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LOANS AND ALLOWANCE FOR CREDIT LOSSES

12 Months Ended

Dec. 31, 2021

The following table presents the balances in our loan portfolio as of the dates indicated:


	December 31,
($ in thousands)	2021		2020
Commercial:
Commercial and industrial (1)	$	2,668,984	$	2,088,308
Commercial real estate	1,311,105		807,195
Multifamily	1,361,054		1,289,820
SBA (2)	205,548		273,444
Construction	181,841		176,016

Consumer:
Single family residential mortgage	1,420,023		1,230,236


Other consumer	102,925		33,386
Total loans	7,251,480		5,898,405
Allowance for loan losses	(92,584)		(81,030)
Loans receivable, net	$	7,158,896	$	5,817,375

(1)Includes warehouse lending balances of $1.60 billion and $1.34 billion at December 31, 2021 and 2020.

(2)Includes 397 PPP loans totaling $123.1 million at December 31, 2021 and 949 PPP loans totaling $210.0 million at December 31, 2020.

The following table presents the balances of total loans as of the dates indicated:


	December 31,
($ in thousands)	2021		2020
Unpaid principal balance	$	7,245,952	$	5,892,229
Unamortized net premiums	18,005		6,535
Unamortized net deferred costs	819		5,331
Unamortized SBA PPP fees	(831)		(1,739)
Fair value adjustment (1)	(12,465)		(3,951)
Total loans	$	7,251,480	$	5,898,405

(1)Includes $10.6 million at December 31, 2021 related to the PMB Acquisition, of which $3.9 million related to PCD loans.

Credit Quality Indicators

We categorize loans into risk categories based on relevant information about the ability of borrowers to service their debt such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. We perform historical loss analysis that is combined with a comprehensive loan to value analysis to analyze the associated risks in the current loan portfolio. We analyze loans individually by classifying the loans as to credit risk. This analysis includes all loans delinquent over 60 days and non-homogeneous loans such as commercial and commercial real estate loans. We use the following definitions for risk ratings:

Pass: Loans classified as pass are in compliance in all respects with the Bank’s credit policy and regulatory requirements, and do not exhibit any potential or defined weakness as defined under “Special Mention”, “Substandard” or “Doubtful”.

Special Mention: Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of our credit position at some future date.

Substandard: Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans.

The following table presents the risk categories for total loans by class of loans and origination year as of December 31, 2021:


	Term Loans Amortized Cost Basis by Origination Year
($ in thousands)	2021		2020		2019		2018		2017		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Amortized Cost Basis Converted to Term		Total
December 31, 2021
















Commercial:
Commercial and industrial
Pass	$	254,218	$	81,177	$	71,950	$	78,461	$	56,439	$	110,490	$	1,888,126	$	9,679	$	2,550,540
Special mention	1,206		5,971		13,721		835		7,272		9,846		20,460		6,348		65,659
Substandard	2		241		17,853		11,378		3,374		117		17,429		2,391		52,785
Doubtful	—		—		—		—		—		—		—		—		—
Commercial and industrial	255,426		87,389		103,524		90,674		67,085		120,453		1,926,015		18,418		2,668,984
Commercial real estate
Pass	465,524		82,759		140,108		192,263		85,755		317,941		8,416		71		1,292,837
Special mention	—		—		—		1,925		—		2,920		—		—		4,845
Substandard	—		—		506		—		—		9,084		3,833		—		13,423
Doubtful	—		—		—		—		—		—		—		—		—
Commercial real estate	465,524		82,759		140,614		194,188		85,755		329,945		12,249		71		1,311,105
Multifamily
Pass	410,958		208,396		315,119		157,640		61,457		158,464		4		—		1,312,038
Special mention	—		1,988		—		11,261		—		33,065		—		—		46,314
Substandard	—		—		—		—		—		2,702		—		—		2,702
Doubtful	—		—		—		—		—		—		—		—		—
Multifamily	410,958		210,384		315,119		168,901		61,457		194,231		4		—		1,361,054
SBA
Pass	106,749		23,972		8,049		1,957		10,836		28,495		928		143		181,129
Special mention	—		1,586		3,618		236		—		596		—		4		6,040
Substandard	—		5,888		—		390		3,358		7,245		599		899		18,379
Doubtful	—		—		—		—		—		—		—		—		—
SBA	106,749		31,446		11,667		2,583		14,194		36,336		1,527		1,046		205,548


