Hanmi Financial Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Loans (Tables)

Loans (Tables)

9 Months Ended

Sep. 30, 2014

Loans receivable consisted of the following as of the dates indicated:


	September 30, 2014								December 31,
	Non-PCI Loans			PCI Loans		Total			2013
	(In thousands)
Real estate loans:

Commercial property ⁽¹⁾
Retail	$	635,861		$	15,940	$	651,801		$	543,619
Hotel/Motel		452,405			14,206		466,611			322,927
Gas station		340,386			18,069		358,455			292,557
Other		805,696			15,715		821,411			731,617
Construction		4,146			—		4,146			—
Residential property		106,044			2,686		108,730			79,078

Total real estate loans		2,344,538			66,616		2,411,154			1,969,798
Commercial and industrial loans:
Commercial term		119,175			350		119,525			124,391
Commercial lines of credit		75,246			—		75,246			71,042
International loans		41,127			—		41,127			36,353

Total commercial and industrial loans		235,548			350		235,898			231,786
Consumer loans		28,849			58		28,907			32,505

Total gross loans		2,608,935			67,024		2,675,959			2,234,089
Allowance for loans losses		(51,179	)		—		(51,179	)		(57,555	)
Deferred loan costs		3,311			—		3,311			964

Loans receivable, net	$	2,561,067		$	67,024	$	2,628,091		$	2,177,498

⁽¹⁾

Includes owner-occupied property loans of $1.10 billion and $957.3 million as of September 30, 2014 and December 31, 2013, respectively.

Loans Receivable to Loans Held for Sale

The following table details the information on the sales and reclassifications of loans receivable to loans held for sale (excluding PCI loans) by portfolio segment for the three months ended September 30, 2014 and 2013:


	Real Estate			Commercial and Industrial			Consumer		Total Non-PCI
	(In thousands)
September 30, 2014
Balance at beginning of period	$	2,568		$	1,274		$	—	$	3,842
Origination of loans held for sale		15,198			3,031			—		18,229
Sales of loans held for sale		(12,135	)		(2,133	)		—		(14,268	)
Principal payoffs and amortization		(20	)		(26	)		—		(46	)

Balance at end of period	$	5,611		$	2,146		$	—	$	7,757


September 30, 2013
Balance at beginning of period	$	2,137		$	416		$	—	$	2,553
Origination of loans held for sale		15,634			1,501			—		17,135
Reclassification from loans held for sale to loans receivable		(2,118	)		(416	)		—		(2,534	)
Sales of loans held for sale		(10,725	)		(1,181	)		—		(11,906	)
Principal payoffs and amortization		(20	)		—			—		(20	)

Balance at end of period	$	4,908		$	320		$	—	$	5,228

The following table details the information on the sales and reclassifications of loans receivable to loans held for sale (excluding PCI loans) by portfolio segment for the nine months ended September 30, 2014 and 2013:


	Real Estate			Commercial and Industrial			Consumer		Total Non-PCI
	(In thousands)
September 30, 2014
Balance at beginning of period	$	—		$	—		$	—	$	—
Origination of loans held for sale		29,591			5,207			—		34,798
Sales of loans held for sale		(23,953	)		(3,033	)		—		(26,986	)
Principal payoffs and amortization		(27	)		(28	)		—		(55	)

Balance at end of period	$	5,611		$	2,146		$	—	$	7,757


September 30, 2013
Balance at beginning of period	$	7,977		$	329		$	—	$	8,306
Origination of loans held for sale		58,725			4,387			—		63,112
Reclassification from loans receivable to loans held for sale		7,593			416			—		8,009
Reclassification from loans held for sale to loans receivable		(2,118	)		(416	)		—		(2,534	)
Sales of loans held for sale		(67,235	)		(4,391	)		—		(71,626	)
Principal payoffs and amortization		(34	)		(5	)		—		(39	)

Balance at end of period	$	4,908		$	320		$	—	$	5,228

Allowance for Non-PCI Losses and Allowance for Off-Balance Sheet Items

Activity in the allowance for loan losses and allowance for off-balance sheet items was as follows for the periods indicated:


	As of and for the Three Months Ended						As of and for the Nine Months Ended
	September 30, 2014			September 30, 2013			September 30, 2014			September 30, 2013
	(In thousands)
Allowance for loan losses:
Balance at beginning of period	$	51,886		$	59,876		$	57,555		$	63,305
Charge-offs		(1,418	)		(4,610	)		(5,569	)		(11,124	)
Recoveries on loans previously charged off		663			2,383			6,656			4,964

Net loan (charge-offs) recoveries		(755	)		(2,227	)		1,087			(6,160	)
Provision (negative provision) charged to operating expense		48			(10	)		(7,463	)		494

Balance at end of period	$	51,179		$	57,639		$	51,179		$	57,639


Allowance for off-balance sheet items:
Balance at beginning of period	$	1,592		$	1,320		$	1,247		$	1,824
(Negative provision) provision charged to operating expense		(48	)		10			297			(494	)

Balance at end of period	$	1,544		$	1,330		$	1,544		$	1,330

Allowance for Loan Losses by Portfolio Segment

The following table details the information on the allowance for loan losses by portfolio segment for the three months ended September 30, 2014 and 2013:


	Real Estate			Commercial and Industrial			Consumer			Unallocated			Total
	(In thousands)
September 30, 2014
Allowance for loan losses:
Beginning balance	$	40,303		$	9,738		$	540		$	1,305		$	51,886
Charge-offs		(884	)		(499	)		(35	)		—			(1,418	)
Recoveries on loans previously charged off		293			365			5			—			663
(Negative provision) provision		179			260			(186	)		(205	)		48

Ending balance	$	39,891		$	9,864		$	324		$	1,100		$	51,179

Ending balance: individually evaluated for impairment	$	2,027		$	3,757		$	—		$	—		$	5,784

Ending balance: collectively evaluated for impairment	$	37,864		$	6,107		$	324		$	1,100		$	45,395

Loans receivable:
Ending balance	$	2,411,154		$	235,898		$	28,907		$	—		$	2,675,959

Ending balance: individually evaluated for impairment	$	35,654		$	11,970		$	1,758		$	—		$	49,382

Ending balance: collectively evaluated for impairment	$	2,308,884		$	223,578		$	27,091		$	—		$	2,559,553

Ending balance: acquired with deteriorated credit quality	$	66,616		$	350		$	58		$	—		$	67,024


	Real Estate			Commercial and Industrial			Consumer			Unallocated		Total
	(In thousands)
September 30, 2013
Allowance for loan losses:
Beginning balance	$	46,396		$	11,118		$	1,884		$	478	$	59,876
Charge-offs		(1,017	)		(3,575	)		(18	)		—		(4,610	)
Recoveries on loans previously charged off		1,641			737			5			—		2,383
Provision (negative provision)		(1,795	)		388			(232	)		1,629		(10	)

Ending balance	$	45,225		$	8,668		$	1,639		$	2,107	$	57,639

Ending balance: individually evaluated for impairment	$	564		$	1,475		$	330		$	—	$	2,369

Ending balance: collectively evaluated for impairment	$	44,661		$	7,193		$	1,309		$	2,107	$	55,270

Loans receivable:
Ending balance	$	1,921,659		$	203,547		$	34,065		$	—	$	2,159,271

Ending balance: individually evaluated for impairment	$	29,424		$	12,468		$	1,574		$	—	$	43,466

Ending balance: collectively evaluated for impairment	$	1,892,235		$	191,079		$	32,491		$	—	$	2,115,805

The following table details the information on the allowance for loan losses by portfolio segment for the nine months ended September 30, 2014 and 2013:


	Real Estate			Commercial and Industrial			Consumer			Unallocated			Total
	(In thousands)
September 30, 2014
Allowance for loan losses:
Beginning balance	$	43,550		$	11,287		$	1,427		$	1,291		$	57,555
Charge-offs		(2,073	)		(3,394	)		(102	)		—			(5,569	)
Recoveries on loans previously charged off		3,298			3,338			20			—			6,656
(Negative provision) provision		(4,884	)		(1,367	)		(1,021	)		(191	)		(7,463	)

