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Loans and Leases

9 Months Ended

Sep. 30, 2024

LOANS AND LEASES

Our loans are carried at the principal amount outstanding, net of deferred fees and costs, and in the case of acquired and purchased loans, net of purchase discounts and premiums. Deferred fees and costs and purchase discounts and premiums on acquired loans are recognized as an adjustment to interest income over the contractual life of the loans primarily using the effective interest method or taken into income when the related loans are paid off or included in the carrying amount of loans that are sold.

Loans and Leases Held for Investment

The following table summarizes the composition of our loans and leases held for investment as of the dates indicated:


	September 30,		December 31,
	2024		2023
	(In thousands)
Real estate mortgage	$	13,527,145	$	16,378,537
Real estate construction and land (1)	3,476,332		3,183,357
Commercial	6,329,861		5,780,346
Consumer	414,357		454,474
Total gross loans and leases held for investment	23,747,695		25,796,714
Unearned discounts, net (2)	(194,161)		(261,984)
Deferred fees, net	(25,757)		(45,043)
Total loans and leases held for investment, net of unearned discounts and deferred fees	23,527,777		25,489,687
Allowance for loan and lease losses	(254,345)		(281,687)
Total loans and leases held for investment, net (3)	$	23,273,432	$	25,208,000

____________________

(1) Includes land and acquisition and development loans of $208.3 million and $228.9 million at September 30, 2024 and December 31, 2023.

(2) Represents net acquisition discounts of $258.9 million and purchase premiums of $64.7 million at September 30, 2024, and net acquisition discounts of $334.2 million and purchase premiums of $72.2 million at December 31, 2023.

(3) Excludes accrued interest receivable of $99.0 million and $111.3 million at September 30, 2024 and December 31, 2023, respectively, which is recorded in "Other assets" on the condensed consolidated balance sheets.

The following tables present an aging analysis of our loans and leases held for investment, net of deferred fees, by loan portfolio segment and class as of the dates indicated:


	September 30, 2024
	30 - 89		90 or More
	Days		Days		Total
	Past Due		Past Due		Past Due		Current		Total
	(In thousands)
Real estate mortgage:
Commercial	$	17,261	$	29,412	$	46,673	$	4,511,266	$	4,557,939
Multi-family	—		—		—		6,009,280		6,009,280
Other residential	19,703		39,546		59,249		2,707,938		2,767,187
Total real estate mortgage	36,964		68,958		105,922		13,228,484		13,334,406
Real estate construction and land:
Commercial	—		—		—		836,902		836,902
Residential	—		—		—		2,622,507		2,622,507
Total real estate construction and land	—		—		—		3,459,409		3,459,409
Commercial:
Asset-based	1,097		—		1,097		2,114,214		2,115,311
Venture capital	—		—		—		1,353,626		1,353,626
Other commercial	12,417		2,669		15,086		2,835,449		2,850,535
Total commercial	13,514		2,669		16,183		6,303,289		6,319,472
Consumer	2,449		410		2,859		411,631		414,490
Total	$	52,927	$	72,037	$	124,964	$	23,402,813	$	23,527,777


	December 31, 2023
	30 - 89		90 or More
	Days		Days		Total
	Past Due		Past Due		Past Due		Current		Total
	(In thousands)
Real estate mortgage:
Commercial	$	12,618	$	15,168	$	27,786	$	4,998,711	$	5,026,497
Multi-family	2,302		1,020		3,322		6,021,857		6,025,179
Other residential	93,042		4,341		97,383		4,962,926		5,060,309
Total real estate mortgage	107,962		20,529		128,491		15,983,494		16,111,985
Real estate construction and land:
Commercial	—		—		—		759,585		759,585
Residential	—		—		—		2,399,684		2,399,684
Total real estate construction and land	—		—		—		3,159,269		3,159,269
Commercial:
Asset-based	608		2,689		3,297		2,185,788		2,189,085
Venture capital	—		—		—		1,446,362		1,446,362
Other commercial	1,276		6,993		8,269		2,121,591		2,129,860
Total commercial	1,884		9,682		11,566		5,753,741		5,765,307
Consumer	3,461		670		4,131		448,995		453,126
Total	$	113,307	$	30,881	$	144,188	$	25,345,499	$	25,489,687

It is our policy to discontinue accruing interest when principal or interest payments are past due 90 days or more (unless the loan is both well secured and in the process of collection) or when, in the opinion of management, there is a reasonable doubt as to the collectability of a loan or lease in the normal course of business. Interest income on nonaccrual loans is recognized only to the extent cash is received and the principal balance of the loan is deemed collectable.

The following table presents our nonaccrual and performing loans and leases held for investment, net of deferred fees, by loan portfolio segment and class as of the dates indicated:


	September 30, 2024						December 31, 2023
	Nonaccrual		Performing		Total		Nonaccrual		Performing		Total
	(In thousands)
Real estate mortgage:
Commercial	$	78,478	$	4,479,461	$	4,557,939	$	15,669	$	5,010,828	$	5,026,497
Multi-family	916		6,008,364		6,009,280		1,020		6,024,159		6,025,179
Other residential	50,514		2,716,673		2,767,187		31,041		5,029,268		5,060,309
Total real estate mortgage	129,908		13,204,498		13,334,406		47,730		16,064,255		16,111,985
Real estate construction and land:
Commercial	—		836,902		836,902		—		759,585		759,585
Residential	—		2,622,507		2,622,507		—		2,399,684		2,399,684
Total real estate construction and land	—		3,459,409		3,459,409		—		3,159,269		3,159,269
Commercial:
Asset-based	2,295		2,113,016		2,115,311		2,689		2,186,396		2,189,085
Venture capital	19,957		1,333,669		1,353,626		325		1,446,037		1,446,362
Other commercial	15,662		2,834,873		2,850,535		10,972		2,118,888		2,129,860
Total commercial	37,914		6,281,558		6,319,472		13,986		5,751,321		5,765,307
Consumer	519		413,971		414,490		811		452,315		453,126
Total	$	168,341	$	23,359,436	$	23,527,777	$	62,527	$	25,427,160	$	25,489,687

At September 30, 2024, nonaccrual loans and leases included $72.0 million of loans and leases 90 or more days past due, $29.5 million of loans and leases 30 to 89 days past due, and $66.8 million of loans and leases current with respect to contractual payments that were placed on nonaccrual status based on management’s judgment regarding their collectability. At December 31, 2023, nonaccrual loans and leases included $19.1 million of loans and leases 90 or more days past due, $11.4 million of loans and leases 30 to 89 days past due, and $32.0 million of current loans and leases that were placed on nonaccrual status based on management’s judgment regarding their collectability.