Construction
Pass	67,074		32,995		29,038		17,139		25,485		—		—		—		171,731
Special mention	—		—		—		1,607		—		8,503		—		—		10,110
Substandard	—		—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—		—
Construction	67,074		32,995		29,038		18,746		25,485		8,503		—		—		181,841
Consumer:
Single family residential mortgage
Pass	713,844		96,339		67,075		140,329		88,123		277,247		12,828		—		1,395,785
Special mention	—		1,644		339		910		692		6,838		—		—		10,423
Substandard	—		—		—		11,005		975		1,601		—		234		13,815
Doubtful	—		—		—		—		—		—		—		—		—
Single family residential mortgage	713,844		97,983		67,414		152,244		89,790		285,686		12,828		234		1,420,023
Other consumer
Pass	26,179		13,556		8,891		5,265		9,038		15,951		21,327		2,331		102,538
Special mention	—		—		4		—		—		25		63		—		92
Substandard	—		61		14		148		46		26		—		—		295
Doubtful	—		—		—		—		—		—		—		—		—
Other consumer	26,179		13,617		8,909		5,413		9,084		16,002		21,390		2,331		102,925


Total loans	$	2,045,754	$	556,573	$	676,285	$	632,749	$	352,850	$	991,156	$	1,974,013	$	22,100	$	7,251,480

Total loans
Pass	$	2,044,546	$	539,194	$	640,230	$	593,054	$	337,133	$	908,588	$	1,931,629	$	12,224	$	7,006,598
Special mention	1,206		11,189		17,682		16,774		7,964		61,793		20,523		6,352		143,483
Substandard	2		6,190		18,373		22,921		7,753		20,775		21,861		3,524		101,399
Doubtful	—		—		—		—		—		—		—		—		—
Total loans	$	2,045,754	$	556,573	$	676,285	$	632,749	$	352,850	$	991,156	$	1,974,013	$	22,100	$	7,251,480

Past Due Loans

The following table presents the aging of the recorded investment in past due loans as of December 31, 2021, excluding accrued interest receivable (which is not considered to be material), by class of loans:


	December 31, 2021
($ in thousands)	30 - 59 Days Past Due		60 - 89 Days Past Due		Greater than 89 Days Past due		Total Past Due		Current		Total
Commercial:
Commercial and industrial	$	9,342	$	1,351	$	9,503	$	20,196	$	2,648,788	$	2,668,984
Commercial real estate	—		—		—		—		1,311,105		1,311,105
Multifamily	786		—		—		786		1,360,268		1,361,054
SBA	987		2,360		15,941		19,288		186,260		205,548
Construction	—		—		—		—		181,841		181,841

Consumer:
Single family residential mortgage	24,867		—		7,076		31,943		1,388,080		1,420,023
Other consumer	449		—		89		538		102,387		102,925
Total loans	$	36,431	$	3,711	$	32,609	$	72,751	$	7,178,729	$	7,251,480

The following table presents the aging of the recorded investment in past due loans as of December 31, 2020, excluding accrued interest receivable (which is not considered to be material), by class of loans:


	December 31, 2020
($ in thousands)	30 - 59 Days Past Due		60 - 89 Days Past Due		Greater than 89 Days Past due		Total Past Due		Current		Total
Commercial:
Commercial and industrial	$	67	$	—	$	4,284	$	4,351	$	2,083,957	$	2,088,308
Commercial real estate	—		—		—		—		807,195		807,195
Multifamily	—		—		—		—		1,289,820		1,289,820
SBA	354		626		3,062		4,042		269,402		273,444
Construction	—		—		—		—		176,016		176,016

