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Loans Receivable and Allowance for Credit Losses

9 Months Ended

Sep. 30, 2020

Loans Receivable and Allowance for Credit Losses

On January 1, 2020, the Company adopted CECL, which replaced the incurred loss methodology with an expected loss methodology. The adoption of the new standard resulted in the Company recording a $7.9 million increase to the allowance for credit losses on loans with a corresponding cumulative effect adjustment to decrease retained earnings by $5.9 million, net of income taxes. (See Adoption of CECL table below for additional detail.)

Loans receivable at September 30, 2020 and December 31, 2019 are summarized as follows (in thousands):


	September 30, 2020		December 31, 2019
Mortgage loans:
Residential	$	1,320,222	1,077,689
Commercial	3,750,639		2,578,393
Multi-family	1,544,924		1,225,551
Construction	462,161		429,812
Total mortgage loans	7,077,946		5,311,445
Commercial loans
Commercial owner occupied	934,104		853,269
Commercial non-owner occupied	906,355		732,277
Other commercial loans	449,737		49,213
Total commercial loans	2,290,196		1,634,759
Consumer loans	406,451		391,360

Total gross loans	9,774,593		7,337,564
PCI loans prior to CECL	—		746
Premiums on purchased loans	1,514		2,474
Unearned discounts	(26)		(26)
Net deferred fees	(19,272)		(7,873)
Total loans	$	9,756,809	7,332,885

The following tables summarize the aging of loans receivable by portfolio segment and class of loans (in thousands). The September 30, 2020 balances include PCD loans, while the December 31, 2019 balances exclude PCI loans (in accordance with ASC 310, prior to the adoption of ASU 2016-13 on January 1, 2020):


	September 30, 2020
	30-59 Days		60-89 Days	Non-accrual	Recorded Investment > 90 days accruing	Total Past Due	Current	Total Loans Receivable	Non-accrual loans with no related allowance
Mortgage loans:
Residential	$	8,719	7,215	9,424	—	25,358	1,294,864	1,320,222	1,491
Commercial	3,914		4,629	16,568	—	25,111	3,725,528	3,750,639	4,134
Multi-family	—		488	—	—	488	1,544,436	1,544,924	—
Construction	7,396		918	151	—	8,465	453,696	462,161	—
Total mortgage loans	20,029		13,250	26,143	—	59,422	7,018,524	7,077,946	5,625
Commercial loans	5,575		949	21,269	—	27,793	2,262,403	2,290,196	6,060
Consumer loans	745		862	1,541	—	3,148	403,303	406,451	9
Total gross loans	$	26,349	15,061	48,953	—	90,363	9,684,230	9,774,593	11,694


	December 31, 2019
	30-59 Days		60-89 Days	Non-accrual	Recorded Investment > 90 days accruing	Total Past Due	Current	Total Loans Receivable	Non-accrual loans with no related allowance
Mortgage loans:
Residential	$	5,905	2,579	8,543	—	17,027	1,060,662	1,077,689	2,989
Commercial	—		—	5,270	—	5,270	2,573,123	2,578,393	—
Multi-family	—		—	—	—	—	1,225,551	1,225,551	—
Construction	—		—	—	—	—	429,812	429,812	—
Total mortgage loans	5,905		2,579	13,813	—	22,297	5,289,148	5,311,445	2,989
Commercial loans	2,383		95	25,160	—	27,638	1,607,121	1,634,759	3,238
Consumer loans	1,276		337	1,221	—	2,834	388,526	391,360	569
Total gross loans	$	9,564	3,011	40,194	—	52,769	7,284,795	7,337,564	6,796

Included in loans receivable are loans for which the accrual of interest income has been discontinued due to deterioration in the financial condition of the borrowers. The principal amounts of these non-accrual loans were $49.0 million and $40.2 million at September 30, 2020 and December 31, 2019, respectively. Included in non-accrual loans were $4.9 million and $13.1 million of loans which were less than 90 days past due at September 30, 2020 and December 31, 2019, respectively. There were no loans 90 days or greater past due and still accruing interest at September 30, 2020 or December 31, 2019.

