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Loans and Asset Quality Information | 12 Months Ended
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Dec. 31, 2020
Receivables [Abstract] |
Loans and Asset Quality Information | Loans and Asset Quality Information The following is a summary of the major categories of total loans outstanding:
($ in thousands) | December 31, 2020 |  | December 31, 2019
| Amount |  | Percentage |  | Amount |  | Percentage
All loans: |  |  |  |  |  |  |
Commercial, financial, and agricultural | $ | 782,549 |  |  | 17 | % |  | $ | 504,271 |  |  | 11 | %
Real estate – construction, land development & other land loans | 570,672 |  |  | 12 | % |  | 530,866 |  |  | 12 | %
Real estate – mortgage – residential (1-4 family) first mortgages | 972,378 |  |  | 21 | % |  | 1,105,014 |  |  | 25 | %
Real estate – mortgage – home equity loans / lines of credit | 306,256 |  |  | 6 | % |  | 337,922 |  |  | 8 | %
Real estate – mortgage – commercial and other | 2,049,203 |  |  | 43 | % |  | 1,917,280 |  |  | 43 | %
Consumer loans | 53,955 |  |  | 1 | % |  | 56,172 |  |  | 1 | %
Subtotal | 4,735,013 |  |  | 100 | % |  | 4,451,525 |  |  | 100 | %
Unamortized net deferred loan costs (fees) | (3,698) |  |  |  |  | 1,941 |  |  |
Total loans | $ | 4,731,315 |  |  |  |  | $ | 4,453,466 |  |  |
Included within "Commercial, financial and agricultural" in the table above are PPP loans totaling $240.5 million. PPP loans are fully guaranteed by the SBA. Included in unamortized net deferred loan fees are $6.0 million in unamortized net deferred loan fees associated with PPP loans. These fees are being amortized under the effective interest method over the terms of the loans. Accelerated amortization is recorded in the periods in which principal amounts are forgiven in accordance with the terms of the program. Because of their fully guaranteed nature, the Company has no allocation of allowance for loan losses established for these loans. Also included in the table above are various non-PPP SBA loans, with additional information on these loans presented in the table below.
($ in thousands) | December 31, 2020 |  | December 31, 2019
Guaranteed portions of non-PPP SBA Loans included in table above | $ | 33,959 |  |  | 54,400 |
Unguaranteed portions of SBA Loans included in table above | 135,703 |  |  | 110,782 |
Total non-PPP SBA loans included in the table above | $ | 169,662 |  |  | 165,182 |
Sold portions of SBA loans with servicing retained - not included in table above | $ | 395,398 |  |  | 316,730 |
At December 31, 2020 and 2019, there was a remaining unaccreted discount on the retained portion of sold SBA loans amounting to $7.3 million and $7.1 million, respectively. The discounts are amortized as yield adjustments over the respective lives of the loans, so long as the loans perform. Loans in the amount of $4.0 billion were pledged as collateral for certain borrowings at both December 31, 2020 and December 31, 2019, respectively (see Note 9). Included in the table above are credit card balances outstanding totaling $33.2 million and $30.9 million at December 31, 2020 and 2019, respectively. The loans above also include loans to executive officers and directors serving the Company at December 31, 2020 and to their associates, totaling approximately $3.6 million and $5.3 million at December 31, 2020 and 2019, respectively. New loans and advances on those loans in 2020 totaled $2.2 million and repayments amounted to $3.9 million. Management does not believe these loans involve more than the normal risk of collectability or present other unfavorable features. The Company has several acquired loan portfolios as a result of merger and acquisition transactions. In these transactions, the Company recorded loans at their fair value as required by applicable accounting guidance. Included in these loan portfolios were purchased credit impaired (“PCI”) loans, which are loans for which it is probable at acquisition date that all contractually required payments will not be collected. The remaining loans were considered to be purchased non-impaired loans and their related fair value discount or premium is being recognized as an adjustment to yield over the remaining life of each loan. As of December 31, 2020, 2019 and 2018, there was a remaining accretable discount of $7.9 million, $11.1 million, and $15.0 million, respectively, related to purchased non-impaired loans. The discounts are amortized as yield adjustments over the respective lives of the loans, so long as the loans perform. The following table presents changes in the carrying value of PCI loans.
($ in thousands) Purchased Credit Impaired Loans | For the Year Ended December 31, 2020 |  | For the Year Ended December 31, 2019 |  | For the Year Ended December 31, 2018
Balance at beginning of period | $ | 12,664 |  |  | 17,393 |  |  | 23,165 |
Change due to payments received and accretion | (4,087) |  |  | (4,863) |  |  | (5,799) |
Change due to loan charge-offs | (13) |  |  | (11) |  |  | (4) |
Transfers to foreclosed real estate | — |  |  | — |  |  | (10) |
Other | 27 |  |  | 145 |  |  | 41 |
Balance at end of period | $ | 8,591 |  |  | 12,664 |  |  | 17,393 |
The following table presents changes in the accretable yield for PCI loans.
