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Portfolio Loans | 12 Months Ended
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Dec. 31, 2021
Receivables [Abstract] |
Portfolio Loans | LOANS Below is a summary of loans by category at December 31, 2021 and 2020:
($ in thousands) | December 31, 2021 |  | December 31, 2020
Commercial and industrial | $ | 3,396,590 |  |  | $ | 3,100,299 |
Real estate loans: |  |  |
Commercial - investor owned | 2,141,143 |  |  | 1,589,419 |
Commercial - owner occupied | 2,035,785 |  |  | 1,498,408 |
Construction and land development | 734,073 |  |  | 546,686 |
Residential | 454,052 |  |  | 319,179 |
Total real estate loans | 5,365,053 |  |  | 3,953,692 |
Other | 265,137 |  |  | 187,083 |
Loans, before unearned loan fees | 9,026,780 |  |  | 7,241,074 |
Unearned loan fees, net | (9,138) |  |  | (16,139) |
Loans, including unearned loan fees | $ | 9,017,642 |  |  | $ | 7,224,935 |
PPP loans totaled $276.2 million at December 31, 2021, or $272.0 million net of unearned fees of $4.2 million. PPP loans totaled $709.9 million at December 31, 2020, or $698.6 million net of unearned fees of $11.3 million. The loan balance includes a net premium on acquired loans of $11.9 million and $16.1 million at December 31, 2021 and 2020, respectively. At December 31, 2021 loans of $2.5 billion were pledged to the FHLB and the Federal Reserve. Loans to executive officers and directors, or to entities in which such individuals had beneficial interests as a shareholder, officer, or director totaled $5.7 million for each year ended December 31, 2021 and 2020. Such loans were made in the normal course of business on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other customers and did not involve more than the normal risk of collectibility. A summary of the activity, by loan category, in the allowance for loan losses for 2019, excluding the allowance on PCI loans, and the ACL on loans for 2020 and 2021 is as follows:
($ in thousands) | Commercial and industrial |  | CRE - investor owned |  | CRE - owner occupied |  | Construction and land development |  | Residential real estate |  | Other |  |  |  | Total
Balance at December 31, 2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Allowance for loan losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance, beginning of year | $ | 29,039 |  |  | $ | 4,683 |  |  | $ | 4,239 |  |  | $ | 1,987 |  |  | $ | 1,616 |  |  | $ | 731 |  |  |  |  | $ | 42,295 |
Provision for loan losses | 4,801 |  |  | 1,708 |  |  | 673 |  |  | (237) |  |  | (330) |  |  | 67 |  |  |  |  | 6,682 |
Charge-offs | (6,882) |  |  | (551) |  |  | (58) |  |  | (54) |  |  | (667) |  |  | (382) |  |  |  |  | (8,594) |
Recoveries | 338 |  |  | 95 |  |  | 19 |  |  | 776 |  |  | 661 |  |  | 295 |  |  |  |  | 2,184 |
Balance, end of year | $ | 27,296 |  |  | $ | 5,935 |  |  | $ | 4,873 |  |  | $ | 2,472 |  |  | $ | 1,280 |  |  | $ | 711 |  |  |  |  | $ | 42,567 |
Balance at December 31, 2020 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Allowance for loan losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance at December 31, 2019 | $ | 27,296 |  |  | $ | 5,935 |  |  | $ | 4,873 |  |  | $ | 2,472 |  |  | $ | 1,280 |  |  | $ | 711 |  |  |  |  | $ | 42,567 |
PCI allowance at December 31, 2019 | 159 |  |  | — |  |  | — |  |  | 139 |  |  | — |  |  | 423 |  |  |  |  | 721 |
CECL adoption | 6,494 |  |  | 10,726 |  |  | 2,598 |  |  | 5,183 |  |  | 3,470 |  |  | (84) |  |  |  |  | 28,387 |
PCD loans immediately charged off | — |  |  | (5) |  |  | (57) |  |  | (217) |  |  | (1,401) |  |  | — |  |  |  |  | (1,680) |
Balance, beginning of year | $ | 33,949 |  |  | $ | 16,656 |  |  | $ | 7,414 |  |  | $ | 7,577 |  |  | $ | 3,349 |  |  | $ | 1,050 |  |  |  |  | $ | 69,995 |
Provision for loan losses | 28,373 |  |  | 11,037 |  |  | 7,845 |  |  | 13,438 |  |  | 674 |  |  | 2,012 |  |  |  |  | 63,379 |
Initial allowance on acquired PCD loans | 23 |  |  | 2,026 |  |  | 1,427 |  |  | 45 |  |  | 3 |  |  | — |  |  |  |  | 3,524 |
Charge-offs | (5,381) |  |  | (498) |  |  | (30) |  |  | (31) |  |  | (408) |  |  | (391) |  |  |  |  | (6,739) |
Recoveries | 1,848 |  |  | 2,841 |  |  | 356 |  |  | 384 |  |  | 967 |  |  | 116 |  |  |  |  | 6,512 |