Management has elected to measure an allowance for credit losses for accrued interest receivables specifically related to any loan that has been deferred as a result of COVID-19. Generally, accrued interest is written off by reversing interest income during the quarter the loan is moved from an accrual to a non-accrual status.

The Company defines an impaired loan as a non-homogeneous loan greater than $1.0 million, for which, based on current information, the Bank does not expect to collect all amounts due under the contractual terms of the loan agreement. Impaired loans also include all loans modified as troubled debt restructurings (“TDRs”). An allowance for collateral-dependent impaired loans that have been modified in a TDR is measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price, or the estimated fair value of the collateral, less any selling costs. The Company uses third-party appraisals to determine the fair value of the underlying collateral in its analysis of collateral-dependent loans. A third-party appraisal is generally ordered as soon as a loan is designated as a collateral-dependent loan and updated annually, or more frequently if required.

A financial asset is considered collateral-dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. For all classes of loans deemed collateral-dependent, the Company estimates expected credit losses based on the collateral’s fair value less any selling costs. A specific allocation of the allowance for credit losses is established for each collateral-dependent loan with a carrying balance greater

than the collateral’s fair value, less estimated selling costs. In most cases, the Company records a partial charge-off to reduce the loan’s carrying value to the collateral’s fair value less estimated selling costs. At each fiscal quarter end, if a loan is designated as collateral-dependent and the third-party appraisal has not yet been received, an evaluation of all available collateral is made using the best information available at the time, including rent rolls, borrower financial statements and tax returns, prior appraisals, management’s knowledge of the market and collateral, and internally prepared collateral valuations based upon market assumptions regarding vacancy and capitalization rates, each as and where applicable. Once the appraisal is received and reviewed, the specific reserves are adjusted to reflect the appraised value. The Company believes there have been no significant time lapses resulting from this process.

At September 30, 2020, there were 151 impaired loans totaling $65.8 million. Included in this total were 122 TDRs related to 119 borrowers totaling $38.0 million that were performing in accordance with their restructured terms and which continued to accrue interest at September 30, 2020. At December 31, 2019, there were 158 impaired loans totaling $70.6 million, of which 147 loans totaling $48.3 million were TDRs. Included in this total were 133 TDRs to 128 borrowers totaling $42.7 million that were performing in accordance with their restructured terms and which continued to accrue interest at December 31, 2019.

At September 30, 2020 and December 31, 2019, the Company had $18.0 million and $20.4 million of collateral-dependent impaired loans, respectively. The collateral-dependent impaired loans at September 30, 2020 consisted of $13.2 million in commercial loans, $4.7 million in residential real estate loans, and $9,000 in consumer loans. The collateral for these impaired loans was primarily real estate.

The activity in the allowance for credit losses by portfolio segment for the three and nine months ended September 30, 2020 and 2019 was as follows (in thousands):


Three months ended September 30,	Mortgage loans		Commercial loans	Consumer loans	Total
2020
Balance at beginning of period	$	54,871	25,284	6,104	86,259
Provision charged to operations	2,922		2,767	722	6,411
Initial allowance on credit loans related to PCD loans	11,984		1,582	20	13,586
Recoveries of loans previously charged-off	35		679	144	858
Loans charged-off	(22)		(727)	(51)	(800)
Balance at end of period	$	69,790	29,585	6,939	106,314

2019
Balance at beginning of period	$	27,280	33,549	1,981	62,810
Provision charged to operations	(2,092)		2,880	(288)	500
Recoveries of loans previously charged-off	24		126	343	493
Loans charged-off	(131)		(6,212)	(116)	(6,459)
Balance at end of period	$	25,081	30,343	1,920	57,344


Nine months ended September 30,	Mortgage loans		Commercial loans	Consumer loans	Total
2020
Balance at beginning of period	$	25,511	28,263	1,751	55,525
Increase (decrease) due to the initial adoption of CECL - Retained earnings	14,188		(9,974)	3,706	7,920
Initial allowance on credit loans related to PCD loans	11,984		1,582	20	13,586
Provision charged to operations	17,987		12,672	1,352	32,011
Recoveries of loans previously charged-off	143		1,597	370	2,110
Loans charged-off	(23)		(4,555)	(260)	(4,838)
Balance at end of period	$	69,790	29,585	6,939	106,314