($ in thousands) Accretable Yield for PCI loans | For the Year Ended December 31, 2020 |  | For the Year Ended December 31, 2019 |  | For the Year Ended December 31, 2018
Balance at beginning of period | $ | 4,149 |  |  | 4,750 |  |  | 4,688 |
Accretion | (1,119) |  |  | (1,486) |  |  | (2,050) |
Reclassification from (to) nonaccretable difference | 413 |  |  | 617 |  |  | 849 |
Other, net | (545) |  |  | 268 |  |  | 1,263 |
Balance at end of period | $ | 2,898 |  |  | 4,149 |  |  | 4,750 |
During 2020, the Company received $500,000 in payments that exceeded the carrying amount of the related PCI loans, of which $397,000 was recognized as loan discount accretion income, $89,000 was recorded as additional loan interest income, and $14,000 was recorded as a recovery. During 2019, the Company received $406,000 in payments that exceeded the carrying amount of the related PCI loans, of which $348,000 was recognized as loan discount accretion income and $58,000 was recorded as additional loan interest income. During 2018, the Company received $772,000 in payments that exceeded the carrying amount of the related PCI loans, of which $493,000 was recognized as loan discount accretion income and $279,000 was recorded as additional loan interest income. Nonperforming assets are defined as nonaccrual loans, troubled debt restructurings, loans past due 90 or more days and still accruing interest, and foreclosed real estate. Nonperforming assets are summarized as follows:
ASSET QUALITY DATA ($ in thousands) | December 31, 2020 |  | December 31, 2019
Nonperforming assets |  |  |
Nonaccrual loans | $ | 35,076 |  |  | 24,866 |
Restructured loans - accruing | 9,497 |  |  | 9,053 |
Accruing loans > 90 days past due | — |  |  | — |
Total nonperforming loans | 44,573 |  |  | 33,919 |
Foreclosed properties | 2,424 |  |  | 3,873 |
Total nonperforming assets | $ | 46,997 |  |  | 37,792 |
Purchased credit impaired loans not included above (1) | $ | 8,591 |  |  | 12,664 |
(1) In the March 3, 2017 acquisition of Carolina Bank. and the October 1, 2017 acquisition of Asheville Savings Bank, the Company acquired $19.3 million and $9.9 million, respectively, in PCI loans in accordance with ASC 310-30 accounting guidance. These loans are excluded from nonperforming loans, including $0.7 million and $0.8 million in PCI loans at December 31, 2020 and 2019, respectively, that are contractually past due 90 days or more. At December 31, 2020 and 2019, the Company had $1.9 million and $0.6 million in residential mortgage loans in process of foreclosure, respectively. At December 31, 2020 and 2019, there were no commitments to lend additional funds to debtors whose loans were nonperforming. The following is a summary the Company’s nonaccrual loans by major categories.
($ in thousands) | December 31, 2020 |  | December 31, 2019
Commercial, financial, and agricultural | $ | 9,681 |  |  | 5,518 |
Real estate – construction, land development & other land loans | 643 |  |  | 1,067 |
Real estate – mortgage – residential (1-4 family) first mortgages | 6,048 |  |  | 7,552 |
Real estate – mortgage – home equity loans / lines of credit | 1,333 |  |  | 1,797 |
Real estate – mortgage – commercial and other | 17,191 |  |  | 8,820 |
Consumer loans | 180 |  |  | 112 |
Total | $ | 35,076 |  |  | 24,866 |
The following table presents an analysis of the payment status of the Company’s loans as of December 31, 2020.
($ in thousands) | Accruing 30-59 Days Past Due |  | Accruing 60- 89 Days Past Due |  | Accruing 90 Days or More Past Due |  | Nonaccrual Loans |  | Accruing Current |  | Total Loans Receivable
Commercial, financial, and agricultural | $ | 1,464 |  |  | 1,101 |  |  | — |  |  | 9,681 |  |  | 770,166 |  |  | 782,412 |
Real estate – construction, land development & other land loans | 572 |  |  | — |  |  | — |  |  | 643 |  |  | 569,307 |  |  | 570,522 |
Real estate – mortgage – residential (1-4 family) first mortgages | 10,146 |  |  | 869 |  |  | — |  |  | 6,048 |  |  | 951,088 |  |  | 968,151 |
Real estate – mortgage – home equity loans / lines of credit | 1,088 |  |  | 42 |  |  | — |  |  | 1,333 |  |  | 303,693 |  |  | 306,156 |
Real estate – mortgage – commercial and other | 2,540 |  |  | 3,111 |  |  | — |  |  | 17,191 |  |  | 2,022,422 |  |  | 2,045,264 |
Consumer loans | 180 |  |  | 36 |  |  | — |  |  | 180 |  |  | 53,521 |  |  | 53,917 |
Purchased credit impaired | 328 |  |  | 112 |  |  | 719 |  |  | — |  |  | 7,432 |  |  | 8,591 |
Total | $ | 16,318 |  |  | 5,271 |  |  | 719 |  |  | 35,076 |  |  | 4,677,629 |  |  | 4,735,013 |
Unamortized net deferred loan (fees) costs |  |  |  |  |  |  |  |  |  |  | (3,698) |
Total loans |  |  |  |  |  |  |  |  |  |  | $ | 4,731,315 |
The following table presents an analysis of the payment status of the Company’s loans as of December 31, 2019.