Balance, end of year | $ | 58,812 |  |  | $ | 32,062 |  |  | $ | 17,012 |  |  | $ | 21,413 |  |  | $ | 4,585 |  |  | $ | 2,787 |  |  |  |  | $ | 136,671 |
Balance at December 31, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance, beginning of year | $ | 58,812 |  |  | $ | 32,062 |  |  | $ | 17,012 |  |  | $ | 21,413 |  |  | $ | 4,585 |  |  | $ | 2,787 |  |  |  |  | $ | 136,671 |
Provision (benefit) for loan losses | 14,361 |  |  | 568 |  |  | (550) |  |  | (7,365) |  |  | 3,900 |  |  | 2,079 |  |  |  |  | 12,993 |
Initial allowance on acquired PCD loans | 1,077 |  |  | 3,651 |  |  | 1,504 |  |  | 37 |  |  | — |  |  | 737 |  |  |  |  | 7,006 |
Charge-offs | (12,113) |  |  | (2,487) |  |  | (602) |  |  | (3) |  |  | (1,521) |  |  | (459) |  |  |  |  | (17,185) |
Recoveries | 1,688 |  |  | 2,083 |  |  | 196 |  |  | 454 |  |  | 963 |  |  | 172 |  |  |  |  | 5,556 |
Balance, end of year | $ | 63,825 |  |  | $ | 35,877 |  |  | $ | 17,560 |  |  | $ | 14,536 |  |  | $ | 7,927 |  |  | $ | 5,316 |  |  |  |  | $ | 145,041 |
The ACL on sponsor finance loans, which is included in the categories above, represented $18.2 million and $19.0 million as of December 31, 2021 and 2020, respectively. On January 1, 2020, the Company adopted the CECL methodology which added $28.4 million to the ACL on loans. Upon adoption, $1.7 million of nonaccrual PCD loans with individual outstanding balances of less than $100,000 were immediately charged-off. Under the CECL method, the Company recorded $13.0 million and $63.4 million in provision for credit losses on loans for the years ended December 31, 2021 and 2020, respectively. An additional provision for credit losses of $0.4 million and $2.0 million was recorded in 2021 and 2020, respectively, for HTM securities, unfunded commitments and the recapture of accrued interest on nonaccrual loans. In 2019, a $6.7 million provision for loan losses (excluding the allowance release on PCI loans) was recorded under the incurred loss method. Acquisition-related provision expense of $25.4 million and $8.6 million in 2021 and 2020, respectively, was included in the provision for credit losses. This expense, commonly referred to as the “CECL double-count”, is recognized when a loan portfolio is acquired. The CECL methodology incorporates various economic scenarios. The Company utilizes three forecasts in the model; Moody’s baseline, a stronger near-term growth upside and a moderate recession downside forecast. The Company weights these scenarios at 40%, 30%, and 30%, respectively, which added approximately $17.5 million to the ACL over the baseline model. These forecasts incorporate an expectation that government stimulus will decline, the Federal Reserve will wind down quantitative easing and begin raising the federal funds rate, and that the pandemic will begin to slowly recede. The Company has also recognized the risk posed by loans that have received multiple deferrals of principal and interest payments, including the hospitality sector, by allocating additional reserves to those segments. Some of the key risks to the forecasts that could result in future provision for credit losses are additional shutdowns and self-quarantines from another significant wave of COVID, continued or worsening supply-chain issues, labor supply and job growth worsens, or financial market conditions tighten. In addition to the CECL methodology, the Company incorporates qualitative adjustments into the ACL on loans to capture credit risks inherent within the loan portfolio that are not captured in the DCF model. Included in these risks are 1) changes in lending policies and procedures, 2) actual and expected changes in business and economic conditions, 3) changes in the nature and volume of the portfolio, 4) changes in lending management, 5) changes in volume and the severity of past due loans, 6) changes in the quality of the loan review system, 7) changes in the value of underlying collateral, 8) the existence and effect of concentrations of credit and 9) other factors such as the regulatory, legal and competitive environments and events such as natural disasters and pandemics. At December 31, 2021, the ACL on loans included a qualitative adjustment of approximately $39.1 million. Of this amount, approximately $8.6 million was allocated to Sponsor Finance loans due to their unsecured nature.