Ending balance	$	39,891		$	9,864		$	324		$	1,100		$	51,179

Ending balance: individually evaluated for impairment	$	2,027		$	3,757		$	—		$	—		$	5,784

Ending balance: collectively evaluated for impairment	$	37,864		$	6,107		$	324		$	1,100		$	45,395

Loans receivable:
Ending balance	$	2,411,154		$	235,898		$	28,907		$	—		$	2,675,959

Ending balance: individually evaluated for impairment	$	35,654		$	11,970		$	1,758		$	—		$	49,382

Ending balance: collectively evaluated for impairment	$	2,308,884		$	223,578		$	27,091		$	—		$	2,559,553

Ending balance: acquired with deteriorated credit quality	$	66,616		$	350		$	58		$	—		$	67,024


	Real Estate			Commercial and Industrial			Consumer			Unallocated		Total
	(In thousands)
September 30, 2013
Allowance for loan losses:
Beginning balance	$	49,472		$	10,636		$	2,280		$	917	$	63,305
Charge-offs		(4,592	)		(6,314	)		(218	)		—		(11,124	)
Recoveries on loans previously charged off		2,923			1,981			60			—		4,964
Provision (negative provision)		(2,578	)		2,365			(483	)		1,190		494

Ending balance	$	45,225		$	8,668		$	1,639		$	2,107	$	57,639

Ending balance: individually evaluated for impairment	$	564		$	1,475		$	330		$	—	$	2,369

Ending balance: collectively evaluated for impairment	$	44,661		$	7,193		$	1,309		$	2,107	$	55,270

Loans receivable:
Ending balance	$	1,921,659		$	203,547		$	34,065		$	—	$	2,159,271

Ending balance: individually evaluated for impairment	$	29,424		$	12,468		$	1,574		$	—	$	43,466

Ending balance: collectively evaluated for impairment	$	1,892,235		$	191,079		$	32,491		$	—	$	2,115,805

Analysis of Past Due Loans, Disaggregated by Loan Class

The following is an aging analysis of past due loans (excluding PCI loans), disaggregated by loan class, as of the dates indicated:


	As of September 30, 2014
	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)
Real estate loans:
Commercial property
Retail	$	1,927	$	146	$	182	$	2,255	$	633,606	$	635,861	$	—
Hotel/Motel		52		733		1,203		1,988		450,417		452,405		—
Gas station		4,781		794		544		6,119		334,267		340,386		—
Other		1,867		67		380		2,314		803,382		805,696		15
Construction		—		—		—		—		4,146		4,146		—
Residential property		113		121		486		720		105,324		106,044		—
Commercial and industrial loans:
Commercial term		1,410		587		2,873		4,870		114,305		119,175		—
Commercial lines of credit		274		197		—		471		74,775		75,246		—
International loans		251		—		—		251		40,876		41,127		—
Consumer loans		—		—		248		248		28,601		28,849		—

Total Non-PCI loans	$	10,675	$	2,645	$	5,916	$	19,236	$	2,589,699	$	2,608,935	$	15


	As of December 31, 2013
	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)
Real estate loans:
Commercial property
Retail	$	202	$	426	$	2,196	$	2,824	$	540,794	$	543,618	$	—
Hotel/Motel		1,087		—		1,532		2,619		320,308		322,927		—
Gas station		141		410		153		704		291,853		292,557		—
Other		423		2,036		839		3,298		728,320		731,618		—
Residential property		—		122		279		401		78,677		79,078		—
Commercial and industrial loans:
Commercial term		1,443		886		3,269		5,598		118,793		124,391		—
Commercial lines of credit		—		150		250		400		70,642		71,042		—
International loans		—		—		—		—		36,353		36,353		—
Consumer loans		311		42		77		430		32,075		32,505		—

Total Non-PCI loans	$	3,607	$	4,072	$	8,595	$	16,274	$	2,217,815	$	2,234,089	$	—

Information on Impaired Loans, Disaggregated by Loan Class

The following tables provide information on impaired loans (excluding PCI loans), disaggregated by loan class, as of the dates indicated:


	Recorded Investment		Unpaid Principal Balance		With No Related Allowance Recorded		With an Allowance Recorded		Related Allowance
	(In thousands)
September 30, 2014
Real estate loans:
Commercial property
Retail	$	4,443	$	4,543	$	1,940	$	2,503	$	256
Hotel/Motel		4,042		4,855		4,042		—		1,261
Gas station		14,152		14,681		13,692		460		166
Other		9,856		11,266		8,518		1,338		344
Residential property		3,161		3,292		3,161		—		—
Commercial and industrial loans:
Commercial term		7,958		8,408		1,914		6,044		3,469
Commercial lines of credit		2,874		2,976		2,692		182		183
International loans		1,138		1,138		460		678		105
Consumer loans		1,758		1,910		1,758		—		—

Total Non-PCI loans	$	49,382	$	53,069	$	38,177	$	11,205	$	5,784


December 31, 2013
Real estate loans:
Commercial property
Retail	$	6,244	$	6,332	$	3,767	$	2,477	$	305
Hotel/Motel		6,200		6,940		4,668		1,532		1,183
Gas station		9,389		9,884		8,592		797		209
Other		11,451		12,882		9,555		1,896		351
Residential property		2,678		2,773		2,678		—		—
Commercial and industrial loans:
Commercial term		13,834		14,308		2,929		10,905		3,806
Commercial lines of credit		614		686		173		441		252
International loans		1,087		1,087		286		801		78
Consumer loans		1,569		1,671		644		925		284

Total Non-PCI loans	$	53,066	$	56,563	$	33,292	$	19,774	$	6,468


	Average Recorded Investment for the Three Months Ended		Interest Income Recognized for the Three Months Ended		Average Recorded Investment for the Nine Months Ended		Interest Income Recognized for the Nine Months Ended
	(In thousands)
September 30, 2014
Real estate loans:
Commercial property
Retail	$	4,456	$	36	$	5,682	$	215
Hotel/Motel		4,206		102		4,149		232
Gas station		14,181		218		12,023		587
Other		9,898		232		10,716		682
Residential property		3,173		30		2,853		87
Commercial and industrial loans:
Commercial term		8,118		126		10,007		443
Commercial lines of credit		2,884		36		1,447		61
International loans		1,146		—		1,136		—
Consumer loans		1,765		16		1,619		46

Total Non-PCI loans	$	49,827	$	796	$	49,632	$	2,353


September 30, 2013
Real estate loans:
Commercial property
Retail	$	2,723	$	27	$	3,703	$	105
Hotel/Motel		6,377		127		4,752		384
Gas station		8,777		229		8,775		569
Other		8,699		243		9,512		779
Residential property		2,992		33		3,026		92
Commercial and industrial loans:
Commercial term		10,581		191		12,751		692
Commercial lines of credit		840		23		1,137		47
International loans		1,197		—		1,342		—
Consumer loans		1,581		27		1,624		54

Total Non-PCI loans	$	43,767	$	900	$	46,622	$	2,722

Summary of Interest Foregone on Impaired Loans

The following is a summary of interest foregone on impaired loans (excluding PCI loans) for the periods indicated:


	Three Months Ended						Nine Months Ended
	September 30, 2014			September 30, 2013			September 30, 2014			September 30, 2013
	(In thousands)
Interest income that would have been recognized had impaired loans performed in accordance with their original terms	$	1,063		$	1,058		$	3,490		$	3,183
Less: Interest income recognized on impaired loans		(796	)		(900	)		(2,353	)		(2,722	)

Interest foregone on impaired loans	$	267		$	158		$	1,137		$	461

Non-Accrual Loans, Disaggregated by Loan Class

The following table details nonaccrual loans (excluding PCI loans), disaggregated by loan class, as of the dates indicated:


	September 30, 2014		December 31, 2013
	(In thousands)
Real estate loans:
Commercial property
Retail	$	2,062	$	2,946
Hotel/Motel		3,051		5,200
Gas station		5,208		2,492
Other		3,674		4,808
Residential property		1,516		1,365
Commercial and industrial loans:
Commercial term		6,060		7,146
Commercial lines of credit		674		423
Consumer loans		1,758		1,497

Total nonaccrual Non-PCI loans	$	24,003	$	25,877

Non-Performing Assets

The following table details nonperforming assets (excluding PCI loans) as of the dates indicated:


	September 30, 2014		December 31, 2013
	(In thousands)
Nonaccrual Non-PCI loans	$	24,003	$	25,877
Loans 90 days or more past due and still accruing		15		—

Total nonperforming Non-PCI loans		24,018		25,877
Other real estate owned		24,781		756

Total nonperforming assets	$	48,799	$	26,633

Troubled Debt Restructurings, Disaggregated by Type of Concession and by Loan Type

The following table details troubled debt restructurings (excluding PCI loans), disaggregated by concession type and by loan type, as of September 30, 2014 and December 31, 2013:


	Nonaccrual TDRs										Accrual TDRs
	Deferral of Principal		Deferral of Principal and Interest		Reduction of Principal and Interest		Extension of Maturity		Total		Deferral of Principal		Deferral of Principal and Interest		Reduction of Principal and Interest		Extension of Maturity		Total
	(In thousands)
September 30, 2014
Real estate loans:
Commercial property
Retail	$	—	$	—	$	—	$	1,856	$	1,856	$	307	$	—	$	—	$	—	$	307
Hotel/Motel		1,158		727		—		—		1,885		991		—		—		—		991
Gas station		1,106		—		—		—		1,106		2,351		—		—		—		2,351
Other		—		1,532		465		59		2,056		3,310		—		792		1,378		5,480
Residential property		755		—		—		—		755		—		—		—		311		311
Commercial and industrial loans:
Commercial term		118		2		1,007		1,567		2,694		61		227		2,118		1,176		3,582
Commercial lines of credit		230		—		316		128		674		2,200		—		—		—		2,200
Consumer loans		—		—		135		—		135		—		—		—		—		—

Total Non-PCI loans	$	3,367	$	2,261	$	1,923	$	3,610	$	11,161	$	9,220	$	227	$	2,910	$	2,865	$	15,222


December 31, 2013
Real estate loans:
Commercial property
Retail	$	—	$	—	$	—	$	750	$	750	$	—	$	—	$	—	$	474	$	474
Hotel/Motel		1,272		758		—		—		2,030		1,000		—		—		—		1,000
Gas station		1,291		—		729		—		2,020		365		—		—		2,609		2,974
Other		403		1,279		555		—		2,237		2,956		—		1,253		2,027		6,236
Residential property		795		—		—		—		795		—		—		—		—		—
Commercial and industrial loans:
Commercial term		25		206		1,449		851		2,531		1,203		—		2,286		3,817		7,306
Commercial lines of credit		—		—		—		173		173		—		—		191		—		191
International loans		—		—		—		—		—		—		—		1,087		—		1,087
Consumer loans		—		—		—		—		—		—		—		149		—		149

Total Non-PCI loans	$	3,786	$	2,243	$	2,733	$	1,774	$	10,536	$	5,524	$	—	$	4,966	$	8,927	$	19,417

Troubled Debt Restructurings, Disaggregated by Loan Class

The following table details troubled debt restructurings (excluding PCI loans), disaggregated by loan class, for the three months ended September 30, 2014 and 2013:


	September 30, 2014						September 30, 2013
	Number of Loans		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Number of Loans		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
	(In thousands, except number of loans)
Real estate loans:
Commercial property
Hotel/Motel ⁽¹⁾		—	$	—	$	—		1	$	1,000	$	1,000
Gas station ⁽²⁾		1		2,014		1,991		1		107		91
Other ⁽³⁾		1		395		385		2		1,011		1,014
Commercial and industrial loans:
Commercial term ⁽⁴⁾		—		—		—		8		1,015		1,002
Commercial lines of credit ⁽⁵⁾		1		2,092		2,200		—		—		—

Total Non-PCI loans		3	$	4,501	$	4,576		12	$	3,133	$	3,107

⁽¹⁾

Includes a modification of $1.0 million through a payment deferral for the three months ended September 30, 2013.

⁽²⁾

Includes a modification of $2.0 million through a payment deferral for the three months ended September 30, 2014, and a modification of $91,000 through a payment deferral for the three months ended September 30, 2013.