($ in thousands) | Accruing 30-59 Days Past Due |  | Accruing 60- 89 Days Past Due |  | Accruing 90 Days or More Past Due |  | Nonaccrual Loans |  | Accruing Current |  | Total Loans Receivable
Commercial, financial, and agricultural | $ | 752 |  |  | — |  |  | — |  |  | 5,518 |  |  | 497,788 |  |  | 504,058 |
Real estate – construction, land development & other land loans | 37 |  |  | 152 |  |  | — |  |  | 1,067 |  |  | 529,444 |  |  | 530,700 |
Real estate – mortgage – residential (1-4 family) first mortgages | 10,858 |  |  | 5,056 |  |  | — |  |  | 7,552 |  |  | 1,076,205 |  |  | 1,099,671 |
Real estate – mortgage – home equity loans / lines of credit | 770 |  |  | 300 |  |  | — |  |  | 1,797 |  |  | 334,832 |  |  | 337,699 |
Real estate – mortgage – commercial and other | 4,257 |  |  | — |  |  | — |  |  | 8,820 |  |  | 1,897,573 |  |  | 1,910,650 |
Consumer loans | 344 |  |  | 137 |  |  | — |  |  | 112 |  |  | 55,490 |  |  | 56,083 |
Purchased credit impaired | 218 |  |  | 38 |  |  | 762 |  |  | — |  |  | 11,646 |  |  | 12,664 |
Total | $ | 17,236 |  |  | 5,683 |  |  | 762 |  |  | 24,866 |  |  | 4,402,978 |  |  | 4,451,525 |
Unamortized net deferred loan (fees) costs |  |  |  |  |  |  |  |  |  |  | 1,941 |
Total loans |  |  |  |  |  |  |  |  |  |  | $ | 4,453,466 |
The following table presents the activity in the allowance for loan losses for the year ended December 31, 2020.
($ in thousands) | Commercial, Financial, and Agricultural |  | Real Estate – Construction, Land Development & Other Land Loans |  | Real Estate – Residential (1-4 Family) First Mortgages |  | Real Estate – Mortgage – Home Equity Lines of Credit |  | Real Estate – Mortgage – Commercial and Other |  | Consumer loans |  | Unallocated |  | Total
As of and for the year ended December 31, 2020
Beginning balance | $ | 4,553 |  |  | 1,976 |  |  | 3,832 |  |  | 1,127 |  |  | 8,938 |  |  | 972 |  |  | — |  |  | 21,398 |
Charge-offs | (5,608) |  |  | (51) |  |  | (478) |  |  | (524) |  |  | (968) |  |  | (873) |  |  | — |  |  | (8,502) |
Recoveries | 745 |  |  | 1,552 |  |  | 754 |  |  | 487 |  |  | 621 |  |  | 294 |  |  | — |  |  | 4,453 |
Provisions | 11,626 |  |  | 1,878 |  |  | 3,940 |  |  | 1,285 |  |  | 15,012 |  |  | 1,085 |  |  | 213 |  |  | 35,039 |
Ending balance | $ | 11,316 |  |  | 5,355 |  |  | 8,048 |  |  | 2,375 |  |  | 23,603 |  |  | 1,478 |  |  | 213 |  |  | 52,388 |
Ending balances as of December 31, 2020: Allowance for loan losses
Individually evaluated for impairment | $ | 3,546 |  |  | 30 |  |  | 800 |  |  | — |  |  | 2,175 |  |  | — |  |  | — |  |  | 6,551 |
Collectively evaluated for impairment | $ | 7,742 |  |  | 5,325 |  |  | 7,141 |  |  | 2,375 |  |  | 21,428 |  |  | 1,475 |  |  | 213 |  |  | 45,699 |
Purchased credit impaired | $ | 28 |  |  | — |  |  | 107 |  |  | — |  |  | — |  |  | 3 |  |  | — |  |  | 138 |
Loans receivable as of December 31, 2020:
Ending balance – total | $ | 782,549 |  |  | 570,672 |  |  | 972,378 |  |  | 306,256 |  |  | 2,049,203 |  |  | 53,955 |  |  | — |  |  | 4,735,013 |
Unamortized net deferred loan (fees) costs |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (3,698) |
Total loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 4,731,315 |
Ending balances as of December 31, 2020: Loans
Individually evaluated for impairment | $ | 7,700 |  |  | 677 |  |  | 9,303 |  |  | 15 |  |  | 18,582 |  |  | 4 |  |  | — |  |  | 36,281 |
Collectively evaluated for impairment | $ | 774,712 |  |  | 569,845 |  |  | 958,848 |  |  | 306,141 |  |  | 2,026,682 |  |  | 53,913 |  |  | — |  |  | 4,690,141 |
Purchased credit impaired | $ | 137 |  |  | 150 |  |  | 4,227 |  |  | 100 |  |  | 3,939 |  |  | 38 |  |  | — |  |  | 8,591 |
The following table presents the activity in the allowance for loan losses for the year ended December 31, 2019.
