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Loans and Allowance for Loan Losses | 3 Months Ended
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Mar. 31, 2020
Receivables [Abstract] |
Loans and Allowance for Loan Losses | Loans and Allowance for Loan Losses Portfolio Segmentation: Major categories of loans are summarized as follows (in thousands):
|  | March 31, 2020 |  |  |  |  |  | December 31, 2019 |  |  |  |
|  | PCI Loans1 |  | All Other Loans2 |  | Total |  | PCI Loans1 |  | All Other Loans2 |  | Total
Commercial real estate |  | $ | 16,589 |  |  | $ | 992,446 |  |  | $ | 1,009,035 |  |  | $ | 15,255 |  |  | $ | 890,051 |  |  | $ | 905,306 |
Consumer real estate |  | 11,950 |  |  | 476,823 |  |  | 488,773 |  |  | 6,541 |  |  | 416,797 |  |  | 423,338 |
Construction and land development |  | 6,479 |  |  | 246,966 |  |  | 253,445 |  |  | 4,458 |  |  | 223,168 |  |  | 227,626 |
Commercial and industrial |  | 143 |  |  | 377,030 |  |  | 377,173 |  |  | 407 |  |  | 336,668 |  |  | 337,075 |
Consumer and other |  | 325 |  |  | 16,541 |  |  | 16,866 |  |  | 326 |  |  | 9,577 |  |  | 9,903 |
Total loans |  | 35,486 |  |  | 2,109,806 |  |  | 2,145,292 |  |  | 26,987 |  |  | 1,876,261 |  |  | 1,903,248 |
Less: Allowance for loan losses |  | — |  |  | (13,431) |  |  | (13,431) |  |  | (156) |  |  | (10,087) |  |  | (10,243) |
Loans, net |  | $ | 35,486 |  |  | $ | 2,096,375 |  |  | $ | 2,131,861 |  |  | $ | 26,831 |  |  | $ | 1,866,174 |  |  | $ | 1,893,005 |
1 Purchased Credit Impaired loans (“PCI loans”) are loans with evidence of credit deterioration at purchase. 2 Includes loans held for sale. For purposes of the disclosures required pursuant to the adoption of ASC 310, the loan portfolio was disaggregated into segments. A portfolio segment is defined as the level at which an entity develops and documents a systematic method for determining its allowance for credit losses. There are five loan portfolio segments that include commercial real estate, consumer real estate, construction and land development, commercial and industrial, and consumer and other. The composition of loans by loan classification for impaired and performing loan status is summarized in the tables below (in thousands):
|  | Commercial Real Estate |  | Consumer Real Estate |  | Construction and Land Development |  | Commercial and Industrial |  | Consumer and Other |  | Total
March 31, 2020: |  |  |  |  |  |  |  |  |  |  |  |
Performing loans |  | $ | 991,914 |  |  | $ | 475,303 |  |  | $ | 246,359 |  |  | $ | 376,872 |  |  | $ | 16,541 |  |  | $ | 2,106,989 |
Impaired loans |  | 532 |  |  | 1,520 |  |  | 607 |  |  | 158 |  |  | — |  |  | 2,817 |
|  | 992,446 |  |  | 476,823 |  |  | 246,966 |  |  | 377,030 |  |  | 16,541 |  |  | 2,109,806 |
PCI loans |  | 16,589 |  |  | 11,950 |  |  | 6,479 |  |  | 143 |  |  | 325 |  |  | 35,486 |
Total loans |  | $ | 1,009,035 |  |  | $ | 488,773 |  |  | $ | 253,445 |  |  | $ | 377,173 |  |  | $ | 16,866 |  |  | $ | 2,145,292 |
December 31, 2019: |  |  |  |  |  |  |  |  |  |  |  |
Performing loans |  | $ | 889,795 |  |  | $ | 415,250 |  |  | $ | 222,621 |  |  | $ | 336,508 |  |  | $ | 9,577 |  |  | $ | 1,873,751 |
Impaired loans |  | 256 |  |  | 1,547 |  |  | 547 |  |  | 160 |  |  | — |  |  | 2,510 |
|  | 890,051 |  |  | 416,797 |  |  | 223,168 |  |  | 336,668 |  |  | 9,577 |  |  | 1,876,261 |
PCI loans |  | 15,255 |  |  | 6,541 |  |  | 4,458 |  |  | 407 |  |  | 326 |  |  | 26,987 |
