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

3 Months Ended

Mar. 31, 2022

Receivables [Abstract]

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, 2022				December 31, 2021
	(Dollars in thousands)

Commercial real estate	$	6,470,841			$	5,789,730
Construction		73,478				62,264
SBA		311,238				288,600
SBA - Paycheck Protection Program (PPP)		121,189				186,585
Commercial and industrial		924,780				813,063
Dairy & livestock and agribusiness		292,784				386,219
Municipal lease finance receivables		65,543				45,933
SFR mortgage		255,136				240,654
Consumer and other loans		76,695				74,665
Total loans, at amortized cost		8,591,684				7,887,713
Less: Allowance for credit losses		(76,119	)			(65,019	)
Total loans and lease finance receivables, net	$	8,515,565			$	7,822,694

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

The following table summarizes loans by type and origination year, including acquired Suncrest loans in the year of origination, according to our internal risk ratings as of the dates presented.


	Origination Year																								Revolving loans amortized				Revolving loans converted to
March 31, 2022	2022				2021				2020				2019				2018				Prior				cost basis				term loans				Total
	(Dollars in thousands)
Commercial real estate loans:
Risk Rating:
Pass	$	309,734			$	1,266,416			$	1,034,822			$	650,330			$	584,265			$	2,195,297			$	203,627			$	34,407			$	6,278,898
Special Mention		511				6,368				26,868				13,203				21,280				86,656				3,285				5,500				163,671
Substandard		-				3,524				553				447				6,983				14,153				2,500				112				28,272
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Commercial real estate loans:	$	310,245			$	1,276,308			$	1,062,243			$	663,980			$	612,528			$	2,296,106			$	209,412			$	40,019			$	6,470,841

Construction loans:
Risk Rating:
Pass	$	3,150			$	20,766			$	24,308			$	-			$	1,389			$	-			$	20,083			$	-			$	69,696
Special Mention		-				-				-				-				3,782				-				-				-				3,782
Substandard		-				-				-				-				-				-				-				-				-
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Construction loans:	$	3,150			$	20,766			$	24,308			$	-			$	5,171			$	-			$	20,083			$	-			$	73,478

SBA loans:
Risk Rating:
Pass	$	29,451			$	65,744			$	36,025			$	11,881			$	31,312			$	116,138			$	201			$	-			$	290,752
Special Mention		-				-				1,854				1,341				1,442				5,224				-				-				9,861
Substandard		-				-				-				-				768				9,857				-				-				10,625
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total SBA loans:	$	29,451			$	65,744			$	37,879			$	13,222			$	33,522			$	131,219			$	201			$	-			$	311,238

SBA - PPP loans:
Risk Rating:
Pass	$	-			$	112,623			$	7,867			$	-			$	-			$	-			$	-			$	-			$	120,490
Special Mention		-				562				-				-				-				-				-				-				562
Substandard		-				135				2				-				-				-				-				-				137
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total SBA - PPP loans:	$	-			$	113,320			$	7,869			$	-			$	-			$	-			$	-			$	-			$	121,189

Commercial and industrial loans:
Risk Rating:
Pass	$	44,239			$	163,488			$	90,575			$	119,147			$	53,297			$	112,214			$	307,641			$	6,954			$	897,555
Special Mention		-				1,849				2,052				3,407				1,787				299				7,338				463				17,195
Substandard		-				246				6				326				4,381				1,029				1,510				2,532				10,030
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Commercial and industrial loans:	$	44,239			$	165,583			$	92,633			$	122,880			$	59,465			$	113,542			$	316,489			$	9,949			$	924,780


	Origination Year																								Revolving loans amortized				Revolving loans converted to
March 31, 2022	2022				2021				2020				2019				2018				Prior				cost basis				term loans				Total
	(Dollars in thousands)
Dairy & livestock and agribusiness loans:
Risk Rating:
Pass	$	749			$	4,012			$	3,138			$	1,175			$	1,140			$	1,334			$	263,440			$	399			$	275,387
Special Mention		-				-				-				-				-				-				3,947				1,283				5,230
Substandard		-				-				-				-				1,794				898				3,426				6,049				12,167
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Dairy & livestock and agribusiness loans:	$	749			$	4,012			$	3,138			$	1,175			$	2,934			$	2,232			$	270,813			$	7,731			$	292,784

Municipal lease finance receivables loans:
Risk Rating:
Pass	$	-			$	13,087			$	7,416			$	4,417			$	5,196			$	34,896			$	-			$	-			$	65,012
Special Mention		-				-				-				-				-				339				-				-				339
Substandard		-				-				-				-				-				192				-				-				192
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Municipal lease finance receivables loans:	$	-			$	13,087			$	7,416			$	4,417			$	5,196			$	35,427			$	-			$	-			$	65,543

