,808

)

Proceeds from maturities of investment securities – available-for-sale

 

 

175,805

 

 

 

137,960

 

Proceeds from sales of investment securities – available-for-sale

 

 

18,112

 

 

 

 

Purchases of equity securities

 

 

(10,460

)

 

 

(15,015

)

Proceeds from sales of equity securities

 

 

15,354

 

 

 

 

Redemptions of other investments

 

 

(50

)

 

 

(11,384

)

Proceeds from foreclosed assets held for sale

 

 

3,603

 

 

 

2,471

 

Proceeds from sale of SBA loans

 

 

 

 

 

4,057

 

Purchases of premises and equipment, net

 

 

(3,153

)

 

 

(4,545

)

Return of investment on cash value of life insurance

 

 

418

 

 

 

46,028

 

Net cash paid – market acquisitions

 

 

 

 

 

(421,211

)

Net cash provided by (used in) investing activities

 

 

342,476

 

 

 

(530,926

)

Financing Activities

 

 

 

 

 

 

 

 

Net increase in deposits

 

 

786,804

 

 

 

236,531

 

Net decrease in securities sold under agreements to repurchase

 

 

(6,002

)

 

 

(16,843

)

Net decrease in federal funds purchased

 

 

 

 

 

(5,000

)

Net increase in FHLB and other borrowed funds

 

 

 

 

 

329,997

 

Proceeds from exercise of stock options

 

 

2,322

 

 

 

422

 

Repurchase of common stock

 

 

(8,770

)

 

 

(23,857

)

Dividends paid on common stock

 

 

(23,154

)

 

 

(21,608

)

Net cash provided by financing activities

 

 

751,200

 

 

 

499,642

 

Net change in cash and cash equivalents

 

 

1,214,760

 

 

 

80,834

 

Cash and cash equivalents – beginning of year

 

 

1,263,788

 

 

 

490,601

 

Cash and cash equivalents – end of period

 

$

2,478,548

 

 

$

571,435

 

 

See Condensed Notes to Consolidated Financial Statements.

 

 

 

9

 


 

 

Home BancShares, Inc.

Condensed Notes to Consolidated Financial Statements

(Unaudited)

 

1.  Nature of Operations and Summary of Significant Accounting Policies

Nature of Operations

Home BancShares, Inc. (the “Company” or “HBI”) is a bank holding company headquartered in Conway, Arkansas. The Company is primarily engaged in providing a full range of banking services to individual and corporate customers through its wholly-owned community bank subsidiary – Centennial Bank (sometimes referred to as “Centennial” or the “Bank”).  The Bank has branch locations in Arkansas, Florida, South Alabama and New York City.  The Company is subject to competition from other financial institutions. The Company also is subject to the regulation of certain federal and state agencies and undergoes periodic examinations by those regulatory authorities.

A summary of the significant accounting policies of the Company follows:

Operating Segments

Operating segments are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance.  The Bank is the only significant subsidiary upon which management makes decisions regarding how to allocate resources and assess performance. Each of the branches of the Bank provide a group of similar banking services, including such products and services as commercial, real estate and consumer loans, time deposits, checking and savings accounts. The individual bank branches have similar operating and economic characteristics.  While the chief decision maker monitors the revenue streams of the various products, services and branch locations, operations are managed, and financial performance is evaluated on a Company-wide basis.  Accordingly, all of the banking services and branch locations are considered by management to be aggregated into 1 reportable operating segment.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for credit losses, the valuation of investment securities, the valuation of foreclosed assets and the valuations of assets acquired, and liabilities assumed in business combinations. In connection with the determination of the allowance for credit losses and the valuation of foreclosed assets, management obtains independent appraisals for significant properties.

Principles of Consolidation

The consolidated financial statements include the accounts of HBI and its subsidiaries. Significant intercompany accounts and transactions have been eliminated in consolidation.

Reclassifications

Various items within the accompanying consolidated financial statements for previous years have been reclassified to provide more comparative information. These reclassifications had no effect on net earnings or stockholders’ equity.

Interim financial information

The accompanying unaudited consolidated financial statements as of March 31, 2021 and 2020 have been prepared in condensed format, and therefore do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

The information furnished in these interim statements reflects all adjustments which are, in the opinion of management, necessary for a fair statement of the results for each respective period presented. Such adjustments are of a normal recurring nature. The results of operations in the interim statements are not necessarily indicative of the results that may be expected for any other quarter or for the full year. The interim financial information should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2020 Form 10-K, filed with the Securities and Exchange Commission.

 

10

 


 

New Accounting Pronouncements

The Company adopted ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASC 326”), effective January 1, 2020. The guidance replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology.  The measurement of expected credit losses under the CECL methodology is applicable to financial assets measured at amortized cost, including loan receivables and held-to-maturity debt securities. It also applies to off-balance sheet credit exposures not accounted for as insurance (loan commitments, standby letters of credits, financial guarantees, and other similar instruments) and net investments in leases recognized by a lessor in accordance with Topic 842 on leases. ASC 326 requires enhanced disclosures related to the significant estimates and judgments used in estimating credit losses as well as the credit quality and underwriting standards of a company’s portfolio.  In addition, ASC 326 made changes to the accounting for available-for-sale debt securities. One such change is to require credit losses to be presented as an allowance rather than as a write-down on available-for-sale debt securities management does not intend to sell or believes that it is more likely than not they will be required to sell.

The Company adopted ASC 326 using the modified retrospective method for loans and off-balance-sheet (“OBS”) credit exposures.  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.  The Company recorded a one-time cumulative-effect adjustment to the allowance for credit losses of $44.0 million which was recognized through a $32.5 million adjustment to retained earnings, net of tax. This adjustment brought the beginning balance of the allowance for credit losses to $146.1 million  as of January 1, 2020.  In addition, the Company recorded a $15.5 million reserve on unfunded commitments which was recognized through an $11.5 million adjustment to retained earnings, net of tax.

The Company adopted ASC 326 using the prospective transition approach for financial assets purchased with credit deterioration (“PCD”) that were previously classified as purchased credit impaired (“PCI”) and accounted for under ASC 310-30.  In 2019, the Company reevaluated its loan pools of purchased loans with deteriorated credit quality. These loans pools related specifically to acquired loans from the Heritage, Liberty, Landmark, Bay Cities, Bank of Commerce, Premier Bank, Stonegate and Shore Premier Finance acquisitions. At acquisition, a portion of these loans was recorded as purchased credit impaired loans on a pool by pool basis. Through the reevaluation of these loan pools, management determined that estimated losses for purchase credit impaired loans should be processed against the credit mark of the applicable pools.  The remaining non-accretable mark was then moved to accretable mark to be recognized over the remaining weighted average life of the loan pools.  The projected losses for these loans were less than the total credit mark.  As such, the remaining $107.6 million of loans in these pools along with the $29.3 million in accretable yield was deemed to be immaterial and was reclassified out of the purchased credit impaired loans category.  As of December 31, 2019, the Company no longer held any purchased loans with deteriorated credit quality. Therefore, the Company did not have any PCI loans upon adoption on of ASC 326 as of January 1, 2020.

The Company has purchased loans, some of which have experienced more than insignificant credit deterioration since origination.  PCD loans are recorded at the amount paid. An allowance for credit losses is determined using the same methodology as other loans. The initial allowance for credit losses determined on a collective basis is allocated to individual loans. The sum of the loan’s purchase price and allowance for credit losses becomes its initial amortized cost basis. The difference between the initial amortized cost basis and the par value of the loan is a noncredit discount or premium, which is amortized into interest income over the life of the loan. Subsequent changes to the allowance for credit losses are recorded through the provision for credit loss.

The Company adopted ASC 326 using the prospective transition approach for debt securities for which other-than-temporary impairment had been recognized prior to January 1, 2020. As of December 31, 2019, the Company did not have any other-than-temporarily impaired investment securities. Therefore, upon adoption of ASC 326, the Company determined than an allowance for credit losses on available-for-sale securities was not deemed material. However, the Company evaluated the investment portfolio during the first quarter of 2020 and determined that an $842,000 provision for credit losses was necessary. NaN additional provision was deemed necessary during the remaining quarters of 2020 or the first quarter of 2021. See Note 3 for further discussion.

 


 

11

 


 

 

The following table illustrates the impact of the adoption of ASC 326 on the Company’s 2020 consolidated balance sheet.

 

 

 

January 1, 2020

 

 

 

As Reported Under ASC 326

 

 

Pre-ASC 326 Adoption

 

 

Impact of ASC 326 Adoption

 

 

 

(In thousands)

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

    Allowance for credit losses on loans

 

$

146,110

 

 

$

102,122

 

 

$

43,988

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

    Allowance for credit losses on OBS

       credit exposures

       (included in other liabilities)

 

 

15,521

 

 

 

 

 

 

15,521

 

 

Revenue Recognition

Accounting Standards Codification ("ASC") Topic 606, Revenue from Contracts with Customers ("ASC Topic 606"), establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity's contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. The majority of our revenue-generating transactions are not subject to ASC Topic 606, including revenue generated from financial instruments, such as our loans, letters of credit, investment securities and mortgage lending income, as these activities are subject to other GAAP discussed elsewhere within our disclosures. Descriptions of our significant revenue-generating activities that are within the scope of ASC Topic 606, which are presented in our income statements as components of non-interest income are as follows:

 

Service charges on deposit accounts – These represent general service fees for monthly account maintenance and activity or transaction-based fees and consist of transaction-based revenue, time-based revenue (service period), item-based revenue or some other individual attribute-based revenue. Revenue is recognized when our performance obligation is completed which is generally monthly for account maintenance services or when a transaction has been completed (such as a wire transfer). Payment for such performance obligations are generally received at the time the performance obligations are satisfied.

 

Other service charges and fees – These represent credit card interchange fees and Centennial Commercial Finance Group (“Centennial CFG”) loan fees. The interchange fees are recorded in the period the performance obligation is satisfied which is generally the cash basis based on agreed upon contracts. The Centennial CFG loan fees are based on loan or other negotiated agreements with customers and are accounted for under ASC Topic 310.  

Earnings per Share

Basic earnings per share is computed based on the weighted-average number of shares outstanding during each year.  Diluted earnings per share is computed using the weighted-average shares and all potential dilutive shares outstanding during the period.  The following table sets forth the computation of basic and diluted earnings per share (“EPS”) for the following periods:

 

 

 

Three Months Ended

March 31,

 

 

 

2021

 

 

2020

 

 

 

(In thousands)

 

Net income

 

$

91,602

 

 

$

507

 

Average shares outstanding

 

 

165,257

 

 

 

166,014

 

Effect of common stock options

 

 

189

 

 

 

 

Average diluted shares outstanding

 

 

165,446

 

 

 

166,014

 

Basic earnings per share

 

$

0.55

 

 

$

0.00

 

Diluted earnings per share

 

$

0.55

 

 

$

0.00

 

 

As of March 31, 2020, options to purchase 3.3 million shares of common stock with a weighted average exercise price of $19.57 were excluded from the computation of diluted earnings per share as the majority of the options had an exercise price which was greater than the average market price of the common stock.

