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Loans | 9 Months Ended
--- | ---
Sep. 30, 2019
Receivables [Abstract] |
Loans | Loans The following table presents loans by class as of the dates indicated:
| September 30, 2019 |  | December 31, 2018
Real estate loans: |  |  |
Commercial | $ | 3,468.2 |  |  | $ | 3,235.4 |
Construction: |  |  |
Land acquisition & development | 309.6 |  |  | 321.6 |
Residential | 261.8 |  |  | 242.8 |
Commercial | 386.7 |  |  | 274.3 |
Total construction loans | 958.1 |  |  | 838.7 |
Residential | 1,556.3 |  |  | 1,542.0 |
Agricultural | 226.5 |  |  | 217.4 |
Total real estate loans | 6,209.1 |  |  | 5,833.5 |
Consumer: |  |  |
Indirect consumer | 797.8 |  |  | 787.8 |
Other consumer | 188.8 |  |  | 200.6 |
Credit card | 80.3 |  |  | 81.8 |
Total consumer loans | 1,066.9 |  |  | 1,070.2 |
Commercial | 1,422.6 |  |  | 1,310.3 |
Agricultural | 292.7 |  |  | 254.8 |
Other, including overdrafts | 1.3 |  |  | 1.6 |
Loans held for investment | 8,992.6 |  |  | 8,470.4 |
Mortgage loans held for sale | 108.9 |  |  | 33.3 |
Total loans | $ | 9,101.5 |  |  | $ | 8,503.7 |
The following tables present the Company’s recorded investment and contractual aging of the Company’s recorded investment in loans by class as of the dates indicated. Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due.
|  |  |  | Total Loans |  |  |
| 30 - 59 | 60 - 89 | > 90 | 30 or More |  |  |
| Days | Days | Days | Days | Current | Non-accrual | Total
As of September 30, 2019 | Past Due | Past Due | Past Due | Past Due | Loans | Loans | Loans
Real estate |  |  |  |  |  |  |
Commercial | $ | 5.0 |  | $ | 4.6 |  | $ | 0.7 |  | $ | 10.3 |  | $ | 3,444.3 |  | $ | 13.6 |  | $ | 3,468.2 |
Construction: |  |  |  |  |  |  |
Land acquisition & development | 1.4 |  | 0.1 |  | 0.7 |  | 2.2 |  | 307.0 |  | 0.4 |  | 309.6 |
Residential | 4.1 |  | — |  | 0.8 |  | 4.9 |  | 256.5 |  | 0.4 |  | 261.8 |
Commercial | 1.5 |  | — |  | — |  | 1.5 |  | 384.7 |  | 0.5 |  | 386.7 |
Total construction loans | 7.0 |  | 0.1 |  | 1.5 |  | 8.6 |  | 948.2 |  | 1.3 |  | 958.1 |
Residential | 2.1 |  | 1.3 |  | 0.9 |  | 4.3 |  | 1,548.4 |  | 3.6 |  | 1,556.3 |
Agricultural | — |  | — |  | 0.1 |  | 0.1 |  | 221.3 |  | 5.1 |  | 226.5 |
Total real estate loans | 14.1 |  | 6.0 |  | 3.2 |  | 23.3 |  | 6,162.2 |  | 23.6 |  | 6,209.1 |
Consumer: |  |  |  |  |  |  |
Indirect consumer | 7.1 |  | 2.0 |  | 0.6 |  | 9.7 |  | 786.0 |  | 2.1 |  | 797.8 |
Other consumer | 1.1 |  | 0.6 |  | 0.3 |  | 2.0 |  | 186.3 |  | 0.5 |  | 188.8 |
Credit card | 0.9 |  | 0.4 |  | 0.6 |  | 1.9 |  | 78.4 |  | — |  | 80.3 |
Total consumer loans | 9.1 |  | 3.0 |  | 1.5 |  | 13.6 |  | 1,050.7 |  | 2.6 |  | 1,066.9 |
Commercial | 4.3 |  | 2.9 |  | 2.1 |  | 9.3 |  | 1,392.3 |  | 21.0 |  | 1,422.6 |
Agricultural | 0.6 |  | 0.1 |  | 0.2 |  | 0.9 |  | 288.9 |  | 2.9 |  | 292.7 |
Other, including overdrafts | — |  | — |  | — |  | — |  | 1.3 |  | — |  | 1.3 |
Loans held for investment | 28.1 |  | 12.0 |  | 7.0 |  | 47.1 |  | 8,895.4 |  | 50.1 |  | 8,992.6 |