Total loans |  | $ | 905,306 |  |  | $ | 423,338 |  |  | $ | 227,626 |  |  | $ | 337,075 |  |  | $ | 9,903 |  |  | $ | 1,903,248 |
The following tables show the allowance for loan losses allocation by loan classification for impaired, PCI, and performing loans (in thousands):
|  | Commercial Real Estate |  | Consumer Real Estate |  | Construction and Land Development |  | Commercial and Industrial |  | Consumer and Other |  | Total
March 31, 2020: |  |  |  |  |  |  |  |  |  |  |  |
Performing loans |  | $ | 5,917 |  |  | $ | 2,922 |  |  | $ | 1,484 |  |  | $ | 2,427 |  |  | $ | 126 |  |  | $ | 12,876 |
Impaired loans |  | 46 |  |  | 379 |  |  | — |  |  | 130 |  |  | — |  |  | 555 |
|  | 5,963 |  |  | 3,301 |  |  | 1,484 |  |  | 2,557 |  |  | 126 |  |  | 13,431 |
PCI loans |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total loans |  | $ | 5,963 |  |  | $ | 3,301 |  |  | $ | 1,484 |  |  | $ | 2,557 |  |  | $ | 126 |  |  | $ | 13,431 |
December 31, 2019: |  |  |  |  |  |  |  |  |  |  |  |
Performing loans |  | $ | 4,491 |  |  | $ | 2,159 |  |  | $ | 1,127 |  |  | $ | 1,766 |  |  | $ | 69 |  |  | $ | 9,612 |
Impaired loans |  | — |  |  | 343 |  |  | — |  |  | 132 |  |  | — |  |  | 475 |
|  | 4,491 |  |  | 2,502 |  |  | 1,127 |  |  | 1,898 |  |  | 69 |  |  | 10,087 |
PCI loans |  | 17 |  |  | 74 |  |  | — |  |  | 59 |  |  | 6 |  |  | 156 |
Total loans |  | $ | 4,508 |  |  | $ | 2,576 |  |  | $ | 1,127 |  |  | $ | 1,957 |  |  | $ | 75 |  |  | $ | 10,243 |
The following tables detail the changes in the allowance for loan losses by loan classification (in thousands):
|  | Three Months Ended March 31, 2020 |  |  |  |  |  |  |  |  |  |
|  | Commercial Real Estate |  | Consumer Real Estate |  | Construction and Land Development |  | Commercial and Industrial |  | Consumer and Other |  | Total
Beginning balance |  | $ | 4,508 |  |  | $ | 2,576 |  |  | $ | 1,127 |  |  | $ | 1,957 |  |  | $ | 75 |  |  | $ | 10,243 |
Charged off loans |  | — |  |  | (2) |  |  | — |  |  | (8) |  |  | (76) |  |  | (86) |
Recoveries of charge-offs |  | 2 |  |  | 6 |  |  | 2 |  |  | 42 |  |  | 22 |  |  | 74 |
Provision (reallocation) charged to expense |  | 1,453 |  |  | 721 |  |  | 355 |  |  | 566 |  |  | 105 |  |  | 3,200 |
Ending balance |  | $ | 5,963 |  |  | $ | 3,301 |  |  | $ | 1,484 |  |  | $ | 2,557 |  |  | $ | 126 |  |  | $ | 13,431 |
|  | Three Months Ended March 31, 2019 |  |  |  |  |  |  |  |  |  |
|  | Commercial Real Estate |  | Consumer Real Estate |  | Construction and Land Development |  | Commercial and Industrial |  | Consumer and Other |  | Total
Beginning balance |  | $ | 3,639 |  |  | $ | 1,789 |  |  | $ | 795 |  |  | $ | 1,746 |  |  | $ | 306 |  |  | $ | 8,275 |
Charged off loans |  | — |  |  | (2) |  |  | — |  |  | (318) |  |  | (130) |  |  | (450) |
Recoveries of charge-offs |  | 2 |  |  | 4 |  |  | 2 |  |  | 12 |  |  | 62 |  |  | 82 |
Provision (reallocation) charged to expense |  | 433 |  |  | 158 |  |  | 57 |  |  | 269 |  |  | (120) |  |  | 797 |
Ending balance |  | $ | 4,074 |  |  | $ | 1,949 |  |  | $ | 854 |  |  | $ | 1,709 |  |  | $ | 118 |  |  | $ | 8,704 |
The following tables outline the amount of each loan classification and the amount categorized into each risk rating (in thousands):
|  | March 31, 2020 |  |  |  |  |  |  |  |  |  |
Non PCI Loans: |  | Commercial Real Estate |  | Consumer Real Estate |  | Construction and Land Development |  | Commercial and Industrial |  | Consumer and Other |  | Total
