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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the Quarterly Period Ended March 31, 2021

or

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the Transition Period From                  To

Commission File Number: 000-30421

HANMI FINANCIAL CORPORATION

(Exact Name of Registrant as Specified in its Charter)

 

Delaware

 

95-4788120

(State or Other Jurisdiction of

 

(I.R.S. Employer

Incorporation or Organization)

 

Identification No.)

 

900 Wilshire Boulevard, Suite 1250

 

 

Los Angeles, California

 

90017

(Address of Principal Executive Offices)

 

(Zip Code)

(213) 382-2200

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report)

Securities Registered Pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common Stock, $0.001 par value

 

HAFC

 

Nasdaq Global Select Market

 

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes  ☒    No  

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).   Yes  ☒    No  

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

  

Accelerated filer

 

 

 

 

 

 

 

 

Non-accelerated filer

 

  

Smaller reporting company

 

 

 

 

 

 

 

 

 

 

 

 

Emerging Growth Company

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act).   Yes      No  

As of May 3, 2021, there were 30,694,659 outstanding shares of the Registrant’s Common Stock.

 

 

 

 


 

 

Hanmi Financial Corporation and Subsidiaries Quarterly Report on Form 10-Q

Three Months Ended March 31, 2021

Table of Contents

 

 

 

Part I – Financial Information

 

 

 

 

 

 

 

Item 1.

 

Financial Statements

 

3

 

 

 

 

 

 

 

Consolidated Balance Sheets at March 31, 2021 (unaudited) and December 31, 2020

 

3

 

 

 

 

 

 

 

Consolidated Statements of Income (Unaudited)

 

4

 

 

 

 

 

 

 

Consolidated Statements of Comprehensive Income (Unaudited)

 

5

 

 

 

 

 

 

 

Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)

 

6

 

 

 

 

 

 

 

Consolidated Statements of Cash Flows (Unaudited)

 

7

 

 

 

 

 

 

 

Notes to Consolidated Financial Statements (Unaudited)

 

8

 

 

 

 

 

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

39

 

 

 

 

 

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

 

53

 

 

 

 

 

Item 4.

 

Controls and Procedures

 

53

 

 

 

 

 

 

 

Part II – Other Information

 

 

 

 

 

 

 

Item 1.

 

Legal Proceedings

 

54

 

 

 

 

 

Item 1A.

 

Risk Factors

 

54

 

 

 

 

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

54

 

 

 

 

 

Item 3.

 

Defaults Upon Senior Securities

 

54

 

 

 

 

 

Item 4.

 

Mine Safety Disclosures

 

54

 

 

 

 

 

Item 5.

 

Other Information

 

54

 

 

 

 

 

Item 6.

 

Exhibits

 

55

 

 

 

Signatures

 

56

 

2


 

 

Part I — Financial Information

Item 1. Financial Statements

Hanmi Financial Corporation and Subsidiaries

Consolidated Balance Sheets

(in thousands, except share data)

 

 

 

March 31,

 

 

December 31,

 

 

 

2021

 

 

2020

 

 

 

(Unaudited)

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

646,445

 

 

$

391,849

 

Securities available for sale, at fair value (amortized cost of $787,675 as of March 31, 2021 and $749,458 as of December 31, 2020)

 

 

780,114

 

 

 

753,781

 

Loans held for sale, at the lower of cost or fair value

 

 

32,674

 

 

 

8,568

 

Loans receivable, net of allowance for credit losses of $88,392 as of March 31, 2021 and $90,426 as of December 31, 2020

 

 

4,728,759

 

 

 

4,789,742

 

Accrued interest receivable

 

 

14,806

 

 

 

16,363

 

Premises and equipment, net

 

 

26,398

 

 

 

26,431

 

Customers' liability on acceptances

 

 

735

 

 

 

1,319

 

Servicing assets

 

 

6,150

 

 

 

6,212

 

Goodwill and other intangible assets, net

 

 

11,558

 

 

 

11,612

 

Federal Home Loan Bank ("FHLB") stock, at cost

 

 

16,385

 

 

 

16,385

 

Income tax assets

 

 

42,665

 

 

 

42,704

 

Bank-owned life insurance

 

 

54,150

 

 

 

53,894

 

Prepaid expenses and other assets

 

 

77,562

 

 

 

83,028

 

Total assets

 

$

6,438,401

 

 

$

6,201,888

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

Noninterest-bearing

 

$

2,174,624

 

 

$

1,898,766

 

Interest-bearing

 

 

3,335,199

 

 

 

3,376,242

 

Total deposits

 

 

5,509,823

 

 

 

5,275,008

 

Accrued interest payable

 

 

2,352

 

 

 

4,564

 

Bank's liability on acceptances

 

 

735

 

 

 

1,319

 

Borrowings

 

 

150,000

 

 

 

150,000

 

Subordinated debentures ($126,800 face amount less unamortized discount and debt issuance costs of $7,676 and $7,828 as of March 31, 2021 and December 31, 2020, respectively)

 

 

119,124

 

 

 

118,972

 

Accrued expenses and other liabilities

 

 

74,545

 

 

 

74,981

 

Total liabilities

 

 

5,856,579

 

 

 

5,624,844

 

Stockholders' equity:

 

 

 

 

 

 

 

 

Preferred Stock, $0.001 par value; authorized 10,000,000 shares; no shares issued as of March 31, 2021 and December 31, 2020

 

 

 

 

 

 

Common stock, $0.001 par value; authorized 62,500,000 shares; issued 33,585,181 shares (30,682,533 shares outstanding) as of March 31, 2021 and issued 33,560,801 shares (30,717,835 shares outstanding) as of December 31, 2020

 

 

33

 

 

 

33

 

Additional paid-in capital

 

 

578,958

 

 

 

578,360

 

Accumulated other comprehensive (loss) income, net of tax benefit of $2,268 as of March 31, 2021 and net of tax expense of $1,247 as of December 31, 2020

 

 

(5,293

)

 

 

3,076

 

Retained earnings

 

 

128,211

 

 

 

114,621

 

Less treasury stock; 2,902,648 shares as of March 31, 2021 and 2,842,966 shares as of December 31, 2020

 

 

(120,087

)

 

 

(119,046

)

Total stockholders' equity

 

 

581,822

 

 

 

577,044

 

Total liabilities and stockholders' equity

 

$

6,438,401

 

 

$

6,201,888

 

 

See Accompanying Notes to Consolidated Financial Statements (Unaudited)

3


 

Hanmi Financial Corporation and Subsidiaries

Consolidated Statements of Income (Unaudited)

(in thousands, except share and per share data)

 

 

 

Three Months Ended March 31,

 

 

 

2021

 

 

2020

 

Interest and dividend income:

 

 

 

 

 

 

 

 

Interest and fees on loans receivable

 

$

50,614

 

 

$

54,648

 

Interest on securities

 

 

1,140

 

 

 

3,655

 

Dividends on FHLB stock

 

 

206

 

 

 

289

 

Interest on deposits in other banks

 

 

96

 

 

 

333

 

Total interest and dividend income

 

 

52,056

 

 

 

58,925

 

Interest expense:

 

 

 

 

 

 

 

 

Interest on deposits

 

 

3,958

 

 

 

12,742

 

Interest on borrowings

 

 

478

 

 

 

496

 

Interest on subordinated debentures

 

 

1,619

 

 

 

1,712

 

Total interest expense

 

 

6,055

 

 

 

14,950

 

Net interest income before credit loss expense

 

 

46,001

 

 

 

43,975

 

Credit loss expense

 

 

2,109

 

 

 

15,739

 