The recorded investment in nonperforming loans by category at December 31, 2021 and 2020 is as follows:
| December 31, 2021
($ in thousands) | Non-accrual |  | Restructured, accruing |  | Loans over 90 days past due and still accruing interest |  | Total nonperforming loans |  | Nonaccrual loans with no allowance
Commercial and industrial | $ | 17,052 |  |  | $ | 2,783 |  |  | $ | 1,703 |  |  | $ | 21,538 |  |  | $ | 5,685 |
Real estate: |  |  |  |  |  |  |  |  |
Commercial - investor owned | 1,575 |  |  | — |  |  | — |  |  | 1,575 |  |  | 168 |
Commercial - owner occupied | 2,839 |  |  | — |  |  | — |  |  | 2,839 |  |  | 2,550 |
Residential | 1,971 |  |  | 76 |  |  | 1 |  |  | 2,048 |  |  | 1,348 |
Other | 12 |  |  | — |  |  | 12 |  |  | 24 |  |  | — |
Total | $ | 23,449 |  |  | $ | 2,859 |  |  | $ | 1,716 |  |  | $ | 28,024 |  |  | $ | 9,751 |
| December 31, 2020
($ in thousands) | Non-accrual |  | Restructured, accruing |  | Loans over 90 days past due and still accruing interest |  | Total nonperforming loans |  | Nonaccrual loans with no allowance
Commercial and industrial | $ | 18,158 |  |  | $ | 3,482 |  |  | $ | 130 |  |  | $ | 21,770 |  |  | $ | 8,316 |
Real estate: |  |  |  |  |  |  |  |  |
Commercial - investor owned | 9,579 |  |  | — |  |  | — |  |  | 9,579 |  |  | 716 |
Commercial - owner occupied | 2,940 |  |  | — |  |  | — |  |  | 2,940 |  |  | 6,024 |
Residential | 4,112 |  |  | 77 |  |  | — |  |  | 4,189 |  |  | — |
Other | 29 |  |  | — |  |  | — |  |  | 29 |  |  | 3,190 |
Total | $ | 34,818 |  |  | $ | 3,559 |  |  | $ | 130 |  |  | $ | 38,507 |  |  | $ | 18,246 |
The amortized cost basis of collateral-dependent nonperforming loans by class of loan is presented for the periods indicated:
| December 31, 2021
| Type of Collateral
(in thousands) | Commercial Real Estate |  | Residential Real Estate |  | Blanket Lien |  |
Commercial and industrial | $ | 4,271 |  |  | $ | 209 |  |  | $ | 9,312 |  |  |
Real estate: |  |  |  |  |  |  |
Commercial - investor owned | 169 |  |  | 1,200 |  |  | — |  |  |
Commercial - owner occupied | 2,807 |  |  | 32 |  |  | — |  |  |
Residential | — |  |  | 2,048 |  |  | — |  |  |
Total | $ | 7,247 |  |  | $ | 3,489 |  |  | $ | 9,312 |  |  |
| December 31, 2020
| Type of Collateral
(in thousands) | Commercial Real Estate |  | Residential Real Estate |  | Blanket Lien |  | Other
Commercial and industrial | $ | 8,316 |  |  | $ | — |  |  | $ | 394 |  |  | $ | — |
Real estate: |  |  |  |  |  |  |
Commercial - investor owned | 9,579 |  |  | — |  |  | — |  |  | — |
Commercial - owner occupied | 2,940 |  |  | — |  |  | — |  |  | — |
Residential | — |  |  | 4,135 |  |  | — |  |  | — |
Other | — |  |  | — |  |  | — |  |  | 17 |
Total | $ | 20,835 |  |  | $ | 4,135 |  |  | $ | 394 |  |  | $ | 17 |
The recorded investment by category for loans restructured during the years ended December 31, 2021 and 2020 is as follows:
| Year ended December 31, 2021 |  | Year ended December 31, 2020
($ in thousands, except for number of loans) | Number of Loans |  | Pre-Modification Outstanding Recorded Balance |  | Post-Modification Outstanding Recorded Balance |  | Number of Loans |  | Pre-Modification Outstanding Recorded Balance |  | Post-Modification Outstanding Recorded Balance
Commercial and industrial | — |  |  | $ | — |  |  | $ | — |  |  | 3 |  |  | $ | 7,447 |  |  | $ | 7,447 |
