Note 4.

Loans

The Company groups loans held for investment into three segments (commercial loans, consumer real estate loans, and consumer and other loans) with each segment divided into various classes. Covered loans are those loans acquired in Federal Deposit Insurance Corporation (“FDIC”) assisted transactions that are covered by loss share agreements. The following table presents loans, net of unearned income and disaggregated by class, as of the periods indicated:


	June 30, 2016					December 31, 2015
(Amounts in thousands)	Amount		Percent			Amount		Percent
Non-covered loans held for investment
Commercial loans
Construction, development, and other land	$	58,971		3.27	%	$	48,896		2.86	%
Commercial and industrial		92,791		5.15	%		88,903		5.21	%
Multi-family residential		109,651		6.08	%		95,026		5.57	%
Single family non-owner occupied		153,308		8.51	%		149,351		8.75	%
Non-farm, non-residential		549,771		30.51	%		485,460		28.45	%
Agricultural		4,421		0.25	%		2,911		0.17	%
Farmland		27,515		1.53	%		27,540		1.61	%

Total commercial loans		996,428		55.30	%		898,087		52.62	%
Consumer real estate loans
Home equity lines		106,517		5.91	%		107,367		6.29	%
Single family owner occupied		504,057		27.97	%		495,209		29.02	%
Owner occupied construction		43,186		2.40	%		43,505		2.55	%

Total consumer real estate loans		653,760		36.28	%		646,081		37.86	%
Consumer and other loans
Consumer loans		75,703		4.20	%		72,000		4.22	%
Other		7,507		0.42	%		7,338		0.43	%

Total consumer and other loans		83,210		4.62	%		79,338		4.65	%

Total non-covered loans		1,733,398		96.20	%		1,623,506		95.13	%
Total covered loans		68,585		3.80	%		83,035		4.87	%

Total loans held for investment, net of unearned income	$	1,801,983		100.00	%	$	1,706,541		100.00	%

Customer overdrafts reclassified as loans totaled $1.52 million as of June 30, 2016, and $1.24 million as of December 31, 2015. Deferred loan fees totaled $4.08 million as of June 30, 2016, and $3.78 million as of December 31, 2015. For information concerning off-balance sheet financing, see Note 14, “Litigation, Commitments and Contingencies,” to the Condensed Consolidated Financial Statements of this report.

The following table presents the covered loan portfolio, disaggregated by class, as of the dates indicated:


(Amounts in thousands)	June 30, 2016		December 31, 2015
Commercial loans
Construction, development, and other land	$	5,487	$	6,303
Commercial and industrial		973		1,170
Multi-family residential		74		640
Single family non-owner occupied		1,866		2,674
Non-farm, non-residential		9,570		14,065
Agricultural		26		34
Farmland		618		643

Total commercial loans		18,614		25,529
Consumer real estate loans
Home equity lines		42,254		48,565
Single family owner occupied		7,432		8,595
Owner occupied construction		204		262

Total consumer real estate loans		49,890		57,422
Consumer and other loans
Consumer loans		81		84

Total covered loans	$	68,585	$	83,035

The Company identifies certain purchased loans as impaired when fair values are established at acquisition and aggregates purchased credit impaired (“PCI”) loans into loan pools with common risk characteristics. The Company estimates cash flows to be collected on PCI loans and discounts those cash flows at a market rate of interest. The following table presents the carrying and contractual unpaid principal balance of PCI loans, by acquisition, as of the dates indicated:


	June 30, 2016				December 31, 2015
(Amounts in thousands)	Carrying Balance		Unpaid Principal Balance		Carrying Balance		Unpaid Principal Balance
Peoples Bank of Virginia	$	6,390	$	10,496	$	6,681	$	11,249
Waccamaw Bank		28,965		53,698		34,707		63,151
Other acquired		1,200		1,243		1,254		1,297

Total PCI Loans	$	36,555	$	65,437	$	42,642	$	75,697

The following tables present the activity in the accretable yield on PCI loans, by acquisition, for the periods indicated:


	Six Months Ended June 30, 2016
(Amounts in thousands)	Peoples			Waccamaw			Total
Beginning balance	$	3,589		$	26,109		$	29,698
Accretion		(719	)		(3,186	)		(3,905	)
Reclassifications from nonaccretable difference		(194	)		147			(47	)
Removals, extensions, and other events, net		1,772			182			1,954

Ending balance	$	4,448		$	23,252		$	27,700


	Six Months Ended June 30, 2015
(Amounts in thousands)	Peoples			Waccamaw			Total
Beginning balance	$	4,745		$	19,048		$	23,793
Additions		—			2			2
Accretion		(1,169	)		(2,860	)		(4,029	)
Reclassifications from nonaccretable difference		1,106			2,445			3,551
Removals, extensions, and other events, net		(735	)		(807	)		(1,542	)

Ending balance	$	3,947		$	17,828		$	21,775