Net interest income after credit loss expense

 

 

43,892

 

 

 

28,236

 

Noninterest income:

 

 

 

 

 

 

 

 

Service charges on deposit accounts

 

 

2,357

 

 

 

2,400

 

Trade finance and other service charges and fees

 

 

1,034

 

 

 

986

 

Gain on sale of Small Business Administration ("SBA") loans

 

 

4,125

 

 

 

1,154

 

Net gain on sales of securities

 

 

99

 

 

 

 

Other operating income

 

 

2,193

 

 

 

1,683

 

Total noninterest income

 

 

9,808

 

 

 

6,223

 

Noninterest expense:

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

16,820

 

 

 

17,749

 

Occupancy and equipment

 

 

4,595

 

 

 

4,475

 

Data processing

 

 

2,926

 

 

 

2,669

 

Professional fees

 

 

1,447

 

 

 

1,915

 

Supplies and communications

 

 

757

 

 

 

781

 

Advertising and promotion

 

 

359

 

 

 

734

 

Other operating expenses

 

 

2,631

 

 

 

2,745

 

Total noninterest expense

 

 

29,535

 

 

 

31,068

 

Income before tax

 

 

24,165

 

 

 

3,391

 

Income tax expense

 

 

7,506

 

 

 

1,041

 

Net income

 

$

16,659

 

 

$

2,350

 

Basic earnings per share

 

$

0.54

 

 

$

0.08

 

Diluted earnings per share

 

$

0.54

 

 

$

0.08

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

Basic

 

 

30,461,681

 

 

 

30,469,022

 

Diluted

 

 

30,473,970

 

 

 

30,472,899

 

 

See Accompanying Notes to Consolidated Financial Statements (Unaudited)

4


 

Hanmi Financial Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income (Unaudited)

(in thousands)

 

 

 

Three Months Ended March 31,

 

 

 

2021

 

 

2020

 

Net income

 

$

16,659

 

 

$

2,350

 

Other comprehensive income (loss), net of tax:

 

 

 

 

 

 

 

 

Unrealized gain on securities:

 

 

 

 

 

 

 

 

Unrealized holding gain arising during period

 

 

(11,785

)

 

 

11,924

 

Less: reclassification adjustment for net gain included in net income

 

 

(99

)

 

 

 

Income tax benefit (expense) related to items of other comprehensive income

 

 

3,515

 

 

 

(3,439

)

Other comprehensive income (loss), net of tax

 

 

(8,369

)

 

 

8,485

 

Comprehensive income

 

$

8,290

 

 

$

10,835

 

 

See Accompanying Notes to Consolidated Financial Statements (Unaudited)

5


 

Hanmi Financial Corporation and Subsidiaries

Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)

For the Three Months Ended March 31, 2021 and March 31, 2020

(in thousands, except share data)

 

 

 

Common Stock - Number of Shares

 

 

Stockholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

Other

 

 

 

 

 

 

Treasury

 

 

Total

 

 

 

Shares

 

 

Treasury

 

 

Shares

 

 

Common

 

 

Paid-in

 

 

Comprehensive

 

 

Retained

 

 

Stock,

 

 

Stockholders'

 

 

 

Issued

 

 

Shares

 

 

Outstanding

 

 

Stock

 

 

Capital

 

 

Income (Loss)

 

 

Earnings

 

 

at Cost

 

 

Equity

 

Balance at January 1, 2020

 

 

33,475,402

 

 

 

(2,675,778

)

 

 

30,799,624

 

 

$

33

 

 

$

575,816

 

 

$

3,382

 

 

$

100,552

 

 

$

(116,515

)

 

$

563,268

 

Adjustment related to adopting of new accounting standards

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ASU 2016-13 (See Notes 1 and 3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(12,167

)

 

 

 

 

 

(12,167

)

Adjusted balance at January 1, 2020

 

 

33,475,402

 

 

 

(2,675,778

)

 

 

30,799,624

 

 

 

33

 

 

 

575,816

 

 

 

3,382

 

 

 

88,385

 

 

 

(116,515

)

 

 

551,101

 

Restricted stock awards, net of forfeitures

 

 

(27,188

)

 

 

 

 

 

(27,188

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

769

 

 

 

 

 

 

 

 

 

 

 

 

769

 

Restricted stock surrendered due to employee tax liability

 

 

 

 

 

(14,295

)

 

 

(14,295

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(171

)

 

 

(171

)

Repurchase of common stock

 

 

 

 

 

(135,400

)

 

 

(135,400

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2,196

)

 

 

(2,196

)

Cash dividends declared (common stock, $0.24/share)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(7,380

)

 

 

 

 

 

(7,380

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,350

 

 

 

 

 

 

2,350

 

Change in unrealized gain on securities available for sale, net of income taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8,485

 

 

 

 

 

 

 

 

 

8,485

 

Balance at March 31, 2020

 

 

33,448,214

 

 

 

(2,825,473

)

 

 

30,622,741

 

 

$

33

 

 

$

576,585

 

 

$

11,867

 

 

$

83,355

 

 

$

(118,882

)

 

$

552,958

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at January 1, 2021

 

 

33,560,801

 

 

 

(2,842,966

)

 

 

30,717,835

 

 

$

33

 

 

$

578,360

 

 

$

3,076

 

 

$

114,621

 

 

$

(119,046

)

 

$

577,044

 

Restricted stock awards, net of forfeitures

 

 

24,380

 

 

 

 

 

 

24,380

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

598

 

 

 

 

 

 

 

 

 

 

 

 

598

 

Restricted stock surrendered due to employee tax liability

 

 

 

 

 

(4,682

)

 

 

(4,682

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(95

)

 

 

(95

)

Repurchase of common stock

 

 

 

 

 

(55,000

)

 

 

(55,000

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(946

)

 

 

(946

)

Cash dividends declared (common stock, $0.10/share)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3,069

)

 

 

 

 

 

(3,069

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

16,659

 

 

 

 

 

 

16,659

 

Change in unrealized gain on securities available for sale, net of income taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(8,369

)

 

 

 

 

 

 

 

 

(8,369

)

Balance at March 31, 2021

 

 

33,585,181

 

 

 

(2,902,648

)

 

 

30,682,533

 

 

$

33

 

 

$

578,958

 

 

$

(5,293

)

 

$

128,211

 

 

$

(120,087

)

 

$

581,822

 

 

See Accompanying Notes to Consolidated Financial Statements (Unaudited)

 

 

6


 

 

Hanmi Financial Corporation and Subsidiaries

Consolidated Statements of Cash Flows (Unaudited)

(in thousands)

 

 

 

Three Months Ended March 31,

 

 

 

2021

 

 

2020

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

Net income

 

$

16,659

 

 

$

2,350

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

3,850

 

 

 

2,317

 

Share-based compensation expense

 

 

598

 

 

 

769

 

Credit loss expense

 

 

2,109

 

 

 

15,739

 

Gain on sales of securities

 

 

(99

)

 

 

 

Gain on sales of SBA loans

 

 

(4,125

)

 

 

(1,154

)

Origination of SBA loans held for sale

 

 

(146,670

)

 

 

(12,197

)

Proceeds from sales of SBA loans

 

 

126,690

 

 

 

19,366

 

Change in bank-owned life insurance

 

 

(256

)

 

 

(276

)

Change in prepaid expenses and other assets

 

 

4,945

 

 

 

(4,905

)

Change in income tax assets

 

 

3,554

 

 

 

4,098

 

Change in accrued expenses and other liabilities

 

 

(652

)

 

 

(1,846

)

Net cash provided by (used in) operating activities

 