Real estate: |  |  |  |  |  |  |  |  |  |  |
Residential | 1 |  |  | 221 |  |  | 221 |  |  | 3 |  |  | 372 |  |  | 372 |
Total | 1 |  |  | $ | 221 |  |  | $ | 221 |  |  | 6 |  |  | $ | 7,819 |  |  | $ | 7,819 |
Restructured loans primarily resulted from interest rate concessions. As of December 31, 2021, the Company allocated an immaterial amount in specific reserves to loans that have been restructured. Loans restructured that subsequently defaulted during the year ended December 31, 2021 are as follows:
| Year ended December 31, 2021 |  |
($ in thousands, except for number of loans) | Number of Loans |  | Recorded Balance |  |  |  |
Real Estate: |  |  |  |  |  |  |
Residential | 1 |  |  | 148 |  |  |  |  |
There were no restructured loans that subsequently defaulted during the year ended December 31, 2020. In response to the COVID-19 pandemic, the Company implemented short-term deferral programs allowing customers to primarily defer payments for up to 90 days. Deferrals under the CARES Act or interagency guidance are not included above as troubled debt restructurings. As of December 31, 2021, substantially all of these loans have returned to a current payment status. The aging of the recorded investment in past due loans by class and category at December 31, 2021 and 2020 is shown below:
| December 31, 2021
($ in thousands) | 30-89 Days Past Due |  | 90 or More Days Past Due |  | Total Past Due |  | Current |  | Total
Commercial and industrial | $ | 24,447 |  |  | $ | 14,158 |  |  | $ | 38,605 |  |  | $ | 3,353,770 |  |  | $ | 3,392,375 |
Real estate: |  |  |  |  |  |  |  |  |
Commercial - investor owned | 3,880 |  |  | — |  |  | 3,880 |  |  | 2,137,263 |  |  | 2,141,143 |
Commercial - owner occupied | 10,070 |  |  | 289 |  |  | 10,359 |  |  | 2,025,426 |  |  | 2,035,785 |
Construction and land development | 24 |  |  | — |  |  | 24 |  |  | 734,049 |  |  | 734,073 |
Residential | 3,181 |  |  | 1,305 |  |  | 4,486 |  |  | 449,566 |  |  | 454,052 |
Other | 37 |  |  | 11 |  |  | 48 |  |  | 260,166 |  |  | 260,214 |
Total | $ | 41,639 |  |  | $ | 15,763 |  |  | $ | 57,402 |  |  | $ | 8,960,240 |  |  | $ | 9,017,642 |
| December 31, 2020
($ in thousands) | 30-89 Days Past Due |  | 90 or More Days Past Due |  | Total Past Due |  | Current |  | Total
Commercial and industrial | $ | 8,652 |  |  | $ | 12,928 |  |  | $ | 21,580 |  |  | $ | 3,067,415 |  |  | $ | 3,088,995 |
Real estate: |  |  |  |  |  |  |  |  |
Commercial - investor owned | 734 |  |  | 9,301 |  |  | 10,035 |  |  | 1,579,384 |  |  | 1,589,419 |
Commercial - owner occupied | 328 |  |  | 4,647 |  |  | 4,975 |  |  | 1,493,433 |  |  | 1,498,408 |
Construction and land development | 13 |  |  | — |  |  | 13 |  |  | 546,673 |  |  | 546,686 |
Residential | 2,071 |  |  | 2,118 |  |  | 4,189 |  |  | 314,990 |  |  | 319,179 |
Other | 1,731 |  |  | 50 |  |  | 1,781 |  |  | 180,467 |  |  | 182,248 |
Total | $ | 13,529 |  |  | $ | 29,044 |  |  | $ | 42,573 |  |  | $ | 7,182,362 |  |  | $ | 7,224,935 |