($ in thousands) | Commercial, Financial, and Agricultural |  | Real Estate – Construction, Land Development & Other Land Loans |  | Real Estate – Residential (1-4 Family) First Mortgages |  | Real Estate – Mortgage – Home Equity Lines of Credit |  | Real Estate – Mortgage – Commercial and Other |  | Consumer loans |  | Unallocated |  | Total
As of and for the year ended December 31, 2019
Beginning balance | $ | 2,889 |  |  | 2,243 |  |  | 5,197 |  |  | 1,665 |  |  | 7,983 |  |  | 952 |  |  | 110 |  |  | 21,039 |
Charge-offs | (2,473) |  |  | (553) |  |  | (657) |  |  | (307) |  |  | (1,556) |  |  | (757) |  |  | — |  |  | (6,303) |
Recoveries | 980 |  |  | 1,275 |  |  | 705 |  |  | 629 |  |  | 575 |  |  | 235 |  |  | — |  |  | 4,399 |
Provisions | 3,157 |  |  | (989) |  |  | (1,413) |  |  | (860) |  |  | 1,936 |  |  | 542 |  |  | (110) |  |  | 2,263 |
Ending balance | $ | 4,553 |  |  | 1,976 |  |  | 3,832 |  |  | 1,127 |  |  | 8,938 |  |  | 972 |  |  | — |  |  | 21,398 |
Ending balances as of December 31, 2019: Allowance for loan losses
Individually evaluated for impairment | $ | 1,791 |  |  | 50 |  |  | 750 |  |  | — |  |  | 983 |  |  | — |  |  | — |  |  | 3,574 |
Collectively evaluated for impairment | $ | 2,720 |  |  | 1,926 |  |  | 2,976 |  |  | 1,127 |  |  | 7,931 |  |  | 961 |  |  | — |  |  | 17,641 |
Purchased credit impaired | $ | 42 |  |  | — |  |  | 106 |  |  | — |  |  | 24 |  |  | 11 |  |  | — |  |  | 183 |
Loans receivable as of December 31, 2019:
Ending balance – total | $ | 504,271 |  |  | 530,866 |  |  | 1,105,014 |  |  | 337,922 |  |  | 1,917,280 |  |  | 56,172 |  |  | — |  |  | 4,451,525 |
Unamortized net deferred loan (fees) costs |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,941 |
Total loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 4,453,466 |
Ending balances as of December 31, 2019: Loans
Individually evaluated for impairment | $ | 4,957 |  |  | 796 |  |  | 9,546 |  |  | 333 |  |  | 9,570 |  |  | — |  |  | — |  |  | 25,202 |
Collectively evaluated for impairment | $ | 499,101 |  |  | 529,904 |  |  | 1,090,125 |  |  | 337,366 |  |  | 1,901,080 |  |  | 56,083 |  |  | — |  |  | 4,413,659 |
Purchased credit impaired | $ | 213 |  |  | 166 |  |  | 5,343 |  |  | 223 |  |  | 6,630 |  |  | 89 |  |  | — |  |  | 12,664 |
The following table presents the activity in the allowance for loan losses for the year ended December 31, 2018.
($ in thousands) | Commercial, Financial, and Agricultural |  | Real Estate – Construction, Land Development & Other Land Loans |  | Real Estate – Residential (1-4 Family) First Mortgages |  | Real Estate – Mortgage – Home Equity Lines of Credit |  | Real Estate – Mortgage – Commercial and Other |  | Consumer loans |  | Unallo- cated |  | Total
As of and for the year ended December 31, 2018
Beginning balance | $ | 3,111 |  |  | 2,816 |  |  | 6,147 |  |  | 1,827 |  |  | 6,475 |  |  | 950 |  |  | 1,972 |  |  | 23,298 |
Charge-offs | (2,128) |  |  | (158) |  |  | (1,734) |  |  | (711) |  |  | (1,459) |  |  | (781) |  |  | — |  |  | (6,971) |
Recoveries | 1,195 |  |  | 4,097 |  |  | 833 |  |  | 364 |  |  | 1,503 |  |  | 309 |  |  | — |  |  | 8,301 |
Provisions | 711 |  |  | (4,512) |  |  | (49) |  |  | 185 |  |  | 1,464 |  |  | 474 |  |  | (1,862) |  |  | (3,589) |
Ending balance | $ | 2,889 |  |  | 2,243 |  |  | 5,197 |  |  | 1,665 |  |  | 7,983 |  |  | 952 |  |  | 110 |  |  | 21,039 |
Ending balances as of December 31, 2018: Allowance for loan losses
Individually evaluated for impairment | $ | 226 |  |  | 134 |  |  | 955 |  |  | 48 |  |  | 906 |  |  | — |  |  | — |  |  | 2,269 |
Collectively evaluated for impairment | $ | 2,661 |  |  | 2,109 |  |  | 4,143 |  |  | 1,608 |  |  | 7,070 |  |  | 941 |  |  | 110 |  |  | 18,642 |
Purchased credit impaired | $ | 2 |  |  | — |  |  | 99 |  |  | 9 |  |  | 7 |  |  | 11 |  |  | — |  |  | 128 |
Loans receivable as of December 31, 2018:
Ending balance – total | $ | 457,037 |  |  | 518,976 |  |  | 1,054,176 |  |  | 359,162 |  |  | 1,787,022 |  |  | 71,392 |  |  | — |  |  | 4,247,765 |
Unamortized net deferred loan (fees) costs |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,299 |
Total loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 4,249,064 |
Ending balances as of December 31, 2018: Loans
Individually evaluated for impairment | $ | 696 |  |  | 1,345 |  |  | 12,391 |  |  | 296 |  |  | 9,525 |  |  | — |  |  | — |  |  | 24,253 |
Collectively evaluated for impairment | $ | 456,111 |  |  | 517,453 |  |  | 1,035,532 |  |  | 358,522 |  |  | 1,767,361 |  |  | 71,140 |  |  | — |  |  | 4,206,119 |
Purchased credit impaired | $ | 230 |  |  | 178 |  |  | 6,253 |  |  | 344 |  |  | 10,136 |  |  | 252 |  |  | — |  |  | 17,393 |
The following table presents loans individually evaluated for impairment by class of loans, excluding purchased credit impaired loans, as of December 31, 2020.