 

6,602

 

 

 

24,262

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Purchases of securities available for sale

 

 

(116,026

)

 

 

(26,423

)

Proceeds from matured, called and repayment of securities

 

 

67,729

 

 

 

49,987

 

Proceeds from sales of securities available for sale

 

 

8,035

 

 

 

 

Purchases of loans receivable

 

 

(298

)

 

 

 

Purchases of premises and equipment

 

 

(1,011

)

 

 

(1,244

)

Proceeds from disposition of premises and equipment

 

 

 

 

 

44

 

Proceeds from sales of other real estate owned ("OREO")

 

 

589

 

 

 

 

Change in loans receivable, excluding purchases

 

 

58,271

 

 

 

38,884

 

Net cash provided by (used in) investing activities

 

 

17,289

 

 

 

61,248

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Change in deposits

 

 

234,815

 

 

 

(116,894

)

Change in overnight borrowings

 

 

 

 

 

135,000

 

Proceeds from borrowings

 

 

 

 

 

75,000

 

Cash paid for surrender of vested shares due to employee tax liability

 

 

(95

)

 

 

(171

)

Repurchase of common stock

 

 

(946

)

 

 

(2,196

)

Cash dividends paid

 

 

(3,069

)

 

 

(7,380

)

Net cash provided by (used in) financing activities

 

 

230,705

 

 

 

83,359

 

Net increase (decrease) in cash and due from banks

 

 

254,596

 

 

 

168,869

 

Cash and due from banks at beginning of year

 

 

391,849

 

 

 

121,678

 

Cash and due from banks at end of period

 

$

646,445

 

 

$

290,546

 

 

 

 

 

 

 

 

 

 

Supplemental disclosures of cash flow information:

 

 

 

 

 

 

 

 

Interest expense paid

 

$

8,267

 

 

$

16,472

 

Income taxes paid

 

$

125

 

 

$

93

 

Non-cash activities:

 

 

 

 

 

 

 

 

Transfer of loans receivable to other real estate owned

 

$

1

 

 

$

 

Income tax benefit (expense) related to items of other comprehensive income

 

$

3,515

 

 

$

(3,439

)

Change in right-of-use asset obtained in exchange for lease liability

 

$

 

 

$

1,287

 

 

See Accompanying Notes to Consolidated Financial Statements (Unaudited)

7


 

Hanmi Financial Corporation and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

Three Months Ended March 31, 2021 and 2020

Note 1 — Organization and Basis of Presentation

Hanmi Financial Corporation (“Hanmi Financial,” the “Company,” “we,” “us” or “our”) is a bank holding company whose primary subsidiary is Hanmi Bank (the “Bank”). Our primary operations are related to traditional banking activities, including the acceptance of deposits and the lending and investing of money through the operation of the Bank. 

In management’s opinion, the accompanying unaudited consolidated financial statements of Hanmi Financial and its subsidiaries reflect all adjustments of a normal and recurring nature that are necessary for a fair presentation of the results for the interim periods ended March 31, 2021, but are not necessarily indicative of the results that will be reported for the entire year or any other interim period. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted. The unaudited consolidated financial statements are prepared in conformity with GAAP and in accordance with the instructions to Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission. The interim information should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2020 (the “2020 Annual Report on Form 10-K”).

The preparation of interim unaudited consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. These estimates and assumptions affect the amounts reported in the unaudited financial statements and disclosures provided, and actual results could differ.

 

The outbreak of COVID-19 has resulted in restrictions on travel and gatherings and restricted business activities. As a result, the operations and business results of the Company could be materially adversely affected. The extent to which the COVID-19 crisis may impact business activity or financial results will depend on future developments, including new information which may emerge concerning the severity of the coronavirus and the actions required to contain the coronavirus or treat its impact, among others, which are highly uncertain and cannot be predicted. This uncertainty may impact the accuracy of our significant estimates, which includes the allowance for credit losses, the allowance for credit losses related to off-balance sheet items, and the valuation of intangible assets including deferred tax assets, goodwill, and servicing assets.

 

Descriptions of our significant accounting policies are included in Note 1 - Summary of Significant Accounting Policies in the Notes to Consolidated Financial Statements in the 2020 Annual Report on Form 10-K.

Recently Issued Accounting Standards Not Yet Effective

 

ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, On March 12, 2020, the FASB issued ASU 2020-04 to ease the potential burden in accounting for reference rate reform.  The amendments in ASU 2020-04 are elective and apply to all entities that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform.

 

The new guidance provided several optional expedients that reduce costs and complexity of accounting for reference rate reform, including measures to simplify or modify accounting issues resulting from reference rate reform for contract modifications, hedges, and debt securities.

 

The amendments are effective for all entities from the beginning of an interim period that includes the issuance date of ASU 2020-04.  An entity may elect to apply the amendments prospectively through December 31, 2022.

 

The adoption of this standard is not expected to have material effect on the Company’s operating results or financial condition.

 

8


 

 

Note 2 — Securities

The following is a summary of securities available for sale as of the dates indicated:

 

 

 

 

 

 

 

Gross

 

 

Gross

 

 

Estimated

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Fair

 

 

 

Cost

 

 

Gain

 

 

Loss

 

 

Value

 

 

 

(in thousands)

 

March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

9,998

 

 

$

77

 

 

$

 

 

$

10,075

 

U.S. government agency and sponsored agency obligations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

 

 

579,209

 

 

 

87

 

 

 

(7,216

)

 

 

572,080

 

Collateralized mortgage obligations

 

 

112,808

 

 

 

145

 

 

 

(210

)

 

 

112,743

 

Debt securities

 

 

85,660

 

 

 

31

 

 

 

(475

)

 

 

85,216

 

Total U.S. government agency and sponsored agency obligations

 

 

777,677

 

 

 

263

 

 

 

(7,901

)

 

 

770,039

 

Total securities available for sale

 

$

787,675

 

 

$

340

 

 

$

(7,901

)

 

$

780,114

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

9,997

 

 

$

135

 

 

$

 

 

$

10,132

 

U.S. government agency and sponsored agency obligations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

 

 

515,169

 

 

 

4,260

 

 

 

(188

)

 

 

519,241

 

Collateralized mortgage obligations

 

 

133,632

 

 

 

186

 

 

 

(217

)

 

 

133,601

 

Debt securities

 

 

90,660

 

 

 

148

 

 

 

(1

)

 

 

90,807

 

Total U.S. government agency and sponsored agency obligations

 

 

739,461

 

 

 

4,594

 

 

 

(406

)

 

 

743,649

 

Total securities available for sale

 

$

749,458

 

 

$

4,729

 

 

$

(406

)

 

$

753,781

 

 

The amortized cost and estimated fair value of securities as of March 31, 2021 and December 31, 2020, by contractual or expected maturity, are shown below. Collateralized mortgage obligations are included in the table shown below based on their expected maturities. All other securities are included based on their contractual maturities.