Pass |  | $ | 903,306 |  |  | $ | 468,494 |  |  | $ | 238,701 |  |  | $ | 368,506 |  |  | $ | 16,423 |  |  | $ | 1,995,430 |
Watch |  | 81,277 |  |  | 5,697 |  |  | 7,587 |  |  | 7,233 |  |  | 38 |  |  | 101,832 |
Special mention |  | 7,225 |  |  | 748 |  |  | — |  |  | 1,020 |  |  | — |  |  | 8,993 |
Substandard |  | 638 |  |  | 1,722 |  |  | 678 |  |  | 221 |  |  | 56 |  |  | 3,315 |
Doubtful |  | — |  |  | 162 |  |  | — |  |  | 50 |  |  | 24 |  |  | 236 |
Total |  | 992,446 |  |  | 476,823 |  |  | 246,966 |  |  | 377,030 |  |  | 16,541 |  |  | 2,109,806 |
PCI Loans: |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 13,220 |  |  | 8,122 |  |  | 2,169 |  |  | 48 |  |  | 300 |  |  | 23,859 |
Watch |  | 2,189 |  |  | 743 |  |  | 3,743 |  |  | — |  |  | 14 |  |  | 6,689 |
Special mention |  | 21 |  |  | 59 |  |  | — |  |  | — |  |  | — |  |  | 80 |
Substandard |  | 1,159 |  |  | 3,026 |  |  | 567 |  |  | 95 |  |  | 11 |  |  | 4,858 |
Doubtful |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total |  | 16,589 |  |  | 11,950 |  |  | 6,479 |  |  | 143 |  |  | 325 |  |  | 35,486 |
Total loans |  | $ | 1,009,035 |  |  | $ | 488,773 |  |  | $ | 253,445 |  |  | $ | 377,173 |  |  | $ | 16,866 |  |  | $ | 2,145,292 |
|  | December 31, 2019 |  |  |  |  |  |  |  |  |  |
Non PCI Loans: |  | Commercial Real Estate |  | Consumer Real Estate |  | Construction and Land Development |  | Commercial and Industrial |  | Consumer and Other |  | Total
Pass |  | $ | 860,447 |  |  | $ | 413,192 |  |  | $ | 216,459 |  |  | $ | 328,564 |  |  | $ | 9,462 |  |  | $ | 1,828,124 |
Watch |  | 25,180 |  |  | 989 |  |  | 6,089 |  |  | 6,786 |  |  | 40 |  |  | 39,084 |
Special mention |  | 4,057 |  |  | 738 |  |  | — |  |  | 1,033 |  |  | — |  |  | 5,828 |
Substandard |  | 367 |  |  | 1,713 |  |  | 620 |  |  | 228 |  |  | 51 |  |  | 2,979 |
Doubtful |  | — |  |  | 165 |  |  | — |  |  | 57 |  |  | 24 |  |  | 246 |
Total |  | 890,051 |  |  | 416,797 |  |  | 223,168 |  |  | 336,668 |  |  | 9,577 |  |  | 1,876,261 |
PCI Loans: |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 12,473 |  |  | 5,258 |  |  | 902 |  |  | 41 |  |  | 300 |  |  | 18,974 |
Watch |  | 2,234 |  |  | 38 |  |  | 3,556 |  |  | — |  |  | 13 |  |  | 5,841 |
Special mention |  | 139 |  |  | 60 |  |  | — |  |  | — |  |  | — |  |  | 199 |
Substandard |  | 409 |  |  | 1,185 |  |  | — |  |  | 366 |  |  | 13 |  |  | 1,973 |
Doubtful |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total |  | 15,255 |  |  | 6,541 |  |  | 4,458 |  |  | 407 |  |  | 326 |  |  | 26,987 |
Total loans |  | $ | 905,306 |  |  | $ | 423,338 |  |  | $ | 227,626 |  |  | $ | 337,075 |  |  | $ | 9,903 |  |  | $ | 1,903,248 |
Past Due Loans: A loan is considered past due if any required principal and interest payments have not been received as of the date such payments were required to be made under the terms of the loan agreement. Generally, management places a loan on nonaccrual when there is a clear indicator that the borrower’s cash flow may not be sufficient to meet payments as they become due, which is generally when a loan is 90 days past due. The following tables present an aging analysis of our loan portfolio (in thousands):
|  | March 31, 2020 |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 30-60 Days Past Due and Accruing |  | 61-89 Days Past Due and Accruing |  | Past Due 90 Days or More and Accruing |  | Nonaccrual |  | Total Past Due and Nonaccrual |  | PCI Loans |  | Current Loans |  | Total Loans