Mortgage loans originated for sale | — |  | — |  | — |  | — |  | 108.9 |  | — |  | 108.9 |
Total loans | $ | 28.1 |  | $ | 12.0 |  | $ | 7.0 |  | $ | 47.1 |  | $ | 9,004.3 |  | $ | 50.1 |  | $ | 9,101.5 |
|  |  |  | Total Loans |  |  |
| 30 - 59 | 60 - 89 | > 90 | 30 or More |  |  |
| Days | Days | Days | Days | Current | Non-accrual | Total
As of December 31, 2018 | Past Due | Past Due | Past Due | Past Due | Loans | Loans | Loans
Real estate |  |  |  |  |  |  |
Commercial | $ | 10.4 |  | $ | 1.0 |  | $ | 0.8 |  | $ | 12.2 |  | $ | 3,214.0 |  | $ | 9.2 |  | $ | 3,235.4 |
Construction: |  |  |  |  |  |  |
Land acquisition & development | 1.6 |  | 0.1 |  | 0.2 |  | 1.9 |  | 316.0 |  | 3.7 |  | 321.6 |
Residential | 1.0 |  | 0.4 |  | — |  | 1.4 |  | 240.4 |  | 1.0 |  | 242.8 |
Commercial | 0.4 |  | — |  | — |  | 0.4 |  | 273.7 |  | 0.2 |  | 274.3 |
Total construction loans | 3.0 |  | 0.5 |  | 0.2 |  | 3.7 |  | 830.1 |  | 4.9 |  | 838.7 |
Residential | 8.8 |  | 1.1 |  | 0.2 |  | 10.1 |  | 1,525.3 |  | 6.6 |  | 1,542.0 |
Agricultural | 2.2 |  | — |  | — |  | 2.2 |  | 202.6 |  | 12.6 |  | 217.4 |
Total real estate loans | 24.4 |  | 2.6 |  | 1.2 |  | 28.2 |  | 5,772.0 |  | 33.3 |  | 5,833.5 |
Consumer: |  |  |  |  |  |  |
Indirect consumer | 6.8 |  | 2.1 |  | 0.4 |  | 9.3 |  | 776.8 |  | 1.7 |  | 787.8 |
Other consumer | 1.4 |  | 0.5 |  | 0.1 |  | 2.0 |  | 198.1 |  | 0.5 |  | 200.6 |
Credit card | 0.9 |  | 0.4 |  | 0.8 |  | 2.1 |  | 79.7 |  | — |  | 81.8 |
Total consumer loans | 9.1 |  | 3.0 |  | 1.3 |  | 13.4 |  | 1,054.6 |  | 2.2 |  | 1,070.2 |
Commercial | 8.3 |  | 1.2 |  | 1.3 |  | 10.8 |  | 1,283.7 |  | 15.8 |  | 1,310.3 |
Agricultural | 2.1 |  | 0.3 |  | — |  | 2.4 |  | 249.4 |  | 3.0 |  | 254.8 |
Other, including overdrafts | — |  | — |  | — |  | — |  | 1.6 |  | — |  | 1.6 |
Loans held for investment | 43.9 |  | 7.1 |  | 3.8 |  | 54.8 |  | 8,361.3 |  | 54.3 |  | 8,470.4 |
Mortgage loans originated for sale | — |  | — |  | — |  | — |  | 33.3 |  | — |  | 33.3 |
Total loans | $ | 43.9 |  | $ | 7.1 |  | $ | 3.8 |  | $ | 54.8 |  | $ | 8,394.6 |  | $ | 54.3 |  | $ | 8,503.7 |
Loans from business combinations included in the tables above include certain loans that had evidence of deterioration in credit quality since origination and for which it was probable, at acquisition, that all contractually required payments would not be collected. The following table displays the outstanding unpaid balances and accrual status of loans acquired with credit impairment as of the dates indicated:
| September 30, 2019 |  | December 31, 2018
Outstanding balance | $ | 52.8 |  |  | $ | 43.4 |
Carrying value |  |  |
Loans on accrual status | 39.9 |  |  | 30.2 |
Total carrying value | $ | 39.9 |  |  | $ | 30.2 |
The following table summarizes changes in the accretable yield for loans acquired deemed credit impaired for the three and nine month periods ended September 30, 2019 and 2018:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2019 | 2018 |  | 2019 | 2018