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

 

Available for Sale

 

 

Available for Sale

 

 

 

Amortized

 

 

Estimated

 

 

Amortized

 

 

Estimated

 

 

 

Cost

 

 

Fair Value

 

 

Cost

 

 

Fair Value

 

 

 

(in thousands)

 

Within one year

 

$

12,963

 

 

$

13,045

 

 

$

13,305

 

 

$

13,435

 

Over one year through five years

 

 

90,083

 

 

 

89,890

 

 

 

139,876

 

 

 

140,100

 

Over five years through ten years

 

 

50,135

 

 

 

49,990

 

 

 

25,764

 

 

 

25,768

 

Over ten years

 

 

634,494

 

 

 

627,189

 

 

 

570,513

 

 

 

574,478

 

Total

 

$

787,675

 

 

$

780,114

 

 

$

749,458

 

 

$

753,781

 

9


 

 

 

The following table summarizes debt securities available-for-sale in an unrealized loss position for which an allowance for credit losses has not been recorded at March 31, 2021 and December 31, 2020, aggregated by major security type and length of time in a continuous unrealized loss position:

 

 

 

Holding Period

 

 

 

Less than 12 Months

 

 

12 Months or More

 

 

Total

 

 

 

Gross

 

 

Estimated

 

 

Number

 

 

Gross

 

 

Estimated

 

 

Number

 

 

Gross

 

 

Estimated

 

 

Number

 

 

 

Unrealized

 

 

Fair

 

 

of

 

 

Unrealized

 

 

Fair

 

 

of

 

 

Unrealized

 

 

Fair

 

 

of

 

 

 

Loss

 

 

Value

 

 

Securities

 

 

Loss

 

 

Value

 

 

Securities

 

 

Loss

 

 

Value

 

 

Securities

 

 

 

(in thousands, except number of securities)

 

March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government agency and sponsored agency obligations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

 

$

(7,216

)

 

$

562,136

 

 

 

87

 

 

$

 

 

$

 

 

 

 

 

$

(7,216

)

 

$

562,136

 

 

 

87

 

Collateralized mortgage obligations

 

 

(210

)

 

 

78,602

 

 

 

18

 

 

 

 

 

 

 

 

 

 

 

 

(210

)

 

 

78,602

 

 

 

18

 

Debt securities

 

 

(475

)

 

 

55,525

 

 

 

9

 

 

 

 

 

 

 

 

 

 

 

 

(475

)

 

 

55,525

 

 

 

9

 

Total U.S. government agency and sponsored agency obligations

 

 

(7,901

)

 

 

696,263

 

 

 

114

 

 

 

 

 

 

 

 

 

 

 

 

(7,901

)

 

 

696,263

 

 

 

114

 

Total

 

$

(7,901

)

 

$

696,263

 

 

 

114

 

 

$

 

 

$

 

 

 

 

 

$

(7,901

)

 

$

696,263

 

 

 

114

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government agency and sponsored agency obligations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

 

$

(188

)

 

$

76,023

 

 

 

10

 

 

$

 

 

$

 

 

 

 

 

$

(188

)

 

$

76,023

 

 

 

10

 

Collateralized mortgage obligations

 

 

(217

)

 

 

97,659

 

 

 

21

 

 

 

 

 

 

 

 

 

 

 

 

(217

)

 

 

97,659

 

 

 

21

 

Debt securities

 

 

(1

)

 

 

4,999

 

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

(1

)

 

 

4,999

 

 

 

1

 

Total U.S. government agency and sponsored agency obligations

 

 

(406

)

 

 

178,681

 

 

 

32

 

 

 

 

 

 

 

 

 

 

 

 

(406

)

 

 

178,681

 

 

 

32

 

Total

 

$

(406

)

 

$

178,681

 

 

 

32

 

 

$

 

 

$

 

 

 

 

 

$

(406

)

 

$

178,681

 

 

 

32

 

 

The Company evaluates its available-for-sale securities portfolio for impairment on an at least quarterly basis. This assessment took into account the credit quality of these debt securities and determined that since all were U.S. Treasury obligations, U.S. government agency securities, and U.S. government sponsored agency securities, all of which have the backing of the U.S. government, no credit impairment had occurred.

Realized gains and losses on sales of securities and proceeds from sales of securities were as follows for the periods indicated:

 

 

 

Three Months Ended March 31,

 

 

 

2021

 

 

2020

 

 

 

(in thousands)

 

Gross realized gains on sales of securities

 

$

99

 

 

$

 

Gross realized losses on sales of securities

 

 

 

 

 

 

Net realized gains on sales of securities

 

$

99

 

 

$

 

Proceeds from sales of securities

 

$

8,035

 

 

$

 

 

 

During the three months ended March 31, 2021 and 2020, there were $99,000 and $0 in gains or losses, respectively, in earnings resulting from the sale of securities.

Securities available for sale with market values of $32.6 million and $27.3 million as of March 31, 2021 and December 31, 2020, respectively, were pledged to secure borrowings from the Federal Reserve Bank (“FRB”) Discount Window.

At March 31, 2021, there were no holdings of securities of any one issuer, other than the U.S. government and its agencies in an amount greater than 10 percent of shareholders’ equity.

10


 

Note 3 — Loans

Loans Receivable

Loans consisted of the following as of the dates indicated:

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

 

(in thousands)

 

Real estate loans:

 

 

 

 

 

 

 

 

Commercial property

 

 

 

 

 

 

 

 

Retail

 

$

811,583

 

 

$

824,606

 

Hospitality

 

 

842,014

 

 

 

859,953

 

Other (1)

 

 

1,656,065

 

 

 

1,610,377

 

Total commercial property loans

 

 

3,309,662

 

 

 

3,294,936

 

Construction

 

 

62,626

 

 

 

58,882

 

Residential/consumer loans

 

 

328,228

 

 

 

345,831

 

Total real estate loans

 

 

3,700,516

 

 

 

3,699,649

 

Commercial and industrial loans

 

 

707,073

 

 

 

757,255

 

Leases receivable

 

 

409,562

 

 

 

423,264

 

Loans receivable

 

 

4,817,151

 

 

 

4,880,168

 

Allowance for credit losses

 

 

(88,392

)

 

 

(90,426

)

Loans receivable, net

 

$

4,728,759

 

 

$

4,789,742

 

 

(1)

Includes, among other types, mixed-use, apartment, office, industrial, gas stations, faith-based facilities and warehouse; all other property types represent less than one percent of total loans receivable.

 

The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act allows financial institutions to assist customers in dealing with financial hardship by (a) providing federal funding so that financial institutions can originate SBA loans to borrowers at a low interest rate under the Paycheck Protection Program (“PPP”) loans with eventual debt forgiveness should the borrower continue to meet certain criteria; and (b) allowing financial institutions to temporarily modify loan terms by deferring loan payments, loan fees, etc. without considering them Troubled Debt Restructurings (“TDRs”).

At March 31, 2021, there were $256.5 million of PPP loans included in commercial and industrial loans in the table above.  In addition, at March 31, 2021, there were $116.4 million of loans modified under Section 4013 of the CARES Act.

Accrued interest on loans was $13.6 million and $15.2 million at March 31, 2021 and December 31, 2020, respectively. Accrued interest at March 31, 2021 and December 31, 2020 included unpaid deferred interest receivable for loans currently or previously modified under the CARES Act of $5.2 million and $7.5 million, net of a $1.2 million and $1.7 million valuation allowance, respectively.

At March 31, 2021 and December 31, 2020, loans of $2.34 billion and $2.17 billion, respectively, were pledged to secure advances from the FHLB.