 

12

 


 

2.  Business Combinations

Acquisition of LH-Finance

On February 29, 2020, the Company completed the acquisition of LH-Finance, the marine lending division of People’s United Bank, N.A. The Company paid a purchase price of approximately $421.2 million in cash. LH-Finance provides direct consumer financing for United States Coast Guard (“USCG”) registered high-end sail and power boats. Additionally, LH-Finance provides inventory floor plan lines of credit to marine dealers, primarily those selling USCG documented vessels.

Including the purchase accounting adjustments, as of the acquisition date, LH-Finance had approximately $409.1 million in total assets, including $407.4 million in total loans, which resulted in goodwill of $14.6 million being recorded.

The acquired portfolio of loans is now housed in the Shore Premier Finance (“SPF”) division.  The SPF division of Centennial is responsible for servicing the acquired loan portfolio and originating new loan production. In connection with this acquisition, Centennial opened a loan production office in Baltimore, Maryland.

3.  Investment Securities

  The following table summarizes the amortized cost and fair value of securities available-for-sale and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income (loss):

 

 

 

March 31, 2021

 

 

 

Available-for-Sale

 

 

 

Amortized

Cost

 

 

Gross

Unrealized

Gains

 

 

Gross

Unrealized

(Losses)

 

 

Estimated

Fair Value

 

 

 

(In thousands)

 

U.S. government-sponsored enterprises

 

$

333,291

 

 

$

2,004

 

 

$

(2,321

)

 

$

332,974

 

Residential mortgage-backed securities

 

 

751,372

 

 

 

8,731

 

 

 

(8,093

)

 

 

752,010

 

Commercial mortgage-backed securities

 

 

435,269

 

 

 

13,610

 

 

 

(1,042

)

 

 

447,837

 

State and political subdivisions

 

 

951,293

 

 

 

19,677

 

 

 

(7,167

)

 

 

963,803

 

Other securities

 

 

42,407

 

 

 

449

 

 

 

(357

)

 

 

42,499

 

Total

 

$

2,513,632

 

 

$

44,471

 

 

$

(18,980

)

 

$

2,539,123

 

 

 

 

December 31, 2020

 

 

 

Available-for-Sale

 

 

 

Amortized

Cost

 

 

Gross

Unrealized

Gains

 

 

Gross

Unrealized

(Losses)

 

 

Estimated

Fair Value

 

 

 

(In thousands)

 

U.S. government-sponsored enterprises

 

$

325,860

 

 

$

2,338

 

 

$

(1,207

)

 

$

326,991

 

Residential mortgage-backed securities

 

 

703,138

 

 

 

10,607

 

 

 

(688

)

 

 

713,057

 

Commercial mortgage-backed securities

 

 

446,964

 

 

 

18,048

 

 

 

(126

)

 

 

464,886

 

State and political subdivisions

 

 

898,174

 

 

 

31,173

 

 

 

(1,454

)

 

 

927,893

 

Other securities

 

 

40,755

 

 

 

434

 

 

 

(235

)

 

 

40,954

 

Total

 

$

2,414,891

 

 

$

62,600

 

 

$

(3,710

)

 

$

2,473,781

 

 

 


 

13

 


 

 

Assets, principally investment securities, having a carrying value of approximately $1.08 billion at March 31, 2021 and December 31, 2020, respectively, were pledged to secure public deposits, as collateral for repurchase agreements, and for other purposes required or permitted by law. Investment securities pledged as collateral for repurchase agreements totaled approximately $162.9 million and $168.9 million at March 31, 2021 and December 31, 2020, respectively.

The amortized cost and estimated fair value of securities classified as available-for-sale at March 31, 2021, by contractual maturity, are shown below. Expected maturities could differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.

 

 

 

Available-for-Sale

 

 

 

Amortized

Cost

 

 

Estimated

Fair Value

 

 

 

(In thousands)

 

Due in one year or less

 

$

8,651

 

 

$

8,690

 

Due after one year through five years

 

 

47,161

 

 

 

48,038

 

Due after five years through ten years

 

 

232,035

 

 

 

232,163

 

Due after ten years

 

 

1,037,144

 

 

 

1,048,385

 

Mortgage - backed securities: Residential

 

 

751,372

 

 

 

752,010

 

Mortgage - backed securities: Commercial

 

 

435,269

 

 

 

447,837

 

Other

 

 

2,000

 

 

 

2,000

 

Total

 

$

2,513,632

 

 

$

2,539,123

 

During the three months ended March 31, 2021, $17.9 million in available-for-sale securities were sold. The gross realized gains on the sales totaled $219,000 for the three months ended March 31, 2021.

During the three-month period ended March 31, 2020, 0 available-for-sale securities were sold.

The following shows gross unrealized losses and estimated fair value of investment securities classified as available-for-sale, aggregated by investment category and length of time that individual investment securities have been in a continuous loss position as of March 31, 2021 and December 31, 2020.

 

 

 

March 31, 2021

 

 

 

Less Than 12 Months

 

 

12 Months or More

 

 

Total

 

 

 

Fair

Value

 

 

Unrealized

Losses

 

 

Fair

Value

 

 

Unrealized

Losses

 

 

Fair

Value

 

 

Unrealized

Losses

 

 

 

(In thousands)

 

U.S. government-sponsored enterprises

 

$

60,870

 

 

$

(1,637

)

 

$

77,145

 

 

$

(684

)

 

$

138,015

 

 

$

(2,321

)

Residential mortgage-backed securities

 

 

338,020

 

 

 

(8,016

)

 

 

10,938

 

 

 

(77

)

 

 

348,958

 

 

 

(8,093

)

Commercial mortgage-backed securities

 

 

68,953

 

 

 

(1,042

)

 

 

 

 

 

 

 

 

68,953

 

 

 

(1,042

)

State and political subdivisions

 

 

377,950

 

 

 

(6,217

)

 

 

13,133

 

 

 

(950

)

 

 

391,083

 

 

 

(7,167

)

Other securities

 

 

9,302

 

 

 

(250

)

 

 

8,258

 

 

 

(107

)

 

 

17,560

 

 

 

(357

)

Total

 

$

855,095

 

 

$

(17,162

)

 

$

109,474

 

 

$

(1,818

)

 

$

964,569

 

 

$

(18,980

)

 

 

 

December 31, 2020

 

 

 

Less Than 12 Months

 

 

12 Months or More

 

 

Total

 

 

 

Fair

Value

 

 

Unrealized

Losses

 

 

Fair

Value

 

 

Unrealized

Losses

 

 

Fair

Value

 

 

Unrealized

Losses

 

 

 

(In thousands)

 

U.S. government-sponsored enterprises

 

$

54,611

 

 

$

(383

)

 

$

95,249

 

 

$

(824

)

 

$

149,860

 

 

$

(1,207

)

Residential mortgage-backed securities

 

 

143,458

 

 

 

(643

)

 

 

4,900

 

 

 

(45

)

 

 

148,358

 

 

 

(688

)

Commercial mortgage-backed securities

 

 

26,886

 

 

 

(126

)

 

 

 

 

 

 

 

 

26,886

 

 

 

(126

)

State and political subdivisions

 

 

78,349

 

 

 

(1,454

)

 

 

 

 

 

 

 

 

78,349

 

 

 

(1,454

)

Other securities

 

 

5,434

 

 

 

(100

)

 

 

8,748

 

 

 

(135

)

 

 

14,182

 

 

 

(235

)

Total

 

$

308,738

 

 

$

(2,706

)

 

$

108,897

 

 

$

(1,004

)

 

$

417,635

 

 

$

(3,710

)

 


 

14

 


 

 

The Company evaluates all securities quarterly to determine if any debt securities in a loss position require a provision for credit losses in accordance with ASC 326, Measurement of Credit Losses on Financial Instruments. The Company first assesses whether it intends to sell or is more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For securities that do not meet this criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, the Company considers the extent to which fair value is less than amortized cost, changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. Changes in the allowance for credit losses are recorded as provision for (or reversal of) credit loss expense. Losses are charged against the allowance when management believes the uncollectability of a security is confirmed or when either of the criteria regarding intent or requirement to sell is met. At March 31, 2021, the Company determined that the allowance for credit losses of $842,000, resulting from economic uncertainties related to the COVID-19 pandemic, was adequate for the investment portfolio. No additional provision for credit losses was considered necessary for the portfolio.

 

 

March 31, 2021

 

 

December 31, 2020

 

 

 

 

 

 

(In thousands)

 

Allowance for credit losses:

 

 

 

 

 

 

 

Beginning balance

$

842

 

 

$

 

Provision for credit loss - investment securities

 

 

 

 

842

 

Balance, March 31

$

842

 

 

$

842

 

Provision for credit loss - investment securities

 

 

 

 

 

 

Balance, December 31, 2020

 

 

 

 

$

842

 

 

For the three months ended March 31, 2021, the Company had investment securities with approximately $1.8 million in unrealized losses, which have been in continuous loss positions for more than twelve months.  The Company’s assessments indicated that the cause of the market depreciation was primarily due to the change in interest rates and not the issuer’s financial condition or downgrades by rating agencies. In addition, approximately 52.9% of the principal balance from the Company’s investment portfolio will mature and be repaid to the Company within five years or less. As a result, the Company has the ability and intent to hold such securities until maturity.

As of March 31, 2021, the Company's securities portfolio consisted of 1,296 investment securities, 321 of which were in an unrealized loss position. As noted in the table above, the total amount of the unrealized loss was $19.0 million. The U.S government-sponsored enterprises portfolio contained unrealized losses of $2.3 million on 51 securities. The residential mortgage-backed securities portfolio contained $8.1 million of unrealized losses on 110 securities, and the commercial mortgage-backed securities portfolio contained $1.0 million of unrealized losses on 27 securities. The state and political subdivisions portfolio contained $7.2 million of unrealized losses on 125 securities. In addition, the other securities portfolio contained $357,000 of unrealized losses on 8 securities. The unrealized losses on the Company's investments were a result of interest rate changes. The Company expects to recover the amortized cost basis over the term of the securities. Because the decline in market value was attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Company does not consider an allowance for credit losses on the other portions of the investment portfolio necessary as of March 31, 2021.