As of September 30, 2024, our three largest loan relationships on nonaccrual status had an aggregate carrying value of $49.0 million and represented 29% of total nonaccrual loans and leases.

The following tables present the credit risk rating categories for loans and leases held for investment, net of deferred fees, by loan portfolio segment and class as of the dates indicated. Classified loans and leases are those with a credit risk rating of either substandard or doubtful.


	September 30, 2024
	Classified		Special Mention		Pass		Total
	(In thousands)
Real estate mortgage:
Commercial	$	256,581	$	339,559	$	3,961,799	$	4,557,939
Multi-family	152,288		46,332		5,810,660		6,009,280
Other residential	53,140		14,775		2,699,272		2,767,187
Total real estate mortgage	462,009		400,666		12,471,731		13,334,406
Real estate construction and land:
Commercial	—		111,195		725,707		836,902
Residential	—		3,164		2,619,343		2,622,507
Total real estate construction and land	—		114,359		3,345,050		3,459,409
Commercial:
Asset-based	5,731		11,156		2,098,424		2,115,311
Venture capital	39,699		145,441		1,168,486		1,353,626
Other commercial	25,511		32,358		2,792,666		2,850,535
Total commercial	70,941		188,955		6,059,576		6,319,472
Consumer	641		7,908		405,941		414,490
Total	$	533,591	$	711,888	$	22,282,298	$	23,527,777


	December 31, 2023
	Classified		Special Mention		Pass		Total
	(In thousands)
Real estate mortgage:
Commercial	$	75,739	$	219,687	$	4,731,071	$	5,026,497
Multi-family	74,954		108,356		5,841,869		6,025,179
Other residential	38,155		54,197		4,967,957		5,060,309
Total real estate mortgage	188,848		382,240		15,540,897		16,111,985
Real estate construction and land:
Commercial	—		—		759,585		759,585
Residential	—		2,757		2,396,927		2,399,684
Total real estate construction and land	—		2,757		3,156,512		3,159,269
Commercial:
Asset-based	4,561		12,506		2,172,018		2,189,085
Venture capital	7,805		98,633		1,339,924		1,446,362
Other commercial	26,044		9,984		2,093,832		2,129,860
Total commercial	38,410		121,123		5,605,774		5,765,307
Consumer	1,159		7,192		444,775		453,126
Total	$	228,417	$	513,312	$	24,747,958	$	25,489,687

The following table presents our nonaccrual loans and leases by loan portfolio segment and class and by with and without an allowance recorded as of the date indicated and interest income recognized on nonaccrual loans and leases for the periods indicated:


			Three Months		Nine Months				Three Months		Nine Months
			Ended		Ended				Ended		Ended
	September 30,		September 30,		September 30,		September 30,		September 30,		September 30,
	2024		2024		2024		2023		2023		2023
	Nonaccrual		Interest		Interest		Nonaccrual		Interest		Interest
	Recorded		Income		Income		Recorded		Income		Income
	Investment		Recognized		Recognized		Investment		Recognized		Recognized
	(In thousands)
With An Allowance Recorded:
Real estate mortgage:
Commercial	$	201	$	—	$	—	$	55	$	—	$	—
Multi-family	—		—		—		—		—		—
Other residential	232		—		—		372		—		—
Real estate construction and land:
Commercial	—		—		—		—		—		—
Residential	—		—		—		—		—		—
Commercial:
Asset-based	—		—		—		—		—		—
Venture capital	19,957		—		—		2,001		—		—
Other commercial	6,950		—		—		672		—		—
Consumer	519		—		—		207		—		—
With No Related Allowance
Recorded:
Real estate mortgage:
Commercial	$	78,277	$	3	$	10	$	31,410	$	24	$	80
Multi-family	916		—		—		—		—		—
Other residential	50,282		—		—		87,957		—		—
Real estate construction and land:
Commercial	—		—		—		—		—		—
Residential	—		—		—		—		—		—
Commercial:
Asset-based	2,295		—		—		363		—		—
Venture capital	—		—		—		—		—		—
Other commercial	8,712		—		—		2,359		8		8
Consumer	—		—		—		—		—		—
Total Loans and Leases With and
Without an Allowance Recorded:
Real estate mortgage	$	129,908	$	3	$	10	$	119,794	$	24	$	80
Real estate construction and land	—		—		—		—		—		—
Commercial	37,914		—		—		5,395		8		8
Consumer	519		—		—		207		—		—
Total	$	168,341	$	3	$	10	$	125,396	$	32	$	88

The following tables present our loans held for investment by loan portfolio segment and class, by credit quality indicator (internal risk ratings), and by year of origination (vintage year) as of the dates indicated:


															Revolving
															Converted
Amortized Cost Basis (1)	Term Loans by Origination Year												Revolving		to Term
September 30, 2024	2024		2023		2022		2021		2020		Prior		Loans		Loans		Total
	(In thousands)
Real Estate Mortgage:
Commercial
Internal risk rating:
1-2 High pass	$	1,702	$	—	$	28,984	$	27,455	$	11,507	$	91,870	$	1	$	—	$	161,519
3-4.5 Pass	107,554		168,787		815,924		703,752		478,959		1,437,575		55,407		32,322		3,800,280
5 Special mention	—		1,325		103,785		11,804		4,331		217,510		804		—		339,559
6-8 Classified	—		1,812		12,673		68,314		17,212		156,570		—		—		256,581
Total	$	109,256	$	171,924	$	961,366	$	811,325	$	512,009	$	1,903,525	$	56,212	$	32,322	$	4,557,939
Current YTD period:
Gross charge-offs	$	—	$	—	$	175	$	10,030	$	9,714	$	1,375	$	—	$	—	$	21,294

Real Estate Mortgage:
Multi-family
Internal risk rating:
1-2 High pass	$	—	$	—	$	51,103	$	223,538	$	79,409	$	138,645	$	—	$	—	$	492,695
3-4.5 Pass	71,993		85,449		2,168,365		1,145,375		492,934		1,294,278		11,571		48,000		5,317,965
5 Special mention	—		—		—		—		—		46,332		—		—		46,332
6-8 Classified	—		—		40,019		17,254		11,795		83,220		—		—		152,288
Total	$	71,993	$	85,449	$	2,259,487	$	1,386,167	$	584,138	$	1,562,475	$	11,571	$	48,000	$	6,009,280
Current YTD period:
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Real Estate Mortgage:
Other residential
Internal risk rating:
1-2 High pass	$	—	$	—	$	—	$	—	$	—	$	—	$	4,014	$	—	$	4,014
3-4.5 Pass	—		4,582		317,480		2,276,938		40,062		19,374		36,733		89		2,695,258
5 Special mention	—		590		9,857		4,049		—		279		—		—		14,775
6-8 Classified	—		4,068		29,385		17,669		—		1,671		347		—		53,140
Total	$	—	$	9,240	$	356,722	$	2,298,656	$	40,062	$	21,324	$	41,094	$	89	$	2,767,187
Current YTD period:
Gross charge-offs	$	—	$	3,355	$	25,538	$	6,394	$	350	$	67	$	—	$	—	$	35,704

____________________

(1) Amounts with negative balances are loans with zero principal balances and deferred loan origination fees.


															Revolving
															Converted
Amortized Cost Basis (1)	Term Loans by Origination Year												Revolving		to Term
September 30, 2024	2024		2023		2022		2021		2020		Prior		Loans		Loans		Total
	(In thousands)
Real Estate Construction
and Land: Commercial
Internal risk rating:
1-2 High pass	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
3-4.5 Pass	20,371		36,461		457,681		123,977		52,446		10,727		24,044		—		725,707
5 Special mention	—		—		—		111,195		—		—		—		—		111,195
6-8 Classified	—		—		—		—		—		—		—		—		—
Total	$	20,371	$	36,461	$	457,681	$	235,172	$	52,446	$	10,727	$	24,044	$	—	$	836,902
Current YTD period:
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Real Estate Construction
and Land: Residential
Internal risk rating:
1-2 High pass	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
3-4.5 Pass	89,504		159,489		1,433,928		597,557		237,151		—		101,714		—		2,619,343
5 Special mention	—		—		—		3,164		—		—		—		—		3,164
6-8 Classified	—		—		—		—		—		—		—		—		—
Total	$	89,504	$	159,489	$	1,433,928	$	600,721	$	237,151	$	—	$	101,714	$	—	$	2,622,507
Current YTD period:
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial: Asset-Based
Internal risk rating:
1-2 High pass	$	32,730	$	39,510	$	207,755	$	228,132	$	17,496	$	267,152	$	178,231	$	—	$	971,006
3-4.5 Pass	70,694		91,341		183,245		73,496		10,467		68,513		575,366		54,296		1,127,418
5 Special mention	—		198		5,670		—		—		—		5,288		—		11,156
6-8 Classified	—		—		—		—		—		—		5,731		—		5,731
Total	$	103,424	$	131,049	$	396,670	$	301,628	$	27,963	$	335,665	$	764,616	$	54,296	$	2,115,311
Current YTD period:
Gross charge-offs	$	—	$	—	$	—	$	—	$	92	$	—	$	—	$	—	$	92

Commercial: Venture
Capital
Internal risk rating:
1-2 High pass	$	(56)	$	(82)	$	(2)	$	—	$	1,998	$	—	$	155,156	$	23,691	$	180,705
3-4.5 Pass	58,318		122,614		64,856		89,910		4,325		18,601		550,660		78,497		987,781
5 Special mention	—		34,003		19,926		15,647		—		—		69,334		6,531		145,441
6-8 Classified	—		—		13,994		19,957		—		—		5,748		—		39,699
Total	$	58,262	$	156,535	$	98,774	$	125,514	$	6,323	$	18,601	$	780,898	$	108,719	$	1,353,626
Current YTD period:
Gross charge-offs	$	—	$	2,272	$	—	$	—	$	—	$	2	$	140	$	—	$	2,414

____________________

(1) Amounts with negative balances are loans with zero principal balances and deferred loan origination fees.


															Revolving
															Converted
Amortized Cost Basis (1)	Term Loans by Origination Year												Revolving		to Term
September 30, 2024	2024		2023		2022		2021		2020		Prior		Loans		Loans		Total
	(In thousands)
Commercial: Other
Commercial
Internal risk rating:
1-2 High pass	$	230	$	715	$	3,831	$	4,028	$	50	$	1,271	$	72,074	$	—	$	82,199
3-4.5 Pass	53,584		83,370		144,198		207,356		43,073		166,708		1,981,850		30,328		2,710,467
5 Special mention	—		11,288		497		1,890		710		3,502		14,362		109		32,358
6-8 Classified	—		—		3,160		3,128		1,322		9,585		7,571		745		25,511
Total	$	53,814	$	95,373	$	151,686	$	216,402	$	45,155	$	181,066	$	2,075,857	$	31,182	$	2,850,535
Current YTD period:
Gross charge-offs	$	—	$	—	$	565	$	453	$	—	$	747	$	1,157	$	387	$	3,309