The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt, such as current financial information, historical payment experience, credit documentation, and current economic factors among other factors. This analysis is performed on a quarterly basis. The Company uses the following definitions for risk ratings: •Grades 1, 2, and 3 – Includes loans to borrowers with a continuous record of strong earnings, sound balance sheet condition and capitalization, ample liquidity with solid cash flow, and whose management team has experience and depth within their industry. •Grade 4 – Includes loans to borrowers with positive trends in profitability, satisfactory capitalization and balance sheet condition, and sufficient liquidity and cash flow. •Grade 5 – Includes loans to borrowers that may display fluctuating trends in sales, profitability, capitalization, liquidity, and cash flow. •Grade 6 – Includes loans to borrowers where an adverse change or perceived weakness has occurred, but may be correctable in the near future. Alternatively, this rating category may also include circumstances where the borrower is starting to reverse a negative trend or condition, or has recently been upgraded from a 7, 8, or 9 rating. •Grade 7 – Watch credits are borrowers that have experienced financial setback of a nature that is not determined to be severe or influence ‘ongoing concern’ expectations. Although possible, no loss is anticipated, due to strong collateral and/or guarantor support. •Grade 8 – Substandard credits will include those borrowers characterized by significant losses and sustained downward trends in balance sheet condition, liquidity, and cash flow. Repayment reliance may have shifted to secondary sources. Collateral exposure may exist and additional reserves may be warranted. •Grade 9 – Doubtful credits include borrowers that may show deteriorating trends that are unlikely to be corrected. Collateral values may appear insufficient for full recovery, therefore requiring a partial charge-off, or debt renegotiation with the borrower. The borrower may have declared bankruptcy or bankruptcy is likely in the near term. All doubtful rated credits will be on non-accrual. The recorded investment by risk category of the loans by class and year of origination is presented in the following tables as of the dates indicated:
|  | December 31, 2021
|  | Term Loans by Origination Year |  |  |  |  |  |
(in thousands) |  | 2021 |  | 2020 |  | 2019 |  | 2018 |  | 2017 |  | Prior |  | Revolving Loans Converted to Term Loans |  | Revolving Loans |  | Total
Commercial and industrial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 1,180,601 |  |  | $ | 477,374 |  |  | $ | 317,869 |  |  | $ | 132,851 |  |  | $ | 116,738 |  |  | $ | 82,846 |  |  | $ | 11,648 |  |  | $ | 854,102 |  |  | $ | 3,174,029 |
Watch (7) |  | 35,005 |  |  | 17,502 |  |  | 9,404 |  |  | 9,880 |  |  | 12,217 |  |  | 10,979 |  |  | 4,037 |  |  | 53,595 |  |  | 152,619 |
Classified (8-9) |  | 14,917 |  |  | 3,530 |  |  | 3,840 |  |  | 1,689 |  |  | 2,988 |  |  | 813 |  |  | 787 |  |  | 10,996 |  |  | 39,560 |
Total Commercial and industrial |  | $ | 1,230,523 |  |  | $ | 498,406 |  |  | $ | 331,113 |  |  | $ | 144,420 |  |  | $ | 131,943 |  |  | $ | 94,638 |  |  | $ | 16,472 |  |  | $ | 918,693 |  |  | $ | 3,366,208 |
Commercial real estate-investor owned |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 651,740 |  |  | $ | 476,946 |  |  | $ | 346,245 |  |  | $ | 146,107 |  |  | $ | 112,043 |  |  | $ | 217,808 |  |  | $ | 3,625 |  |  | $ | 68,236 |  |  | $ | 2,022,750 |
Watch (7) |  | 16,871 |  |  | 35,908 |  |  | 32,755 |  |  | 1,003 |  |  | 502 |  |  | 17,478 |  |  | 300 |  |  | 2,062 |  |  | 106,879 |