Commercial real estate |  | $ | 4,305 |  |  | $ | 418 |  |  | $ | — |  |  | $ | 397 |  |  | $ | 5,120 |  |  | $ | 16,589 |  |  | $ | 987,326 |  |  | $ | 1,009,035 |
Consumer real estate |  | 4,029 |  |  | 486 |  |  | — |  |  | 1,860 |  |  | 6,375 |  |  | 11,950 |  |  | 470,448 |  |  | 488,773 |
Construction and land development |  | 564 |  |  | 40 |  |  | — |  |  | 679 |  |  | 1,283 |  |  | 6,479 |  |  | 245,683 |  |  | 253,445 |
Commercial and industrial |  | 665 |  |  | 302 |  |  | — |  |  | 48 |  |  | 1,015 |  |  | 143 |  |  | 376,015 |  |  | 377,173 |
Consumer and other |  | 373 |  |  | 6 |  |  | 10 |  |  | 76 |  |  | 465 |  |  | 325 |  |  | 16,076 |  |  | 16,866 |
Total |  | $ | 9,936 |  |  | $ | 1,252 |  |  | $ | 10 |  |  | $ | 3,060 |  |  | $ | 14,258 |  |  | $ | 35,486 |  |  | $ | 2,095,548 |  |  | $ | 2,145,292 |
|  | December 31, 2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 30-60 Days Past Due and Accruing |  | 61-89 Days Past Due and Accruing |  | Past Due 90 Days or More and Accruing |  | Nonaccrual |  | Total Past Due and Nonaccrual |  | PCI Loans |  | Current Loans |  | Total Loans
Commercial real estate |  | $ | 466 |  |  | $ | 22 |  |  | $ | — |  |  | $ | 124 |  |  | $ | 612 |  |  | $ | 15,255 |  |  | $ | 889,439 |  |  | $ | 905,306 |
Consumer real estate |  | 1,564 |  |  | 30 |  |  | — |  |  | 1,872 |  |  | 3,466 |  |  | 6,541 |  |  | 413,331 |  |  | 423,338 |
Construction and land development |  | 507 |  |  | — |  |  | 607 |  |  | 620 |  |  | 1,734 |  |  | 4,458 |  |  | 221,434 |  |  | 227,626 |
Commercial and industrial |  | 559 |  |  | 53 |  |  | — |  |  | 57 |  |  | 669 |  |  | 407 |  |  | 335,999 |  |  | 337,075 |
Consumer and other |  | 86 |  |  | 14 |  |  | — |  |  | 70 |  |  | 170 |  |  | 326 |  |  | 9,407 |  |  | 9,903 |
Total |  | $ | 3,182 |  |  | $ | 119 |  |  | $ | 607 |  |  | $ | 2,743 |  |  | $ | 6,651 |  |  | $ | 26,987 |  |  | $ | 1,869,610 |  |  | $ | 1,903,248 |
Impaired Loans: The following is an analysis of the impaired loan portfolio, including PCI loans, detailing the related allowance recorded (in thousands):
|  | March 31, 2020 |  |  |  |  |  | December 31, 2019 |  |  |  |
|  | Recorded Investment |  | Unpaid Principal Balance |  | Related Allowance |  | Recorded Investment |  | Unpaid Principal Balance |  | Related Allowance
Impaired loans without a valuation allowance: |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate |  | $ | 136 |  |  | $ | 136 |  |  | $ | — |  |  | $ | 256 |  |  | $ | 261 |  |  | $ | — |
Consumer real estate |  | 546 |  |  | 546 |  |  | — |  |  | 553 |  |  | 553 |  |  | — |
Construction and land development |  | 607 |  |  | 607 |  |  | — |  |  | 547 |  |  | 547 |  |  | — |
Commercial and industrial |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Consumer and other |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
|  | 1,289 |  |  | 1,289 |  |  | — |  |  | 1,356 |  |  | 1,361 |  |  | — |
Impaired loans with a valuation allowance: |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate |  | 396 |  |  | 402 |  |  | 46 |  |  | — |  |  | — |  |  | — |
Consumer real estate |  | 974 |  |  | 974 |  |  | 379 |  |  | 994 |  |  | 994 |  |  | 343 |
Construction and land development |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Commercial and industrial |  | 158 |  |  | 158 |  |  | 130 |  |  | 160 |  |  | 160 |  |  | 132 |
Consumer and other |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
|  | 1,528 |  |  | 1,534 |  |  | 555 |  |  | 1,154 |  |  | 1,154 |  |  | 475 |