Beginning balance | $ | 10.8 |  | $ | 6.5 |  |  | $ | 8.9 |  | $ | 7.3 |
Acquisitions | — |  | 3.2 |  |  | 3.4 |  | 3.2 |
Additions | — |  | — |  |  | — |  | 0.4 |
Accretion income | (0.8 | ) | (0.7 | ) |  | (2.5 | ) | (2.4 | )
Reductions due to exit events | (0.2 | ) | (0.1 | ) |  | (1.3 | ) | (0.6 | )
Reclassifications from non-accretable differences | 0.2 |  | 0.6 |  |  | 1.5 |  | 1.6 |
Ending balance | $ | 10.0 |  | $ | 9.5 |  |  | $ | 10.0 |  | $ | 9.5 |
Acquired loans that met the criteria for non-accrual of interest prior to acquisition were considered performing upon acquisition. If interest on non-accrual loans had been accrued, such income would have been approximately $0.6 million and $0.8 million for the three months ended September 30, 2019 and 2018, respectively, and approximately $2.0 million and $1.6 million for the nine months ended September 30, 2019 and 2018, respectively. The Company considers impaired loans to include all originated loans, except consumer loans, that are risk rated as doubtful, or have been placed on non-accrual status or renegotiated in troubled debt restructurings, and all loans acquired with evidence of deterioration in credit quality and for which it was probable, at acquisition, that the Company would be unable to collect all contractual amounts owed. The following tables present information on the Company’s recorded investment in impaired loans as of the dates indicated:
As of September 30, 2019 | Unpaid Total Principal Balance | Recorded Investment With No Allowance | Recorded Investment With Allowance | Total Recorded Investment | Related Allowance
Real estate: |  |  |  |  |
Commercial | $ | 28.4 |  | $ | 13.2 |  | $ | 9.7 |  | $ | 22.9 |  | $ | 0.7 |
Construction: |  |  |  |  |
Land acquisition & development | 6.8 |  | 0.4 |  | 0.2 |  | 0.6 |  | — |
Residential | 0.6 |  | 0.4 |  | — |  | 0.4 |  | — |
Commercial | 1.0 |  | 0.5 |  | 0.1 |  | 0.6 |  | — |
Total construction loans | 8.4 |  | 1.3 |  | 0.3 |  | 1.6 |  | — |
Residential | 6.3 |  | 3.1 |  | 2.0 |  | 5.1 |  | 0.2 |
Agricultural | 7.6 |  | 5.1 |  | 2.1 |  | 7.2 |  | 0.1 |
Total real estate loans | 50.7 |  | 22.7 |  | 14.1 |  | 36.8 |  | 1.0 |
Commercial | 30.9 |  | 12.6 |  | 12.4 |  | 25.0 |  | 2.9 |
Agricultural | 5.8 |  | 2.8 |  | 2.5 |  | 5.3 |  | 0.2 |
Total | $ | 87.4 |  | $ | 38.1 |  | $ | 29.0 |  | $ | 67.1 |  | $ | 4.1 |
As of December 31, 2018 | Unpaid Total Principal Balance | Recorded Investment With No Allowance | Recorded Investment With Allowance | Total Recorded Investment | Related Allowance
Real estate: |  |  |  |  |
Commercial | $ | 22.2 |  | $ | 8.6 |  | $ | 7.7 |  | $ | 16.3 |  | $ | 0.7 |
Construction: |  |  |  |  |
Land acquisition & development | 10.0 |  | 0.4 |  | 3.5 |  | 3.9 |  | 0.2 |
Residential | 1.1 |  | 0.6 |  | 0.4 |  | 1.0 |  | 0.1 |
Commercial | 0.7 |  | 0.2 |  | — |  | 0.2 |  | — |
Total construction loans | 11.8 |  | 1.2 |  | 3.9 |  | 5.1 |  | 0.3 |
Residential | 8.8 |  | 5.7 |  | 2.0 |  | 7.7 |  | 0.3 |