⁽³⁾

Includes a modification of $385,000 through a payment deferral for the three months ended September 30, 2014, and modifications of $365,000 through a payment deferral and reduction of principal or accrued interest and $649,000 through an extension of maturity for the three months ended September 30, 2013.

⁽⁴⁾

Includes modifications of $381,000 through payment deferrals and $621,000 through extensions of maturity for the three months ended September 30, 2013.

⁽⁵⁾

Includes a modification of $2.2 million through a payment deferral for the three months ended September 30, 2014.

The following table details troubled debt restructurings (excluding PCI loans), disaggregated by loan class, for the nine months ended September 30, 2014 and 2013:


	September 30, 2014						September 30, 2013
	Number of Loans		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Number of Loans		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
	(In thousands, except number of loans)
Real estate loans:
Commercial property
Retail ⁽¹⁾		1	$	2,002	$	1,856		—	$	—	$	—
Hotel/Motel ⁽²⁾		—		—		—		1		1,000		1,000
Gas station ⁽³⁾		1		2,040		1,991		1		113		91
Other ⁽⁴⁾		3		1,422		1,386		3		1,176		1,144
Residential property ⁽⁵⁾		1		317		311		—		—		—
Commercial and industrial loans:
Commercial term ⁽⁶⁾		5		327		263		15		1,787		1,625
Commercial lines of credit ⁽⁷⁾		3		2,366		2,563		—		—		—
International loans ⁽⁸⁾		—		—		—		2		1,584		1,180
Consumer loans ⁽⁹⁾		—		—		—		1		149		149

Total Non-PCI loans		14	$	8,474	$	8,370		23	$	5,809	$	5,189

⁽¹⁾

Includes a modification of $1.9 million through an extension of maturity for the nine months ended September 30, 2014.

⁽²⁾

Includes a modification of $1.0 million through an extension of maturity for the nine months ended September 30, 2013.

⁽³⁾

Includes a modification of $2.0 million through a payment deferral for the nine months ended September 30, 2014, and a modification of $91,000 a payment deferral for the nine months ended September 30, 2013.

⁽⁴⁾

Includes modifications of $1.3 million through payment deferrals and $59,000 through an extension of maturity for the nine months ended September 30, 2014, and modifications of $356,000 through a payment deferral, $130,000 through a reduction of principal or accrued interests and $649,000 through an extension of maturity for the nine months ended September 30, 2013.

⁽⁵⁾

Includes a modification of $311,000 through an extension of maturity for the nine months ended September 30, 2014.

⁽⁶⁾

Includes modifications of $39,000 through a payment deferral, $51,000 through reductions of principal or accrued interest and $173,000 through an extension of maturity for the nine months ended September 30, 2014, and modifications of $388,000 through payment deferrals and $1.2 million through extensions of maturity for the nine months ended September 30, 2013.

⁽⁷⁾

Includes modifications of $2.4 million through payment deferrals and $134,000 through a reduction of principal or accrued interest for the nine months ended September 30, 2014.

⁽⁸⁾

Includes modifications of $1.2 million through reductions of principal or accrued interest for the nine months ended September 30, 2013.

⁽⁹⁾

Includes a modification of $149,000 through a reduction of principal or accrued interest for the nine months ended September 30, 2013.

Troubled Debt Restructurings that Defaulted Subsequent to Modifications Occurring Within Previous Twelve Months, Disaggregated by Loan Class

The following table details troubled debt restructurings, excluding PCI loans, that defaulted subsequent to the modifications occurring within the previous twelve months, disaggregated by loan class, for the three and nine months ended September 30, 2014 and 2013, respectively:


	Three Months Ended								Nine Months Ended
	September 30, 2014				September 30, 2013				September 30, 2014				September 30, 2013
	Number of Loans		Recorded Investment		Number of Loans		Recorded Investment		Number of Loans		Recorded Investment		Number of Loans		Recorded Investment
	(In thousands, except number of loans)
Real estate loans:
Commercial property
Retail		1	$	1,856		—	$	—		1	$	1,856		—	$	—
Other		—		—		1		130		—		—		1		130
Commercial and industrial loans:
Commercial term		2		47		—		—		2		47		1		29
Commercial lines of credit		2		412		—		—		3		546		—		—