Consumer
Internal risk rating:
1-2 High pass	$	—	$	—	$	22	$	17	$	2	$	—	$	1,623	$	—	$	1,664
3-4.5 Pass	23,648		20,948		61,226		183,592		20,250		88,553		5,804		256		404,277
5 Special mention	—		—		2,165		4,310		113		1,320		—		—		7,908
6-8 Classified	—		—		55		163		53		358		—		12		641
Total	$	23,648	$	20,948	$	63,468	$	188,082	$	20,418	$	90,231	$	7,427	$	268	$	414,490
Current YTD period:
Gross charge-offs	$	—	$	199	$	603	$	2,197	$	332	$	1,102	$	1	$	—	$	4,434

Total Loans and Leases
Internal risk rating:
1-2 High pass	$	34,606	$	40,143	$	291,693	$	483,170	$	110,462	$	498,938	$	411,099	$	23,691	$	1,893,802
3-4.5 Pass	495,666		773,041		5,646,903		5,401,953		1,379,667		3,104,329		3,343,149		243,788		20,388,496
5 Special mention	—		47,404		141,900		152,059		5,154		268,943		89,788		6,640		711,888
6-8 Classified	—		5,880		99,286		126,485		30,382		251,404		19,397		757		533,591
Total	$	530,272	$	866,468	$	6,179,782	$	6,163,667	$	1,525,665	$	4,123,614	$	3,863,433	$	274,876	$	23,527,777
Current YTD period:
Gross charge-offs	$	—	$	5,826	$	26,881	$	19,074	$	10,488	$	3,293	$	1,298	$	387	$	67,247

______________________

(1) Amounts with negative balances are loans with zero principal balances and deferred loan origination fees.


															Revolving
															Converted
Amortized Cost Basis (1)	Term Loans by Origination Year												Revolving		to Term
December 31, 2023	2023		2022		2021		2020		2019		Prior		Loans		Loans		Total
	(In thousands)
Real Estate Mortgage:
Commercial
Internal risk rating:
1-3 High pass	$	—	$	16,976	$	17,432	$	16,832	$	17,337	$	69,205	$	1	$	—	$	137,783
4-6 Pass	182,236		933,294		814,564		510,952		298,985		1,765,454		76,866		10,937		4,593,288
7 Special mention	—		14,021		32,235		25,485		17,147		129,549		1,250		—		219,687
8-9 Classified	749		—		26,172		439		17,063		29,566		1,750		—		75,739
Total	$	182,985	$	964,291	$	890,403	$	553,708	$	350,532	$	1,993,774	$	79,867	$	10,937	$	5,026,497
Current YTD period:
Gross charge-offs	$	34	$	—	$	—	$	—	$	76	$	14,185	$	—	$	—	$	14,295

Real Estate Mortgage:
Multi-family
Internal risk rating:
1-3 High pass	$	—	$	28,155	$	140,424	$	58,959	$	57,988	$	109,423	$	—	$	—	$	394,949
4-6 Pass	66,143		2,221,235		1,193,052		539,660		564,420		794,599		67,811		—		5,446,920
7 Special mention	—		2,610		17,784		12,201		39,808		35,953		—		—		108,356
8-9 Classified	—		—		17,283		8,576		26,543		22,552		—		—		74,954
Total	$	66,143	$	2,252,000	$	1,368,543	$	619,396	$	688,759	$	962,527	$	67,811	$	—	$	6,025,179
Current YTD period:
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Real Estate Mortgage:
Other residential
Internal risk rating:
1-3 High pass	$	—	$	—	$	—	$	—	$	—	$	—	$	6,769	$	—	$	6,769
4-6 Pass	188,561		1,824,253		2,812,293		65,230		—		19,518		51,246		87		4,961,188
7 Special mention	—		46,263		7,568		—		—		—		366		—		54,197
8-9 Classified	3,847		18,263		12,908		1,223		—		1,764		65		85		38,155
Total	$	192,408	$	1,888,779	$	2,832,769	$	66,453	$	—	$	21,282	$	58,446	$	172	$	5,060,309
Current YTD period:
Gross charge-offs	$	3,402	$	23,544	$	5,385	$	740	$	—	$	4	$	—	$	—	$	33,075

____________________

(1) Amounts with negative balances are loans with zero principal balances and deferred loan origination fees.


															Revolving
															Converted
Amortized Cost Basis (1)	Term Loans by Origination Year												Revolving		to Term
December 31, 2023	2023		2022		2021		2020		2019		Prior		Loans		Loans		Total
	(In thousands)
Real Estate Construction
and Land: Commercial
Internal risk rating:
1-3 High pass	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
4-6 Pass	23,916		388,165		214,303		68,833		16,781		27,175		20,412		—		759,585
7 Special mention	—		—		—		—		—		—		—		—		—
8-9 Classified	—		—		—		—		—		—		—		—		—
Total	$	23,916	$	388,165	$	214,303	$	68,833	$	16,781	$	27,175	$	20,412	$	—	$	759,585
Current YTD period:
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Real Estate Construction
and Land: Residential
Internal risk rating:
1-3 High pass	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
4-6 Pass	64,341		1,185,297		668,083		336,636		—		26,896		115,674		—		2,396,927
7 Special mention	—		—		2,757		—		—		—		—		—		2,757
8-9 Classified	—		—		—		—		—		—		—		—		—
Total	$	64,341	$	1,185,297	$	670,840	$	336,636	$	—	$	26,896	$	115,674	$	—	$	2,399,684
Current YTD period:
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial: Asset-Based
Internal risk rating:
1-3 High pass	$	32,485	$	237,936	$	223,088	$	39,380	$	119,364	$	254,638	$	89,667	$	—	$	996,558
4-6 Pass	122,064		238,206		132,449		17,823		7,447		25,945		630,073		1,453		1,175,460
7 Special mention	—		101		—		—		—		1		12,394		10		12,506
8-9 Classified	—		—		—		701		—		340		3,520		—		4,561
Total	$	154,549	$	476,243	$	355,537	$	57,904	$	126,811	$	280,924	$	735,654	$	1,463	$	2,189,085
Current YTD period:
Gross charge-offs	$	—	$	—	$	—	$	60	$	—	$	—	$	—	$	150	$	210