Agricultural | 12.9 |  | 12.5 |  | 0.2 |  | 12.7 |  | — |
Total real estate loans | 55.7 |  | 28.0 |  | 13.8 |  | 41.8 |  | 1.3 |
Commercial | 24.1 |  | 5.5 |  | 14.4 |  | 19.9 |  | 5.2 |
Agricultural | 3.2 |  | 2.5 |  | 0.6 |  | 3.1 |  | 0.3 |
Total | $ | 83.0 |  | $ | 36.0 |  | $ | 28.8 |  | $ | 64.8 |  | $ | 6.8 |
The following table presents the average recorded investment in and income recognized on impaired loans for the periods indicated:
| Three Months Ended September 30,
| 2019 |  | 2018
| Average Recorded Investment |  | Income Recognized |  | Average Recorded Investment |  | Income Recognized
Real estate | $ | 33.9 |  |  | $ | — |  |  | $ | 54.5 |  |  | $ | — |
Commercial | 22.1 |  |  | — |  |  | 20.7 |  |  | — |
Agricultural | 6.0 |  |  | — |  |  | 1.9 |  |  | — |
Total | $ | 62.0 |  |  | $ | — |  |  | $ | 77.1 |  |  | $ | — |
| Nine Months Ended September 30,
| 2019 |  | 2018
| Average Recorded Investment |  | Income Recognized |  | Average Recorded Investment |  | Income Recognized
Real estate | $ | 39.2 |  |  | $ | — |  |  | $ | 54.1 |  |  | $ | 0.2 |
Commercial | 22.5 |  |  | 0.1 |  |  | 22.0 |  |  | 0.1 |
Agricultural | 4.1 |  |  | — |  |  | 1.6 |  |  | — |
Total | $ | 65.8 |  |  | $ | 0.1 |  |  | $ | 77.7 |  |  | $ | 0.3 |
Interest payments received on non-accrual impaired loans are applied to principal. Interest income is subsequently recognized only to the extent cash payments are received in excess of principal due. If interest on impaired loans had been accrued, interest income on impaired loans would have been approximately $0.6 million and $0.8 million for the three months ended September 30, 2019 and 2018, respectively, and approximately $2.0 million and $1.6 million for the nine months ended September 30, 2019 and 2018, respectively. Collateralized impaired loans are generally recorded at the fair value of the underlying collateral using discounted cash flows, independent appraisals, and management estimates based upon current market conditions. For loans measured under the present value of cash flows method, the change in present value attributable to the passage of time, if applicable, is recognized in the provision for loan losses and thus no interest income is recognized. Modifications of performing loans are made in the ordinary course of business and are completed on a case-by-case basis as negotiated with the borrower. Loan modifications typically include interest rate changes, interest only periods of less than twelve months, short-term payment deferrals and extension of amortization periods to provide payment relief. A loan modification is considered a troubled debt restructuring if the borrower is experiencing financial difficulties and the Company, for economic or legal reasons, grants a concession to the borrower that it would not otherwise consider. Certain troubled debt restructurings are on non-accrual status at the time of restructuring and may be returned to accrual status after considering the