Consumer:
Single family residential mortgage	11,036		1,621		10,290		22,947		1,207,289		1,230,236
Other consumer	216		61		—		277		33,109		33,386









Total loans	$	11,673	$	2,308	$	17,636	$	31,617	$	5,866,788	$	5,898,405

Nonaccrual Loans

The following table presents the composition of total nonaccrual loans and the subset of nonaccrual loans with no ACL as of the dates indicated:


	December 31, 2021				December 31, 2020
($ in thousands)	Total Nonaccrual Loans		Nonaccrual Loans with no ACL		Total Nonaccrual Loans		Nonaccrual Loans with no ACL
Nonaccrual loans
Commercial:
Commercial and industrial	$	28,594	$	9,137	$	13,821	$	13,088
Commercial real estate	—		—		4,654		4,654

SBA	16,653		11,443		3,749		648


Consumer:
Single family residential mortgage	7,076		7,076		13,519		13,519


Other consumer	235		235		157		157
Total nonaccrual loans	$	52,558	$	27,891	$	35,900	$	32,066

At December 31, 2021 and 2020, zero and $728 thousand of loans were past due 90 days or more and still accruing.

Loans in Process of Foreclosure

At December 31, 2021 and 2020, there were no consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings were in process according to local requirements of the applicable jurisdiction.

Allowance for Credit Losses

The ACL methodology uses a nationally recognized, third-party model that includes many assumptions based on historical and peer loss data, current loan portfolio risk profile including risk ratings, and economic forecasts including macroeconomic variables (MEVs) released by our model provider during December 2021. The December 2021 forecasts reflect a more favorable view of the economy (i.e. higher GDP growth rates and lower unemployment rates) compared to December 2020 forecasts. While the current forecasts generally reflect an improving economy with the availability of the vaccine and other factors, there continues to be uncertainty regarding the impact of inflation (lasting or transitory), COVID-19 variants, further government stimulus, supply chain issues, and the ultimate pace of the recovery. Accordingly, our economic assumptions, the resulting ACL level and resulting provision consider all of the potential uncertainties and underlying assumptions, both positive and negative. The ACL also incorporated qualitative factors to account for certain loan portfolio characteristics that are not taken into consideration by the third-party model including underlying strengths and weaknesses in various segments of the loan portfolio. As is the case with all estimates, the ACL is expected to be impacted in future periods by economic volatility, changing economic forecasts, underlying model assumptions, and asset quality metrics, all of which may be better than or worse than current estimates.

The ACL process involves subjective and complex judgments as well as adjustments for numerous factors including those described in the federal banking agencies' joint interagency policy statement on ALL, which include underwriting experience and collateral value changes, among others.

The following table presents a summary of activity in the ACL for the periods indicated:


	Year Ended December 31,
($ in thousands)	2021						2020						2019
	Allowance for Loan Losses		Reserve for Unfunded Loan Commit-ments		Allowance for Credit Losses		Allowance for Loan Losses		Reserve for Unfunded Loan Commit-ments		Allowance for Credit Losses		Allowance for Loan Losses		Reserve for Unfunded Loan Commit-ments		Allowance for Credit Losses
Balance at beginning of year	$	81,030	$	3,183	$	84,213	$	57,649	$	4,064	$	61,713	$	62,192	$	4,622	$	66,814
Impact of adopting ASU 2016-13	—		—		—		7,609		(1,226)		6,383		—		—		—
Initial reserve for purchased credit-deteriorated loans (1)	13,650		—		13,650		—		—		—		—		—		—
Loans charged off	(9,886)		—		(9,886)		(15,417)		—		(15,417)		(41,766)		—		(41,766)
Recoveries of loans previously charged off	3,358		—		3,358		1,815		—		1,815		836		—		836
Net charge-offs	(6,528)		—		(6,528)		(13,602)		—		(13,602)		(40,930)		—		(40,930)