Commercial: Venture
Capital
Internal risk rating:
1-3 High pass	$	(84)	$	(7)	$	—	$	1,998	$	—	$	(3)	$	136,339	$	(140)	$	138,103
4-6 Pass	101,038		128,485		113,183		6,473		6,216		622		770,941		74,863		1,201,821
7 Special mention	17,481		10,984		31,928		—		19,986		—		13,260		4,994		98,633
8-9 Classified	—		—		7,808		—		—		—		(3)		—		7,805
Total	$	118,435	$	139,462	$	152,919	$	8,471	$	26,202	$	619	$	920,537	$	79,717	$	1,446,362
Current YTD period:
Gross charge-offs	$	—	$	2,245	$	2,759	$	—	$	—	$	—	$	9	$	—	$	5,013

____________________

(1) Amounts with negative balances are loans with zero principal balances and deferred loan origination fees.


															Revolving
															Converted
Amortized Cost Basis (1)	Term Loans by Origination Year												Revolving		to Term
December 31, 2023	2023		2022		2021		2020		2019		Prior		Loans		Loans		Total
	(In thousands)
Commercial: Other
Commercial
Internal risk rating:
1-3 High pass	$	815	$	4,350	$	5,216	$	130	$	29	$	2,148	$	66,827	$	—	$	79,515
4-6 Pass	98,643		201,215		285,249		50,582		39,951		158,810		1,176,946		2,921		2,014,317
7 Special mention	1,748		1,306		442		554		540		5,071		254		69		9,984
8-9 Classified	—		912		4,011		1,706		1,299		13,768		3,257		1,091		26,044
Total	$	101,206	$	207,783	$	294,918	$	52,972	$	41,819	$	179,797	$	1,247,284	$	4,081	$	2,129,860
Current YTD period:
Gross charge-offs	$	—	$	6,867	$	24	$	—	$	28	$	75	$	1,013	$	431	$	8,438

Consumer
Internal risk rating:
1-3 High pass	$	—	$	27	$	22	$	4	$	—	$	—	$	1,304	$	—	$	1,357
4-6 Pass	26,468		71,523		207,751		23,390		42,338		63,919		7,684		345		443,418
7 Special mention	—		1,286		4,224		371		1,100		181		30		—		7,192
8-9 Classified	—		281		42		135		198		486		1		16		1,159
Total	$	26,468	$	73,117	$	212,039	$	23,900	$	43,636	$	64,586	$	9,019	$	361	$	453,126
Current YTD period:
Gross charge-offs	$	—	$	432	$	540	$	76	$	255	$	1,081	$	1	$	12	$	2,397

Total Loans and Leases
Internal risk rating:
1-3 High pass	$	33,216	$	287,437	$	386,182	$	117,303	$	194,718	$	435,411	$	300,907	$	(140)	$	1,755,034
4-6 Pass	873,410		7,191,673		6,440,927		1,619,579		976,138		2,882,938		2,917,653		90,606		22,992,924
7 Special mention	19,229		76,571		96,938		38,611		78,581		170,755		27,554		5,073		513,312
8-9 Classified	4,596		19,456		68,224		12,780		45,103		68,476		8,590		1,192		228,417
Total	$	930,451	$	7,575,137	$	6,992,271	$	1,788,273	$	1,294,540	$	3,557,580	$	3,254,704	$	96,731	$	25,489,687
Current YTD period:
Gross charge-offs	$	3,436	$	33,088	$	8,708	$	876	$	359	$	15,345	$	1,023	$	593	$	63,428

____________________

(1) Amounts with negative balances are loans with zero principal balances and deferred loan origination fees.

On January 1, 2023, the Company adopted ASU 2022-02, "Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures" ("ASU 2022-02"), which eliminated the accounting guidance for troubled debt restructurings while enhancing disclosure requirements for certain loan refinancing and restructurings by creditors when a borrower is experiencing financial difficulty. This guidance was applied on a prospective basis.

The following table presents our loan modifications made to borrowers experiencing financial difficulty by type of modification for the period indicated with related amortized cost balances as of the date indicated:


	Three Months Ended September 30, 2024
	Loan Modifications
	Balances (Amortized Cost Basis) at
	September 30, 2024
									Combination - Term
									Extension and			Total Loan
	Term Extension				Payment Delay				Payment Delay			Modifications
			% of				% of					% of				% of
			Loan				Loan					Loan				Loan
			Portfolio				Portfolio					Portfolio				Portfolio
	Balance		Class		Balance		Class			Balance		Class		Balance		Class
	(Dollars in thousands)
Real estate mortgage:
Commercial	$	93,551	2.1	%	$	45,957	1.0	%		$	—	—	%	$	139,508	3.1	%

Other residential	1,528		0.1	%	—		—	%		—		—	%	1,528		0.1	%



Commercial:
Asset-based	2,195		0.1	%	—		—	%		—		—	%	2,195		0.1	%
Venture capital	—		—	%	—		—	%		13,156		1.0	%	13,156		1.0	%
Other commercial	2,141		0.1	%	—		—	%		—		—	%	2,141		0.1	%