($ in thousands) | Recorded Investment |  | Unpaid Principal Balance |  | Related Allowance |  | Average Recorded Investment
Impaired loans with no related allowance recorded: |  |  |  |  |  |  |
Commercial, financial, and agricultural | $ | 3,688 |  |  | 4,325 |  |  | — |  |  | 750 |
Real estate – mortgage – construction, land development & other land loans | 554 |  |  | 694 |  |  | — |  |  | 308 |
Real estate – mortgage – residential (1-4 family) first mortgages | 4,115 |  |  | 4,456 |  |  | — |  |  | 4,447 |
Real estate – mortgage –home equity loans / lines of credit | 15 |  |  | 27 |  |  | — |  |  | 264 |
Real estate – mortgage –commercial and other | 11,763 |  |  | 13,107 |  |  | — |  |  | 9,026 |
Consumer loans | 4 |  |  | 4 |  |  | — |  |  | 1 |
Total impaired loans with no allowance | $ | 20,139 |  |  | 22,613 |  |  | — |  |  | 14,796 |
Impaired loans with an allowance recorded: |  |  |  |  |  |  |
Commercial, financial, and agricultural | $ | 4,012 |  |  | 4,398 |  |  | 3,546 |  |  | 5,139 |
Real estate – mortgage – construction, land development & other land loans | 123 |  |  | 131 |  |  | 30 |  |  | 502 |
Real estate – mortgage – residential (1-4 family) first mortgages | 5,188 |  |  | 5,361 |  |  | 800 |  |  | 5,186 |
Real estate – mortgage –home equity loans / lines of credit | — |  |  | — |  |  | — |  |  | 21 |
Real estate – mortgage –commercial and other | 6,819 |  |  | 7,552 |  |  | 2,175 |  |  | 5,786 |
Consumer loans | — |  |  | — |  |  | — |  |  | — |
Total impaired loans with allowance | $ | 16,142 |  |  | 17,442 |  |  | 6,551 |  |  | 16,634 |
Interest income recorded on impaired loans during the year ended December 31, 2020 was $1.1 million, and reflects interest income recorded on nonaccrual loans prior to them being placed on nonaccrual status and interest income recorded on accruing TDRs. The following table presents loans individually evaluated for impairment by class of loans, excluding purchased credit impaired loans, as of December 31, 2019.
($ in thousands) | Recorded Investment |  | Unpaid Principal Balance |  | Related Allowance |  | Average Recorded Investment
Impaired loans with no related allowance recorded: |  |  |  |  |  |  |
Commercial, financial, and agricultural | $ | 16 |  |  | 19 |  |  | — |  |  | 74 |
Real estate – mortgage – construction, land development & other land loans | 221 |  |  | 263 |  |  | — |  |  | 366 |
Real estate – mortgage – residential (1-4 family) first mortgages | 4,300 |  |  | 4,539 |  |  | — |  |  | 4,415 |
Real estate – mortgage –home equity loans / lines of credit | 333 |  |  | 357 |  |  | — |  |  | 147 |
Real estate – mortgage –commercial and other | 2,643 |  |  | 3,328 |  |  | — |  |  | 3,240 |
Consumer loans | — |  |  | — |  |  | — |  |  | — |
Total impaired loans with no allowance | $ | 7,513 |  |  | 8,506 |  |  | — |  |  | 8,242 |
Impaired loans with an allowance recorded: |  |  |  |  |  |  |
Commercial, financial, and agricultural | $ | 4,941 |  |  | 4,995 |  |  | 1,791 |  |  | 1,681 |
Real estate – mortgage – construction, land development & other land loans | 575 |  |  | 575 |  |  | 50 |  |  | 586 |
Real estate – mortgage – residential (1-4 family) first mortgages | 5,246 |  |  | 5,469 |  |  | 750 |  |  | 6,206 |
Real estate – mortgage –home equity loans / lines of credit | — |  |  | — |  |  | — |  |  | 55 |
Real estate – mortgage –commercial and other | 6,927 |  |  | 7,914 |  |  | 983 |  |  | 5,136 |
Consumer loans | — |  |  | — |  |  | — |  |  | — |
Total impaired loans with allowance | $ | 17,689 |  |  | 18,953 |  |  | 3,574 |  |  | 13,664 |
Interest income recorded on impaired loans during the year ended December 31, 2019 was $1.3 million, and reflects interest income recorded on nonaccrual loans prior to them being placed on nonaccrual status and interest income recorded on accruing TDRs. The following table presents loans individually evaluated for impairment by class of loans, excluding purchased credit impaired loans, as of December 31, 2018.