2019
Balance at beginning of period	$	27,678	25,693	2,191	55,562
Provision (credited) charged to operations	(2,814)		13,337	(323)	10,200
Recoveries of loans previously charged-off	361		291	596	1,248
Loans charged-off	(144)		(8,978)	(544)	(9,666)
Balance at end of period	$	25,081	30,343	1,920	57,344

As a result of the January 1, 2020 adoption of CECL, the Company recorded a $7.9 million increase to the allowance for credit losses on loans. For the three and nine months ended September 30, 2020, the Company recorded a $6.4 million and $32.0 million provision for credit losses on loans, respectively. The increase in the provision for credit losses for the three and nine months ended September 30, 2020 reflects management’s best estimate of projected losses over the life of loans in our portfolio in accordance with the CECL approach, given the economic outlook and forecasts related to the COVID-19 pandemic, as well as the impact of unprecedented fiscal, monetary and regulatory interventions. The largest increase in the provision for credit losses on loans for the three and nine months ended September 30, 2020 was in the commercial real estate portfolio.

The following table illustrates the impact of the January 1, 2020 adoption of CECL on the allowance for credits for the loan portfolio (in thousands):


	January 1, 2020
	As reported under CECL		Prior to CECL	Impact of CECL adoption
Loans
Residential	$	8,950	3,411	5,539
Commercial	17,118		12,885	4,233
Multi-family	9,519		3,370	6,149
Construction	4,152		5,885	(1,733)
Total mortgage loans	39,739		25,551	14,188
Commercial loans	18,254		28,228	(9,974)
Consumer loans	5,452		1,746	3,706
Allowance for credit losses on loans	$	63,445	55,525	7,920

The following tables summarize loans receivable by portfolio segment and impairment method (in thousands):


	September 30, 2020
	Mortgage loans		Commercial loans	Consumer loans	Total Portfolio Segments
Individually evaluated for impairment	$	43,397	20,963	1,449	65,809
Collectively evaluated for impairment	7,034,549		2,269,233	405,002	9,708,784
Total gross loans	$	7,077,946	2,290,196	406,451	9,774,593


	December 31, 2019
	Mortgage loans		Commercial loans	Consumer loans	Total Portfolio Segments
Individually evaluated for impairment	$	39,910	28,357	2,374	70,641
Collectively evaluated for impairment	5,271,535		1,606,402	388,986	7,266,923
Total gross loans	$	5,311,445	1,634,759	391,360	7,337,564

The allowance for credit losses is summarized by portfolio segment and impairment classification as follows (in thousands):


	September 30, 2020
	Mortgage loans		Commercial loans	Consumer loans	Total
Individually evaluated for impairment	$	1,391	1,876	33	3,300
Collectively evaluated for impairment	68,399		27,709	6,906	103,014
Total gross loans	$	69,790	29,585	6,939	106,314


	December 31, 2019
	Mortgage loans		Commercial loans	Consumer loans	Total
Individually evaluated for impairment	$	1,580	3,462	25	5,067
Collectively evaluated for impairment	23,931		24,801	1,726	50,458
Total gross loans	$	25,511	28,263	1,751	55,525

Loan modifications to borrowers experiencing financial difficulties that are considered TDRs primarily involve lowering the monthly payments on such loans through either a reduction in interest rate below a market rate, an extension of the term of the loan without a corresponding adjustment to the risk premium reflected in the interest rate, or a combination of these two methods. These modifications generally do not result in the forgiveness of principal or accrued interest. In addition, management attempts to obtain additional collateral or guarantor support when modifying such loans. If the borrower has demonstrated performance under the previous terms and our underwriting process shows the borrower has the capacity to continue to perform under the restructured terms, the loan will continue to accrue interest. Non-accruing restructured loans may be returned to accrual status when there has been a sustained period of repayment performance (generally six consecutive months of payments) and both principal and interest are deemed collectible.