Provision for (reversal of) credit losses	4,432		2,422		6,854		29,374		345		29,719		36,387		(558)		35,829
Balance at end of year	$	92,584	$	5,605	$	98,189	$	81,030	$	3,183	$	84,213	$	57,649	$	4,064	$	61,713

(1)Represents the amounts, at acquisition date, of expected credit losses on PCD loans, net of expected recoveries of PCD loans charged-off prior to acquisition date that we have a contractual right to receive.

During 2021, we recorded a $13.7 million initial allowance for credit losses established for PCD loans from the PMB Acquisition and an $11.3 million initial charge to provision for credit losses for all other loans and unfunded commitments acquired from PMB. During 2021, net charge-offs included $4.4 million related to a commercial and industrial loan acquired from PMB and a $2.0 million SBA relationship. During 2021, recoveries totaled $3.4 million and included $2.6 million of recoveries related to PCD loans acquired from PMB that were charged-off prior to acquisition date that we had a contractual right to receive.

During 2020, a $16.1 million legacy shared national credit was resolved resulting in a charge-off of $10.7 million.

During 2019, we recorded a $35.1 million charge-off of a line of credit originated in November 2017 to a borrower purportedly the subject of a fraudulent scheme. In connection with the $35.1 million charge-off, on October 22, 2019, the Bank filed a complaint in the U.S. District Court for the Southern District of California (Case CV '19 02031 GPC KSC) seeking to recover its losses and other monetary damages against Chicago Title Insurance Company and Chicago Title Company, asserting claims under RICO, 18 U.S.C § 1962 and for RICO Conspiracy, Fraud, Aiding and Abetting Fraud, Negligent Misrepresentation, Breach of Fiduciary Duty and Negligence. On October 2, 2020, the case was re-filed in the Superior Court of the State of California, County of San Diego (Case 37-2020-00034947) asserting claims for Fraud, Aiding and Abetting Fraud, Conspiracy to Defraud, Negligent Misrepresentation, Breach of Fiduciary Duty, Negligence, Money Had And Received, and Conversion. On February 9, 2021, an Amended Complaint was filed asserting claims for Fraud, Aiding and Abetting Fraud, Conspiracy to Defraud, Negligent Misrepresentation, Breach of Fiduciary Duty, Negligence, Money Had And Received, Conversion, Violation of Penal Code Section 496, Violation of Corporations Code Section 25504.1, and Violation of Business & Professions Code Section 17200. We are actively considering and pursuing available sources of recovery and other potential means of mitigating the loss; however, no assurance can be given that we will be successful in that regard.

During the third quarter of 2019 and in response to the identified charge-off, we undertook an extensive collateral review of all commercial lending relationships $5.0 million and above not secured by real estate. The collateral review focused on security and collateral documentation and confirmation of the Bank's collateral interest. The review was performed within the Bank's Internal Audit division and the work was validated by an independent third party. Our review and outside validation did not identify any other instances of apparent fraud for the credits reviewed or concerns over the existence of collateral held by the Bank or on our behalf at third parties; however, there are no assurances that our internal review and third party validation were sufficient to identify all such issues.

Accrued interest receivable on loans receivable, net totaled $25.8 million and $24.7 million at December 31, 2021 and 2020, and is included within other assets in the accompanying consolidated statements of financial condition.