($ in thousands) | Recorded Investment |  | Unpaid Principal Balance |  | Related Allowance |  | Average Recorded Investment
Impaired loans with no related allowance recorded: |  |  |  |  |  |  |
Commercial, financial, and agricultural | $ | 310 |  |  | 310 |  |  | — |  |  | 957 |
Real estate – mortgage – construction, land development & other land loans | 485 |  |  | 803 |  |  | — |  |  | 2,366 |
Real estate – mortgage – residential (1-4 family) first mortgages | 4,626 |  |  | 4,948 |  |  | — |  |  | 4,804 |
Real estate – mortgage –home equity loans / lines of credit | 22 |  |  | 31 |  |  | — |  |  | 91 |
Real estate – mortgage –commercial and other | 3,475 |  |  | 4,237 |  |  | — |  |  | 3,670 |
Consumer loans | — |  |  | — |  |  | — |  |  | — |
Total impaired loans with no allowance | $ | 8,918 |  |  | 10,329 |  |  | — |  |  | 11,888 |
Impaired loans with an allowance recorded: |  |  |  |  |  |  |
Commercial, financial, and agricultural | $ | 386 |  |  | 387 |  |  | 226 |  |  | 422 |
Real estate – mortgage – construction, land development & other land loans | 860 |  |  | 864 |  |  | 134 |  |  | 385 |
Real estate – mortgage – residential (1-4 family) first mortgages | 7,765 |  |  | 7,904 |  |  | 955 |  |  | 8,963 |
Real estate – mortgage –home equity loans / lines of credit | 274 |  |  | 275 |  |  | 48 |  |  | 184 |
Real estate – mortgage –commercial and other | 6,050 |  |  | 6,054 |  |  | 906 |  |  | 5,911 |
Consumer loans | — |  |  | — |  |  | — |  |  | 2 |
Total impaired loans with allowance | $ | 15,335 |  |  | 15,484 |  |  | 2,269 |  |  | 15,867 |
Interest income recorded on impaired loans during the year ended December 31, 2018 was $1.5 million, and reflects interest income recorded on nonaccrual loans prior to them being placed on nonaccrual status and interest income recorded on accruing TDRs. The Company tracks credit quality based on its internal risk ratings. Upon origination a loan is assigned an initial risk grade, which is generally based on several factors such as the borrower’s credit score, the loan-to-value ratio, the debt-to-income ratio, etc. Loans that are risk-graded as substandard during the origination process are declined. After loans are initially graded, they are monitored regularly for credit quality based on many factors, such as payment history, the borrower’s financial status, and changes in collateral value. Loans can be downgraded or upgraded depending on management’s evaluation of these factors. Internal risk-grading policies are consistent throughout each loan type. The following describes the Company’s internal risk grades in ascending order of likelihood of loss:
| Risk Grade | Description
Pass: |
| 1 | Loans with virtually no risk, including cash secured loans.
| 2 | Loans with documented significant overall financial strength. These loans have minimum chance of loss due to the presence of multiple sources of repayment – each clearly sufficient to satisfy the obligation.
| 3 | Loans with documented satisfactory overall financial strength. These loans have a low loss potential due to presence of at least two clearly identified sources of repayment – each of which is sufficient to satisfy the obligation under the present circumstances.
| 4 | Loans to borrowers with acceptable financial condition. These loans could have signs of minor operational weaknesses, lack of adequate financial information, or loans supported by collateral with questionable value or marketability.
| 5 | Loans that represent above average risk due to minor weaknesses and warrant closer scrutiny by management. Collateral is generally available and felt to provide reasonable coverage with realizable liquidation values in normal circumstances. Repayment performance is satisfactory.
| P (Pass) | Consumer loans (<$500,000) that are of satisfactory credit quality with borrowers who exhibit good personal credit history, average personal financial strength and moderate debt levels. These loans generally conform to Bank policy, but may include approved mitigated exceptions to the guidelines.
Special Mention: |
| 6 | Existing loans with defined weaknesses in primary source of repayment that, if not corrected, could cause a loss to the Bank.
Classified: |
| 7 | An existing loan inadequately protected by the current sound net worth and paying capacity of the obligor or the collateral pledged, if any. These loans have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt.
| 8 | Loans that have a well-defined weakness that make the collection or liquidation in full highly questionable and improbable. Loss appears imminent, but the exact amount and timing is uncertain.
| 9 | Loans that are considered uncollectible and are in the process of being charged-off. This grade is a temporary grade assigned for administrative purposes until the charge-off is completed.
| F (Fail) | Consumer loans (<$500,000) with a well-defined weakness, such as exceptions of any kind with no mitigating factors, history of paying outside the terms of the note, insufficient income to support the current level of debt, etc.
The following table presents the Company’s recorded investment in loans by credit quality indicators as of December 31, 2020.