SFR mortgage loans:
Risk Rating:
Pass	$	29,913			$	48,149			$	47,066			$	39,231			$	18,257			$	69,355			$	451			$	-			$	252,422
Special Mention		-				-				961				-				-				-				-				-				961
Substandard		-				-				-				-				-				1,350				-				403				1,753
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total SFR mortgage loans:	$	29,913			$	48,149			$	48,027			$	39,231			$	18,257			$	70,705			$	451			$	403			$	255,136

Consumer and other loans:
Risk Rating:
Pass	$	5,613			$	4,379			$	1,789			$	1,302			$	423			$	1,472			$	55,811			$	3,211			$	74,000
Special Mention		-				771				-				-				-				-				590				402				1,763
Substandard		-				-				-				-				-				15				5				912				932
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Consumer and other loans:	$	5,613			$	5,150			$	1,789			$	1,302			$	423			$	1,487			$	56,406			$	4,525			$	76,695

Total Loans:
Risk Rating:
Pass	$	422,849			$	1,698,664			$	1,253,006			$	827,483			$	695,279			$	2,530,706			$	851,254			$	44,971			$	8,324,212
Special Mention		511				9,550				31,735				17,951				28,291				92,518				15,160				7,648				203,364
Substandard		-				3,905				561				773				13,926				27,494				7,441				10,008				64,108
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Loans:	$	423,360			$	1,712,119			$	1,285,302			$	846,207			$	737,496			$	2,650,718			$	873,855			$	62,627			$	8,591,684


	Origination Year																								Revolving loans amortized				Revolving loans converted to
December 31, 2021	2021				2020				2019				2018				2017				Prior				cost basis				term loans				Total
	(Dollars in thousands)
Commercial real estate loans:
Risk Rating:
Pass	$	1,137,714			$	963,697			$	591,202			$	534,468			$	484,721			$	1,704,267			$	156,841			$	33,564			$	5,606,474
Special Mention		3,133				20,640				14,477				16,097				43,262				44,045				6,970				6,800				155,424
Substandard		-				-				2,859				6,933				4,646				7,329				5,951				114				27,832
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Commercial real estate loans:	$	1,140,847			$	984,337			$	608,538			$	557,498			$	532,629			$	1,755,641			$	169,762			$	40,478			$	5,789,730

Construction loans:
Risk Rating:
Pass	$	10,511			$	15,896			$	7,236			$	-			$	-			$	-			$	25,262			$	-			$	58,905
Special Mention		-				-				-				3,359				-				-				-				-				3,359
Substandard		-				-				-				-				-				-				-				-				-
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Construction loans:	$	10,511			$	15,896			$	7,236			$	3,359			$	-			$	-			$	25,262			$	-			$	62,264

SBA loans:
Risk Rating:
Pass	$	70,929			$	36,468			$	11,129			$	36,068			$	38,504			$	78,527			$	-			$	-			$	271,625
Special Mention		-				-				-				-				4,056				2,700				-				-				6,756
Substandard		-				-				-				785				4,092				5,342				-				-				10,219
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total SBA loans:	$	70,929			$	36,468			$	11,129			$	36,853			$	46,652			$	86,569			$	-			$	-			$	288,600

SBA - PPP loans:
Risk Rating:
Pass	$	183,614			$	2,969			$	-			$	-			$	-			$	-			$	-			$	-			$	186,583
Special Mention		-				-				-				-				-				-				-				-				-
Substandard		-				2				-				-				-				-				-				-				2
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total SBA - PPP loans:	$	183,614			$	2,971			$	-			$	-			$	-			$	-			$	-			$	-			$	186,585

Commercial and industrial loans:
Risk Rating:
Pass	$	145,494			$	81,944			$	126,647			$	54,690			$	32,455			$	73,600			$	267,659			$	6,992			$	789,481
Special Mention		1,556				1,929				127				1,396				394				26				9,369				177				14,974
Substandard		244				6				602				1,712				505				475				1,991				3,073				8,608
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Commercial and industrial loans:	$	147,294			$	83,879			$	127,376			$	57,798			$	33,354			$	74,101			$	279,019			$	10,242			$	813,063