borrower’s sustained repayment performance in accordance with the restructuring agreement for a period of at least six months and management is reasonably assured of future performance. If the troubled debt restructuring meets these performance criteria and the interest rate granted at the modification is equal to or greater than the rate that the Company was willing to accept at the time of the restructuring for a new loan with comparable risk, then the loan will return to performing status and the accrual of interest will resume, although they continue to be individually evaluated for impairment and disclosed as impaired loans. The Company had loans renegotiated in troubled debt restructurings of $19.5 million as of September 30, 2019, of which $14.0 million were included in non-accrual loans and $5.5 million were on accrual status. The Company had loans renegotiated in troubled debt restructurings of $23.4 million as of December 31, 2018, of which $17.8 million were included in non-accrual loans and $5.6 million were on accrual status. The Company had no troubled debt restructurings during the three months ended September 30, 2019 and $0.2 million of troubled debt restructurings that occurred during the nine months ended September 30, 2019.
|  | Number of Notes |  | Type of Concession | Principal Balance at Restructure Date
Nine Months Ended September 30, 2019 |  |  | Interest only period | Extension of term or amortization schedule | Interest rate adjustment | Other (1)
Commercial real estate |  | 1 |  | $ | — |  | $ | 0.2 |  | $ | — |  | $ | — |  | $ | 0.2 |
Total loans restructured during period |  | 1 |  | $ | — |  | $ | 0.2 |  | $ | — |  | $ | — |  | $ | 0.2 |
(1) Other includes concessions that reduce or defer payments for a specified period of time and/or concessions that do not fit into other designated categories.
For troubled debt restructurings that were on non-accrual status or otherwise deemed impaired before the modification, a specific reserve may already be recorded. In periods subsequent to modification, the Company continues to evaluate all troubled debt restructurings for possible impairment and recognizes impairment through the allowance. Additionally these loans continue to work their way through the credit cycle through charge-off, pay-off, or foreclosure. Financial effects of modifications of troubled debt restructurings may include principal loan forgiveness or other charge-offs directly related to the restructuring. The Company had no charge-offs directly related to modifying troubled debt restructurings during the three and nine months ended September 30, 2019 or 2018. The Company had no material troubled debt restructurings during the previous 12 months for which there was a payment default during the three and nine months ended September 30, 2019. The Company considers a payment default to occur on troubled debt restructurings when the loan is 90 days or more past due or was placed on non-accrual status after the modification.