11


 

Loans Held for Sale

The following is the activity for loans held for sale for the three months ended March 31, 2021 and 2020:

 

 

 

Real Estate

 

 

Commercial and

Industrial

 

 

Total

 

 

 

(in thousands)

 

March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

8,042

 

 

$

526

 

 

$

8,568

 

Originations and transfers

 

 

16,283

 

 

 

130,387

 

 

 

146,670

 

Sales

 

 

(13,395

)

 

 

(109,169

)

 

 

(122,564

)

Principal paydowns and amortization

 

 

 

 

 

 

 

 

 

Balance at end of period

 

$

10,930

 

 

$

21,744

 

 

$

32,674

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2020

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

2,943

 

 

$

3,077

 

 

$

6,020

 

Originations

 

 

6,494

 

 

 

5,703

 

 

 

12,197

 

Sales

 

 

(9,432

)

 

 

(8,780

)

 

 

(18,212

)

Principal paydowns and amortization

 

 

(5

)

 

 

 

 

 

(5

)

Balance at end of period

 

$

 

 

$

 

 

$

 

 

Loans held for sale was comprised of $10.9 million of the guaranteed portion of SBA 7(a) loans and $21.7 million in second draw PPP loans at March 31, 2021. During the quarter ended March 31, 2021, the Company recognized $2.5 million of gains on the sale of $108.5 million second draw PPP loans.

 

12


 

 

Allowance for Credit Losses

 

The following table details the information on the allowance for credit losses by portfolio segment for the periods indicated:

 

 

 

Real Estate

 

 

Commercial and

Industrial

 

 

Leases

Receivable

 

 

Total

 

 

 

(in thousands)

 

March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

 

51,877

 

 

$

21,410

 

 

$

17,139

 

 

$

90,426

 

Less loans charged off

 

 

1,509

 

 

 

93

 

 

 

1,903

 

 

 

3,505

 

Recoveries on loans receivable previously charged off

 

 

(273

)

 

 

(99

)

 

 

(135

)

 

 

(507

)

Provision for credit losses

 

 

7,121

 

 

 

(5,029

)

 

 

(1,128

)

 

 

964

 

Ending balance

 

$

57,762

 

 

$

16,387

 

 

$

14,243

 

 

$

88,392

 

Individually evaluated

 

$

11

 

 

$

7,584

 

 

$

4,561

 

 

$

12,156

 

Collectively evaluated

 

$

57,751

 

 

$

8,803

 

 

$

9,682

 

 

$

76,236

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans receivable

 

$

3,700,516

 

 

$

707,073

 

 

$

409,562

 

 

$

4,817,151

 

Individually evaluated

 

$

39,144

 

 

$

14,297

 

 

$

10,025

 

 

$

63,466

 

Collectively evaluated

 

$

3,661,372

 

 

$

692,777

 

 

$

399,537

 

 

$

4,753,686

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

36,435

 

 

$

16,206

 

 

$

8,767

 

 

$

61,408

 

Adjustment related to adoption of ASU 2016-13

 

 

14,028

 

 

 

(2,497

)

 

 

5,902

 

 

 

17,433

 

Adjusted balance as of January 1, 2020

 

 

50,463

 

 

 

13,709

 

 

 

14,669

 

 

 

78,841

 

Less loans charged off

 

 

14,143

 

 

 

12,150

 

 

 

1,181

 

 

 

27,474

 

Recoveries on loans receivable previously charged off

 

 

(58

)

 

 

(84

)

 

 

(74

)

 

 

(216

)

Provision for credit losses

 

 

2,754

 

 

 

9,945

 

 

 

2,218

 

 

 

14,917

 

Ending balance

 

$

39,132

 

 

$

11,588

 

 

$

15,780

 

 

$

66,500

 

Individually evaluated

 

$

81

 

 

$

147

 

 

$

1,671

 

 

$

1,899

 

Collectively evaluated

 

$

39,051

 

 

$

11,441

 

 

$

14,109

 

 

$

64,601

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans receivable

 

$

3,578,395

 

 

$

472,714

 

 

$

492,527

 

 

$

4,543,636

 

Individually evaluated

 

$

35,459

 

 

$

5,444

 

 

$

6,393

 

 

$

47,296

 

Collectively evaluated

 

$

3,542,936

 

 

$

467,270

 

 

$

486,134

 

 

$

4,496,340

 

 

The table below illustrates the allowance for credit losses by loan portfolio segment and each loan portfolio segment as a percentage of total loans.

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

 

Allowance Amount

 

 

Total Loans

 

 

Percentage of Total Loans

 

 

Allowance Amount

 

 

Total Loans

 

 

Percentage of Total Loans

 

 

 

(in thousands)

 

Real estate loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial property

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail

 

$

3,962

 

 

$

811,583

 

 

 

16.8

%

 

$

4,855

 

 

$

824,606

 

 

 

16.9

%

Hospitality

 

 

38,251

 

 

 

842,014

 

 

 

17.5

%

 

 

28,801

 

 

 

859,953

 

 

 

17.6

%

Other

 

 

11,121

 

 

 

1,656,065

 

 

 

34.4

%

 

 

13,991

 

 

 

1,610,377

 

 

 

32.9

%

Total commercial property loans

 

 

53,334

 

 

 

3,309,662

 

 

 

68.7

%

 

 

47,647

 

 

 

3,294,936

 

 

 

67.4

%

Construction

 

 

3,670

 

 

 

62,626

 

 

 

1.3

%

 

 

2,876

 

 

 

58,882

 

 

 

1.2

%

Residential/consumer loans

 

 

758

 

 

 

328,228

 

 

 

6.8

%

 

 

1,353

 

 

 

345,831

 

 

 

7.1

%

Total real estate loans

 

 

57,762

 

 

 

3,700,516

 

 

 

76.8

%

 

 

51,876

 

 

 

3,699,649

 

 

 

75.8

%

Commercial and industrial loans

 

 

16,387

 

 

 

707,073

 

 

 

14.7

%

 

 

21,410

 

 

 

757,255

 

 

 

15.5

%

Leases receivable

 

 

14,243

 

 

 

409,562

 

 

 

8.5

%

 

 

17,140

 

 

 

423,264

 

 

 

8.7

%

Total

 

$

88,392

 

 

$

4,817,151

 

 

 

100.0

%

 

$

90,426

 

 

$

4,880,168

 

 

 

100.0

%

13


 

 

 

The following table represents the amortized cost basis of collateral-dependent loans by class of loans as of March 31, 2021 and December 31, 2020, for which repayment is expected to be obtained through the sale of the underlying collateral.

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

 

Amortized Cost

 

 

Amortized Cost

 

 

 

(in thousands)

 

Real estate loans:

 

 

 

 

 

 

 

 

Commercial property

 

 

 

 

 

 

 

 

Retail

 

$

6,270

 

 

$

6,330

 

Hospitality

 

 

8,941

 

 

 

20,612

 

Other (1)

 

 

8,137

 

 

 

8,410

 

Total commercial property loans

 

 

23,348

 

 

 

35,352

 

Construction

 

 

11,046

 

 

 

24,854

 

Residential/consumer loans

 

 

2,832

 

 

 

2,867

 

Total real estate loans

 

 

37,226

 

 

 

63,073

 

Commercial and industrial loans

 

 

 

 

 

41

 

Total

 

$

37,226

 

 

$

63,114

 

 

(1)

Includes, among other types, mixed-use, apartment, office, industrial, gas stations, faith-based facilities and warehouse; all other property types represent less than one percent of total loans receivable.

 

Loan Quality Indicators

As part of the on-going monitoring of the quality of our loans portfolio, we utilize an internal loan grading system to identify credit risk and assign an appropriate grade (from 0 to 8) for each loan in our portfolio. A third-party loan review is performed at least on an annual basis. Additional adjustments are made when determined to be necessary. The loan grade definitions are as follows:

Pass and Pass-Watch: Pass and Pass-Watch loans, grades (0-4), are in compliance with the Bank’s credit policy and regulatory requirements, and do not exhibit any potential or defined weaknesses as defined under “Special Mention,” “Substandard” or “Doubtful.” This category is the strongest level of the Bank’s loan grading system. It consists of all performing loans with no identified credit weaknesses. It includes cash and stock/security secured loans or other investment grade loans.