Total	$	99,415			$	45,957				$	13,156			$	158,528


	Nine Months Ended September 30, 2024
	Loan Modifications
	Balances (Amortized Cost Basis) at
	September 30, 2024
									Combination - Term				Combination - Term
									Extension and				Extension and				Total Loan
	Term Extension				Payment Delay				Principal Forgiveness				Payment Delay				Modifications
			% of				% of				% of				% of				% of
			Loan				Loan				Loan				Loan				Loan
			Portfolio				Portfolio				Portfolio				Portfolio				Portfolio
	Balance		Class		Balance		Class		Balance		Class		Balance		Class		Balance		Class
	(Dollars in thousands)
Real estate mortgage:
Commercial	$	94,690	2.1	%	$	60,117	1.3	%	$	13,500	0.3	%	$	—	—	%	$	168,307	3.7	%

Other residential	5,092		0.2	%	—		—	%	—		—	%	—		—	%	5,092		0.2	%




Commercial:
Asset-based	2,195		0.1	%	—		—	%	—		—	%	—		—	%	2,195		0.1	%
Venture capital	—		—	%	—		—	%	—		—	%	13,156		1.0	%	13,156		1.0	%
Other commercial	2,386		0.1	%	—		—	%	—		—	%	45		—	%	2,431		0.1	%
Consumer	11		—	%	—		—	%	—		—	%	—		—	%	11		—	%
Total	$	104,374			$	60,117			$	13,500			$	13,201			$	191,192


	Three Months Ended September 30, 2023
	Loan Modifications
	Balances (Amortized Cost Basis) at
	September 30, 2023
									Combination - Term
									Extension and
									Interest Rate				Total Loan
	Term Extension				Payment Delay				Reduction				Modifications
			% of				% of				% of				% of
			Loan				Loan				Loan				Loan
			Portfolio				Portfolio				Portfolio				Portfolio
	Balance		Class		Balance		Class		Balance		Class		Balance		Class
	(Dollars in thousands)
Real estate mortgage:


Other residential	$	4,001	0.1	%	—		—	%	—		—	%	$	4,001	0.1	%



Commercial:


Other commercial	1,508		0.2	%	41		—	%	6		—	%	1,555		0.2	%

Total	$	5,509			$	41			$	6			$	5,556


	Nine Months Ended September 30, 2023
	Loan Modifications
	Balances (Amortized Cost Basis) at
	September 30, 2023
									Combination - Term
									Extension and
									Interest Rate				Total Loan
	Term Extension				Payment Delay				Reduction				Modifications
			% of				% of				% of					% of
			Loan				Loan				Loan					Loan
			Portfolio				Portfolio				Portfolio					Portfolio
	Balance		Class		Balance		Class		Balance		Class			Balance		Class
	(Dollars in thousands)
Real estate mortgage:


Other residential	$	15,311	0.3	%	$	—	—	%	$	—	—	%		$	15,311	0.3	%




Commercial:


Other commercial	2,556		0.3	%	41		—	%	6		—	%		2,603		0.3	%
Consumer	15		—	%	—		—	%	2		—	%		17		—	%
Total	$	17,882			$	41			$	8				$	17,931

The following tables present the financial effect of our loan modifications made to borrowers experiencing financial difficulty by type of modification for the period indicated:

Three Months Ended September 30, 2024

Term Extension - Financial Effect

Real estate mortgage:

Commercial

Extended maturity by a weighted average 15 months.

Other residential

Extended maturity by a weighted average 8 months.

Commercial:

Asset-based

Extended maturity by a weighted average 4 months.

Other commercial

Extended maturity by a weighted average 14 months.

Three Months Ended September 30, 2024

Payment Delay - Financial Effect

Real estate mortgage:

Commercial

Deferred partial payments for 24 months.

Three Months Ended September 30, 2024

Combination - Term Extension and Payment Delay - Financial Effect

Commercial:

Venture capital

Extended maturity by a weighted average 3 months and granted 3 months of partial payment deferrals.

Nine Months Ended September 30, 2024

Term Extension - Financial Effect

Real estate mortgage:

Commercial

Extended maturity by a weighted average 15 months.

Other residential

Extended maturity by a weighted average 10 months.

Commercial:

Asset-based

Extended maturity by a weighted average 4 months.

Other commercial

Extended maturity by a weighted average 15 months.

Consumer

Extended maturity by a weighted average 12 months.

Nine Months Ended September 30, 2024

Payment Delay - Financial Effect

Real estate mortgage:

Commercial

Deferred partial payments for up to 20 months.

Nine Months Ended September 30, 2024

Combination - Term Extension and Principal Forgiveness - Financial Effect

Real estate mortgage:

Commercial

Extended maturity by a weighted average 3 years and granted principal forgiveness totaling $4.0 million.

Nine Months Ended September 30, 2024

Combination - Term Extension and Payment Delay - Financial Effect

Commercial:

Venture capital

Extended maturity by a weighted average 3 months and granted 3 months of partial payment deferrals.

Other commercial

Extended maturity by a weighted average 10 years and granted 4 months of partial payment deferrals.

Three Months Ended September 30, 2023

Term Extension - Financial Effect

Real estate mortgage:

Other residential

Extended maturity by a weighted average 8 months.

Commercial:

Other commercial

Extended maturity by a weighted average 17 months.

Three Months Ended September 30, 2023

Payment Delay - Financial Effect

Commercial:

Other commercial

Provided 18 months of reduced payments to borrowers without extending the loan term.

Three Months Ended September 30, 2023

Combination - Term Extension and Interest Rate Reduction– Financial Effect

Consumer

Extended maturity by a weighted average 3 years and reduced weighted average contractual interest rate from 11.75% to 7.50%.

Nine Months Ended September 30, 2023

Term Extension - Financial Effect

Real estate mortgage:

Other residential

Extended maturity by a weighted average 10 months.

Commercial:

Other commercial

Extended maturity by a weighted average 22 months.

Consumer

Extended maturity by a weighted average 12 months.

Nine Months Ended September 30, 2023

Payment Delay - Financial Effect

Commercial:

Other commercial

Provided 18 months of reduced payments to borrowers without extending the loan term.

