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Loans and Lease Finance Receivables and Allowance for Credit Losses (Tables)

3 Months Ended

Mar. 31, 2021

Summary of Components of Loans and Lease Finance Receivables, Excluding PCI Loans

The following table provides a summary of total loans and lease finance receivables by type.


	March 31, 2021			December 31, 2020
	(Dollars in thousands)
Commercial real estate	$	5,596,781		$	5,501,509
Construction		96,356			85,145
SBA		307,727			303,896
SBA - Paycheck Protection Program (PPP)		897,724			882,986
Commercial and industrial		753,708			812,062
Dairy & livestock and agribusiness		261,088			361,146
Municipal lease finance receivables		42,349			45,547
SFR mortgage		255,400			270,511
Consumer and other loans		81,924			86,006

Total loans, at amortized cost		8,293,057			8,348,808
Less: Allowance for credit losses		(71,805	)		(93,692	)

Total loans and lease finance receivables, net	$	8,221,252		$	8,255,116

Summary of loans by type and origination year, according to our internal risk ratings


		Origination Year												Revolving loans amortized cost basis		Revolving loans converted to term loans
March 31, 2021		2021		2020		2019		2018		2017		Prior		Revolving loans amortized cost basis		Revolving loans converted to term loans		Total
	(Dollars in thousands)
Commercial real estate loans:
Risk Rating:
Pass		$	282,950	$	981,750	$	678,640	$	588,405	$	569,006	$	2,063,996	$	180,542	$	35,794	$	5,381,083
Special Mention			10,420		9,254		11,441		25,826		50,811		66,570		4,609		9,890		188,821
Substandard			-		-		479		2,156		9,064		14,347		500		331		26,877
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Commercial real estate loans:		$	293,370	$	991,004	$	690,560	$	616,387	$	628,881	$	2,144,913	$	185,651	$	46,015	$	5,596,781

Construction loans:
Risk Rating:
Pass		$	876	$	19,034	$	7,974	$	6,380	$	2,257	$	4	$	52,058	$	-	$	88,583
Special Mention			-		-		-		7,773		-		-		-		-		7,773
Substandard			-		-		-		-		-		-		-		-		-
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Construction loans:		$	876	$	19,034	$	7,974	$	14,153	$	2,257	$	4	$	52,058	$	-	$	96,356

SBA loans:
Risk Rating:
Pass		$	20,599	$	44,593	$	12,742	$	43,163	$	55,759	$	104,385	$	-	$	2,976	$	284,217
Special Mention			-		-		-		-		5,408		6,864		-		-		12,272
Substandard			-		-		-		876		5,145		5,217		-		-		11,238
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total SBA loans:		$	20,599	$	44,593	$	12,742	$	44,039	$	66,312	$	116,466	$	-	$	2,976	$	307,727

SBA - PPP loans:
Risk Rating:
Pass		$	314,940	$	581,281	$	-	$	-	$	-	$	-	$	-	$	-	$	896,221
Special Mention			-		-		-		-		-		-		-		-		-
Substandard			-		1,503		-		-		-		-		-		-		1,503
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total SBA - PPP loans:		$	314,940	$	582,784	$	-	$	-	$	-	$	-	$	-	$	-	$	897,724

Commercial and industrial loans:
Risk Rating:
Pass		$	31,474	$	100,585	$	147,772	$	59,414	$	50,335	$	97,792	$	219,271	$	6,303	$	712,946
Special Mention			486		1,781		1,881		1,732		856		4,798		10,485		247		22,266
Substandard			2,643		1,611		808		3,467		2,039		355		6,183		1,390		18,496
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Commercial and industrial loans:		$	34,603	$	103,977	$	150,461	$	64,613	$	53,230	$	102,945	$	235,939	$	7,940	$	753,708


		Origination Year												Revolving loans amortized cost basis		Revolving loans converted to term loans
March 31, 2021		2021		2020		2019		2018		2017		Prior		Revolving loans amortized cost basis		Revolving loans converted to term loans		Total
	(Dollars in thousands)
Dairy & livestock and agribusiness loans:
Risk Rating:
Pass		$	-	$	2,216	$	1,660	$	1,102	$	256	$	391	$	227,667	$	387	$	233,679
Special Mention			-		-		-		347		-		1,684		11,029		7,342		20,402
Substandard			-		-		-		259		-		-		-		6,748		7,007
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Dairy & livestock and agribusiness loans:		$	-	$	2,216	$	1,660	$	1,708	$	256	$	2,075	$	238,696	$	14,477	$	261,088

