Company: RNST
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0000715072-25-000234
Chunk: 104

Company: RENASANT CORP
Filing Date: 2025-11-07
Form: 10-Q
Item: Item 1
Chunk 104
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 adversely rated are subject to enhanced scrutiny and monitoring through a variety of processes within our special assets department, which is a division of credit administration.  Results and findings are reported to management’s problem asset resolution committee and the Board of Directors Credit Review Committee. When the ultimate collectability of a loan’s principal becomes doubtful, the loan is placed on nonaccrual. 

The Company’s practice is to charge off estimated losses as soon as such loss is identified and reasonably quantifiable. If the value of the collateral after consideration of disposition costs is less than the loan balance, a charge off is recorded to reduce the allowance for credit losses on loans. Charge-offs reflect the realization of losses in the portfolio that were recognized previously through the provision for credit losses on loans. After collection efforts have been exhausted or a settlement agreement is reached with the borrower, underlying collateral is liquidated.

70

Allowance for Credit Losses on Loans; Provision for Credit Losses on Loans. The allowance for credit losses is available to absorb credit losses inherent in the loans held for investment portfolio. Management evaluates the adequacy of the allowance on a quarterly basis. 

The appropriate level of the allowance is based on an ongoing analysis of the loan portfolio and represents an amount that management deems adequate to provide for inherent losses, including loans evaluated on a collective (pooled) basis and those evaluated on an individual basis as set forth in Accounting Standards Codification Topic 326, “Financial Instruments - Credit Losses,” often referred to as CECL. The credit loss estimation process involves procedures to appropriately consider the unique characteristics of the Company’s loan portfolio segments. Credit quality is assessed and monitored by evaluating various attributes, and the results of those evaluations are utilized in underwriting new loans and in the Company’s process for the estimation of expected credit losses. Credit quality monitoring procedures and indicators can include an assessment of problem loans, the types of loans, historical loss experience, new lending products, emerging credit trends, changes in the size and character of loan categories, and other factors, including our risk rating system, regulatory guidance and economic conditions, such as the unemployment rate and change in GDP in the national and local economies as well as trends in the market values of underlying collateral securing loans, all as determined based on input from management, loan review staff and other sources. This evaluation is complex and inherently subjective, as it requires estimates by management that are inherently uncertain and therefore susceptible to significant revision as more information becomes available. In future periods, evaluations of the overall loan portfolio, in light of the factors and forecasts