Special Mention: A Special Mention loan, grade (5), has potential weaknesses that deserve management’s close attention. If not corrected, these potential weaknesses may result in deterioration of the repayment of the debt and result in a Substandard classification. Loans that have significant actual, not potential, weaknesses are considered more severely classified.

Substandard: A Substandard loan, grade (6), has a well-defined weakness that jeopardizes the liquidation of the debt. A loan graded Substandard is not protected by the sound worth and paying capacity of the borrower, or of the value and type of collateral pledged. With a Substandard loan, there is a distinct possibility that the Bank will sustain some loss if the weaknesses or deficiencies are not corrected.

Doubtful: A Doubtful loan, grade (7), is one that has critical weaknesses that would make the collection or liquidation of the full amount due improbable. However, there may be pending events which may work to strengthen the loan, and therefore the amount or timing of a possible loss cannot be determined at the current time.

Loss: A loan classified as Loss, grade (8), is considered uncollectible and of such little value that their continuance as active bank assets is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this asset even though partial recovery may be possible in the future. Loans classified as Loss will be charged off in a timely manner.

Under regulatory guidance, loans graded special mention or worse are considered criticized loans, and loans graded substandard or worse are considered classified loans.

14


 

Loans by Vintage Year and Risk Rating

 

 

 

Term Loans

 

 

 

 

 

 

 

 

 

 

 

Amortized Cost Basis by Origination Year (1)

 

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

2019

 

 

2018

 

 

2017

 

 

Prior

 

 

Revolving

Loans

Amortized

Cost Basis

 

 

Total

 

 

 

(in thousands)

 

March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial property

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

$

248,282

 

 

$

824,943

 

 

$

499,488

 

 

$

457,893

 

 

$

333,986

 

 

$

757,814

 

 

$

40,720

 

 

$

3,163,126

 

Special Mention

 

 

 

 

 

6,390

 

 

 

18,559

 

 

 

11,023

 

 

 

1,660

 

 

 

38,335

 

 

 

260

 

 

 

76,227

 

Classified

 

 

 

 

 

 

 

 

5,510

 

 

 

12,572

 

 

 

4,665

 

 

 

47,562

 

 

 

 

 

 

70,309

 

Total commercial property

 

 

248,282

 

 

 

831,333

 

 

 

523,557

 

 

 

481,488

 

 

 

340,311

 

 

 

843,711

 

 

 

40,980

 

 

 

3,309,662

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass Watch

 

 

11,659

 

 

 

27,263

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

38,922

 

Special Mention

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Classified

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

23,704

 

 

 

 

 

 

23,704

 

Total construction

 

 

11,659

 

 

 

27,263

 

 

 

 

 

 

 

 

 

 

 

 

23,704

 

 

 

 

 

 

62,626

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential/consumer loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

12,640

 

 

 

26,795

 

 

 

947

 

 

 

33,026

 

 

 

117,121

 

 

 

121,431

 

 

 

7,093

 

 

 

319,053

 

Special Mention

 

 

 

 

 

 

 

 

 

 

 

930

 

 

 

378

 

 

 

5,299

 

 

 

 

 

 

6,607

 

Classified

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,245

 

 

 

323

 

 

 

 

 

 

2,568

 

Total residential/consumer loans

 

 

12,640

 

 

 

26,795

 

 

 

947

 

 

 

33,956

 

 

 

119,744

 

 

 

127,053

 

 

 

7,093

 

 

 

328,228

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

272,581

 

 

 

879,001

 

 

 

500,435

 

 

 

490,919

 

 

 

451,107

 

 

 

879,245

 

 

 

47,813

 

 

 

3,521,101

 

Special Mention

 

 

 

 

 

6,390

 

 

 

18,559

 

 

 

11,953

 

 

 

2,038

 

 

 

43,634

 

 

 

260

 

 

 

82,834

 

Classified

 

 

 

 

 

 

 

 

5,510

 

 

 

12,572

 

 

 

6,910

 

 

 

71,589

 

 

 

 

 

 

96,581

 

Total real estate loans

 

 

272,581

 

 

 

885,391

 

 

 

524,504

 

 

 

515,444

 

 

 

460,055

 

 

 

994,468

 

 

 

48,073

 

 

 

3,700,516

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

75,769

 

 

 

327,677

 

 

 

54,566

 

 

 

50,755

 

 

 

16,844

 

 

 

12,987

 

 

 

114,431

 

 

 

653,029

 

Special Mention

 

 

 

 

 

3,446

 

 

 

4,690

 

 

 

4,429

 

 

 

75

 

 

 

68

 

 

 

515

 

 

 

13,223

 

Classified

 

 

456

 

 

 

 

 

 

15,272

 

 

 

5,070

 

 

 

9,247

 

 

 

6,587

 

 

 

4,189

 

 

 

40,821

 

Total commercial and industrial loans

 

 

76,225

 

 

 

331,123

 

 

 

74,528

 

 

 

60,254

 

 

 

26,166

 

 

 

19,642

 

 

 

119,135

 

 

 

707,073

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leases receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

34,174

 

 

 

107,408

 

 

 

148,514

 

 

 

79,816

 

 

 

24,719

 

 

 

4,906

 

 

 

 

 

 

399,537

 

Special Mention

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Classified

 

 

 

 

 

488

 

 

 

5,826

 

 

 

2,267

 

 

 

595

 

 

 

849

 

 

 

 

 

 

10,025

 

Total leases receivable

 

 

34,174

 

 

 

107,896

 

 

 

154,340

 

 

 

82,083

 

 

 

25,314

 

 

 

5,755

 

 

 

 

 

 

409,562

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

382,524

 

 

 

1,314,086

 

 

 

703,515

 

 

 

621,490

 

 

 

492,670

 

 

 

897,138

 

 

 

162,244

 

 

 

4,573,667

 

Special Mention

 

 

 

 

 

9,836

 

 

 

23,249

 

 

 

16,382

 

 

 

2,113

 

 

 

43,702

 

 

 

775

 

 

 

96,057

 

Classified

 

 

456

 

 

 

488

 

 

 

26,608

 

 

 

19,909

 

 

 

16,752

 

 

 

79,025

 

 

 

4,189

 

 

 

147,427

 

Total loans receivable

 

$

382,980

 

 

$

1,324,410

 

 

$

753,372

 

 

$

657,781

 

 

$

511,535

 

 

$

1,019,865

 

 

$

167,208

 

 

$

4,817,151

 

 

15


 

 

 

 

Term Loans

 

 

 

 

 

 

 

 

 

 

 

Amortized Cost Basis by Origination Year (1)

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

2018

 

 

2017

 

 

2016

 

 

Prior

 

 

Revolving

Loans

Amortized

Cost Basis

 

 

Total

 

 

 

 

 

December 31, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial property

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

$

920,876

 

 

$

513,962

 

 

$

479,221

 

 

$

343,659

 

 

$

418,361

 

 

$

459,367

 

 

$

31,283

 

 

$

3,166,729

 

Special Mention

 

 

13,680

 

 

 

2,484

 

 

 

8,630

 

 

 

1,671

 

 

 

14,971

 

 

 

11,907

 

 

 

 

 

 

53,343

 

Classified

 

 

 

 

 

3,528

 

 

 

7,303

 

 

 

4,712

 

 

 

21,351

 

 

 

37,840

 

 

 

130

 

 

 

74,864

 

Total commercial property

 

 

934,556

 

 

 

519,974

 

 

 

495,154

 

 

 

350,042

 

 

 

454,683

 