Nine Months Ended September 30, 2023

Combination - Term Extension and Interest Rate Reduction– Financial Effect

Commercial:

Other commercial

Extended maturity by a weighted average 3 years and reduced weighted average contractual interest rate from 11.75% to 7.50%.

Consumer

Extended maturity by a weighted average 2 years and reduced weighted average contractual interest rate from 9.5% to 2.0%.

The following table presents the payment status of loans that were modified during the preceding 12-month period, with related amortized cost balances as of the date indicated:


	Payment Status (Amortized Cost Basis) at
	September 30, 2024
			30-89 Days		90 or More Days
	Current		Past Due		Past Due		Total
	(In thousands)
Real estate mortgage:
Commercial	$	154,206	$	14,160	$	—	$	168,366

Other residential	3,112		91		3,986		7,189



Commercial:
Asset-based	2,195		—		—		2,195
Venture capital	13,156		—		—		13,156
Other commercial	672		3,161		—		3,833
Consumer	11		—		—		11
Total	$	173,352	$	17,412	$	3,986	$	194,750

The following table presents the payment status of loans that were modified during the nine months ended September 30, 2023, subsequent to the adoption of ASU 2022-02 on January 1, 2023, with related amortized cost balances as of the date indicated:


	Payment Status (Amortized Cost Basis) at
	September 30, 2023
			30-89 Days		90 or More Days
	Current		Past Due		Past Due		Total
	(In thousands)
Real estate mortgage:


Other residential	$	6,225	$	7,662	$	1,424	$	15,311



Commercial:


Other commercial	2,599		4		—		2,603
Consumer	17		—		—		17
Total	$	8,841	$	7,666	$	1,424	$	17,931

The following table presents information on loans that defaulted during the periods indicated, which had been modified during the preceding 12-month period, with related amortized cost balances as of the date indicated:


	Three Months Ended September 30, 2024						Nine Months Ended September 30, 2024
	Modified Loans That						Modified Loans That
	Subsequently Defaulted						Subsequently Defaulted
	Amortized Cost Basis at						Amortized Cost Basis at
	September 30, 2024						September 30, 2024
	Term Extension		Payment Delay		Total		Term Extension		Payment Delay		Total
	(In thousands)
Real estate mortgage:
Commercial	$	—	$	14,160	$	14,160	$	—	$	14,160	$	14,160

Other residential	556		—		556		4,077		—		4,077








Total	$	556	$	14,160	$	14,716	$	4,077	$	14,160	$	18,237

The following table presents information on loans that defaulted during the periods indicated, which had been modified during the nine months ended September 30, 2023, subsequent to the adoption of ASU 2022-02 on January 1, 2023, with related amortized cost balances as of the date indicated:

Three Months Ended September 30, 2023

Nine Months Ended September 30, 2023

Modified Loans That

Subsequently Defaulted

Amortized Cost Basis at

September 30, 2024

Term Extension

(In thousands)

Real estate mortgage:

Other residential

8,700

9,100

Commercial:

Other commercial

Total

8,704

9,104

Leases Receivable

We provide equipment financing to our customers primarily with operating and direct financing leases. For direct financing leases, lease receivables are recorded on the balance sheet but the leased equipment is not, although we generally retain legal title to the leased equipment until the end of each lease. Direct financing leases are stated at the net amount of minimum lease payments receivable, plus any unguaranteed residual value, less the amount of unearned income and net acquisition discount at the reporting date. Direct lease origination costs are amortized using the effective interest method over the life of the leases. Direct financing leases are subject to our accounting for allowance for loan and lease losses. See Note 8. Leases for information regarding operating leases where we are the lessor.

The following table provides the components of leases receivable income for the periods indicated:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
	(In thousands)
Component of leases receivable income:
Interest income on net investments in leases	$	4,711	$	4,319	$	14,323	$	12,186

The following table presents the components of leases receivable as of the dates indicated:


	September 30, 2024		December 31, 2023
	(In thousands)
Net Investment in Direct Financing Leases:
Lease payments receivable	$	223,181	$	249,223
Unguaranteed residual assets	23,816		25,488
Deferred costs and other	2,194		2,715
Aggregate net investment in leases	$	249,191	$	277,426

The following table presents maturities of leases receivable as of the date indicated:


	September 30, 2024
	(In thousands)
Period ending December 31,
2024	$	20,341
2025	78,813
2026	61,079
2027	40,526
2028	23,552
Thereafter	25,400
Total undiscounted cash flows	249,711
Less: Unearned income	(26,530)
Present value of lease payments	$	223,181

Allowance for Loan and Lease Losses

The following tables present a summary of the activity in the allowance for loan and lease losses on loans and leases held for investment by loan portfolio segment for the periods indicated:


	Three Months Ended September 30, 2024
			Real Estate
	Real Estate		Construction
	Mortgage		and Land		Commercial		Consumer		Total
	(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$	155,260	$	25,281	$	51,194	$	16,027	$	247,762
Charge-offs	(640)		—		(1,963)		(1,560)		(4,163)
Recoveries	216		—		1,253		277		1,746
Net charge-offs	(424)		—		(710)		(1,283)		(2,417)
Provision	9,798		(11,943)		10,387		758		9,000
Balance, end of period	$	164,634	$	13,338	$	60,871	$	15,502	$	254,345


	Nine Months Ended September 30, 2024
			Real Estate
	Real Estate		Construction
	Mortgage		and Land		Commercial		Consumer		Total
	(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$	186,827	$	33,830	$	45,156	$	15,874	$	281,687

Charge-offs	(56,998)		—		(5,815)		(4,434)		(67,247)
Recoveries	2,536		—		4,956		413		7,905
Net charge-offs	(54,462)		—		(859)		(4,021)		(59,342)
Provision	32,269		(20,492)		16,574		3,649		32,000
Balance, end of period	$	164,634	$	13,338	$	60,871	$	15,502	$	254,345