PCI loans: |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate |  | 1,010 |  |  | 1,019 |  |  | — |  |  | 17 |  |  | 99 |  |  | 17 |
Consumer real estate |  | 486 |  |  | 491 |  |  | — |  |  | 1,205 |  |  | 1,371 |  |  | 74 |
Construction and land development |  | 253 |  |  | 254 |  |  | — |  |  | — |  |  | — |  |  | — |
Commercial and industrial |  | 376 |  |  | 378 |  |  | — |  |  | 396 |  |  | 534 |  |  | 59 |
Consumer and other |  | 14 |  |  | 14 |  |  | — |  |  | 45 |  |  | 51 |  |  | 6 |
|  | 2,139 |  |  | 2,156 |  |  | — |  |  | 1,663 |  |  | 2,055 |  |  | 156 |
Total impaired loans |  | $ | 4,956 |  |  | $ | 4,979 |  |  | $ | 555 |  |  | $ | 4,173 |  |  | $ | 4,570 |  |  | $ | 631 |
|  | Three Months Ended March 31, |  |  |  |  |  |
|  | 2020 |  |  |  | 2019 |  |
|  | Average Recorded Investment |  | Interest Income Recognized |  | Average Recorded Investment |  | Interest Income Recognized
Impaired loans without a valuation allowance: |  |  |  |  |  |  |  |
Commercial real estate |  | $ | 196 |  |  | $ | 3 |  |  | $ | 613 |  |  | $ | 20 |
Consumer real estate |  | 550 |  |  | 4 |  |  | 967 |  |  | 4 |
Construction and land development |  | 577 |  |  | — |  |  | 573 |  |  | — |
Commercial and industrial |  | — |  |  | — |  |  | 50 |  |  | 1 |
Consumer and other |  | — |  |  | — |  |  | 28 |  |  | 1 |
|  | 1,323 |  |  | 7 |  |  | 2,231 |  |  | 26 |
Impaired loans with a valuation allowance: |  |  |  |  |  |  |  |
Commercial real estate |  | 198 |  |  | 2 |  |  | 24 |  |  | 1 |
Consumer real estate |  | 984 |  |  | 9 |  |  | 99 |  |  | — |
Construction and land development |  | — |  |  | — |  |  | 28 |  |  | — |
Commercial and industrial |  | 159 |  |  | 2 |  |  | 644 |  |  | 9 |
Consumer and other |  | — |  |  | — |  |  | 57 |  |  | — |
|  | 1,341 |  |  | 13 |  |  | 852 |  |  | 10 |
PCI loans: |  |  |  |  |  |  |  |
Commercial real estate |  | 964 |  |  | 1 |  |  | 845 |  |  | (10) |
Consumer real estate |  | 456 |  |  | 1 |  |  | 367 |  |  | 3 |
Construction and land development |  | 231 |  |  | — |  |  | — |  |  | — |
Commercial and industrial |  | 355 |  |  | — |  |  | — |  |  | — |
Consumer real estate |  | 11 |  |  | — |  |  | — |  |  | — |
|  | 2,017 |  |  | 2 |  |  | 1,212 |  |  | (7) |
Total impaired loans |  | $ | 4,681 |  |  | $ | 22 |  |  | $ | 4,295 |  |  | $ | 29 |
Troubled Debt Restructurings: At March 31, 2020, and December 31, 2019, impaired loans included loans that were classified as Troubled Debt Restructurings ("TDRs"). The restructuring of a loan is considered a TDR if both (i) the borrower is experiencing financial difficulties and (ii) the creditor has granted a concession. In assessing whether or not a borrower is experiencing financial difficulties, the Company considers information currently available regarding the financial condition of the borrower. This information includes, but is not limited to, whether (i) the debtor is currently in payment default on any of its debt; (ii) a payment default is probable in the foreseeable future without the modification; (iii) the debtor has declared or is in the process of declaring bankruptcy; and (iv) the debtor's projected cash flow is sufficient to satisfy contractual payments due under the original terms of the loan without a modification. The Company considers all aspects of the modification to loan terms to determine whether or not a concession has been granted to the borrower. Key factors considered by the Company include the debtor's ability to access funds at a market rate for debt