Income earned on available-for sale securities for the three months ended March 31, 2021 and 2020, is as follows:

 

 

 

For the Three Months

Ended March 31,

 

 

 

2021

 

 

2020

 

 

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

Taxable

 

$

6,253

 

 

$

9,776

 

Non-taxable

 

 

5,071

 

 

 

3,114

 

Total

 

$

11,324

 

 

$

12,890

 

 

 

15

 


 

 

4.  Loans Receivable

The various categories of loans receivable are summarized as follows:

 

 

 

March 31,

 

 

December 31,

 

 

 

2021

 

 

2020

 

 

 

(In thousands)

 

Real estate:

 

 

 

 

 

 

 

 

Commercial real estate loans

 

 

 

 

 

 

 

 

Non-farm/non-residential

 

$

4,289,142

 

 

$

4,429,060

 

Construction/land development

 

 

1,612,973

 

 

 

1,562,298

 

Agricultural

 

 

113,382

 

 

 

114,431

 

Residential real estate loans

 

 

 

 

 

 

 

 

Residential 1-4 family

 

 

1,437,546

 

 

 

1,536,257

 

Multifamily residential

 

 

377,661

 

 

 

536,538

 

Total real estate

 

 

7,830,704

 

 

 

8,178,584

 

Consumer

 

 

839,819

 

 

 

864,690

 

Commercial and industrial

 

 

1,794,787

 

 

 

1,896,442

 

Agricultural

 

 

65,017

 

 

 

66,869

 

Other

 

 

248,166

 

 

 

214,136

 

Total loans receivable

 

 

10,778,493

 

 

 

11,220,721

 

Allowance for credit losses

 

 

(242,932

)

 

 

(245,473

)

Loans receivable, net

 

$

10,535,561

 

 

$

10,975,248

 

 

During the three months ended March 31, 2021, the Company did 0t sell any guaranteed portions of Small Business Administration (“SBA”) loans.  During the three months ended March 31, 2020, the Company sold $3.7  million of the guaranteed portion of certain SBA loans, which resulted in gains of approximately $341,000.

Mortgage loans held for sale of approximately $113.4 million and $114.8 million at March 31, 2021 and December 31, 2020, respectively, are included in residential 1-4 family loans.   Mortgage loans held for sale are carried at the lower of cost or fair value, determined using an aggregate basis.  Gains and losses resulting from sales of mortgage loans are recognized when the respective loans are sold to investors.  Gains and losses are determined by the difference between the selling price and the carrying amount of the loans sold, net of discounts collected or paid.  The Company obtains forward commitments to sell mortgage loans to reduce market risk on mortgage loans in the process of origination and mortgage loans held for sale.  The forward commitments acquired by the Company for mortgage loans in process of origination are considered mandatory forward commitments.  Because these commitments are structured on a mandatory basis, the Company is required to substitute another loan or to buy back the commitment if the original loan does not fund.  These commitments are derivative instruments and their fair values at March 31, 2021 and December 31, 2020 were not material.

The Company adopted ASC 326 using the prospective transition approach for financial assets purchased with credit deterioration (“PCD”) that were previously classified as purchased credit impaired (“PCI”) and accounted for under ASC 310-30.  In 2019, the Company reevaluated its loan pools of purchased loans with deteriorated credit quality. These loans pools related specifically to acquired loans from the Heritage, Liberty, Landmark, Bay Cities, Bank of Commerce, Premier Bank, Stonegate and Shore Premier Finance acquisitions. At acquisition, a portion of these loans was recorded as purchased credit impaired loans on a pool by pool basis. Through the reevaluation of these loan pools, management determined that estimated losses for purchase credit impaired loans should be processed against the credit mark of the applicable pools.  The remaining non-accretable mark was then moved to accretable mark to be recognized over the remaining weighted average life of the loan pools.  The projected losses for these loans were less than the total credit mark.  As such, the remaining $107.6 million of loans in these pools along with the $29.3 million in accretable yield was deemed to be immaterial and was reclassified out of the purchased credit impaired loans category.  As of December 31, 2019, the Company 0 longer held any purchased loans with deteriorated credit quality. Therefore, the Company did not have any PCI loans upon adoption on of ASC 326 as of January 1, 2020.

The Company has purchased loans, some of which have experienced more than insignificant credit deterioration since origination.  PCD loans are recorded at the amount paid. An allowance for credit losses is determined using the same methodology as other loans. The initial allowance for credit losses determined on a collective basis is allocated to individual loans. The sum of the loan’s purchase price and allowance for credit losses becomes its initial amortized cost basis. The difference between the initial amortized cost basis and the par value of the loan is a noncredit discount or premium, which is amortized into interest income over the life of the loan. Subsequent changes to the allowance for credit losses are recorded through the provision for credit losses. As a result of the acquisition of LH-Finance in 2020, the Company held approximately $605,000 and $760,000 in PCD loans, as of March 31, 2021 and  December 31, 2020, respectively.

 

16

 


 

A description of our accounting policies for loans, impaired loans and non-accrual loans are set forth in our 2020 Form 10-K filed with the SEC on February 26, 2020. The Company adopted ASC 326 effective January 1, 2020. See Notes 1 and 5 for further discussion.

5.  Allowance for Credit Losses, Credit Quality and Other

The Company adopted ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, effective January 1, 2020. The guidance replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology.  The measurement of expected credit losses under the CECL methodology is applicable to financial assets measured at amortized cost, including loan receivables. It also applies to off-balance sheet credit exposures not accounted for as insurance, including loan commitments, standby letters of credits, financial guarantees, and other similar instruments. The Company adopted ASC 326 using the modified retrospective method for loans and off-balance-sheet credit exposures.  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.  The Company recorded a one-time cumulative-effect adjustment to the allowance for credit losses of $44.0 million which was recognized through a $32.5 million adjustment to retained earnings, net of tax. This adjustment brought the beginning balance of the allowance for credit losses to $146.1 million  as of January 1, 2020.  In addition, the Company recorded a $15.5 million reserve on unfunded commitments as of January 1, 2020, which was recognized through an $11.5 million adjustment to retained earnings, net of tax.

The Company uses the discounted cash flow (“DCF”) method to estimate expected losses for all of Company’s loan pools. These pools are as follows: construction & land development; other commercial real estate; residential real estate; commercial & industrial; and consumer & other. The loan portfolio pools were selected in order to generally align with the loan categories specified in the quarterly call reports required to be filed with the Federal Financial Institutions Examination Council. For each of these loan pools, the Company generates cash flow projections at the instrument level wherein payment expectations are adjusted for estimated prepayment speed, curtailments, time to recovery, probability of default, and loss given default. The modeling of expected prepayment speeds, curtailment rates, and time to recovery are based on historical internal data. The Company uses regression analysis of historical internal and peer data to determine suitable loss drivers to utilize when modeling lifetime probability of default and loss given default. This analysis also determines how expected probability of default and loss given default will react to forecasted levels of the loss drivers.

Each year management evaluates the performance of the selected models used in the CECL calculation through backtesting. Based on the results of the testing, management determines if the various models produced accurate results compared to the actual losses incurred for the current economic environment. Management then determines if changes to the input assumptions and economic factors would produce a stronger overall calculation that is more responsive to changes in economic conditions. The Company continues to use regression analysis to determine suitable loss drives to utilize when modeling lifetime probability of default and loss given default for the changes in the economic factors for the loss driver segments. Based on this analysis, management determined that changes to several of the economic factors for the various loss driver segments were necessary. The identified loss drivers by segment are included below as of March 31, 2021 and December 31, 2020, respectively.

 

March 31, 2021

 

 

 

Loss Driver Segment

Call Report Segment(s)

Modeled Economic Factors

1-4 Family Construction

1a1

National Unemployment (%) & Housing Price Index (%)

All Other Construction

1a2

National Unemployment (%)  & Gross Domestic Product (%)

1-4 Family Revolving HELOC & Junior Liens

1c1

National Unemployment (%) & Housing Price Index – CoreLogic (%)

1-4 Family Revolving HELOC & Junior Liens

1c2b

National Unemployment (%)  & Gross Domestic Product (%)

1-4 Family Senior Liens

1c2a

National Unemployment (%) & Gross Domestic Product (%)

Multifamily

1d

Rental Vacancy Rate (%) & Housing Price Index – Case-Schiller (%)

Owner Occupied CRE

1e1

National Unemployment (%) & Gross Domestic Product (%)

Non-Owner Occupied CRE

1e2,1b,8

National Unemployment (%) & Gross Domestic Product (%)

Commercial & Industrial, Agricultural, Non-Depository Financial Institutions, Purchase/Carry Securities, Other

4a, 3, 9a, 9b1, 9b2, Other

National Unemployment (%) & National Retail Sales (%)

Consumer Auto

6c

National Unemployment (%) & National Retail Sales (%)

Other Consumer

6b, 6d

National Unemployment (%) & National Retail Sales (%)

Other Consumer - SPF

6d

National Unemployment (%)

 

17

 


 

 

December 31, 2020

 

 

 

 

Loss Driver Segment

Call Report Segment(s)

Modeled Economic Factors

1-4 Family Construction

1a1

National Unemployment (%) & Housing Price Index (%)

All Other Construction

1a2

National Unemployment (%)  & Commercial Real Estate Price Index (%)

1-4 Family Revolving HELOC & Junior Liens

1c1, 1c2b

National Unemployment (%) & Housing Price Index (%)

1-4 Family Senior Liens

1c2a

National Unemployment (%) & Housing Price Index (%)

Multifamily

1d

National Unemployment (%) & Housing Price Index (%)

Owner Occupied CRE

1e1

National Unemployment (%) & Commercial Real Estate Price Index (%)

Non-Owner Occupied CRE

1e2,1b,8

National Unemployment (%) & Commercial Real Estate Price Index (%)

Commercial & Industrial, Agricultural, Non-Depository Financial Institutions, Purchase/Carry Securities, Other

4a, 3, 9a, 9b1, 9b2, Other

National Unemployment (%) & National Retail Sales (%)

Consumer Auto

6c

National Unemployment (%) & National Retail Sales (%)

Other Consumer

6b, 6d

National Unemployment (%) & National Retail Sales (%)

Other Consumer - SPF

6d

National Unemployment (%)

For all DCF models, management has determined that four quarters represents a reasonable and supportable forecast period and reverts back to a historical loss rate over four quarters on a straight-line basis. Management leverages economic projections from a reputable and independent third party to inform its loss driver forecasts over the four-quarter forecast period. Other internal and external indicators of economic forecasts are also considered by management when developing the forecast metrics.

The combination of adjustments for credit expectations (default and loss) and time expectations prepayment, curtailment, and time to recovery produces an expected cash flow stream at the instrument level. Instrument effective yield is calculated, net of the impacts of prepayment assumptions, and the instrument expected cash flows are then discounted at that effective yield to produce an instrument-level net present value of expected cash flows (“NPV”). An allowance for credit loss is established for the difference between the instrument’s NPV and amortized cost basis.  