The following tables present the number of loans modified as TDRs during the three and nine months ended September 30, 2020 and 2019, along with their balances immediately prior to the modification date and post-modification as of September 30, 2020 and 2019 (in thousands):


	For the three months ended
	September 30, 2020					September 30, 2019
Troubled Debt Restructurings	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	($ in thousands)
Mortgage loans:
Residential	1	$	91	$	79	—	$	—	$	—


Total mortgage loans	1	91		79		—	—		—
Commercial loans	1	1,399		1,399		—	—		—
Consumer loans	—	—		—		1	20		16
Total restructured loans	2	$	1,490	$	1,478	1	$	20	$	16


	For the nine months ended
	September 30, 2020					September 30, 2019
Troubled Debt Restructurings	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	($ in thousands)
Mortgage loans:
Residential	2	$	434	$	360	2	$	749	$	716
Commercial	—	—		—		1	14,010		14,010

Total mortgage loans	2	434		360		3	14,759		14,726
Commercial loans	5	2,882		2,791		7	2,707		1,878
Consumer loans	—	—		—		1	20		16
Total restructured loans	7	$	3,316	$	3,151	11	$	17,486	$	16,620

All TDRs are impaired loans, which are individually evaluated for impairment. During the three and nine months ended September 30, 2020, $612,000 and $3.8 million of charge-offs were recorded on collateral-dependent impaired loans. During the three and nine months ended September 30, 2019, $5.7 million and $7.7 million of charge-offs were recorded on collateral-dependent impaired loans, respectively. For the nine months ended September 30, 2020, the allowance for credit losses associated with the TDRs presented in the preceding tables totaled $421,000, while there was no allowance associated with TDRs for the three months ended September 30, 2020, and was included in the allowance for credit losses for loans individually evaluated for impairment. (See page 26 for further discussion related to COVID-19 loan modifications)

For the three and nine months ended September 30, 2020, the TDRs presented in the preceding tables had a weighted average modified interest rate of 4.82% and 5.46%, respectively, compared to a weighted average rate of 4.83% and 5.51% prior to modification, for the three and nine months ended September 30, 2020, respectively.

The following table presents loans modified as TDRs within the previous 12 months from September 30, 2020 and 2019, and for which there was a payment default (90 days or more past due) at the quarter ended September 30, 2020 and 2019.


	September 30, 2020			September 30, 2019
Troubled Debt Restructurings Subsequently Defaulted	Number of Loans	Outstanding Recorded Investment		Number of Loans	Outstanding Recorded Investment
	($ in thousands)
Mortgage loans:
Residential	—	$	—	1	$	578

Total mortgage loans	—	—		1	578


Total restructured loans	—	$	—	1	$	578

There were no loans which had a payment default (90 days or more past due) for loans modified as TDRs within the 12 month period ending September 30, 2020. There was one payment default (90 days or more past due) to one borrower for loans modified as TDRs within the 12 month period ending September 30, 2019. For TDRs that subsequently default, the Company determines the amount of the allowance on that loan in accordance with the accounting policy for the allowance for credit losses on loans individually evaluated for impairment.

As allowed by CECL, the Company elected to maintain pools of loans accounted for under ASC 310-30. At December 31, 2019, purchased credit impaired (“PCI”) loans totaled $746,000. In accordance with the CECL standard, management did not reassess whether modifications of individually acquired financial assets accounted for in pools were TDRs as of the date of adoption. Loans considered to be PCI prior to January 1, 2020 were converted to purchased credit deteriorated ("PCD") loans on that date. Any additional loans acquired by the Company after January 1, 2020, that experience more-than-insignificant deterioration in credit quality after origination, have been classified as PCD loans.