($ in thousands) | Pass |  | Special Mention Loans |  | Classified Accruing Loans |  | Classified Nonaccrual Loans |  | Total
Commercial, financial, and agricultural | $ | 762,091 |  |  | 9,553 |  |  | 1,087 |  |  | 9,681 |  |  | 782,412 |
Real estate – construction, land development & other land loans | 560,845 |  |  | 7,877 |  |  | 1,157 |  |  | 643 |  |  | 570,522 |
Real estate – mortgage – residential (1-4 family) first mortgages | 943,455 |  |  | 7,609 |  |  | 11,039 |  |  | 6,048 |  |  | 968,151 |
Real estate – mortgage – home equity loans / lines of credit | 297,795 |  |  | 1,468 |  |  | 5,560 |  |  | 1,333 |  |  | 306,156 |
Real estate – mortgage – commercial and other | 1,988,684 |  |  | 34,588 |  |  | 4,801 |  |  | 17,191 |  |  | 2,045,264 |
Consumer loans | 53,488 |  |  | 80 |  |  | 169 |  |  | 180 |  |  | 53,917 |
Purchased credit impaired | 6,901 |  |  | 85 |  |  | 1,605 |  |  | — |  |  | 8,591 |
Total | $ | 4,613,259 |  |  | 61,260 |  |  | 25,418 |  |  | 35,076 |  |  | 4,735,013 |
Unamortized net deferred loan (fees) costs |  |  |  |  |  |  |  |  | (3,698) |
Total loans |  |  |  |  |  |  |  |  | 4,731,315 |
The following table presents the Company’s recorded investment in loans by credit quality indicators as of December 31, 2019.
($ in thousands) | Pass |  | Special Mention Loans |  | Classified Accruing Loans |  | Classified Nonaccrual Loans |  | Total
Commercial, financial, and agricultural | $ | 486,081 |  |  | 7,998 |  |  | 4,461 |  |  | 5,518 |  |  | 504,058 |
Real estate – construction, land development & other land loans | 522,767 |  |  | 4,075 |  |  | 2,791 |  |  | 1,067 |  |  | 530,700 |
Real estate – mortgage – residential (1-4 family) first mortgages | 1,063,735 |  |  | 13,187 |  |  | 15,197 |  |  | 7,552 |  |  | 1,099,671 |
Real estate – mortgage – home equity loans / lines of credit | 328,903 |  |  | 1,258 |  |  | 5,741 |  |  | 1,797 |  |  | 337,699 |
Real estate – mortgage – commercial and other | 1,873,594 |  |  | 20,800 |  |  | 7,436 |  |  | 8,820 |  |  | 1,910,650 |
Consumer loans | 55,203 |  |  | 413 |  |  | 355 |  |  | 112 |  |  | 56,083 |
Purchased credit impaired | 8,098 |  |  | 2,590 |  |  | 1,976 |  |  | — |  |  | 12,664 |
Total | $ | 4,338,381 |  |  | 50,321 |  |  | 37,957 |  |  | 24,866 |  |  | 4,451,525 |
Unamortized net deferred loan (fees) costs |  |  |  |  |  |  |  |  | 1,941 |
Total loans |  |  |  |  |  |  |  |  | 4,453,466 |
Troubled Debt Restructurings The restructuring of a loan is considered a “troubled debt restructuring” ("TDR") if both (i) the borrower is experiencing financial difficulties and (ii) the creditor has granted a concession. Concessions may include interest rate reductions or below market interest rates, principal forgiveness, extension of terms and other actions intended to minimize potential losses. As previously discussed, under the CARES Act and banking regulator guidance, which the Company has applied, modifications deemed to be COVID-19-related are not considered a TDR if the loan was not more than 30 days past due as of December 31, 2019 and the deferral was executed between March 1, 2020 and the earlier of 60 days after the date of termination of the COVID-19 national emergency or December 31, 2020. In December 2020, this provision was extended to December 31, 2021. The Company's COVID-19 payment deferral program began in late-March 2020, with the payment deferrals limited to 90 days and deferrals were granted to substantially all borrowers who requested it. As the initial 90 day deferrals began to expire, the Company approved subsequent deferral requests of another 90 days based on the circumstances of each borrower. Most of the Company's borrowers who were granted payment deferrals began making payments again in the second half of 2020. As of December 31, 2020, the Company had payment deferrals for 38 loans with an aggregate loan balance of $16.6 million, which are not included in the TDR's disclosed in this report. The Company continues to accrue interest on these loans during the deferral period. The vast majority of the Company’s TDRs modified during the years ended December 31, 2020, 2019, and 2018 related to interest rate reductions combined with extension of terms. The Company does not generally grant principal forgiveness. All loans classified as TDRs are considered to be impaired and are evaluated as such for determination of the allowance for loan losses. The Company’s TDRs can be classified as either nonaccrual or accruing based on the loan’s payment status. The TDRs that are nonaccrual are reported within the nonaccrual loan totals presented previously. The following table presents information related to loans modified in a TDR during the year ended December 31, 2020.