Ending Allowance by
Evaluation Methodology:
Individually evaluated	$	—	$	—	$	8,196	$	—	$	8,196
Collectively evaluated	$	164,634	$	13,338	$	52,675	$	15,502	$	246,149

Ending Loans and Leases by
Evaluation Methodology:
Individually evaluated	$	129,829	$	—	$	36,527	$	—	$	166,356
Collectively evaluated	13,204,577		3,459,409		6,282,945		414,490		23,361,421
Ending balance	$	13,334,406	$	3,459,409	$	6,319,472	$	414,490	$	23,527,777


	Three Months Ended September 30, 2023
			Real Estate
	Real Estate		Construction
	Mortgage		and Land		Commercial		Consumer		Total
	(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$	132,808	$	39,679	$	37,221	$	9,526	$	219,234
Charge-offs	(5,757)		—		(335)		(603)		(6,695)
Recoveries	535		—		1,199		24		1,758
Net charge-offs	(5,222)		—		864		(579)		(4,937)
Provision	8,944		686		(1,411)		(219)		8,000
Balance, end of period	$	136,530	$	40,365	$	36,674	$	8,728	$	222,297


	Nine Months Ended September 30, 2023
			Real Estate
	Real Estate		Construction
	Mortgage		and Land		Commercial		Consumer		Total
	(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$	87,309	$	52,320	$	52,849	$	8,254	$	200,732
Charge-offs	(39,467)		—		(7,819)		(1,514)		(48,800)
Recoveries	797		—		2,916		152		3,865
Net charge-offs	(38,670)		—		(4,903)		(1,362)		(44,935)
Provision	87,891		(11,955)		(11,272)		1,836		66,500
Balance, end of period	$	136,530	$	40,365	$	36,674	$	8,728	$	222,297

Ending Allowance by
Evaluation Methodology:
Individually evaluated	$	—	$	—	$	497	$	—	$	497
Collectively evaluated	$	136,530	$	40,365	$	36,177	$	8,728	$	221,800

Ending Loans and Leases by
Evaluation Methodology:
Individually evaluated	$	120,491	$	—	$	4,723	$	—	$	125,214
Collectively evaluated	13,914,000		2,737,537		4,749,707		394,488		21,795,732
Ending balance	$	14,034,491	$	2,737,537	$	4,754,430	$	394,488	$	21,920,946

The allowance for loan and lease losses increased by $6.6 million in the third quarter of 2024 to $254.3 million due primarily to a $9.0 million provision, offset by net charge-offs of $2.4 million. For additional information regarding the calculation of the allowance for loan and lease losses using the CECL methodology, including discussion of forecasts used to estimate the allowance, please see Note 1(j). Nature of Operations and Summary of Significant Accounting Policies - Allowance for Credit Losses on Loans and Leases Held for Investment of the Notes to Consolidated Financial Statements contained in "Item 8. Financial Statements and Supplementary Data" of the Form 10-K.

A loan is considered collateral-dependent, and is individually evaluated for reserve purposes, when the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. The following table summarizes collateral-dependent loans held for investment by collateral type as of the following dates:


	September 30, 2024				December 31, 2023
	Real		Business				Real		Business
	Property		Assets		Total		Property		Assets		Total
	(In thousands)
Real estate mortgage	$	129,424	$	—	$	129,424	$	47,952	$	—	$	47,952

Commercial	—		11,303		11,303		—		3,616		3,616

Total	$	129,424	$	11,303	$	140,727	$	47,952	$	3,616	$	51,568

Allowance for Credit Losses

The allowance for credit losses is the combination of the allowance for loan and lease losses and the reserve for unfunded loan commitments. The reserve for unfunded loan commitments is included within "Accrued interest payable and other liabilities" on the condensed consolidated balance sheets.

The following tables present a summary of the activity in the allowance for loan and lease losses and reserve for unfunded loan commitments for the periods indicated:


	Three Months Ended
	September 30, 2024
	Allowance for		Reserve for		Total
	Loan and		Unfunded Loan		Allowance for
	Lease Losses		Commitments		Credit Losses
	(In thousands)
Balance, beginning of period	$	247,762	$	27,571	$	275,333
Charge-offs	(4,163)		—		(4,163)
Recoveries	1,746		—		1,746
Net charge-offs	(2,417)		—		(2,417)
Provision	9,000		—		9,000
Balance, end of period	$	254,345	$	27,571	$	281,916


	Nine Months Ended
	September 30, 2024
	Allowance for		Reserve for		Total
	Loan and		Unfunded Loan		Allowance for
	Lease Losses		Commitments		Credit Losses
	(In thousands)
Balance, beginning of period	$	281,687	$	29,571	$	311,258
Charge-offs	(67,247)		—		(67,247)
Recoveries	7,905		—		7,905
Net charge-offs	(59,342)		—		(59,342)
Provision	32,000		(2,000)		30,000
Balance, end of period	$	254,345	$	27,571	$	281,916


	Three Months Ended
	September 30, 2023
	Allowance for		Reserve for		Total
	Loan and		Unfunded Loan		Allowance for
	Lease Losses		Commitments		Credit Losses
	(In thousands)
Balance, beginning of period	$	219,234	$	37,571	$	256,805
Charge-offs	(6,695)		—		(6,695)
Recoveries	1,758		—		1,758
Net charge-offs	(4,937)		—		(4,937)
Provision	8,000		(8,000)		—
Balance, end of period	$	222,297	$	29,571	$	251,868


	Nine Months Ended
	September 30, 2023
	Allowance for		Reserve for		Total
	Loan and		Unfunded Loan		Allowance for
	Lease Losses		Commitments		Credit Losses
	(In thousands)
Balance, beginning of period	$	200,732	$	91,071	$	291,803
Charge-offs	(48,800)		—		(48,800)
Recoveries	3,865		—		3,865
Net charge-offs	(44,935)		—		(44,935)
Provision	66,500		(61,500)		5,000
Balance, end of period	$	222,297	$	29,571	$	251,868