The following table presents the activity and balance in the ALL as of or for the year ended December 31, 2021:


($ in thousands)	Commercial and Industrial		Commercial Real Estate		Multifamily		SBA		Construction		Single Family Residential Mortgage		Other Consumer		Total
ALL:
Balance at December 31, 2020	$	20,608	$	19,074	$	22,512	$	3,145	$	5,849	$	9,191	$	651	$	81,030

Initial reserve for purchased credit-deteriorated loans(1)	11,933		614		469		575		28		—		31		13,650
Charge-offs	(6,209)		(576)		—		(2,780)		—		(321)		—		(9,886)
Recoveries	3,150		—		—		132		—		74		2		3,358
Net (charge-offs) recoveries	(3,059)		(576)		—		(2,648)		—		(247)		2		(6,528)

Provision for (reversal of) credit losses	4,075		2,615		(5,088)		1,945		(255)		664		476		4,432
Balance at December 31, 2021	$	33,557	$	21,727	$	17,893	$	3,017	$	5,622	$	9,608	$	1,160	$	92,584

(1)Represents the amounts, at acquisition date, of expected credit losses on PCD loans and expected recoveries of PCD loans charged-off prior to acquisition date that we have a contractual right to receive.

The following table presents the activity and balance in the ALL as of or for the year ended December 31, 2020:


($ in thousands)	Commercial and Industrial		Commercial Real Estate		Multifamily		SBA		Construction		Single Family Residential Mortgage		Other Consumer		Total
ALL:
Balance at December 31, 2019	$	22,353	$	5,941	$	11,405	$	3,120	$	3,906	$	10,486	$	438	$	57,649
Impact of adopting ASU 2016-13	662		4,847		1,809		388		103		(420)		220		7,609

Charge-offs	(13,588)		—		—		(1,083)		—		(742)		(4)		(15,417)
Recoveries	604		—		—		328		—		664		219		1,815
Net (charge-offs) recoveries	(12,984)		—		—		(755)		—		(78)		215		(13,602)

Provision for (reversal of) credit losses	10,577		8,286		9,298		392		1,840		(797)		(222)		29,374
Balance at December 31, 2020	$	20,608	$	19,074	$	22,512	$	3,145	$	5,849	$	9,191	$	651	$	81,030

Collateral Dependent Loans

A loan is considered collateral dependent when the borrower is experiencing financial difficulty and repayment of the loan is expected to be provided substantially through the operation or sale of the collateral. Collateral dependent loans are evaluated individually and the ACL is determined based on the amount by which amortized costs exceed the estimated fair value of the collateral, adjusted for estimated selling costs.

Collateral dependent loans consisted of the following as of December 31, 2021:


	December 31, 2021
	Real Estate
($ in thousands)	Commercial		Residential		Business Assets		Automobile		Total
Commercial:
Commercial and industrial	$	13,518	$	37	$	4,776	$	—	$	18,331
Commercial real estate	—		—		—		—		—
Multifamily	—		—		—		—		—
SBA	689		4,458		11,511		—		16,658
Construction	—		—		—		—		—

Consumer:
Single family residential mortgage	—		14,012		—		—		14,012
Other consumer	—		—		—		235		235
Total loans	$	14,207	$	18,507	$	16,287	$	235	$	49,236

Collateral dependent loans consisted of the following as of December 31, 2020:


	December 31, 2020
	Real Estate
($ in thousands)	Commercial		Residential		Business Assets		Total
Commercial:
Commercial and industrial	$	5,492	$	—	$	4,965	$	10,457
Commercial real estate	2,644		2,010		—		4,654
Multifamily	—		—		—		—
SBA	349		497		2,750		3,596
Construction	—		—		—		—

Consumer:
Single family residential mortgage	—		17,820		—		17,820
Other consumer	—		157		—		157
Total loans	$	8,485	$	20,484	$	7,715	$	36,684

Troubled Debt Restructurings (TDRs)

Troubled debt restructured loans consisted of the following as of the dates indicated:


	December 31,
($ in thousands)	2021		2020
Commercial:
Commercial and industrial	$	5,241	$	3,884
Commercial real estate	4,243		—
SBA	265		265
Consumer:
Single family residential mortgage	6,935		4,848
Other consumer	—		—
Total	$	16,684	$	8,997

We had commitments to lend to customers with outstanding loans that were classified as TDRs of $63 thousand at both December 31, 2021 and 2020. Accruing TDRs were $12.5 million and nonaccrual TDRs were $4.1 million at December 31, 2021, compared to accruing TDRs of $4.7 million and nonaccrual TDRs of $4.3 million at December 31, 2020. The increase in TDRs during the year ended December 31, 2021 was primarily due the addition of $7.9 million in TDRs from the PMB Acquisition that were outstanding at December 31, 2021.