 

 

509,114

 

 

 

31,413

 

 

 

3,294,936

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

33,415

 

 

 

613

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

34,028

 

Special Mention

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Classified

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,854

 

 

 

 

 

 

 

 

 

24,854

 

Total construction

 

 

33,415

 

 

 

613

 

 

 

 

 

 

 

 

 

24,854

 

 

 

 

 

 

 

 

 

58,882

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential/consumer loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

27,997

 

 

 

962

 

 

 

37,123

 

 

 

127,987

 

 

 

82,124

 

 

 

54,003

 

 

 

7,353

 

 

 

337,549

 

Special Mention

 

 

 

 

 

 

 

 

930

 

 

 

829

 

 

 

537

 

 

 

2,782

 

 

 

 

 

 

5,078

 

Classified

 

 

 

 

 

 

 

 

 

 

 

2,259

 

 

 

301

 

 

 

644

 

 

 

 

 

 

3,204

 

Total residential/consumer loans

 

 

27,997

 

 

 

962

 

 

 

38,053

 

 

 

131,075

 

 

 

82,962

 

 

 

57,429

 

 

 

7,353

 

 

 

345,831

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

982,288

 

 

 

515,537

 

 

 

516,344

 

 

 

471,646

 

 

 

500,485

 

 

 

513,370

 

 

 

38,636

 

 

 

3,538,306

 

Special Mention

 

 

13,680

 

 

 

2,484

 

 

 

9,560

 

 

 

2,500

 

 

 

15,508

 

 

 

14,689

 

 

 

 

 

 

58,421

 

Classified

 

 

 

 

 

3,528

 

 

 

7,303

 

 

 

6,971

 

 

 

46,506

 

 

 

38,484

 

 

 

130

 

 

 

102,922

 

Total real estate loans

 

 

995,968

 

 

 

521,549

 

 

 

533,207

 

 

 

481,117

 

 

 

562,499

 

 

 

566,543

 

 

 

38,766

 

 

 

3,699,649

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

406,486

 

 

 

73,159

 

 

 

54,110

 

 

 

17,834

 

 

 

4,464

 

 

 

9,910

 

 

 

146,722

 

 

 

712,685

 

Special Mention

 

 

6,950

 

 

 

4,509

 

 

 

4,436

 

 

 

1,110

 

 

 

31

 

 

 

1,074

 

 

 

447

 

 

 

18,557

 

Classified

 

 

 

 

 

890

 

 

 

5,115

 

 

 

9,465

 

 

 

4,380

 

 

 

1,519

 

 

 

4,644

 

 

 

26,013

 

Total commercial and industrial loans

 

 

413,436

 

 

 

78,558

 

 

 

63,661

 

 

 

28,409

 

 

 

8,875

 

 

 

12,503

 

 

 

151,813

 

 

 

757,255

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leases receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

113,712

 

 

 

165,242

 

 

 

91,408

 

 

 

30,405

 

 

 

10,096

 

 

 

1,167

 

 

 

 

 

 

412,030

 

Special Mention

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Classified

 

 

452

 

 

 

5,728

 

 

 

3,137

 

 

 

876

 

 

 

804

 

 

 

237

 

 

 

 

 

 

11,234

 

Total leases receivable

 

 

114,164

 

 

 

170,970

 

 

 

94,545

 

 

 

31,281

 

 

 

10,900

 

 

 

1,404

 

 

 

 

 

 

423,264

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass / Pass-Watch

 

 

1,502,486

 

 

 

753,938

 

 

 

661,862

 

 

 

519,885

 

 

 

515,045

 

 

 

524,447

 

 

 

185,358

 

 

 

4,663,021

 

Special Mention

 

 

20,630

 

 

 

6,993

 

 

 

13,996

 

 

 

3,610

 

 

 

15,539

 

 

 

15,763

 

 

 

447

 

 

 

76,978

 

Classified

 

 

452

 

 

 

10,146

 

 

 

15,555

 

 

 

17,312

 

 

 

51,690

 

 

 

40,240

 

 

 

4,774

 

 

 

140,169

 

Total loans receivable

 

$

1,523,568

 

 

$

771,077

 

 

$

691,413

 

 

$

540,807

 

 

$

582,274

 

 

$

580,450

 

 

$

190,579

 

 

$

4,880,168

 

 

(1)

Includes extensions, renewals, or modifications of credit contracts, which consist of a new credit decision. Certain prior period amounts have been reclassified to conform to current period presentation.

 

16


 

 

Loans by Vintage Year and Payment Performance

 

 

 

 

Term Loans

 

 

 

 

 

 

 

 

 

 

 

Amortized Cost Basis by Origination Year (1)

 

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

2019

 

 

2018

 

 

2017

 

 

Prior

 

 

Revolving

Loans

Amortized

Cost Basis

 

 

Total

 

 

 

(in thousands)

 

March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial property

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

$

248,282

 

 

$

831,333

 

 

$

523,557

 

 

$

481,467

 

 

$

337,960

 

 

$

828,069

 

 

$

40,980

 

 

$

3,291,648

 

Nonperforming

 

 

 

 

 

 

 

 

 

 

 

21

 

 

 

2,351

 

 

 

15,642

 

 

 

 

 

 

18,014

 

Total commercial property

 

 

248,282

 

 

 

831,333

 

 

 

523,557

 

 

 

481,488

 

 

 

340,311

 

 

 

843,711

 

 

 

40,980

 

 

 

3,309,662

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

11,659

 

 

 

27,263

 

 

 

 

 

 

 

 

 

 

 

 

12,658

 

 

 

 

 

 

51,580

 

Nonperforming

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11,046

 

 

 

 

 

 

11,046

 

Total construction

 

 

11,659

 

 

 

27,263

 

 

 

 

 

 

 

 

 

 

 

 

23,704

 

 

 

 

 

 

62,626

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential/consumer loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

12,640

 

 

 

26,795

 

 

 

947

 

 

 

33,956

 

 

 

118,347

 

 

 

126,730

 

 

 

7,093

 

 

 

326,508

 

Nonperforming

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,397

 

 

 

323

 

 

 

 

 

 

1,720

 

Total residential/consumer loans

 

 

12,640

 

 

 

26,795

 

 

 

947

 

 

 

33,956

 

 

 

119,744

 

 

 

127,053

 

 

 

7,093

 

 

 

328,228

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

272,581

 

 

 

885,391

 

 

 

524,504

 

 

 

515,423

 

 

 

456,307

 

 

 

967,457

 

 

 

48,073

 

 

 

3,669,736

 

Nonperforming

 

 

 

 

 

 

 

 

 

 

 

21

 

 

 

3,748

 

 

 

27,011

 

 

 

 

 

 

30,780

 

Total real estate loans

 

 

272,581

 

 

 

885,391

 

 

 

524,504

 

 

 

515,444

 

 

 

460,055

 

 

 

994,468

 

 

 

48,073

 

 

 

3,700,516

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

76,225

 

 

 

331,123

 

 

 

73,638

 

 

 

56,348

 

 

 

16,967

 

 

 

19,384

 

 

 

119,135

 

 

 

692,820

 

Nonperforming

 

 

 

 

 

 

 

 

890

 

 

 

3,906

 

 

 

9,199

 

 

 

258

 

 

 

 

 

 

14,253

 

Total commercial and industrial loans

 

 

76,225

 

 

 

331,123

 

 

 

74,528

 

 

 

60,254

 

 

 

26,166

 

 

 

19,642

 

 

 

119,135

 

 

 

707,073

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leases receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

34,174

 

 

 

107,408

 

 