Municipal lease finance receivables loans:
Risk Rating:
Pass		$	-	$	8,217	$	-	$	2,556	$	10,248	$	20,916	$	-	$	-	$	41,937
Special Mention			-		-		-		-		-		412		-		-		412
Substandard			-		-		-		-		-		-		-		-		-
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Municipal lease finance receivables loans:		$	-	$	8,217	$	-	$	2,556	$	10,248	$	21,328	$	-	$	-	$	42,349

SFR mortgage loans:
Risk Rating:
Pass		$	7,745	$	61,021	$	53,148	$	27,117	$	20,857	$	81,721	$	2	$	-	$	251,611
Special Mention			-		-		-		-		-		195		-		-		195
Substandard			-		-		-		-		-		3,168		-		426		3,594
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total SFR mortgage loans:		$	7,745	$	61,021	$	53,148	$	27,117	$	20,857	$	85,084	$	2	$	426	$	255,400

Consumer and other loans:
Risk Rating:
Pass		$	2,618	$	7,558	$	1,833	$	778	$	878	$	2,157	$	61,735	$	1,791	$	79,348
Special Mention			975		-		-		-		-		90		516		-		1,581
Substandard			-		-		-		-		-		170		149		676		995
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Consumer and other loans:		$	3,593	$	7,558	$	1,833	$	778	$	878	$	2,417	$	62,400	$	2,467	$	81,924

Total Loans:
Risk Rating:
Pass		$	661,202	$	1,806,255	$	903,769	$	728,915	$	709,596	$	2,371,362	$	741,275	$	47,251	$	7,969,625
Special Mention			11,881		11,035		13,322		35,678		57,075		80,613		26,639		17,479		253,722
Substandard			2,643		3,114		1,287		6,758		16,248		23,257		6,832		9,571		69,710
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Loans:		$	675,726	$	1,820,404	$	918,378	$	771,351	$	782,919	$	2,475,232	$	774,746	$	74,301	$	8,293,057


		Origination Year												Revolving loans amortized cost basis		Revolving loans converted to term loans
December 31, 2020		2020		2019		2018		2017		2016		Prior		Revolving loans amortized cost basis		Revolving loans converted to term loans		Total
	(Dollars in thousands)
Commercial real estate loans:
Risk Rating:
Pass		$	979,499	$	691,091	$	607,753	$	617,640	$	550,105	$	1,646,876	$	192,583	$	24,548	$	5,310,095
Special Mention			9,332		7,162		30,049		43,870		17,398		49,840		5,720		994		164,365
Substandard			-		491		2,157		7,382		2,528		13,790		360		341		27,049
Doubtful & Loss			-		-		-		-		-		-		-		-		-
Total Commercial real estate loans:		$	988,831	$	698,744	$	639,959	$	668,892	$	570,031	$	1,710,506	$	198,663	$	25,883	$	5,501,509
Construction loans:
Risk Rating:
Pass		$	14,511	$	9,350	$	14,945	$	2,258	$	-	$	4	$	44,077	$	-	$	85,145
Special Mention			-		-		-		-		-		-		-		-		-
Substandard			-		-		-		-		-		-		-		-		-
Doubtful & Loss			-		-		-		-		-		-		-		-		-
Total Construction loans:		$	14,511	$	9,350	$	14,945	$	2,258	$	-	$	4	$	44,077	$	-	$	85,145
SBA loans:
Risk Rating:
Pass		$	47,901	$	12,821	$	44,950	$	58,839	$	26,136	$	86,085	$	-	$	2,976	$	279,708
Special Mention			-		-		-		5,446		1,336		5,648		-		-		12,430
Substandard			-		-		904		5,503		1,554		3,797		-		-		11,758
Doubtful & Loss			-		-		-		-		-		-		-		-		-
Total SBA loans:		$	47,901	$	12,821	$	45,854	$	69,788	$	29,026	$	95,530	$	-	$	2,976	$	303,896
SBA - PPP loans:
Risk Rating:
Pass		$	882,986	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	882,986
Special Mention			-		-		-		-		-		-		-		-		-
Substandard			-		-		-		-		-		-		-		-		-
Doubtful & Loss			-		-		-		-		-		-		-		-		-
Total SBA - PPP loans:		$	882,986	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	882,986
Commercial and industrial loans:
Risk Rating:
Pass		$	104,478	$	168,050	$	62,453	$	56,043	$	32,149	$	76,019	$	257,250	$	6,058	$	762,500
Special Mention			1,995		1,081		1,892		1,028		95		4,882		17,395		1,132		29,500
Substandard			4,346		860		3,996		2,282		285		94		6,677		1,522		20,062
Doubtful & Loss			-		-		-		-		-		-		-		-		-
Total Commercial and industrial loans:		$	110,819	$	169,991	$	68,341	$	59,353	$	32,529	$	80,995	$	281,322	$	8,712	$	812,062