Construction/Land Development and Other Commercial Real Estate Loans.  We originate non-farm and non-residential loans (primarily secured by commercial real estate), construction/land development loans, and agricultural loans, which are generally secured by real estate located in our market areas. Our commercial mortgage loans are generally collateralized by first liens on real estate and amortized (where defined) over a 15 to 30 year period with balloon payments due at the end of one to five years. These loans are generally underwritten by assessing cash flow (debt service coverage), primary and secondary source of repayment, the financial strength of any guarantor, the strength of the tenant (if any), the borrower’s liquidity and leverage, management experience, ownership structure, economic conditions and industry specific trends and collateral. Generally, we will loan up to 85% of the value of improved property, 65% of the value of raw land and 75% of the value of land to be acquired and developed. A first lien on the property and assignment of lease is required if the collateral is rental property, with second lien positions considered on a case-by-case basis.

Residential Real Estate Loans.  We originate one to four family, residential mortgage loans generally secured by property located in our primary market areas.  Residential real estate loans generally have a loan-to-value ratio of up to 90%. These loans are underwritten by giving consideration to many factors including the borrower’s ability to pay, stability of employment or source of income, debt-to-income ratio, credit history and loan-to-value ratio.

Commercial and Industrial Loans.  Commercial and industrial loans are made for a variety of business purposes, including working capital, inventory, equipment and capital expansion. The terms for commercial loans are generally one to seven years. Commercial loan applications must be supported by current financial information on the borrower and, where appropriate, by adequate collateral. Commercial loans are generally underwritten by addressing cash flow (debt service coverage), primary and secondary sources of repayment, the financial strength of any guarantor, the borrower’s liquidity and leverage, management experience, ownership structure, economic conditions and industry specific trends and collateral. The loan to value ratio depends on the type of collateral. Generally, accounts receivable are financed at between 50% and 80% of accounts receivable less than 60 days past due. Inventory financing will range between 50% and 80% (with no work in process) depending on the borrower and nature of inventory. We require a first lien position for those loans.

 

18

 


 

Consumer & Other Loans.  Our consumer & other loans are primarily composed of loans to finance USCG registered high-end sail and power boats as a result of our acquisitions of SPF on June 30, 2018 and LH-Finance on February 29, 2020. The performance of consumer & other loans will be affected by the local and regional economies as well as the rates of personal bankruptcies, job loss, divorce and other individual-specific characteristics.

Off-Balance Sheet Credit Exposures. The Company estimates expected credit losses over the contractual period in which the Company is exposed to credit risk via a contractual obligation to extend credit, unless that obligation is unconditionally cancellable by the Company. The allowance for credit loss on off-balance sheet credit exposures is adjusted as a provision for credit loss expense. The estimate includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over its estimated life. The Company uses the DCF method to estimate expected losses for all of Company’s off-balance sheet credit exposures through the use of the existing DCF models for the Company’s loan portfolio pools. The off-balance sheet credit exposures exhibit similar risk characteristics as loans currently in the Company’s loan portfolio.

As of March 31, 2021, the markets in which we operate have begun to experience economic recovery as unemployment rates have declined, COVID-19 vaccination rates have increased, and communities have begun to reopen for business activity.  However, there is still a significant amount of uncertainty related to the COVID-19 pandemic which may slow the anticipated economic recovery. The Company determined that an additional provision for credit losses on loans was not necessary as the current level of the allowance for credit losses was considered adequate as of March 31, 2021. In addition, the Company determined that the current level of  the unfunded commitment reserve was adequate and 0 additional unfunded commitments expense was necessary as of March 31, 2021.

ASC 326 requires that both a discount and an allowance for credit losses be recorded on loans during an acquisition.  During the first quarter of 2020, we completed the acquisition of $406.2 million of loans from LH-Finance.  As a result, the Company recorded a $6.6 million loan discount and a $9.3 million increase in the allowance for credit losses for this acquisition. A small portion of the loans acquired during the quarter were purchase credit deteriorated (“PCD”) loans, so the Company recorded a $357,000 allowance for credit losses on these loans.

The following tables present the activity in the allowance for credit losses for the three months ended March 31, 2021:

 

 

 

Three Months Ended March 31, 2021

 

 

 

Construction/

Land

Development

 

 

Other

Commercial

Real Estate

 

 

Residential

Real Estate

 

 

Commercial

& Industrial

 

 

Consumer

& Other

 

 

Total

 

 

 

(In thousands)

 

Allowance for credit losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

 

$

32,861

 

 

$

88,453

 

 

$

53,216

 

 

$

46,530

 

 

$

24,413

 

 

$

245,473

 

Loans charged off

 

 

 

 

 

(19

)

 

 

(226

)

 

 

(2,279

)

 

 

(523

)

 

 

(3,047

)

Recoveries of loans previously charged off

 

 

22

 

 

 

14

 

 

 

62

 

 

 

76

 

 

 

332

 

 

 

506

 

Net loans (charged off) recovered

 

 

22

 

 

 

(5

)

 

 

(164

)

 

 

(2,203

)

 

 

(191

)

 

 

(2,541

)

Provision for credit losses

 

 

(9,946

)

 

 

5,421

 

 

 

1,545

 

 

 

5,497

 

 

 

(2,517

)

 

 

 

Balance, March 31

 

$

22,937

 

 

$

93,869

 

 

$

54,597

 

 

$

49,824

 

 

$

21,705

 

 

$

242,932

 

 

19

 


 

 

The following tables present the balances in the allowance for loan losses for the three month period ended March 31, 2020 and the year ended December 31, 2020.

 

 

 

Three Months Ended March 31, 2020 and Year Ended December 31, 2020

 

 

 

Construction/

Land

Development

 

 

Other

Commercial

Real Estate

 

 

Residential

Real Estate

 

 

Commercial

& Industrial

 

 

Consumer

& Other

 

 

Total

 

 

 

(In thousands)

 

Allowance for credit losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

 

$

26,433

 

 

$

33,529

 

 

$

20,135

 

 

$

16,615

 

 

$

5,410

 

 

$

102,122

 

Impact of adoption ASC 326

 

 

(5,296

)

 

 

15,912

 

 

 

16,680

 

 

 

11,584

 

 

 

5,108

 

 

 

43,988

 

Allowance for credit losses on PCD loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

357

 

 

 

357

 

Loans charged off

 

 

(45

)

 

 

(519

)

 

 

(339

)

 

 

(2,804

)

 

 

(558

)

 

 

(4,265

)

Recoveries of loans previously charged off

 

 

10

 

 

 

250

 

 

 

160

 

 

 

65

 

 

 

255

 

 

 

740

 

Net loans charged off

 

 

(35

)

 

 

(269

)

 

 

(179

)

 

 

(2,739

)

 

 

(303

)

 

 

(3,525

)

Provision for credit loss - loans

 

 

13,309

 

 

 

23,483

 

 

 

6,144

 

 

 

28,940

 

 

 

4,796

 

 

 

76,672

 

Provision for credit loss - acquired loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

9,309

 

 

 

9,309

 

Balance, March 31

 

 

34,411

 

 

 

72,655

 

 

 

42,780

 

 

 

54,400

 

 

 

24,677

 

 

 

228,923

 

Loans charged off

 

 

(1,173

)

 

 

(2,522

)

 

 

(146

)

 

 

(4,960

)

 

 

(1,420

)

 

 

(10,221

)

Recoveries of loans previously charged off

 

 

97

 

 

 

397

 

 

 

177

 

 

 

153

 

 

 

506

 

 

 

1,330

 

Net loans charged off

 

 

(1,076

)

 

 

(2,125

)

 

 

31

 

 

 

(4,807

)

 

 

(914

)

 

 

(8,891

)

Provision for credit loss - loans

 

 

(474

)

 

 

17,923

 

 

 

10,405

 

 

 

(3,063

)

 

 

650

 

 

 

25,441

 

Balance, December 31

 

$

32,861

 

 

$

88,453

 

 

$

53,216

 

 

$

46,530

 

 

$

24,413

 

 

$

245,473

 

 

The following table presents the amortized cost basis of loans on nonaccrual status and loans past due over 90 days still accruing as of March 31, 2021 and December 31, 2020:

 

 

 

March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

Loans Past Due

 

 

 

 

 

 

 

Nonaccrual

 

 

Over 90 Days

 

 

 

Nonaccrual

 

 

With Reserve

 

 

Still Accruing

 

 

(In thousands)

 

Real estate:

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

Non-farm/non-residential

 

$

19,945

 

 

$

9,085

 

 

$

2,718

 

Construction/land development

 

 

1,252

 

 

 

7,826

 

 

 

1

 

Agricultural

 

 

862

 

 

 

 

 

 

 

Residential real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

Residential 1-4 family

 

 

19,166

 

 

 

3,000

 

 

 

1,180

 

Multifamily residential

 

 

172

 

 

 

 

 

 

 

Total real estate

 

 

41,397

 

 

 

19,911

 

 

 

3,899

 

Consumer

 

 

1,902

 

 

 

 

 

 

230

 

Commercial and industrial

 

 

14,755

 

 

 

 

 

 

80

 

Agricultural & other

 

 

1,088

 

 

 

 

 

 

 

Total

 

$

59,142

 

 

$

19,911

 

 

$

4,209

 

 

20

 


 

 

 

 

 

December 31, 2020

 

 

 

 

 

 

 

 

 

 

 

Loans Past Due

 

 

 

 

 

 

 

Nonaccrual

 

 

Over 90 Days

 

 

 

Nonaccrual

 

 

With Reserve

 

 

Still Accruing

 

 

(In thousands)

 

Real estate:

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

Non-farm/non-residential

 

$

20,947

 

 

$

6,794

 

 

$

6,088

 

Construction/land development

 

 

1,381

 

 

 

2,089

 

 

 

1,296

 

Agricultural

 

 

879

 

 

 

 

 

 

 

Residential real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

Residential 1-4 family

 

 

19,334

 

 

 

3,000

 

 

 

1,821

 

Multifamily residential

 

 

173

 

 

 

 

 

 

 

Total real estate

 

 

42,714

 

 

 

11,883

 

 

 

9,205

 

Consumer

 

 

3,506

 

 

 

 

 

 

174

 

Commercial and industrial

 

 

17,251

 

 

 

 

 

 

231

 

Agricultural & other

 

 

1,057

 

 

 

 

 

 

 

Total

 

$

64,528

 

 

$

11,883

 

 

$

9,610

 

 

The Company had $59.1 million and $64.5 million in nonaccrual loans for the periods ended March 31, 2021 and December 31, 2020, respectively. In addition, the Company had $4.2 million and $9.6 million in loans past due 90 days or more and still accruing for the periods ended March 31, 2021 and December 31, 2020, respectively.  