with similar risk characteristics, the significance of the modification relative to unpaid principal balance or collateral value of the debt, and the significance of a delay in the timing of payments relative to the original contractual terms of the loan. The most common concessions granted by the Company generally include one or more modifications to the terms of the debt, such as (i) a reduction in the interest rate for the remaining life of the debt; (ii) an extension of the maturity date at an interest rate lower than the current market rate for new debt with similar risk; (iii) a temporary period of interest-only payments; and (iv) a reduction in the contractual payment amount for either a short period or remaining term of the loan. As of March 31, 2020, and December 31, 2019, management had approximately $9 thousand and $61 thousand, respectively, in loans that met the criteria for TDR, none of which were on nonaccrual. A loan is placed back on accrual status when both principal and interest are current and it is probable that the Company will be able to collect all amounts due (both principal and interest) according to the terms of the loan agreement. There was one loan that was modified as a TDR during the three month period ended March 31, 2020, and no loans were modified during the three month period ended March 31, 2019. There were no loans that were modified as troubled debt restructurings during the past three months and for which there was a subsequent payment default. Foreclosure Proceedings and Balances: As of March 31, 2020, there were seven properties secured by real estate included in other real estate owned and there were no consumer mortgage loans collateralized by residential real estate property that were in the process of foreclosure. Purchased Credit Impaired Loans: The Company has acquired loans where there was, at acquisition, evidence of deterioration of credit quality since origination and it was probable, at acquisition, that all contractually required payments would not be collected. The carrying amount of those loans are as follows (in thousands):
| March 31, |  | December 31,
| 2020 |  | 2019
Commercial real estate | $ | 24,557 |  |  | $ | 21,570 |
Consumer real estate | 14,703 |  |  | 8,411 |
Construction and land development | 2,321 |  |  | 5,394 |
Commercial and industrial | 7,806 |  |  | 2,540 |
Consumer and other | 486 |  |  | 504 |
Total loans | 49,873 |  |  | 38,419 |
Less: Remaining purchase discount | (14,387) |  |  | (11,432) |
Total loans, net of purchase discount | 35,486 |  |  | 26,987 |
Less: Allowance for loan losses | — |  |  | (156) |
Carrying amount, net of allowance | $ | 35,486 |  |  | $ | 26,831 |
Activity related to the accretable yield on loans acquired with deteriorated credit quality is as follows (in thousands):
| Three Months Ended |  |  |  |  |  |
| March 31, |  |  |  |  |  |
| 2020 |  | 2019 |  |  |  |
Accretable yield, beginning of period | $ | 8,454 |  |  | $ | 7,052 |  |  |  |  |
Additions | 2,515 |  |  | — |  |  |  |  |
Accretion income | (2,077) |  |  | (1,254) |  |  |  |  |
Reclassification | 1,916 |  |  | 1,035 |  |  |  |  |
Other changes, net | 171 |  |  | 1,811 |  |  |  |  |
Accretable yield, end of period | $ | 10,979 |  |  | $ | 8,644 |  |  |  |  |

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- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -URI http://asc.fasb.org/subtopic&trid=2196772 + Details
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