The table below is a summary of the PCD loans accounted for in accordance with ASC 310-26 that were acquired in the SB One acquisition as of the July 31, 2020 closing date (in thousands):


Gross amortized cost basis at July 31, 2020	$	315,784
Interest component of expected cash flows (accretable difference)	(7,988)

Allowance for credit losses on PCD loans	(13,586)
Net PCD loans	$	294,210

The following table presents loans individually evaluated for impairment by class and loan category, excluding PCD loans (in thousands):


	September 30, 2020						December 31, 2019
	Unpaid Principal Balance		Recorded Investment	Related Allowance	Average Recorded Investment	Interest Income Recognized	Unpaid Principal Balance	Recorded Investment	Related Allowance	Average Recorded Investment	Interest Income Recognized
Loans with no related allowance
Mortgage loans:
Residential	$	14,144	11,541	—	11,694	386	13,478	10,739	—	10,910	533
Commercial	19,543		19,543	—	19,548	431	—	—	—	—	—


Total	33,687		31,084	—	31,242	817	13,478	10,739	—	10,910	533
Commercial loans	7,959		5,713	—	7,300	29	3,927	3,696	—	4,015	17
Consumer loans	1,396		895	—	921	39	2,086	1,517	—	1,491	86
Total impaired loans	$	43,042	37,692	—	39,463	885	19,491	15,952	—	16,416	636

Loans with an allowance recorded
Mortgage loans:
Residential	$	7,922	7,503	728	7,440	235	10,860	10,326	829	10,454	428
Commercial	4,810		4,810	663	4,822	41	18,845	18,845	751	18,862	569


Total	12,732		12,313	1,391	12,262	276	29,705	29,171	1,580	29,316	997
Commercial loans	17,050		15,250	1,876	18,280	293	27,762	24,661	3,462	27,527	444
Consumer loans	569		554	33	560	13	868	857	25	878	46
Total impaired loans	$	30,351	28,117	3,300	31,102	582	58,335	54,689	5,067	57,721	1,487

Total impaired loans
Mortgage loans:
Residential	$	22,066	19,044	728	19,134	621	24,338	21,065	829	21,364	961
Commercial	24,353		24,353	663	24,370	472	18,845	18,845	751	18,862	569


Total	46,419		43,397	1,391	43,504	1,093	43,183	39,910	1,580	40,226	1,530
Commercial loans	25,009		20,963	1,876	25,580	322	31,689	28,357	3,462	31,542	461
Consumer loans	1,965		1,449	33	1,481	52	2,954	2,374	25	2,369	132
Total impaired loans	$	73,393	65,809	3,300	70,565	1,467	77,826	70,641	5,067	74,137	2,123

Specific allocations of the allowance for credit losses attributable to impaired loans totaled $3.3 million at September 30, 2020 and $5.1 million at December 31, 2019. At September 30, 2020 and December 31, 2019, impaired loans for which there was no related allowance for credit losses totaled $37.7 million and $16.0 million, respectively. The average balance of impaired loans for the nine months ended September 30, 2020 and December 31, 2019 was $70.6 million and $74.1 million, respectively.

Management utilizes an internal nine-point risk rating system to summarize its loan portfolio into categories with similar risk characteristics. Loans deemed to be “acceptable quality” are rated 1 through 4, with a rating of 1 established for loans with

minimal risk. Loans that are deemed to be of “questionable quality” are rated 5 (watch) or 6 (special mention). Loans with adverse classifications (substandard, doubtful or loss) are rated 7, 8 or 9, respectively. Commercial mortgage, commercial, multi-family and construction loans are rated individually, and each lending officer is responsible for risk rating loans in their portfolio. These risk ratings are then reviewed by the department manager and/or the Chief Lending Officer and by the Credit Department. The risk ratings are also confirmed through periodic loan review examinations which are currently performed by an independent third-party. Reports by the independent third-party are presented directly to the Audit Committee of the Board of Directors.

In response to the COVID-19 pandemic and its adverse economic impact on both our commercial and retail borrowers, the Company implemented a modification program to defer principal or principal and interest payments for borrowers directly impacted by the pandemic and who were not more than 30 days past due as of December 31, 2019, all in accordance with the Coronavirus Aid, Relief, and Economic Security ("CARES") Act.