The Company had $19.9 million and $11.9 million in nonaccrual loans with a specific reserve as of March 31, 2021 and December 31, 2020, respectively. The Company did 0t recognize any interest income on nonaccrual loans during the period ended March 31, 2021 or March 31, 2020.

The following table presents the amortized cost basis of collateral-dependent impaired loans by class of loans as of March 31, 2021 and December 31, 2020:

 

 

 

March 31, 2021

 

 

 

Commercial

 

 

Residential

 

 

 

 

 

 

 

Real Estate

 

 

Real Estate

 

 

Other

 

 

 

(In thousands)

 

Real estate:

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

Non-farm/non-residential

 

$

307,946

 

 

$

 

 

$

 

Construction/land development

 

 

4,587

 

 

 

 

 

 

 

Agricultural

 

 

862

 

 

 

 

 

 

 

Residential real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

Residential 1-4 family

 

 

 

 

 

27,459

 

 

 

 

Multifamily residential

 

 

 

 

 

172

 

 

 

 

Total real estate

 

 

313,395

 

 

 

27,631

 

 

 

 

Consumer

 

 

 

 

 

 

 

 

2,146

 

Commercial and industrial

 

 

 

 

 

 

 

 

19,077

 

Agricultural & other

 

 

 

 

 

 

 

 

1,088

 

Total

 

$

313,395

 

 

$

27,631

 

 

$

22,311

 

 

21

 


 

 

 

 

 

December 31, 2020

 

 

 

Commercial

 

 

Residential

 

 

 

 

 

 

 

Real Estate

 

 

Real Estate

 

 

Other

 

 

 

(In thousands)

 

Real estate:

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

Non-farm/non-residential

 

$

47,429

 

 

$

 

 

$

 

Construction/land development

 

 

6,012

 

 

 

 

 

 

 

Agricultural

 

 

879

 

 

 

 

 

 

 

Residential real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

Residential 1-4 family

 

 

 

 

 

32,413

 

 

 

 

Multifamily residential

 

 

 

 

 

173

 

 

 

 

Total real estate

 

 

54,320

 

 

 

32,586

 

 

 

 

Consumer

 

 

 

 

 

 

 

 

3,694

 

Commercial and industrial

 

 

 

 

 

 

 

 

21,027

 

Agricultural & other

 

 

 

 

 

 

 

 

1,057

 

Total

 

$

54,320

 

 

$

32,586

 

 

$

25,778

 

The Company had $363.3 million and $112.7 million in collateral-dependent impaired loans for the periods ended March 31, 2021 and December 31, 2020, respectively. The increase in collateral-dependent impaired loans was due to the Company changing the valuation method for lodging and assisted living loans to a market price valuation methodology. This involved assigning a 15% discount of par for these impaired loans. The 15% figure was derived based on knowledge of current hotel and assisted living offerings in the loan sale market. In the event of default, liquidation would be achieved through a loan sale. The Company is continuing to monitor these impaired loans and will adjust the discount as necessary.

Loans that do not share risk characteristics are evaluated on an individual basis. For collateral-dependent impaired loans, excluding lodging and assisted living loans, where the Company has determined that foreclosure of the collateral is probable, or where the borrower is experiencing financial difficulty and the Company expects repayment of the financial asset to be provided substantially through the operation or sale of the collateral, the allowance for credit losses is measured based on the difference between the fair value of the collateral and the amortized cost basis of the loan as of the measurement date. When repayment is expected to be from the operation of the collateral, expected credit losses are calculated as the amount by which the amortized cost basis of the loan exceeds the present value of expected cash flows from the operation of the collateral. When repayment is expected to be from the sale of the collateral, expected credit losses are calculated as the amount by which the amortized cost basis of the loan exceeds the fair value of the underlying collateral less estimated costs to sell. The allowance for credit losses may be zero if the fair value of the collateral at the measurement date exceeds the amortized cost basis of the loan.

 


 

22

 


 

 

The following is an aging analysis for loans receivable as of March 31, 2021 and December 31, 2020:

 

 

 

March 31, 2021

 

 

 

Loans

Past Due

30-59 Days

 

 

Loans

Past Due

60-89 Days

 

 

Loans

Past Due

90 Days

or More

 

 

Total

Past Due

 

 

Current

Loans

 

 

Total

Loans

Receivable

 

 

Accruing

Loans

Past Due

90 Days

or More

 

 

 

(In thousands)

 

Real estate:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-farm/non-residential

 

$

4,540

 

 

$

3,038

 

 

$

22,663

 

 

$

30,241

 

 

$

4,258,901

 

 

$

4,289,142

 

 

$

2,718

 

Construction/land development

 

 

562

 

 

 

35

 

 

 

1,253

 

 

 

1,850

 

 

 

1,611,123

 

 

 

1,612,973

 

 

 

1

 

Agricultural

 

 

 

 

 

130

 

 

 

862

 

 

 

992

 

 

 

112,390

 

 

 

113,382

 

 

 

 

Residential real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential 1-4 family

 

 

6,022

 

 

 

1,477

 

 

 

20,346

 

 

 

27,845

 

 

 

1,409,701

 

 

 

1,437,546

 

 

 

1,180

 

Multifamily residential

 

 

 

 

 

 

 

 

172

 

 

 

172

 

 

 

377,489

 

 

 

377,661

 

 

 

 

Total real estate

 

 

11,124

 

 

 

4,680

 

 

 

45,296

 

 

 

61,100

 

 

 

7,769,604

 

 

 

7,830,704

 

 

 

3,899

 

Consumer

 

 

984

 

 

 

456

 

 

 

2,132

 

 

 

3,572

 

 

 

836,247

 

 

 

839,819

 

 

 

230

 

Commercial and industrial

 

 

1,132

 

 

 

351

 

 

 

14,835

 

 

 

16,318

 

 

 

1,778,469

 

 

 

1,794,787

 

 

 

80

 

Agricultural & other

 

 

691

 

 

 

86

 

 

 

1,088

 

 

 

1,865

 

 

 

311,318

 

 

 

313,183

 

 

 

 

Total

 

$

13,931

 

 

$

5,573

 

 

$

63,351

 

 

$

82,855

 

 

$

10,695,638

 

 

$

10,778,493

 

 

$

4,209

 

 

 

 

December 31, 2020

 

 

 

Loans

Past Due

30-59

Days

 

 

Loans

Past Due

60-89

Days

 

 

Loans

Past Due

90 Days

or More

 

 

Total

Past Due

 

 

Current

Loans

 

 

Total

Loans

Receivable

 

 

Accruing

Loans

Past Due

90 Days

or More

 

 

 

(In thousands)

 

Real estate:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-farm/non-residential

 

$

3,856

 

 

$

68

 

 

$

27,035

 

 

$

30,959

 

 

$

4,398,101

 

 

$

4,429,060

 

 

$

6,088

 

Construction/land development

 

 

178

 

 

 

44

 

 

 

2,677

 

 

$

2,899

 

 

 

1,559,399

 

 

 

1,562,298

 

 

 

1,296

 

Agricultural

 

 

522

 

 

 

 

 

 

879

 

 

 

1,401

 

 

 

113,030

 

 

 

114,431

 

 

 

 

Residential real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential 1-4 family

 

 

4,833

 

 

 

7,787

 

 

 

21,155

 

 

 

33,775

 

 

 

1,502,482

 

 

 

1,536,257

 

 

 

1,821

 

Multifamily residential

 

 

111

 

 

 

 

 

 

173

 

 

 

284

 

 

 

536,254

 

 

 

536,538

 

 

 

 

Total real estate

 

 

9,500

 

 

 

7,899

 

 

 

51,919

 

 

 

69,318

 

 

 

8,109,266

 

 

 

8,178,584

 

 

 

9,205

 

Consumer

 

 

2,899

 

 

 

802

 

 

 

3,680

 

 

 

7,381

 

 

 

857,309

 

 

 

864,690

 

 

 

174

 

Commercial and industrial

 

 

960

 

 

 

515

 

 

 

17,482

 

 

 

18,957

 

 

 

1,877,485

 

 

 

1,896,442

 

 

 

231

 

Agricultural and other

 

 

1,125

 

 

 

3,713

 

 

 

1,057

 

 

 

5,895

 

 

 

275,110

 

 

 

281,005

 

 

 

 

Total

 

$

14,484

 

 

$

12,929

 

 

$

74,138

 

 

$

101,551

 

 

$

11,119,170

 

 

$

11,220,721

 

 

$

9,610

 

 

Non-accruing loans at March 31, 2021 and December 31, 2020 were $59.1 million and $64.5 million, respectively.

Interest recognized on impaired loans during the three months ended March 31, 2021 and 2020 was approximately $267,000 and $399,000, respectively. The amount of interest recognized on impaired loans on the cash basis is not materially different than the accrual basis.


 

23

 


 

 

Credit Quality Indicators. As part of the on-going monitoring of the credit quality of the Company’s loan portfolio, management tracks certain credit quality indicators including trends related to (i) the risk rating of loans, (ii) the level of classified loans, (iii) net charge-offs, (iv) non-performing loans and (v) the general economic conditions in Arkansas, Florida, Alabama and New York.

The Company utilizes a risk rating matrix to assign a risk rating to each of its loans. Loans are rated on a scale from 1 to 8. Descriptions of the general characteristics of the 8 risk ratings are as follows:

 

Risk rating 1 – Excellent.  Loans in this category are to persons or entities of unquestionable financial strength, a highly liquid financial position, with collateral that is liquid and well margined.  These borrowers have performed without question on past obligations, and the Bank expects their performance to continue.  Internally generated cash flow covers current maturities of long-term debt by a substantial margin.  Loans secured by bank certificates of deposit and savings accounts, with appropriate holds placed on the accounts, are to be rated in this category.

 

Risk rating 2 – Good.  These are loans to persons or entities with strong financial condition and above-average liquidity that have previously satisfactorily handled their obligations with the Bank.  Collateral securing the Bank’s debt is margined in accordance with policy guidelines.  Internally generated cash flow covers current maturities of long-term debt more than adequately.  Unsecured loans to individuals supported by strong financial statements and on which repayment is satisfactory may be included in this classification.

 

Risk rating 3 – Satisfactory.  Loans to persons or entities with an average financial condition, adequate collateral margins, adequate cash flow to service long-term debt, and net worth comprised mainly of fixed assets are included in this category.  These entities are minimally profitable now, with projections indicating continued profitability into the foreseeable future.  Closely held corporations or businesses where a majority of the profits are withdrawn by the owners or paid in dividends are included in this rating category.  Overall, these loans are basically sound.