The following table summarizes the pre-modification and post-modification balances of the new TDRs for the periods indicated:


	Year Ended December 31,
	2021					2020					2019
($ in thousands)	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		Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Commercial:
Commercial and industrial	—	$	—	$	—	1	$	5,000	$	5,000	12	$	18,512	$	18,193
SBA	—	—		—		—	—		—		2	3,214		869
Consumer:
Single family residential mortgage	2	3,420		3,420		—	—		—		—	—		—

Total	2	$	3,420	$	3,420	1	$	5,000	$	5,000	14	$	21,726	$	19,062

For the year ended December 31, 2021, there were no loans that were modified as a TDR during the past 12 months that had a subsequent payment default. For the years ended December 31, 2020, and 2019, there was one SBA loan and no loans that were modified as TDRs during the past 12 months that had a subsequent payment default. The following table summarizes the TDRs by modification type for the periods indicated:


	Modification Type
	Change in Principal Payments and Interest Rates			Change in Principal Payments			Extension of Maturity(1)				Total
($ in thousands)	Count	Amount		Count	Amount			Count	Amount			Count	Amount
Year ended December 31, 2021



Consumer:
Single family residential mortgage (2)	—	—		—	—			2	3,420			2	3,420

Total	—	$	—	—	$	—		2	$	3,420		2	$	3,420
Year ended December 31, 2020
Commercial:
Commercial and industrial	—	$	—	—	$	—		1	$	5,000		1	$	5,000



Total	—	$	—	—	$	—		1	$	5,000		1	$	5,000
Year ended December 31, 2019
Commercial:
Commercial and industrial	12	$	18,193	—	$	—		—	$	—		12	$	18,193
SBA	2	869		—	—			—	—			2	869
Total	14	$	19,062	—	$	—		—	$	—		14	$	19,062

(1)Excludes loans in forbearance or deferment that received an extension of maturity through the CARES Act during the years ended December 31, 2021 and 2020.

(2)Includes one single family residential mortgage loan totaling $1.8 million that included both an extension in maturity and change in interest rate from variable to fixed.

Purchases and Sales

The following table presents loans purchased and/or sold by portfolio segment, excluding loans held-for-sale and loans acquired in a business combination for the periods indicated:


	Year Ended December 31,
	2021				2020				2019
($ in thousands)	Purchases		Sales		Purchases		Sales		Purchases		Sales
Commercial:


Multifamily	$	29,764	$	—	$	120,900	$	—	$	—	$	—

Construction	—		—		14,750		—		—		—

Consumer:
Single family residential mortgage	795,773		—		149,687		—		—		—

Total	$	825,537	$	—	$	285,337	$	—	$	—	$	—

Loan purchases during the years ended December 31, 2021, 2020, and 2019 were made at a net premium of $17.5 million, $4.7 million and zero.

The following table presents PCD loans acquired for the periods indicated:


	Year Ended December 31,
($ in thousands)	2021		2020		2019
Par value	225,405		—		—
Initial reserve based on ACL methodology(1)	(16,200)		—		—
Net discount related to items other than credit	(3,786)		—		—
Total purchase price	$	205,419	$	—	$	—

(1)The initial reserve for PCD loans at acquisition date and based on our ACL methodology was $13.7 million and included $2.6 million related to expected recoveries of loans that were fully or partially charged off prior to acquisition.