Classified (8-9) |  | 1,376 |  |  | 3,135 |  |  | 835 |  |  | 817 |  |  | 1,159 |  |  | 4,141 |  |  | — |  |  | 50 |  |  | 11,513 |
Total Commercial real estate-investor owned |  | $ | 669,987 |  |  | $ | 515,989 |  |  | $ | 379,835 |  |  | $ | 147,927 |  |  | $ | 113,704 |  |  | $ | 239,427 |  |  | $ | 3,925 |  |  | $ | 70,348 |  |  | $ | 2,141,142 |
Commercial real estate-owner occupied |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 604,975 |  |  | $ | 423,263 |  |  | $ | 278,830 |  |  | $ | 164,210 |  |  | $ | 140,515 |  |  | $ | 235,973 |  |  | $ | 250 |  |  | $ | 48,349 |  |  | $ | 1,896,365 |
Watch (7) |  | 12,825 |  |  | 13,585 |  |  | 4,301 |  |  | 16,774 |  |  | 10,274 |  |  | 15,764 |  |  | — |  |  | 300 |  |  | 73,823 |
Classified (8-9) |  | 2,048 |  |  | 556 |  |  | 9,181 |  |  | 17,016 |  |  | 6,432 |  |  | 6,959 |  |  | — |  |  | — |  |  | 42,192 |
Total Commercial real estate-owner occupied |  | $ | 619,848 |  |  | $ | 437,404 |  |  | $ | 292,312 |  |  | $ | 198,000 |  |  | $ | 157,221 |  |  | $ | 258,696 |  |  | $ | 250 |  |  | $ | 48,649 |  |  | $ | 2,012,380 |
Construction real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 310,140 |  |  | $ | 229,396 |  |  | $ | 70,531 |  |  | $ | 35,936 |  |  | $ | 14,860 |  |  | $ | 7,180 |  |  | $ | 568 |  |  | $ | 2,992 |  |  | $ | 671,603 |
Watch (7) |  | 28,947 |  |  | 15,348 |  |  | 60 |  |  | 1,199 |  |  | 11,068 |  |  | 2,330 |  |  | — |  |  | — |  |  | 58,952 |
Classified (8-9) |  | — |  |  | — |  |  | 387 |  |  | 419 |  |  | — |  |  | 22 |  |  | — |  |  | — |  |  | 828 |
Total Construction real estate |  | $ | 339,087 |  |  | $ | 244,744 |  |  | $ | 70,978 |  |  | $ | 37,554 |  |  | $ | 25,928 |  |  | $ | 9,532 |  |  | $ | 568 |  |  | $ | 2,992 |  |  | $ | 731,383 |
Residential real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 116,352 |  |  | $ | 66,481 |  |  | $ | 21,356 |  |  | $ | 14,841 |  |  | $ | 24,778 |  |  | $ | 103,840 |  |  | $ | 9,980 |  |  | $ | 87,146 |  |  | $ | 444,774 |
Watch (7) |  | 2,425 |  |  | 2 |  |  | 622 |  |  | 1,157 |  |  | 248 |  |  | 1,305 |  |  | — |  |  | 79 |  |  | 5,838 |
Classified (8-9) |  | 414 |  |  | 169 |  |  | 554 |  |  | — |  |  | 12 |  |  | 2,024 |  |  | — |  |  | — |  |  | 3,173 |
Total residential real estate |  | $ | 119,191 |  |  | $ | 66,652 |  |  | $ | 22,532 |  |  | $ | 15,998 |  |  | $ | 25,038 |  |  | $ | 107,169 |  |  | $ | 9,980 |  |  | $ | 87,225 |  |  | $ | 453,785 |
Other |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 108,209 |  |  | $ | 68,806 |  |  | $ | 22,684 |  |  | $ | 23,145 |  |  | $ | 6,924 |  |  | $ | 13,832 |  |  | $ | 1,500 |  |  | $ | 9,166 |  |  | $ | 254,266 |
Watch (7) |  | — |  |  | — |  |  | — |  |  | 4 |  |  | — |  |  | 2,440 |  |  | — |  |  | 1 |  |  | 2,445 |
Classified (8-9) |  | — |  |  | — |  |  | 10 |  |  | 10 |  |  | — |  |  | 16 |  |  | — |  |  | 2 |  |  | 38 |
Total Other |  | $ | 108,209 |  |  | $ | 68,806 |  |  | $ | 22,694 |  |  | $ | 23,159 |  |  | $ | 6,924 |  |  | $ | 16,288 |  |  | $ | 1,500 |  |  | $ | 9,169 |  |  | $ | 256,749 |
Total loans classified by risk category |  | $ | 3,086,845 |  |  | $ | 1,832,001 |  |  | $ | 1,119,464 |  |  | $ | 567,058 |  |  | $ | 460,758 |  |  | $ | 725,750 |  |  | $ | 32,695 |  |  | $ | 1,137,076 |  |  | $ | 8,961,647 |