	Origination Year																								Revolving loans amortized				Revolving loans converted to
December 31, 2021	2021				2020				2019				2018				2017				Prior				cost basis				term loans				Total
	(Dollars in thousands)
Dairy & livestock and agribusiness loans:
Risk Rating:
Pass	$	1,756			$	942			$	1,285			$	1,035			$	95			$	295			$	364,312			$	454			$	370,174
Special Mention		1,052				-				-				-				-				-				6,979				1,301				9,332
Substandard		-				-				-				37				-				-				-				6,676				6,713
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Dairy & livestock and agribusiness loans:	$	2,808			$	942			$	1,285			$	1,072			$	95			$	295			$	371,291			$	8,431			$	386,219

Municipal lease finance receivables loans:
Risk Rating:
Pass	$	9,310			$	7,666			$	-			$	279			$	9,528			$	18,811			$	-			$	-			$	45,594
Special Mention		-				-				-				-				-				339				-				-				339
Substandard		-				-				-				-				-				-				-				-				-
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Municipal lease finance receivables loans:	$	9,310			$	7,666			$	-			$	279			$	9,528			$	19,150			$	-			$	-			$	45,933

SFR mortgage loans:
Risk Rating:
Pass	$	48,813			$	49,261			$	41,776			$	19,877			$	16,046			$	61,965			$	451			$	-			$	238,189
Special Mention		8				-				-				-				-				-				-				-				8
Substandard		-				-				-				-				-				2,052				-				405				2,457
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total SFR mortgage loans:	$	48,821			$	49,261			$	41,776			$	19,877			$	16,046			$	64,017			$	451			$	405			$	240,654

Consumer and other loans:
Risk Rating:
Pass	$	5,145			$	1,947			$	1,415			$	469			$	386			$	1,611			$	58,060			$	3,378			$	72,411
Special Mention		839				-				-				-				-				150				591				403				1,983
Substandard		-				-				-				-				-				15				5				251				271
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Consumer and other loans:	$	5,984			$	1,947			$	1,415			$	469			$	386			$	1,776			$	58,656			$	4,032			$	74,665

Total Loans:
Risk Rating:
Pass	$	1,613,286			$	1,160,790			$	780,690			$	646,886			$	581,735			$	1,939,076			$	872,585			$	44,388			$	7,639,436
Special Mention		6,588				22,569				14,604				20,852				47,712				47,260				23,909				8,681				192,175
Substandard		244				8				3,461				9,467				9,243				15,213				7,947				10,519				56,102
Doubtful & Loss		-				-				-				-				-				-				-				-				-
Total Loans:	$	1,620,118			$	1,183,367			$	798,755			$	677,205			$	638,690			$	2,001,549			$	904,441			$	63,588			$	7,887,713

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, 2022
	Ending Balance December 31, 2021				Charge-offs				Recoveries				Initial ACL for PCD Loans at Acquisition				Provision Recorded at Acquisition				(Recapture of) Provision for Credit Losses				Ending Balance March 31, 2022
	(Dollars in thousands)
Commercial real estate	$	50,950			$	-			$	-			$	5,086			$	4,127			$	(2,328	)		$	57,835
Construction		765				-				3				122				58				40				988
SBA		2,668				-				5				62				64				25				2,824
Commercial and industrial		6,669				(15	)			3				500				508				(834	)			6,831
Dairy & livestock and agribusiness		3,066				-				-				2,832				149				656				6,703
Municipal lease finance receivables		100				-				-				3				26				23				152
SFR mortgage		188				-				-				-				-				39				227
Consumer and other loans		613				(1	)			-				-				-				(53	)			559
Total allowance for credit losses	$	65,019			$	(16	)		$	11			$	8,605			$	4,932			$	(2,432	)		$	76,119


	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
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

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, 2022
	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	$	113			$	3,523			$	2,789			$	6,425			$	2,386,781			$	2,393,206
Non-owner occupied		565				-				-				565				4,077,070				4,077,635
Construction
Speculative (1)		-				-				-				-				65,022				65,022
Non-speculative		-				-				-				-				8,456				8,456
SBA		1,429				-				695				2,124				309,114				311,238
SBA - PPP		-				-				2				2				121,187				121,189
Commercial and industrial		118				371				675				1,164				923,616				924,780
Dairy & livestock and agribusiness		1,099				2,313				-				3,412				289,372				292,784
Municipal lease finance receivables		-				-				-				-				65,543				65,543
SFR mortgage		403				-				-				403				254,733				255,136
Consumer and other loans		-				-				40				40				76,655				76,695
Total loans	$	3,727			$	6,207			$	4,201			$	14,135			$	8,577,549			$	8,591,684

(1)

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


	December 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	$	438			$	-			$	3,383			$	3,821			$	2,127,979			$	2,131,800
Non-owner occupied		-				-				-				-				3,657,930				3,657,930
Construction
Speculative (1)		-				-				-				-				44,859				44,859
Non-speculative		-				-				-				-				17,405				17,405
SBA		417				1,145				339				1,901				286,699				288,600
SBA - PPP		-				-				-				-				186,585				186,585
Commercial and industrial		-				16				1,356				1,372				811,691				813,063
Dairy & livestock and agribusiness		-				-				-				-				386,219				386,219
Municipal lease finance receivables		-				-				-				-				45,933				45,933
SFR mortgage		1,040				-				-				1,040				239,614				240,654
Consumer and other loans		-				-				42				42				74,623				74,665
Total loans	$	1,895			$	1,161			$	5,120			$	8,176			$	7,879,537			$	7,887,713

(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, 2022 and December 31, 2021 by type of loan.