 

148,515

 

 

 

79,816

 

 

 

24,719

 

 

 

4,906

 

 

 

 

 

 

399,538

 

Nonperforming

 

 

 

 

 

488

 

 

 

5,825

 

 

 

2,267

 

 

 

595

 

 

 

849

 

 

 

 

 

 

10,024

 

Total leases receivable

 

 

34,174

 

 

 

107,896

 

 

 

154,340

 

 

 

82,083

 

 

 

25,314

 

 

 

5,755

 

 

 

 

 

 

409,562

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

382,980

 

 

 

1,323,922

 

 

 

746,657

 

 

 

651,587

 

 

 

497,993

 

 

 

991,747

 

 

 

167,208

 

 

 

4,762,094

 

Nonperforming

 

 

 

 

 

488

 

 

 

6,715

 

 

 

6,194

 

 

 

13,542

 

 

 

28,118

 

 

 

 

 

 

55,057

 

Total loans receivable

 

$

382,980

 

 

$

1,324,410

 

 

$

753,372

 

 

$

657,781

 

 

$

511,535

 

 

$

1,019,865

 

 

$

167,208

 

 

$

4,817,151

 

 

17


 

 

 

 

Term Loans

 

 

 

 

 

 

 

 

 

 

 

Amortized Cost Basis by Origination Year (1)

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

2018

 

 

2017

 

 

2016

 

 

Prior

 

 

Revolving

Loans

Amortized

Cost Basis

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial property

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

$

934,556

 

 

$

519,582

 

 

$

495,132

 

 

$

347,656

 

 

$

437,230

 

 

$

499,410

 

 

$

31,283

 

 

$

3,264,849

 

Nonperforming

 

 

 

 

 

392

 

 

 

22

 

 

 

2,386

 

 

 

17,453

 

 

 

9,704

 

 

 

130

 

 

 

30,087

 

Total commercial property

 

 

934,556

 

 

 

519,974

 

 

 

495,154

 

 

 

350,042

 

 

 

454,683

 

 

 

509,114

 

 

 

31,413

 

 

 

3,294,936

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

33,415

 

 

 

613

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

34,028

 

Nonperforming

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,854

 

 

 

 

 

 

 

 

 

24,854

 

Total construction

 

 

33,415

 

 

 

613

 

 

 

 

 

 

 

 

 

24,854

 

 

 

 

 

 

 

 

 

58,882

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential/consumer loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

27,997

 

 

 

962

 

 

 

38,053

 

 

 

129,670

 

 

 

82,661

 

 

 

56,785

 

 

 

7,353

 

 

 

343,481

 

Nonperforming

 

 

 

 

 

 

 

 

 

 

 

1,405

 

 

 

301

 

 

 

644

 

 

 

 

 

 

2,350

 

Total residential/consumer loans

 

 

27,997

 

 

 

962

 

 

 

38,053

 

 

 

131,075

 

 

 

82,962

 

 

 

57,429

 

 

 

7,353

 

 

 

345,831

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

995,968

 

 

 

521,157

 

 

 

533,185

 

 

 

477,326

 

 

 

519,891

 

 

 

556,195

 

 

 

38,636

 

 

 

3,642,358

 

Nonperforming

 

 

 

 

 

392

 

 

 

22

 

 

 

3,791

 

 

 

42,608

 

 

 

10,348

 

 

 

130

 

 

 

57,291

 

Total real estate loans

 

 

995,968

 

 

 

521,549

 

 

 

533,207

 

 

 

481,117

 

 

 

562,499

 

 

 

566,543

 

 

 

38,766

 

 

 

3,699,649

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

413,436

 

 

 

77,668

 

 

 

59,726

 

 

 

19,002

 

 

 

8,875

 

 

 

12,227

 

 

 

151,813

 

 

 

742,747

 

Nonperforming

 

 

 

 

 

890

 

 

 

3,935

 

 

 

9,407

 

 

 

 

 

 

276

 

 

 

 

 

 

14,508

 

Total commercial and industrial loans

 

 

413,436

 

 

 

78,558

 

 

 

63,661

 

 

 

28,409

 

 

 

8,875

 

 

 

12,503

 

 

 

151,813

 

 

 

757,255

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leases receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

113,712

 

 

 

165,242

 

 

 

91,408

 

 

 

30,405

 

 

 

10,096

 

 

 

1,167

 

 

 

 

 

 

412,030

 

Nonperforming

 

 

452

 

 

 

5,728

 

 

 

3,137

 

 

 

876

 

 

 

804

 

 

 

237

 

 

 

 

 

 

11,234

 

Total leases receivable

 

 

114,164

 

 

 

170,970

 

 

 

94,545

 

 

 

31,281

 

 

 

10,900

 

 

 

1,404

 

 

 

 

 

 

423,264

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

1,523,116

 

 

 

764,067

 

 

 

684,319

 

 

 

526,733

 

 

 

538,862

 

 

 

569,589

 

 

 

190,449

 

 

 

4,797,135

 

Nonperforming

 

 

452

 

 

 

7,010

 

 

 

7,094

 

 

 

14,074

 

 

 

43,412

 

 

 

10,861

 

 

 

130

 

 

 

83,033

 

Total loans receivable

 

$

1,523,568

 

 

$

771,077

 

 

$

691,413

 

 

$

540,807

 

 

$

582,274

 

 

$

580,450

 

 

$

190,579

 

 

$

4,880,168

 

 

(2)

Includes extensions, renewals, or modifications of credit contracts, which consist of a new credit decision. Certain prior period amounts have been reclassified to conform to current period presentation.

 

At March 31, 2021, of the $116.4 million of loans modified in accordance with the provision of the CARES Act, $47.4 million were in pass and pass-watch, $50.8 million were special mention, and $18.2 million were classified. At December 31, 2020, of the $155.6 million of loans modified in accordance with the provision of the CARES Act, $99.9 million were in pass and pass-watch, $31.3 million were special mention, and $24.4 million were classified.

 

18


 

 

The following is an aging analysis of loans, disaggregated by loan class, as of the dates indicated:

 

 

 

30-59

Days

Past Due

 

 

60-89

Days

Past Due

 

 

90 Days

or More

Past Due

 

 

Total

Past Due

 

 

Current

 

 

Total

 

 

Accruing

90 Days

or More

Past Due

 

 

 

(in thousands)

 

March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial property

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail

 

$

1,517

 

 

$

 

 

$

 

 

$

1,517

 

 

$

810,066

 

 

$

811,583

 

 

$

 

Hospitality

 

 

 

 

 

 

 

 

5,873

 

 

 

5,873

 

 

 

836,141

 

 

 

842,014

 

 

 

 

Other

 

 

162

 

 

 

 

 

 

877

 

 

 

1,039

 

 

 

1,655,026

 

 

 

1,656,065

 

 

 

 

Total commercial property loans

 

 

1,679

 

 

 

 

 

 

6,750

 

 

 

8,429

 

 

 

3,301,233

 

 

 

3,309,662

 

 

 

 

Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

62,626

 

 

 

62,626

 

 

 

 

Residential/consumer loans

 

 

1,548

 

 

 

 

 

 

562

 

 

 

2,110

 

 

 

326,118

 

 

 

328,228

 

 

 

 

Total real estate loans

 

 

3,227

 

 

 

 

 

 

7,312

 

 

 

10,539

 

 

 

3,689,977

 

 

 

3,700,516

 

 

 

 

Commercial and industrial loans

 

 

119

 

 

 

890

 

 

 

12,905

 

 

 

13,914

 

 

 

693,159

 

 

 

707,073