At September 30, 2019, there were no material commitments to lend additional funds to borrowers whose existing loans have been renegotiated or are classified as non-accrual. As part of the on-going and continuous monitoring of the credit quality of the Company’s loan portfolio, management tracks internally assigned risk classifications of loans. The Company adheres to a Uniform Classification System developed jointly by the various bank regulatory agencies to internally risk rate loans. The Uniform Classification System defines three broad categories of criticized assets, which the Company uses as credit quality indicators: Other Assets Especially Mentioned — includes loans that exhibit weaknesses in financial condition, loan structure or documentation, which if not promptly corrected, may lead to the development of abnormal risk elements. Substandard — includes loans that are inadequately protected by the current sound worth and paying capacity of the borrower. Although the primary source of repayment for a substandard loan is not currently sufficient, collateral or other sources of repayment are sufficient to satisfy the debt. Continuance of a substandard loan is not warranted unless positive steps are taken to improve the worthiness of the credit. Doubtful — includes loans that exhibit pronounced weaknesses to a point where collection or liquidation in full, on the basis of currently existing facts, conditions and values, is highly questionable and improbable. Doubtful loans are required to be placed on non-accrual status and are assigned specific loss exposure. Company management undertakes the same process for assigning risk ratings to acquired loans as it does for originated loans. Acquired loans rated as substandard or lower, or that were on non-accrual status or designated as troubled debt restructurings at the time of acquisition are deemed to be acquired credit impaired loans accounted for under ASC Topic 310-30, regardless of whether they are classified as performing or non-performing loans. The following tables present the Company’s recorded investment in criticized loans by class and credit quality indicator based on the most recent analysis performed as of the dates indicated:
As of September 30, 2019 | Other Assets Especially Mentioned | Substandard | Doubtful | Total Criticized Loans
Real estate: |  |  |  |
Commercial | $ | 90.0 |  | $ | 96.5 |  | $ | 1.5 |  | $ | 188.0 |
Construction: |  |  |  |
Land acquisition & development | 5.0 |  | 5.0 |  | 0.1 |  | 10.1 |
Residential | 0.9 |  | 1.4 |  | 0.4 |  | 2.7 |
Commercial | 2.3 |  | 1.5 |  | — |  | 3.8 |
Total construction loans | 8.2 |  | 7.9 |  | 0.5 |  | 16.6 |
Residential | 3.3 |  | 7.0 |  | 0.3 |  | 10.6 |
Agricultural | 15.5 |  | 25.3 |  | — |  | 40.8 |
Total real estate loans | 117.0 |  | 136.7 |  | 2.3 |  | 256.0 |
Consumer: |  |  |  |
Indirect consumer | 0.3 |  | 3.2 |  | — |  | 3.5 |
Direct consumer | 0.4 |  | 1.0 |  | 0.1 |  | 1.5 |
Total consumer loans | 0.7 |  | 4.2 |  | 0.1 |  | 5.0 |
Commercial | 40.2 |  | 62.5 |  | 9.9 |  | 112.6 |
Agricultural | 16.6 |  | 25.7 |  | 0.2 |  | 42.5 |
Total | $ | 174.5 |  | $ | 229.1 |  | $ | 12.5 |  | $ | 416.1 |
As of December 31, 2018 | Other Assets Especially Mentioned | Substandard | Doubtful | Total Criticized Loans
Real estate: |  |  |  |
Commercial | $ | 102.5 |  | $ | 87.4 |  | $ | 2.9 |  | $ | 192.8 |
Construction: |  |  |  |
Land acquisition & development | 5.0 |  | 7.0 |  | 3.3 |  | 15.3 |
Residential | 2.8 |  | 2.0 |  | 0.4 |  | 5.2 |
Commercial | 1.7 |  | 3.9 |  | — |  | 5.6 |
Total construction loans | 9.5 |  | 12.9 |  | 3.7 |  | 26.1 |
Residential | 3.0 |  | 10.8 |  | 0.7 |  | 14.5 |
Agricultural | 9.0 |  | 24.0 |  | 0.1 |  | 33.1 |
Total real estate loans | 124.0 |  | 135.1 |  | 7.4 |  | 266.5 |
Consumer: |  |  |  |
Indirect consumer | 0.7 |  | 2.1 |  | 0.1 |  | 2.9 |
Direct consumer | 0.3 |  | 0.8 |  | 0.1 |  | 1.2 |
Total consumer loans | 1.0 |  | 2.9 |  | 0.2 |  | 4.1 |
Commercial | 39.4 |  | 45.8 |  | 11.8 |  | 97.0 |
Agricultural | 14.4 |  | 17.8 |  | 1.5 |  | 33.7 |
Total | $ | 178.8 |  | $ | 201.6 |  | $ | 20.9 |  | $ | 401.3 |
The Company maintains a credit review function, which is independent of the credit approval process, to assess assigned internal risk classifications and monitor compliance with internal lending policies and procedures. Written action plans with firm target dates for resolution of identified problems are maintained and reviewed on a quarterly basis for all categories of criticized loans.

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