	March 31, 2022
	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	$	4,052			$	7,055			$	-
Non-owner occupied		-				-				-
Construction
Speculative (2)		-				-				-
Non-speculative		-				-				-
SBA		152				1,575				-
SBA - PPP		2				2				-
Commercial and industrial		1,246				1,771				-
Dairy & livestock and agribusiness		17				2,655				-
Municipal lease finance receivables		-				-				-
SFR mortgage		167				167				-
Consumer and other loans		40				40				-
Total loans	$	5,676			$	13,265			$	-

(1)

As of March 31, 2022, $1.8 million of nonaccruing loans were current, $1.1 million were 30-59 days past due, $6.2 million were 60-89 days past due, and $4.2 million were 90+ days past due.

(2)

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


	December 31, 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	$	3,607			$	3,607			$	-
Non-owner occupied		-				-				-
Construction
Speculative (2)		-				-				-
Non-speculative		-				-				-
SBA		521				1,034				-
SBA - PPP		-				-				-
Commercial and industrial		1,326				1,714				-
Dairy & livestock and agribusiness		-				-				-
Municipal lease finance receivables		-				-				-
SFR mortgage		380				380				-
Consumer and other loans		158				158				-
Total loans	$	5,992			$	6,893			$	-

(1)

As of December 31, 2021, $1.2 million of nonaccruing loans were current, $332,000 were 30-59 days past due, $267,000 were 60-89 days past due, and $5.1 million were 90+ days past due.

(2)

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

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, 2022												Number of Loans
	Real Estate				Business Assets				Other				Dependent on Collateral
	(Dollars in thousands)
Commercial real estate	$	11,967			$	-			$	-				14
Construction		-				-				-				-
SBA		398				1,177				-				11
SBA - PPP		-				-				-				-
Commercial and industrial		594				4,761				94				19
Dairy & livestock and agribusiness		131				17				2,867				8
Municipal lease finance receivables		-				-				-				-
SFR mortgage		168				-				-				1
Consumer and other loans		40				-				4				2
Total collateral-dependent loans	$	13,298			$	5,955			$	2,965				55


	December 31, 2021												Number of Loans
	Real Estate				Business Assets				Other				Dependent on Collateral
	(Dollars in thousands)
Commercial real estate	$	6,001			$	-			$	-				6
Construction		-				-				-				-
SBA		405				517				112				10
SBA - PPP		-				-				-				-
Commercial and industrial		688				5,133				96				19
Dairy & livestock and agribusiness		-				-				-				-
Municipal lease finance receivables		-				-				-				-
SFR mortgage		380				-				-				2
Consumer and other loans		158				-				-				2
Total collateral-dependent loans	$	7,632			$	5,650			$	208				39

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,
	2022				2021
	(Dollars in thousands)
Performing TDRs:
Beginning balance	$	5,293			$	2,159
New modifications		-				4,643
Payoffs/payments, net and other		(34	)			(989	)
TDRs returned to accrual status		-				-
TDRs placed on nonaccrual status		-				-
Ending balance	$	5,259			$	5,813
Nonperforming TDRs:
Beginning balance	$	-			$	-
New modifications		-				-
Charge-offs		-				-
Payoffs/payments, net and other		-				-
TDRs returned to accrual status		-				-
TDRs placed on nonaccrual status		-				-
Ending balance	$	-			$	-
Total TDRs	$	5,259			$	5,813

Summary of Loans Modified as Troubled Debt Restructurings

The following tables summarize loans modified as TDRs for the period presented.

Modifications (1)

For the Three Months Ended March 31, 2022

Number of Loans

Pre-Modification Outstanding Recorded Investment

Post-Modification Outstanding Recorded
Investment

Outstanding Recorded Investment at March 31, 2022

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

-

-

-

-

-

SFR mortgage:

Interest rate reduction

-

-

-

-

-

Change in amortization period
or maturity

-

-

-

-

-

Total loans

-

$

-

$

-

$

-

$

-


	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.

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