		Origination Year												Revolving loans amortized cost basis		Revolving loans converted to term loans
December 31, 2020		2020		2019		2018		2017		2016		Prior		Revolving loans amortized cost basis		Revolving loans converted to term loans		Total
	(Dollars in thousands)
Dairy & livestock and agribusiness loans:
Risk Rating:
Pass		$	1,041	$	1,765	$	1,199	$	5,680	$	120	$	320	$	319,211	$	363	$	329,699
Special Mention			878		-		364		-		-		-		13,255		1,511		16,008
Substandard			-		-		784		693		2,285		-		-		11,677		15,439
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Dairy & livestock and agribusiness loans:		$	1,919	$	1,765	$	2,347	$	6,373	$	2,405	$	320	$	332,466	$	13,551	$	361,146

Municipal lease finance receivables loans:
Risk Rating:
Pass		$	8,478	$	-	$	2,556	$	10,249	$	3,586	$	20,266	$	-	$	-	$	45,135
Special Mention			-		-		-		-		-		412		-		-		412
Substandard			-		-		-		-		-		-		-		-		-
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Municipal lease finance receivables loans:		$	8,478	$	-	$	2,556	$	10,249	$	3,586	$	20,678	$	-	$	-	$	45,547

SFR mortgage loans:
Risk Rating:
Pass		$	65,463	$	59,596	$	29,142	$	22,452	$	27,192	$	62,593	$	3	$	-	$	266,441
Special Mention			-		-		-		-		-		452		-		-		452
Substandard			-		-		-		-		229		2,957		-		432		3,618
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total SFR mortgage loans:		$	65,463	$	59,596	$	29,142	$	22,452	$	27,421	$	66,002	$	3	$	432	$	270,511

Consumer and other loans:
Risk Rating:
Pass		$	8,557	$	2,077	$	871	$	969	$	1,586	$	961	$	67,774	$	1,688	$	84,483
Special Mention			-		-		-		-		-		91		517		22		630
Substandard			-		-		-		-		-		172		-		721		893
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Consumer and other loans:		$	8,557	$	2,077	$	871	$	969	$	1,586	$	1,224	$	68,291	$	2,431	$	86,006

Total Loans:
Risk Rating:
Pass		$	2,112,914	$	944,750	$	763,869	$	774,130	$	640,874	$	1,893,124	$	880,898	$	35,633	$	8,046,192
Special Mention			12,205		8,243		32,305		50,344		18,829		61,325		36,887		3,659		223,797
Substandard			4,346		1,351		7,841		15,860		6,881		20,810		7,037		14,693		78,819
Doubtful & Loss			-		-		-		-		-		-		-		-		-

Total Loans:		$	2,129,465	$	954,344	$	804,015	$	840,334	$	666,584	$	1,975,259	$	924,822	$	53,985	$	8,348,808

Schedule of Balance and Activity Related to Allowance for Loan Losses for Held-for-Investment Loans by Type

The following tables present the balance and activity related to the allowance for credit losses for

held-for-investment

loans by type for the periods presented.


	Three Months Ended March 31, 2021
	Ending Balance December 31, 2020		Charge-offs			Recoveries		(Recapture of) Provision for Credit Losses			Ending Balance March 31, 2021
	(Dollars in thousands)
Commercial real estate	$	75,439	$	-		$	-	$	(18,867	)	$	56,572
Construction		1,934		-			3		(59	)		1,878
SBA		2,992		-			4		(484	)		2,512
SBA - PPP		-		-			-		-			-
Commercial and industrial		7,142		(2,475	)		2		1,770			6,439
Dairy & livestock and agribusiness		3,949		-			-		(1,227	)		2,722
Municipal lease finance receivables		74		-			-		(39	)		35
SFR mortgage		367		-			79		(148	)		298
Consumer and other loans		1,795		-			-		(446	)		1,349