The following table presents loans transferred from (to) loans held-for-sale by portfolio segment for the periods indicated:


	Year Ended December 31,
	2021				2020				2019
($ in thousands)	Transfers from Held-For-Sale		Transfers to Held-For-Sale		Transfers from Held-For-Sale		Transfers to Held-For-Sale		Transfers from Held-For-Sale		Transfers to Held-For-Sale
Commercial:
Commercial and industrial	$	—	$	—	$	—	$	—	$	—	$	—
Commercial real estate	—		(4,367)		—		—		—		(573)
Multifamily	—		—		—		—		—		(752,087)
SBA	—		—		—		—		—		(559)
Construction	—		—		—		—		—		(2,519)
Consumer:
Single family residential mortgage	—		(10,839)		—		—		—		(383,859)
Other consumer	—		—		—		—		—		—
Total	$	—	$	(15,206)	$	—	$	—	$	—	$	(1,139,597)

During the year ended December 31, 2021, we transferred $4.4 million of commercial mortgage loans and $10.8 million of single family residential mortgage loans to held-for-sale. Included in transfers to loans held for sale for the year ended December 31, 2019 is $573.9 million in multifamily loans from loans held-for-investment related to our completed Freddie Mac multifamily securitization which closed during the third quarter of 2019. The loans included in the securitization had a weighted average coupon of 3.79% and a weighted average term to initial reset of 3.5 years. The related mortgage servicing rights were also sold.

In connection with the securitization, during the second quarter of 2019, we entered into interest rate swap agreements with a combined notional value of $543.4 million to offset variability in the fair value of the related loans as a result of changes in market interest rates. During the year ended December 31, 2019, we realized a loss of $9.0 million related to these swap agreements due to a decline in interest rates since their execution and this was offset by the $8.9 million gross gain realized on the loans sold into the securitization. The swap agreements were closed at the time the loans were sold into the securitization.

Non-Traditional Mortgage (NTM) Loans

As of December 31, 2021 and 2020, the NTM loans totaled $635.3 million, or 8.8% of total loans, and $437.1 million, or 7.4% of total loans, respectively. These SFR loans are included in our consumer portfolio and comprised of three interest only products: interest only loans, Green Loans, and a small number of additional loans with the potential for negative amortization.

Interest only loans are primarily SFR first mortgage loans that generally have a 30 to 40-year term at the time of origination and include payment features that allow interest only payments in initial periods before converting to a fully amortizing loan. At December 31, 2021 and 2020, interest only loans totaled $613.3 million and $401.6 million. Green Loans are SFR first and second mortgage lines of credit with a linked checking account that allows all types of deposits and withdrawals to be performed. Green Loans are generally interest only for a 15-year term with a balloon payment due at maturity. At December 31, 2021 and 2020, Green Loans totaled $21.5 million and $33.2 million. Negative amortization loans totaled $0.5 million and $2.3 million at December 31, 2021 and 2020. We discontinued origination of negative amortization loans in 2007.

We no longer originate SFR loans, however we have and may continue to purchase pools of loans that include NTM loans such as interest only loans with maturities of up to 40 years and flexible initial repricing dates, ranging from 1 to 10 years, and periodic repricing dates through the life of the loan.

At December 31, 2021 and 2020, nonperforming NTM loans totaled $4.0 million and $8.7 million.

Non-Traditional Mortgage Performance Indicators

Our risk management policy and credit monitoring include reviewing delinquency, FICO scores, and LTV ratios on the NTM loan portfolio. We also continuously monitor market conditions for our geographic lending areas. We have determined that the most significant performance indicators for NTM loans are LTV ratios and FICO scores. At December 31, 2021, $631.5 million of our $633.7 million NTM first lien portfolio had LTVs of 80% or less. At December 31, 2021, $14.1 million or 71% of our $19.9 million Green Loans first lien portfolio had FICO scores of 700 or greater.