 

Risk rating 4 – Watch.  Borrowers who have marginal cash flow, marginal profitability or have experienced an unprofitable year and a declining financial condition characterize these loans.  The borrower has in the past satisfactorily handled debts with the Bank, but in recent months has either been late, delinquent in making payments, or made sporadic payments.  While the Bank continues to be adequately secured, margins have decreased or are decreasing, despite the borrower’s continued satisfactory condition.  Other characteristics of borrowers in this class include inadequate credit information, weakness of financial statement and repayment capacity, but with collateral that appears to limit exposure. 

 

Risk rating 5 – Other Loans Especially Mentioned (“OLEM”).  A loan criticized as OLEM has potential weaknesses that deserve management’s close attention.  If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the institution’s credit position at some future date.  OLEM assets are not adversely classified and do not expose the institution to sufficient risk to warrant adverse classification.

 

Risk rating 6 – Substandard.  A loan classified as substandard is inadequately protected by the sound worth and paying capacity of the borrower or the collateral pledged.  Loss potential, while existing in the aggregate amount of substandard loans, does not have to exist in individual assets.

 

Risk rating 7 – Doubtful.  A loan classified as doubtful has all the weaknesses inherent in a loan classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.  These are poor quality loans in which neither the collateral, if any, nor the financial condition of the borrower presently ensure collectability in full in a reasonable period of time; in fact, there is permanent impairment in the collateral securing the loan.

 

Risk rating 8 – Loss. Assets classified as loss are considered uncollectible and of such little value that the continuance as bankable assets is not warranted.  This classification does not mean that the asset has absolutely no recovery or salvage value, but rather, it is not practical or desirable to defer writing off this basically worthless asset, even though partial recovery may occur in the future.  This classification is based upon current facts, not probabilities.  Assets classified as loss should be charged-off in the period in which they became uncollectible.

The Company’s classified loans include loans in risk ratings 6, 7 and 8. The following is a presentation of classified loans by class as of March 31, 2021 and December 31, 2020:

 

Loans may be classified, but not considered impaired, due to one of the following reasons: (1) The Company has established minimum dollar amount thresholds for loan impairment testing. All loans over $2.0 million that are rated 5 – 8 are individually assessed for impairment on a quarterly basis.  Loans rated 5 – 8 that fall under the threshold amount are not individually tested for impairment and therefore are not included in impaired loans; (2) of the loans that are above the threshold amount and tested for impairment, after testing, some are considered to not be impaired and are not included in impaired loans.

 

24

 


 

Based on the most recent analysis performed, the risk category of loans by class of loans as of March 31, 2021 and December 31, 2020 is as follows:

 

 

 

March 31, 2021

 

 

 

Term Loans Amortized Cost Basis by Origination Year

 

 

 

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

2019

 

 

2018

 

 

2017

 

 

Prior

 

 

 

 

Revolving Loans Amortized Cost Basis

 

 

Total

 

 

 

(In thousands)

 

Real estate:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-farm/non-residential

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

 

 

$

 

 

$

 

    Risk rating 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25

 

 

 

25

 

    Risk rating 3

 

 

44,038

 

 

 

293,351

 

 

 

332,244

 

 

 

449,435

 

 

 

268,007

 

 

 

1,188,602

 

 

 

 

 

261,698

 

 

 

2,837,375

 

    Risk rating 4

 

 

1,034

 

 

 

26,988

 

 

 

151,064

 

 

 

202,071

 

 

 

192,571

 

 

 

393,141

 

 

 

 

 

40,386

 

 

 

1,007,255

 

    Risk rating 5

 

 

 

 

 

10,589

 

 

 

2,083

 

 

 

86,174

 

 

 

38,542

 

 

 

228,508

 

 

 

 

 

124

 

 

 

366,020

 

    Risk rating 6

 

 

 

 

 

 

 

 

15,629

 

 

 

1,763

 

 

 

14,048

 

 

 

46,292

 

 

 

 

 

84

 

 

 

77,816

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

557

 

 

 

 

 

 

 

 

557

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

94

 

 

 

 

 

 

 

 

94

 

Total non-farm/non-residential

 

 

45,072

 

 

 

330,928

 

 

 

501,020

 

 

 

739,443

 

 

 

513,168

 

 

 

1,857,194

 

 

 

 

 

302,317

 

 

 

4,289,142

 

Construction/land development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

 

 

$

 

 

$

 

    Risk rating 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

243

 

 

 

 

 

 

 

 

243

 

    Risk rating 3

 

 

31,274

 

 

 

241,608

 

 

 

144,498

 

 

 

68,865

 

 

 

29,756

 

 

 

73,258

 

 

 

 

 

134,788

 

 

 

724,047

 

    Risk rating 4

 

 

10,728

 

 

 

174,120

 

 

 

452,731

 

 

 

73,793

 

 

 

41,076

 

 

 

46,437

 

 

 

 

 

54,926

 

 

 

853,811

 

    Risk rating 5

 

 

 

 

 

 

 

 

457

 

 

 

388

 

 

 

21,902

 

 

 

1,224

 

 

 

 

 

1

 

 

 

23,972

 

    Risk rating 6

 

 

 

 

 

 

 

 

734

 

 

 

82

 

 

 

 

 

 

10,084

 

 

 

 

 

 

 

 

10,900

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total construction/land development

 

 

42,002

 

 

 

415,728

 

 

 

598,420

 

 

 

143,128

 

 

 

92,734

 

 

 

131,246

 

 

 

 

 

189,715

 

 

 

1,612,973

 

Agricultural

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

 

 

$

 

 

$

 

    Risk rating 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 3

 

 

2,084

 

 

 

31,979

 

 

 

8,338

 

 

 

8,549

 

 

 

5,648

 

 

 

27,993

 

 

 

 

 

5,601

 

 

 

90,192

 

    Risk rating 4

 

 

66

 

 

 

2,142

 

 

 

520

 

 

 

1,192

 

 

 

876

 

 

 

16,066

 

 

 

 

 

848

 

 

 

21,710

 

    Risk rating 5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

116

 

 

 

 

 

 

 

 

116

 

    Risk rating 6

 

 

 

 

 

46

 

 

 

 

 

 

 

 

 

 

 

 

1,318

 

 

 

 

 

 

 

 

1,364

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total agricultural

 

 

2,150

 

 

 

34,167

 

 

 

8,858

 

 

 

9,741

 

 

 

6,524

 

 

 

45,493

 

 

 

 

 

6,449

 

 

 

113,382

 

Total commercial real estate loans

 

$

89,224

 

 

$

780,823

 

 

$

1,108,298

 

 

$

892,312

 

 

$

612,426

 

 

$

2,033,933

 

 

 

 

$

498,481

 

 

$

6,015,497

 

Residential real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential 1-4 family

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

 

 

$

 

 

$

47

 

 

$

 

 

$

 

 

$

86

 

 

 

 

$

118

 

 

$

251

 

    Risk rating 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

62

 

 

 

 

 

1

 

 

 

63

 

    Risk rating 3

 

 

86,245

 

 

 

175,228

 

 

 

175,063

 

 

 

141,871

 

 

 

125,404

 

 

 

411,607

 

 

 

 

 

106,087

 

 

 

1,221,505

 

    Risk rating 4

 

 

 

 

 

4,250

 

 

 

11,630

 

 

 

26,214

 

 

 

19,651

 

 

 

74,481

 

 

 

 

 

30,766

 

 

 

166,992

 

    Risk rating 5

 

 

 

 

 

 

 

 

1,178

 

 

 

1,359

 

 

 

4,662

 

 

 

6,334

 

 

 

 

 

964

 

 

 

14,497

 

    Risk rating 6

 

 

290

 

 

 

1,976

 

 

 

2,681

 

 

 

1,339

 

 

 

1,466

 

 

 

19,512

 

 

 

 

 

6,950

 

 

 

34,214

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6

 

 

 

18

 

 

 

 

 

 

 

 

24

 

Total residential 1-4 family

 

 

86,535

 

 

 

181,454

 

 

 

190,599

 

 

 

170,783

 

 

 

151,189

 

 

 

512,100

 

 

 

 

 

144,886

 

 

 

1,437,546

 

Multifamily residential

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

 

 

$

 

 

$

 

    Risk rating 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 3

 

 

161

 

 

 

19,461

 

 

 

23,518

 

 

 

55,875

 

 

 

10,815

 

 

 

59,652

 

 

 

 

 

6,467

 

 

 

175,949

 

    Risk rating 4

 

 

 

 

 

478

 

 

 

3,985

 

 

 

101,146

 

 

 

11,328

 

 

 

20,981

 

 

 

 

 

37,799

 

 

 

175,717

 

    Risk rating 5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,928

 

 

 

 

 

 

 

 

24,928

 

    Risk rating 6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

895

 

 

 

172

 

 

 

 

 

 

 

 

1,067

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total multifamily residential

 

 

161

 

 

 

19,939

 

 

 

27,503

 

 

 

157,021

 

 

 

23,038

 

 

 

105,733

 

 

 

 

 

44,266

 

 

 

377,661

 

Total real estate

 

$

175,920

 

 

$

982,216

 

 

$

1,326,400

 

 

$

1,220,116

 

 

$

786,653

 

 

$

2,651,766

 

 

 

 

$

687,633

 

 

$

7,830,704

 

 

25

 


 

 

 

 

 

March 31, 2021

 

 

 

Term Loans Amortized Cost Basis by Origination Year, Continued

 

 

 

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

2019

 

 

2018

 

 

2017

 

 

 

 

Prior

 

 

 

 

Revolving Loans Amortized Cost Basis

 

 

Total

 

 

 

(In thousands)

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

735

 

 

$

2,721

 

 

$

1,988

 

 

$

1,418

 

 

$

361

 

 

 

 

$

2,088

 

 

 

 

$

1,864

 

 

$

11,175

 

    Risk rating 2

 

 

 

 

 

 

 

 

47

 

 

 

759

 

 

 

 

 

 

 

 

11

 

 

 

 

 

57

 

 

 

874

 

    Risk rating 3

 

 

53,370

 

 

 

218,205

 

 

 

174,945

 

 

 

142,314

 

 

 

86,467

 

 

 

 

 

125,075

 

 

 

 

 

12,315

 

 

 

812,691

 

    Risk rating 4

 

 

374

 

 

 

1,882

 

 

 

3,717

 

 

 

2,082

 

 

 

148

 

 

 

 

 

3,236

 

 

 

 

 

92

 

 

 

11,531

 

    Risk rating 5

 

 

 

 

 

120

 

 

 

 

 

 

105

 

 

 

198

 

 

 

 

 

788

 

 

 

 

 

 

 

 

1,211

 

    Risk rating 6

 

 

 

 

 

29

 

 

 

397

 