Total allowance for credit losses	$	93,692	$	(2,475	)	$	88	$	(19,500	)	$	71,805


	Three Months Ended March 31, 2020
	Ending Balance, prior to adoption of ASU 2016-13 December 31, 2019	Impact of Adoption of ASU 2016-13			Charge-offs			Recoveries		Provision for (Recapture of) Credit Losses			Ending Balance March 31, 2020
	(Dollars in thousands)
Commercial real estate	$48,629	$	3,547		$	-		$	-	$	6,251		$	58,427
Construction	858		655			-			3		3,116			4,632
SBA	1,453		1,818			-			-		675			3,946
Commercial and industrial	8,880		(2,442	)		-			2		2,947			9,387
Dairy & livestock and agribusiness	5,255		(186	)		-			-		(803	)		4,266
Municipal lease finance receivables	623		(416	)		-			-		70			277
SFR mortgage	2,339		(2,043	)		-			206		(221	)		281
Consumer and other loans	623		907			(86	)		16		(35	)		1,425

Total allowance for credit losses	$68,660	$	1,840		$	(86	)	$	227	$	12,000		$	82,641

Schedule of Recorded Investment in, and Aging of, Past Due and Nonaccrual Loans, Excluding PCI Loans by Class of Loans

The following table presents the recorded investment in, and the aging of, past due loans (including nonaccrual loans), by type of loans as of the dates presented.


	March 31, 2021
	30-59 Days Past Due		60-89 Days Past Due		Greater than 89 Days Past Due		Total Past Due		Loans Not Past Due		Total Loans and Financing Receivables
	(Dollars in thousands)
Commercial real estate
Owner occupied	$	-	$	211	$	6,934	$	7,145	$	2,165,178	$	2,172,323
Non-owner occupied		178		-		-		178		3,424,280		3,424,458
Construction
Speculative (1)		-		-		-		-		80,857		80,857
Non-speculative		-		-		-		-		15,499		15,499
SBA		258		-		1,028		1,286		306,441		307,727
SBA - PPP		-		-		-		-		897,724		897,724
Commercial and industrial		452		689		2,606		3,747		749,961		753,708
Dairy & livestock and agribusiness		-		-		259		259		260,829		261,088
Municipal lease finance receivables		-		-		-		-		42,349		42,349
SFR mortgage		266		-		229		495		254,905		255,400
Consumer and other loans		21		-		193		214		81,710		81,924

Total loans	$	1,175	$	900	$	11,249	$	13,324	$	8,279,733	$	8,293,057

(1)

Speculative construction loans are generally for properties where there is no identified buyer or renter.


	December 31, 2020
	30-59 Days Past Due		60-89 Days Past Due		Greater than 89 Days Past Due		Total Past Due		Loans Not Past Due		Total Loans and Financing Receivables
	(Dollars in thousands)
Commercial real estate
Owner occupied	$	-	$	-	$	7,208	$	7,208	$	2,136,051	$	2,143,259
Non-owner occupied		-		-		-		-		3,358,250		3,358,250
Construction
Speculative (1)		-		-		-		-		72,126		72,126
Non-speculative		-		-		-		-		13,019		13,019
SBA		531		2,415		1,025		3,971		299,925		303,896
SBA - PPP		-		-		-		-		882,986		882,986
Commercial and industrial		608		811		2,338		3,757		808,305		812,062
Dairy & livestock and agribusiness		-		-		784		784		360,362		361,146
Municipal lease finance receivables		-		-		-		-		45,547		45,547
SFR mortgage		-		-		229		229		270,282		270,511
Consumer and other loans		-		-		-		-		86,006		86,006

Total loans	$	1,139	$	3,226	$	11,584	$	15,949	$	8,332,859	$	8,348,808

(1)

Speculative construction loans are generally for properties where there is no identified buyer or renter.

Amortized cost of our finance receivables and loans that are on nonaccrual status, including loans with no allowance are presented as of March 31, 2021 and December 31, 2020 by type of loan.


	March 31, 2021
	Nonaccrual with No Allowance for Credit Losses		Total Nonaccrual (1)		Loans Past Due Over 89 Days Still Accruing
	(Dollars in thousands)
Commercial real estate
Owner occupied	$	7,395	$	7,395	$	-
Non-owner occupied		-		-		-
Construction
Speculative (2)		-		-		-
Non-speculative		-		-		-
SBA		2,076		2,412		-
SBA - PPP		-		-		-
Commercial and industrial		1,506		2,967		-
Dairy & livestock and agribusiness		-		259		-
Municipal lease finance receivables		-		-		-
SFR mortgage		424		424		-
Consumer and other loans		312		312		-

Total loans	$	11,713	$	13,769	$	-

(1)

As of March 31, 2021, $2.1 million of nonaccruing loans were current, $400,000 were

60-89

days past due, and $11.2 million were 90+ days past due.