Total loans classified by performing status |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 55,995 |
Total loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 9,017,642 |
|  | December 31, 2020
|  | Term Loans by Origination Year |  |  |  |  |  |
(in thousands) |  | 2020 |  | 2019 |  | 2018 |  | 2017 |  | 2016 |  | Prior |  | Revolving Loans Converted to Term Loans |  | Revolving Loans |  | Total
Commercial and industrial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 1,402,276 |  |  | $ | 454,729 |  |  | $ | 262,258 |  |  | $ | 132,832 |  |  | $ | 25,057 |  |  | $ | 58,315 |  |  | $ | 14,118 |  |  | $ | 527,170 |  |  | $ | 2,876,755 |
Watch (7) |  | 44,922 |  |  | 15,369 |  |  | 9,585 |  |  | 7,509 |  |  | 19,613 |  |  | 110 |  |  | — |  |  | 60,448 |  |  | 157,556 |
Classified (8-9) |  | 6,602 |  |  | 9,219 |  |  | 3,115 |  |  | 3,964 |  |  | 4,490 |  |  | 1,080 |  |  | 1,281 |  |  | 22,432 |  |  | 52,183 |
Total Commercial and industrial |  | $ | 1,453,800 |  |  | $ | 479,317 |  |  | $ | 274,958 |  |  | $ | 144,305 |  |  | $ | 49,160 |  |  | $ | 59,505 |  |  | $ | 15,399 |  |  | $ | 610,050 |  |  | $ | 3,086,494 |
Commercial real estate-investor owned |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 481,867 |  |  | $ | 338,843 |  |  | $ | 189,305 |  |  | $ | 131,718 |  |  | $ | 138,288 |  |  | $ | 161,439 |  |  | $ | 6,509 |  |  | $ | 32,058 |  |  | $ | 1,480,027 |
Watch (7) |  | 32,308 |  |  | 19,722 |  |  | 6,656 |  |  | — |  |  | 9,647 |  |  | 17,370 |  |  | — |  |  | — |  |  | 85,703 |
Classified (8-9) |  | — |  |  | 5,278 |  |  | 8,716 |  |  | 5,830 |  |  | 1,245 |  |  | 2,620 |  |  | — |  |  | — |  |  | 23,689 |
Total Commercial real estate-investor owned |  | $ | 514,175 |  |  | $ | 363,843 |  |  | $ | 204,677 |  |  | $ | 137,548 |  |  | $ | 149,180 |  |  | $ | 181,429 |  |  | $ | 6,509 |  |  | $ | 32,058 |  |  | $ | 1,589,419 |
Commercial real estate-owner occupied |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 419,142 |  |  | $ | 287,001 |  |  | $ | 215,181 |  |  | $ | 179,382 |  |  | $ | 104,470 |  |  | $ | 167,456 |  |  | $ | 2,672 |  |  | $ | 45,323 |  |  | $ | 1,420,627 |
Watch (7) |  | 13,657 |  |  | 5,257 |  |  | 3,113 |  |  | 6,198 |  |  | 4,338 |  |  | 8,460 |  |  | 1,776 |  |  | 941 |  |  | 43,740 |
Classified (8-9) |  | 2,420 |  |  | 7,427 |  |  | 5,822 |  |  | 6,140 |  |  | 1,309 |  |  | 10,860 |  |  | — |  |  | 63 |  |  | 34,041 |
Total Commercial real estate-owner occupied |  | $ | 435,219 |  |  | $ | 299,685 |  |  | $ | 224,116 |  |  | $ | 191,720 |  |  | $ | 110,117 |  |  | $ | 186,776 |  |  | $ | 4,448 |  |  | $ | 46,327 |  |  | $ | 1,498,408 |
Construction real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 223,069 |  |  | $ | 156,360 |  |  | $ | 45,460 |  |  | $ | 18,579 |  |  | $ | 11,539 |  |  | $ | 9,144 |  |  | $ | — |  |  | $ | 28,880 |  |  | $ | 493,031 |
Watch (7) |  | 2,544 |  |  | 86 |  |  | 34,179 |  |  | 11,632 |  |  | — |  |  | 2,499 |  |  | — |  |  | — |  |  | 50,940 |
Classified (8-9) |  | 56 |  |  | 2,124 |  |  | 503 |  |  | 1 |  |  | — |  |  | 31 |  |  | — |  |  | — |  |  | 2,715 |
Total Construction real estate |  | $ | 225,669 |  |  | $ | 158,570 |  |  | $ | 80,142 |  |  | $ | 30,212 |  |  | $ | 11,539 |  |  | $ | 11,674 |  |  | $ | — |  |  | $ | 28,880 |  |  | $ | 546,686 |