 

 

478

 

 

 

1

 

 

 

 

 

1,388

 

 

 

 

 

44

 

 

 

2,337

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total consumer

 

 

54,479

 

 

 

222,957

 

 

 

181,094

 

 

 

147,156

 

 

 

87,175

 

 

 

 

 

132,586

 

 

 

 

 

14,372

 

 

 

839,819

 

Commercial and industrial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

270,945

 

 

$

342,512

 

 

$

421

 

 

$

233

 

 

$

175

 

 

 

 

$

21,627

 

 

 

 

$

11,177

 

 

$

647,090

 

    Risk rating 2

 

 

30

 

 

 

25

 

 

 

180

 

 

 

 

 

 

93

 

 

 

 

 

579

 

 

 

 

 

297

 

 

 

1,204

 

    Risk rating 3

 

 

20,700

 

 

 

92,131

 

 

 

117,920

 

 

 

64,027

 

 

 

35,759

 

 

 

 

 

74,584

 

 

 

 

 

132,787

 

 

 

537,908

 

    Risk rating 4

 

 

33,864

 

 

 

35,042

 

 

 

119,236

 

 

 

143,526

 

 

 

37,659

 

 

 

 

 

45,436

 

 

 

 

 

81,276

 

 

 

496,039

 

    Risk rating 5

 

 

 

 

 

3,143

 

 

 

16,592

 

 

 

11,257

 

 

 

6,097

 

 

 

 

 

3,653

 

 

 

 

 

10,526

 

 

 

51,268

 

    Risk rating 6

 

 

 

 

 

15,502

 

 

 

4,767

 

 

 

28,608

 

 

 

3,207

 

 

 

 

 

6,221

 

 

 

 

 

2,955

 

 

 

61,260

 

    Risk rating 7

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2

 

    Risk rating 8

 

 

 

 

 

2

 

 

 

1

 

 

 

1

 

 

 

 

 

 

 

 

9

 

 

 

 

 

3

 

 

 

16

 

Total commercial and industrial

 

 

325,539

 

 

 

488,357

 

 

 

259,119

 

 

 

247,652

 

 

 

82,990

 

 

 

 

 

152,109

 

 

 

 

 

239,021

 

 

 

1,794,787

 

Agricultural and other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

18,659

 

 

$

35,633

 

 

$

49

 

 

$

53

 

 

$

 

 

 

 

$

131

 

 

 

 

$

1,260

 

 

$

55,785

 

    Risk rating 2

 

 

 

 

 

15

 

 

 

4,571

 

 

 

 

 

 

 

 

 

 

 

2,118

 

 

 

 

 

1,106

 

 

 

7,810

 

    Risk rating 3

 

 

15,492

 

 

 

70,196

 

 

 

6,601

 

 

 

4,780

 

 

 

4,819

 

 

 

 

 

52,180

 

 

 

 

 

28,287

 

 

 

182,355

 

    Risk rating 4

 

 

2,382

 

 

 

442

 

 

 

4,525

 

 

 

1,560

 

 

 

1,081

 

 

 

 

 

2,597

 

 

 

 

 

52,147

 

 

 

64,734

 

    Risk rating 5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

605

 

 

 

 

 

 

 

 

605

 

    Risk rating 6

 

 

 

 

 

 

 

 

30

 

 

 

17

 

 

 

34

 

 

 

 

 

1,756

 

 

 

 

 

57

 

 

 

1,894

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total agricultural and other

 

 

36,533

 

 

 

106,286

 

 

 

15,776

 

 

 

6,410

 

 

 

5,934

 

 

 

 

 

59,387

 

 

 

 

 

82,857

 

 

 

313,183

 

Total

 

$

592,471

 

 

$

1,799,816

 

 

$

1,782,389

 

 

$

1,621,334

 

 

$

962,752

 

 

 

 

$

2,995,848

 

 

 

 

$

1,023,883

 

 

$

10,778,493

 

 

26

 


 

 

 

 

 

December 31, 2020

 

 

 

Term Loans Amortized Cost Basis by Origination Year

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

2018

 

 

2017

 

 

2016

 

 

Prior

 

 

 

 

Revolving Loans Amortized Cost Basis

 

 

Total

 

 

 

(In thousands)

 

Real estate:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-farm/non-residential

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

 

 

$

 

 

$

 

    Risk rating 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25

 

 

 

25

 

    Risk rating 3

 

 

301,237

 

 

 

340,562

 

 

 

546,670

 

 

 

286,173

 

 

 

289,483

 

 

 

942,449

 

 

 

 

 

266,867

 

 

 

2,973,441

 

    Risk rating 4

 

 

27,239

 

 

 

139,354

 

 

 

161,461

 

 

 

265,684

 

 

 

197,979

 

 

 

300,055

 

 

 

 

 

17,305

 

 

 

1,109,077

 

    Risk rating 5

 

 

10,591

 

 

 

16,865

 

 

 

67,089

 

 

 

7,764

 

 

 

108,885

 

 

 

84,609

 

 

 

 

 

750

 

 

 

296,553

 

    Risk rating 6

 

 

 

 

 

859

 

 

 

2,289

 

 

 

987

 

 

 

4,577

 

 

 

40,600

 

 

 

 

 

86

 

 

 

49,398

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

552

 

 

 

 

 

 

 

 

552

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14

 

 

 

 

 

 

 

 

14

 

Total non-farm/non-residential

 

 

339,067

 

 

 

497,640

 

 

 

777,509

 

 

 

560,608

 

 

 

600,924

 

 

 

1,368,279

 

 

 

 

 

285,033

 

 

 

4,429,060

 

Construction/land development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

 

 

$

 

 

$

 

    Risk rating 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

283

 

 

 

 

 

 

 

 

283

 

    Risk rating 3

 

 

211,567

 

 

 

181,257

 

 

 

91,323

 

 

 

33,986

 

 

 

25,600

 

 

 

54,245

 

 

 

 

 

115,120

 

 

 

713,098

 

    Risk rating 4

 

 

129,599

 

 

 

417,737

 

 

 

92,032

 

 

 

46,249

 

 

 

17,161

 

 

 

32,060

 

 

 

 

 

76,845

 

 

 

811,683

 

    Risk rating 5

 

 

 

 

 

 

 

 

392

 

 

 

21,892

 

 

 

 

 

 

1,227

 

 

 

 

 

545

 

 

 

24,056

 

    Risk rating 6

 

 

 

 

 

763

 

 

 

98

 

 

 

63

 

 

 

157

 

 

 

12,065

 

 

 

 

 

 

 

 

13,146

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

1

 

 

 

 

 

 

31

 

 

 

 

 

 

 

 

32

 

Total construction/land development

 

 

341,166

 

 

 

599,757

 

 

 

183,845

 

 

 

102,191

 

 

 

42,918

 

 

 

99,911

 

 

 

 

 

192,510

 

 

 

1,562,298

 

Agricultural

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

 

 

$

 

 

$

 

    Risk rating 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 3

 

 

33,428

 

 

 

8,885

 

 

 

9,119

 

 

 

5,397

 

 

 

3,935

 

 

 

25,159

 

 

 

 

 

5,538

 

 

 

91,461

 

    Risk rating 4

 

 

2,141

 

 

 

535

 

 

 

1,206

 

 

 

681

 

 

 

5,499

 

 

 

10,735

 

 

 

 

 

665

 

 

 

21,462

 

    Risk rating 5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

116

 

 

 

 

 

 

 

 

116

 

    Risk rating 6

 

 

47

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,345

 

 

 

 

 

 

 

 

1,392

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total agricultural

 

 

35,616

 

 

 

9,420

 

 

 

10,325

 

 

 

6,078

 

 

 

9,434

 

 

 

37,355

 

 

 

 

 

6,203

 

 

 

114,431

 

Total commercial real estate loans

 

$

715,849

 

 

$

1,106,817

 

 

$

971,679

 

 

$

668,877

 

 

$

653,276

 

 

$

1,505,545

 

 

 

 

$

483,746

 

 

$

6,105,789

 

Residential real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential 1-4 family

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

 

 

$

47

 

 

$

 

 

$

 

 

$

76

 

 

$

12

 

 

 

 

$

120

 

 

$

255

 

    Risk rating 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

423

 

 

 

 

 

1,540

 

 

 

1,963

 

    Risk rating 3

 

 

237,991

 

 

 

184,578

 

 

 

151,478

 

 

 

139,096

 

 

 

119,642

 

 

 

343,381

 

 

 

 

 

119,186

 

 

 

1,295,352

 

    Risk rating 4

 

 

4,626

 

 

 

12,716

 

 

 

32,594

 

 

 

20,687

 

 

 

16,148

 

 

 

68,328

 

 

 

 

 

30,137

 

 

 

185,236

 

    Risk rating 5

 

 

 

 

 

 

 

 

1,363

 

 

 

4,700

 

 

 

383

 

 

 

5,344

 

 

 

 

 

516

 

 

 

12,306

 

    Risk rating 6

 

 

554

 

 

 

5,973

 

 

 

829

 

 

 

2,084

 

 

 

3,222

 

 

 

18,074

 

 

 

 

 

10,257

 

 

 

40,993

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8

 

 

 

 

 

144

 

 

 

152

 

Total residential 1-4 family

 

 

243,171

 

 

 

203,314

 

 

 

186,264

 

 

 

166,567

 

 

 

139,471

 

 

 

435,570

 

 

 

 

 

161,900

 

 

 

1,536,257

 

Multifamily residential

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

 

 

$

 

 

$

 

    Risk rating 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 3

 

 

19,033

 

 

 

60,175

 

 

 

87,104

 

 

 

11,477

 

 

 

8,092

 

 

 

59,592

 

 

 

 

 

6,386

 

 

 

251,859

 

    Risk rating 4

 

 

477

 

 

 

6,358

 

 

 

101,364

 

 

 

93,475

 

 

 

1,924

 

 

 

17,672

 

 

 

 

 

37,286

 

 

 

258,556

 

    Risk rating 5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,945

 

 

 

 

 

 

 

 

24,945

 

    Risk rating 6

 

 

 

 

 

 

 

 

 

 

 

894

 

 

 

 

 

 

284

 

 

 

 

 

 

 

 

1,178

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total multifamily residential

 

 

19,510

 

 

 

66,533

 

 

 

188,468

 

 

 

105,846

 

 

 

10,016

 

 

 

102,493

 

 

 

 

 

43,672

 

 

 

536,538

 

Total real estate

 

$

978,530

 

 

$

1,376,664

 

 

$

1,346,411

 

 

$

941,290

 

 

$

802,763

 

 

$

2,043,608

 

 

 

 

$

689,318

 

 

$

8,178,584

 

 

27

 


 

 

 

 

 

December 31, 2020

 