(2)

Speculative construction loans are generally for properties where there is no identified buyer or renter.


	December 31, 2020
	Nonaccrual with No Allowance for Credit Losses		Total Nonaccrual (1)(3)		Loans Past Due Over 89 Days Still Accruing
	(Dollars in thousands)
Commercial real estate
Owner occupied	$	7,563	$	7,563	$	-
Non-owner occupied		-		-		-
Construction
Speculative (2)		-		-		-
Non-speculative		-		-		-
SBA		2,035		2,273		-
SBA - PPP		-		-		-
Commercial and industrial		1,576		3,129		-
Dairy & livestock and agribusiness		785		785		-
Municipal lease finance receivables		430		-		-
SFR mortgage		-		430		-
Consumer and other loans		167		167		-

Total loans	$	12,556	$	14,347	$	-

(1)

As of December 31, 2020, $1.4 million of nonaccruing loans were current, $2,000 were

30-59

days past due, $1.3 million were

60-89

days past due, and $11.6 million were 90+ days past due.

(2)

Speculative construction loans are generally for properties where there is no identified buyer or renter.

(3)

Excludes $184,000 of guaranteed portion of nonaccrual SBA loans that are in process of collection.

Summary of pledged assets not separately reported on statement of financial position

The following table presents the recorded investment in collateral-dependent loans by type of loans as of the dates presented.


	March 31, 2021						Number of Loans Dependent on Collateral
	Real Estate		Business Assets		Other		Number of Loans Dependent on Collateral
	(Dollars in thousands)
Commercial real estate	$	7,689	$	-	$	-		8
Construction		-		-		-		11
SBA		1,826		418		168		-
SBA - PPP		-		-		-		-
Commercial and industrial		421		7,708		143		21
Dairy & livestock and agribusiness		-		259		-		1
Municipal lease finance receivables		-		-		-		-
SFR mortgage		424		-		-		2
Consumer and other loans		312		-		-		3

Total collateral-dependent loans	$	10,672	$	8,385	$	311		46


	December 31, 2020						Number of Loans Dependent on Collateral
	Real Estate		Business Assets		Other		Number of Loans Dependent on Collateral
	(Dollars in thousands)
Commercial real estate	$	7,883	$	-	$	-		8
Construction		-		-		-		-
SBA		1,761		326		185		10
SBA - PPP		-		-		-		-
Commercial and industrial		470		5,542		95		18
Dairy & livestock and agribusiness		-		785		-		1
Municipal lease finance receivables		-		-		-		-
SFR mortgage		430		-		-		2
Consumer and other loans		168		-		-		2

Total collateral-dependent loans	$	10,712	$	6,653	$	280		41

Summary of Activity Related to Troubled Debt Restructurings

The following table provides a summary of the activity related to TDRs for the periods presented.


	Three Months Ended
	March 31,
	2021			2020
	(Dollars in thousands)
Performing TDRs:
Beginning balance	$	2,159		$	3,112
New modifications		4,643			-
Payoffs/payments, net and other		(989	)		(299	)
TDRs returned to accrual status		-			-
TDRs placed on nonaccrual status		-			-

Ending balance	$	5,813		$	2,813

Nonperforming TDRs:
Beginning balance	$	-		$	244
New modifications		-			-
Charge-offs		-			-
Payoffs/payments, net and other		-			(244	)
TDRs returned to accrual status		-			-
TDRs placed on nonaccrual status		-			-

Ending balance	$	-		$	-

Total TDRs	$	5,813		$	2,813

Summary of Loans Modified as Troubled Debt Restructurings

Modifications (1)


	For the Three Months Ended March 31, 2021
	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Outstanding Recorded Investment at March 31, 2021		Financial Effect Resulting From Modifications (2)
	(Dollars in thousands)
Commercial real estate:
Interest rate reduction		-	$	-	$	-	$	-	$	-
Change in amortization period or maturity		-		-		-		-		-
Commercial and industrial:
Interest rate reduction		-		-		-		-		-
Change in amortization period or maturity		2		4,643		4,643		4,443		-
SFR mortgage:
Interest rate reduction		-		-		-		-		-
Change in amortization period or maturity		-		-		-		-		-

Total loans		2	$	4,643	$	4,643	$	4,443	$	-

(1)

The tables above exclude modified loans that were paid off prior to the end of the period.

(2)

Financial effects resulting from modifications represent charge-offs and current allowance for credit losses at modification date.