Residential real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 57,059 |  |  | $ | 27,907 |  |  | $ | 17,718 |  |  | $ | 17,138 |  |  | $ | 27,443 |  |  | $ | 92,657 |  |  | $ | 1,172 |  |  | $ | 66,902 |  |  | $ | 307,996 |
Watch (7) |  | 210 |  |  | 840 |  |  | 526 |  |  | — |  |  | 514 |  |  | 1,603 |  |  | 287 |  |  | 511 |  |  | 4,491 |
Classified (8-9) |  | 571 |  |  | 733 |  |  | 121 |  |  | 14 |  |  | 898 |  |  | 3,181 |  |  | — |  |  | 253 |  |  | 5,771 |
Total residential real estate |  | $ | 57,840 |  |  | $ | 29,480 |  |  | $ | 18,365 |  |  | $ | 17,152 |  |  | $ | 28,855 |  |  | $ | 97,441 |  |  | $ | 1,459 |  |  | $ | 67,666 |  |  | $ | 318,258 |
Other |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass (1-6) |  | $ | 43,526 |  |  | $ | 28,195 |  |  | $ | 30,074 |  |  | $ | 9,646 |  |  | $ | 5,641 |  |  | $ | 17,027 |  |  | $ | — |  |  | $ | 40,779 |  |  | $ | 174,888 |
Watch (7) |  | — |  |  | 1 |  |  | 8 |  |  | — |  |  | — |  |  | 2,637 |  |  | — |  |  | 1 |  |  | 2,647 |
Classified (8-9) |  | — |  |  | 18 |  |  | 19 |  |  | 13 |  |  | — |  |  | 17 |  |  | 8 |  |  | 4 |  |  | 79 |
Total Other |  | $ | 43,526 |  |  | $ | 28,214 |  |  | $ | 30,101 |  |  | $ | 9,659 |  |  | $ | 5,641 |  |  | $ | 19,681 |  |  | $ | 8 |  |  | $ | 40,784 |  |  | $ | 177,614 |
Total loans classified by risk category |  | $ | 2,730,229 |  |  | $ | 1,359,109 |  |  | $ | 832,359 |  |  | $ | 530,596 |  |  | $ | 354,492 |  |  | $ | 556,506 |  |  | $ | 27,823 |  |  | $ | 825,765 |  |  | $ | 7,216,879 |
Total loans classified by performing status |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 8,056 |
Total loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 7,224,935 |
In the tables above, loan originations in 2021 and 2020 with a classification of watch or classified primarily represent renewals or modifications initially underwritten and originated in prior years. For certain loans, primarily credit cards, the Company evaluates credit quality based on the aging status. The following tables present the recorded investment on loans based on aging status:
| December 31, 2021
(in thousands) | Performing |  | Non Performing |  | Total
Commercial and industrial | $ | 26,166 |  |  | $ | 1 |  |  | $ | 26,167 |
Real estate: |  |  |  |  |
Commercial - investor owned | 1 |  |  | — |  |  | 1 |
Commercial - owner occupied | 23,405 |  |  | — |  |  | 23,405 |
Construction and land development | 2,690 |  |  | — |  |  | 2,690 |
Residential | 267 |  |  | — |  |  | 267 |
Other | 3,453 |  |  | 12 |  |  | 3,465 |
Total | $ | 55,982 |  |  | $ | 13 |  |  | $ | 55,995 |
| December 31, 2020
(in thousands) | Performing |  | Non Performing |  | Total
Commercial and industrial | $ | 2,502 |  |  | $ | — |  |  | $ | 2,502 |
Real estate: |  |  |  |  |
Residential | 921 |  |  | — |  |  | 921 |
Other | 4,612 |  |  | 21 |  |  | 4,633 |
Total | $ | 8,035 |  |  | $ | 21 |  |  | $ | 8,056 |
The Company has purchased loans, for which there was, at acquisition, evidence of more than insignificant deterioration of credit quality since origination. The carrying amount of those loans is as follows:
($ in thousands) | At July 21, 2021
Par value of acquired loans | $ | 180,440 |
Allowance for credit losses | (7,006) |
Non-credit discount | (6,428) |
Purchase price of acquired loans | $ | 167,006 |

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