 

 

Term Loans Amortized Cost Basis by Origination Year, Continued

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

2018

 

 

2017

 

 

2016

 

 

 

 

Prior

 

 

 

 

Revolving Loans Amortized Cost Basis

 

 

Total

 

 

 

(In thousands)

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

3,389

 

 

$

2,375

 

 

$

1,596

 

 

$

485

 

 

$

828

 

 

 

 

$

1,428

 

 

 

 

$

1,957

 

 

$

12,058

 

    Risk rating 2

 

 

 

 

 

47

 

 

 

931

 

 

 

 

 

 

 

 

 

 

 

12

 

 

 

 

 

57

 

 

 

1,047

 

    Risk rating 3

 

 

229,189

 

 

 

192,054

 

 

 

152,646

 

 

 

97,812

 

 

 

68,585

 

 

 

 

 

68,871

 

 

 

 

 

20,094

 

 

 

829,251

 

    Risk rating 4

 

 

3,699

 

 

 

3,479

 

 

 

2,769

 

 

 

1,411

 

 

 

1,371

 

 

 

 

 

1,991

 

 

 

 

 

117

 

 

 

14,837

 

    Risk rating 5

 

 

144

 

 

 

737

 

 

 

22

 

 

 

198

 

 

 

568

 

 

 

 

 

321

 

 

 

 

 

 

 

 

1,990

 

    Risk rating 6

 

 

12

 

 

 

361

 

 

 

566

 

 

 

3

 

 

 

2,052

 

 

 

 

 

2,468

 

 

 

 

 

45

 

 

 

5,507

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total consumer

 

 

236,433

 

 

 

199,053

 

 

 

158,530

 

 

 

99,909

 

 

 

73,404

 

 

 

 

 

75,091

 

 

 

 

 

22,270

 

 

 

864,690

 

Commercial and industrial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

632,735

 

 

$

506

 

 

$

271

 

 

$

183

 

 

$

20,199

 

 

 

 

$

1,445

 

 

 

 

$

10,023

 

 

$

665,362

 

    Risk rating 2

 

 

29

 

 

 

187

 

 

 

2

 

 

 

96

 

 

 

67

 

 

 

 

 

623

 

 

 

 

 

268

 

 

 

1,272

 

    Risk rating 3

 

 

80,586

 

 

 

131,717

 

 

 

62,814

 

 

 

35,651

 

 

 

39,502

 

 

 

 

 

52,743

 

 

 

 

 

135,590

 

 

 

538,603

 

    Risk rating 4

 

 

68,032

 

 

 

144,867

 

 

 

149,445

 

 

 

42,416

 

 

 

15,138

 

 

 

 

 

43,065

 

 

 

 

 

115,341

 

 

 

578,304

 

    Risk rating 5

 

 

3,195

 

 

 

16,341

 

 

 

11,283

 

 

 

346

 

 

 

251

 

 

 

 

 

448

 

 

 

 

 

10,637

 

 

 

42,501

 

    Risk rating 6

 

 

1,261

 

 

 

4,086

 

 

 

30,834

 

 

 

22,992

 

 

 

2,615

 

 

 

 

 

5,198

 

 

 

 

 

3,405

 

 

 

70,391

 

    Risk rating 7

 

 

 

 

 

3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

    Risk rating 8

 

 

1

 

 

 

 

 

 

1

 

 

 

 

 

 

4

 

 

 

 

 

 

 

 

 

 

 

 

 

6

 

Total commercial and industrial

 

 

785,839

 

 

 

297,707

 

 

 

254,650

 

 

 

101,684

 

 

 

77,776

 

 

 

 

 

103,522

 

 

 

 

 

275,264

 

 

 

1,896,442

 

Agricultural and other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 1

 

$

59,248

 

 

$

51

 

 

$

53

 

 

$

 

 

$

110

 

 

 

 

$

27

 

 

 

 

$

1,036

 

 

$

60,525

 

    Risk rating 2

 

 

16

 

 

 

4,571

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,859

 

 

 

 

 

1,159

 

 

 

8,605

 

    Risk rating 3

 

 

78,305

 

 

 

7,045

 

 

 

5,050

 

 

 

5,045

 

 

 

18,445

 

 

 

 

 

36,925

 

 

 

 

 

42,401

 

 

 

193,216

 

    Risk rating 4

 

 

1,043

 

 

 

5,041

 

 

 

1,592

 

 

 

1,096

 

 

 

895

 

 

 

 

 

1,703

 

 

 

 

 

4,600

 

 

 

15,970

 

    Risk rating 5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

605

 

 

 

 

 

 

 

 

605

 

    Risk rating 6

 

 

 

 

 

219

 

 

 

18

 

 

 

 

 

 

223

 

 

 

 

 

1,624

 

 

 

 

 

 

 

 

2,084

 

    Risk rating 7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Risk rating 8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total agricultural and other

 

 

138,612

 

 

 

16,927

 

 

 

6,713

 

 

 

6,141

 

 

 

19,673

 

 

 

 

 

43,743

 

 

 

 

 

49,196

 

 

 

281,005

 

Total

 

$

2,139,414

 

 

$

1,890,351

 

 

$

1,766,304

 

 

$

1,149,024

 

 

$

973,616

 

 

 

 

$

2,265,964

 

 

 

 

$

1,036,048

 

 

$

11,220,721

 

 

28

 


 

 

The Company considers the performance of the loan portfolio and its impact on the allowance for credit losses. The Company also evaluates credit quality based on the aging status of the loan, which was previously presented and by payment activity. The following tables present the amortized cost of performing and nonperforming loans as of March 31, 2021 and December 31, 2020.

 

 

 

March 31, 2021

 

 

 

Term Loans Amortized Cost Basis by Origination Year

 

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

2019

 

 

2018

 

 

2017

 

 

Prior

 

 

Revolving Loans Amortized Cost Basis

 

 

Total

 

 

 

(In thousands)

 

Real estate:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-farm/non-residential

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Performing

 

$

45,072

 

 

$

320,787

 

 

$

486,244

 

 

$

714,285

 

 

$

476,750

 

 

$

1,635,825

 

 

$

302,233

 

 

$

3,981,196

 

    Non-performing

 

 

 

 

 

10,141

 

 

 

14,776

 

 

 

25,158

 

 

 

36,418

 

 

 

221,369

 

 

 

84

 

 

 

307,946

 

Total non-farm/

    non-residential

 

 

45,072

 

 

 

330,928

 

 

 

501,020

 

 

 

739,443

 

 

 

513,168

 

 

 

1,857,194

 

 

 

302,317

 

 

 

4,289,142

 

Construction/land

    development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Performing

 

$

42,002

 

 

$

415,728

 

 

$

597,686

 

 

$

143,105

 

 

$

92,672

 

 

$

127,478

 

 

$

189,715

 

 

$

1,608,386

 

    Non-performing

 

 

 

 

 

 

 

 

734

 

 

 

23

 

 

 

62

 

 

 

3,768

 

 

 

 

 

 

4,587

 

Total construction/

    land development

 

 

42,002

 

 

 

415,728

 

 

 

598,420

 

 

 

143,128

 

 

 

92,734

 

 

 

131,246

 

 

 

189,715

 

 

 

1,612,973

 

Agricultural

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Performing

 

$

2,150

 

 

$

34,167

 

 

$

8,858

 

 

$

9,741

 

 

$

6,524

 

 

$

44,631

 

 

$

6,449

 

 

$

112,520

 

    Non-performing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

862

 

 

 

 

 

 

862

 

Total agricultural

 

 

2,150

 

 

 

34,167

 

 

 

8,858

 

 

 

9,741

 

 

 

6,524

 

 

 

45,493

 

 

 

6,449

 

 

 

113,382

 

Total commercial real estate

    loans

 

$

89,224

 

 

$

780,823

 

 

$

1,108,298

 

 

$

892,312

 

 

$

612,426

 

 

$

2,033,933

 

 

$

498,481

 

 

$

6,015,497

 

Residential real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential 1-4 family

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Performing

 

$

86,535

 

 

$

179,180

 

 

$

188,053

 

 

$

170,012

 

 

$

146,071

 

 

$

501,478

 

 

$

138,758

 

 

$

1,410,087

 

    Non-performing

 

 

 

 

 

2,274

 

 

 

2,546

 

 

 

771

 

 

 

5,118

 

 

 

10,622

 

 

 

6,128

 

 

 

27,459

 

Total residential 1-4

    family

 

 

86,535

 

 

 

181,454

 

 

 

190,599

 

 

 

170,783

 

 

 

151,189

 

 

 

512,100

 

 

 

144,886

 

 

 

1,437,546

 

Multifamily residential

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Performing

 

$

161

 

 

$

19,939

 

 

$

27,503

 

 

$

157,021

 

 

$

23,038

 

 

$

105,561

 

 

$

44,266

 

 

$

377,489

 

    Non-performing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

172

 

 

 

 

 

 

172

 

Total multifamily

    residential

 

 

161

 

 

 

19,939

 

 

 

27,503

 

 

 

157,021

 

 

 

23,038

 

 

 

105,733

 

 

 

44,266

 

 

 

377,661

 

Total real estate

 

$

175,920

 

 

$

982,216

 

 

$

1,326,400

 

 

$

1,220,116

 

 

$

786,653

 

 

$

2,651,766

 

 

$

687,633

 

 

$

7,830,704

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Performing

 

$

54,479

 

 

$

222,930

 

 

$

180,740

 

 

$

147,038

 

 

$

87,173

 

 

$

130,948

 

 

$

14,365

 

 

$

837,673

 

    Non-performing

 

 

 

 

 

27

 

 

 

354

 

 

 

118

 

 

 

2

 

 

 

1,638

 

 

 

7

 

 

 

2,146

 

Total consumer

 

 

54,479

 

 

 

222,957

 

 

 

181,094

 

 

 

147,156

 

 

 

87,175

 

 

 

132,586

 

 

 

14,372

 

 

 

839,819

 

Commercial and industrial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Performing

 

$

325,539

 

 

$

488,294

 

 

$

254,644

 

 

$

241,302

 

 

$

80,014

 

 

$

147,647

 

 

$

238,270

 

 

$

1,775,710

 

    Non-performing

 

 

 

 

 

63

 

 

 

4,475

 

 

 

6,350

 

 

 

2,976

 

 

 

4,462

 

 

 

751

 

 

 

19,077

 

Total commercial and industrial

 

 

325,539

 

 

 

488,357

 

 

 

259,119

 

 

 

247,652

 

 

 

82,990

 

 

 

152,109

 

 

 

239,021

 

 

 

1,794,787

 

Agricultural and other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Performing

 

$

36,533

 

 

$

106,286

 

 

$

15,776

 

 

$

6,393