Total Non-PCI loans		5	$	2,315		1	$	130		6	$	2,449		2	$	159

Schedule of Changes in Outstanding Balance and Carrying Amount of PCI Loans

The following table presents the outstanding balance and carrying amount of those PCI loans as of the dates indicated:


	Carrying Amount			Accretable Yield
	(In thousands)
Balance at January 1, 2014	$	—		$	—
Additions from CBI acquisition at August 31, 2014		75,878			(22,858	)
Accretion		491			491
Payment received		(5,892	)		—
Disposals/transfers to OREO		(3,453	)		212

Balance at September 30, 2014	$	67,024		$	(22,155	)

As of September 30, 2014, pass/pass-watch (grade 0-4), criticized (grade 5) and classified (grade 6-7) PCI loans, disaggregated by loan class, were as follows:

Changes in Servicing Assets

The changes in servicing assets for the nine months ended September 30, 2014 and 2013 were as follows:


	Nine Months Ended September 30,
	2014			2013
	(In thousands)
Balance at beginning of period	$	6,833		$	5,542
Additions from CBI acquisition		1,458			—
Addition related to sale of SBA loans		871			1,996
Amortization		(1,318	)		(1,152	)

Balance at end of period	$	7,844		$	6,386

Non-PCI Loans [Member]

Credit Quality of Loan Portfolio

As of September 30, 2014 and December 31, 2013, pass/pass-watch (grade 0-4), criticized (grade 5) and classified (grade 6-7) loans (excluding PCI loans), disaggregated by loan class, were as follows:


	As of September 30, 2014
	Pass/Pass-Watch (Grade 0-4)		Criticized (Grade 5)		Classified (Grade 6-7)		Total
	(In thousands)
Real estate loans:
Commercial property
Retail	$	620,511	$	12,821	$	2,529	$	635,861
Hotel/Motel		399,006		48,995		4,404		452,405
Gas station		320,501		10,054		9,831		340,386
Other		780,400		13,599		11,697		805,696
Construction		4,146		—		—		4,146
Residential property		103,812		122		2,110		106,044
Commercial and industrial loans:
Commercial term		108,908		1,315		8,952		119,175
Commercial lines of credit		74,286		—		960		75,246
International loans		38,676		—		2,451		41,127
Consumer loans		26,626		140		2,083		28,849

Total Non-PCI loans	$	2,476,872	$	87,046	$	45,017	$	2,608,935


	As of December 31, 2013
	Pass/Pass-Watch (Grade 0-4)		Criticized (Grade 5)		Classified (Grade 6-7)		Total
	(In thousands)
Real estate loans:
Commercial property
Retail	$	531,014	$	5,309	$	7,296	$	543,619
Hotel/Motel		308,483		1,796		12,648		322,927
Gas station		279,636		3,104		9,817		292,557
Other		690,481		8,524		32,612		731,617
Residential property		77,422		—		1,656		79,078
Commercial and industrial loans:
Commercial term		107,712		2,007		14,672		124,391
Commercial lines of credit		69,823		—		1,219		71,042
International loans		35,777		576		—		36,353
Consumer loans		30,044		163		2,298		32,505

Total Non-PCI loans	$	2,130,392	$	21,479	$	82,218	$	2,234,089

PCI Loans [Member]

Credit Quality of Loan Portfolio

As of September 30, 2014, pass/pass-watch (grade 0-4), criticized (grade 5) and classified (grade 6-7) PCI loans, disaggregated by loan class, were as follows:


	As of September 30, 2014
	Pass/Pass-Watch (Grade 0-4)		Criticized (Grade 5)		Classified (Grade 6-7)		Total
Real estate loans:
Commercial property
Retail	$	2,939	$	215	$	12,786	$	15,940
Hotel/Motel		248		—		13,958		14,206
Gas station		10,200		1,205		6,664		18,069
Other		2,154		—		13,561		15,715
Residential property		—		—		2,686		2,686
Commercial and industrial loans:
Commercial term		—		—		350		350
Consumer loans		—		—		58		58

Total PCI loans	$	15,541	$	1,420	$	50,063	$	67,024