($ in thousands) | For the year ended December 31, 2020
| Number of Contracts |  | Pre- Modification Restructured Balances |  | Post- Modification Restructured Balances
TDRs – Accruing |  |  |  |  |
Commercial, financial, and agricultural | 2 |  |  | $ | 143 |  |  | $ | 143 |
Real estate – construction, land development & other land loans | 1 |  |  | 67 |  |  | 67 |
Real estate – mortgage – residential (1-4 family) first mortgages | 2 |  |  | 75 |  |  | 78 |
Real estate – mortgage – home equity loans / lines of credit | — |  |  | — |  |  | — |
Real estate – mortgage – commercial and other | — |  |  | — |  |  | — |
Consumer loans | 1 |  |  | 4 |  |  | 4 |
TDRs – Nonaccrual |  |  |  |  |
Commercial, financial, and agricultural | 1 |  |  | 72 |  |  | 72 |
Real estate – construction, land development & other land loans | — |  |  | — |  |  | — |
Real estate – mortgage – residential (1-4 family) first mortgages | — |  |  | — |  |  | — |
Real estate – mortgage – home equity loans / lines of credit | — |  |  | — |  |  | — |
Real estate – mortgage – commercial and other | 5 |  |  | 5,977 |  |  | 5,977 |
Consumer loans | — |  |  | — |  |  | — |
Total TDRs arising during period | 12 |  |  | $ | 6,338 |  |  | $ | 6,341 |
The following table presents information related to loans modified in a TDR during the year ended December 31, 2019.
($ in thousands) | For the year ended December 31, 2019
| Number of Contracts |  | Pre- Modification Restructured Balances |  | Post- Modification Restructured Balances
TDRs – Accruing |  |  |  |  |
Commercial, financial, and agricultural | 2 |  |  | $ | 395 |  |  | $ | 395 |
Real estate – construction, land development & other land loans | — |  |  | — |  |  | — |
Real estate – mortgage – residential (1-4 family) first mortgages | 3 |  |  | 387 |  |  | 391 |
Real estate – mortgage – home equity loans / lines of credit | — |  |  | — |  |  | — |
Real estate – mortgage – commercial and other | 1 |  |  | 274 |  |  | 274 |
Consumer loans | — |  |  | — |  |  | — |
TDRs – Nonaccrual |  |  |  |  |
Commercial, financial, and agricultural | — |  |  | — |  |  | — |
Real estate – construction, land development & other land loans | — |  |  | — |  |  | — |
Real estate – mortgage – residential (1-4 family) first mortgages | — |  |  | — |  |  | — |
Real estate – mortgage – home equity loans / lines of credit | — |  |  | — |  |  | — |
Real estate – mortgage – commercial and other | — |  |  | — |  |  | — |
Consumer loans | — |  |  | — |  |  | — |
Total TDRs arising during period | 6 |  |  | $ | 1,056 |  |  | $ | 1,060 |
The following table presents information related to loans modified in a TDR during the year ended December 31, 2018.
($ in thousands) | For the year ended December 31, 2018
| Number of Contracts |  | Pre- Modification Restructured Balances |  | Post- Modification Restructured Balances
TDRs – Accruing |  |  |  |  |
Commercial, financial, and agricultural | — |  |  | $ | — |  |  | $ | — |
Real estate – construction, land development & other land loans | — |  |  | — |  |  | — |
Real estate – mortgage – residential (1-4 family) first mortgages | 2 |  |  | 254 |  |  | 273 |
Real estate – mortgage – home equity loans / lines of credit | — |  |  | — |  |  | — |
Real estate – mortgage – commercial and other | — |  |  | — |  |  | — |
Consumer loans | — |  |  | — |  |  | — |
TDRs – Nonaccrual |  |  |  |  |
Commercial, financial, and agricultural | — |  |  | — |  |  | — |
Real estate – construction, land development & other land loans | 1 |  |  | 61 |  |  | 61 |
Real estate – mortgage – residential (1-4 family) first mortgages | 3 |  |  | 340 |  |  | 350 |
Real estate – mortgage – home equity loans / lines of credit | — |  |  | — |  |  | — |
Real estate – mortgage – commercial and other | — |  |  | — |  |  | — |
Consumer loans | — |  |  | — |  |  | — |
Total TDRs arising during period | 6 |  |  | $ | 655 |  |  | $ | 684 |
Accruing TDRs that were modified in the previous 12 months and that defaulted during the years ended December 31, 2020, 2019, and 2018 are presented in the table below. The Company considers a loan to have defaulted when it becomes 90 or more days delinquent under the modified terms, has been transferred to nonaccrual status, or has been transferred to foreclosed real estate.
($ in thousands) | For the Year Ended December 31, 2020 |  | For the Year Ended December 31, 2019 |  | For the Year Ended December 31, 2018
| Number of Contracts |  | Recorded Investment |  | Number of Contracts |  | Recorded Investment |  | Number of Contracts |  | Recorded Investment
Accruing TDRs that subsequently defaulted |  |  |  |  |  |  |  |  |  |  |
Real estate – mortgage – residential (1-4 family first mortgages) | — |  |  | $ | — |  |  | 1 |  |  | $ | 93 |  |  | 1 |  |  | $ | 60 |
Real estate – mortgage – commercial and other | 1 |  |  | 274 |  |  | — |  |  | — |  |  | 3 |  |  | 1,333 |
Total accruing TDRs that subsequently defaulted | 1 |  |  | $ | 274 |  |  | 1 |  |  | $ | 93 |  |  | 4 |  |  | $ | 1,393 |

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