Loans that have been or are expected to be granted COVID-19 related deferrals or modifications have decreased from a peak level of $1.31 billion, or 16.8% of loans, to $310.8 million, or 3.2% of loans as of October 16, 2020. This $310.8 million of loans includes $47.5 million acquired from SB One and consists of $27.0 million in a first 90-day deferral period, $84.9 million in a second 90-day deferral period, and $198.9 million that have completed their initial deferral periods, but are expected to require ongoing assistance. Included in the $310.8 million of loans, $92.4 million are secured by hotels, $43.7 million are secured by retail properties, $31.4 million are secured by restaurants, $15.1 million are secured by suburban office space, and $42.7 million are secured by residential mortgages, with the balance comprised of diverse commercial loans. In accordance with the CARES Act, the Company has elected to not apply troubled debt restructuring classification to any COVID-19 related loan modifications that were performed after March 1, 2020 to borrowers who were current as of December 31, 2019. Accordingly, these modifications are not classified as troubled debt restructurings (“TDRs”).

In addition, the Company participated in the Paycheck Protection Program (“PPP”) through the United States Department of the Treasury and Small Business Administration ("SBA"). As of September 30, 2020, the Company secured 1,289 PPP loans for its customers totaling $474.8 million. The PPP loans are fully guaranteed by the SBA and may be eligible for forgiveness by the SBA to the extent that the proceeds are used to cover eligible payroll costs, interest costs, rent, and utility costs over a period of up to 24 weeks after the loan was made as long as certain conditions are met regarding employee retention and compensation levels. PPP loans deemed eligible for forgiveness by the SBA will be repaid by the SBA to the Company. PPP loans are included in the commercial loan portfolio.

The following table summarizes the Company's gross loans held for investment by year of origination and internally assigned credit grades (in thousands):


	At September 30, 2020
Total portfolio	Residential		Commercial mortgage	Multi-family	Construction	Total mortgages	Commercial	Consumer	Total Loans (1)
Special mention	$	4,483	54,368	101	872	59,824	168,833	362	229,019
Substandard	41,255		52,847	124	—	94,226	103,132	3,680	201,038
Doubtful	—		—	—	—	—	76	—	76
Loss	—		—	—	—	—	—	—	—
Total criticized and classified	45,738		107,215	225	872	154,050	272,041	4,042	430,133
Pass/Watch	1,274,484		3,643,424	1,544,699	461,289	6,923,896	2,018,155	402,409	9,344,460
Total	$	1,320,222	3,750,639	1,544,924	462,161	7,077,946	2,290,196	406,451	9,774,593

2020
Special mention	$	—	—	—	872	872	657	—	1,529
Substandard	2,079		—	—	—	2,079	—	25	2,104
Doubtful	—		—	—	—	—	—	—	—
Loss	—		—	—	—	—	—	—	—
Total criticized and classified	2,079		—	—	872	2,951	657	25	3,633
Pass/Watch	198,722		375,324	230,034	28,187	832,267	586,510	27,605	1,446,382
Total gross loans	$	200,801	375,324	230,034	29,059	835,218	587,167	27,630	1,450,015


2019
Special mention	$	1,753	$	12,434	$	—	$	—	$	14,187	$	6,755	$	—	$	20,942
Substandard	6,321		—		—		—		6,321		2,742		343		9,406
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total criticized and classified	8,074		12,434		—		—		20,508		9,497		343		30,348
Pass/Watch	139,391		547,969		139,633		164,333		991,326		225,447		46,745		1,263,518
Total gross loans	$	147,465	560,403		139,633		164,333		1,011,834		234,944		47,088		1,293,866

2018
Special mention	$	318	6,630		—		—		6,948		10,908		—		17,856
Substandard	2,152		—		—		—		2,152		4,948		356		7,456
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total criticized and classified	2,470		6,630		—		—		9,100		15,856		356		25,312
Pass/Watch	79,552		361,309		171,555		119,980		732,396		169,974		40,927		943,297
Total gross loans	$	82,022	367,939		171,555		119,980		741,496		185,830		41,283		968,609

2017
Special mention	$	—	—		—		—		—		31,465		—		31,465
Substandard	3,233		17,529		—		—		20,762		8,040		15		28,817
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total criticized and classified	3,233		17,529		—		—		20,762		39,505		15		60,282
Pass/Watch	80,813		387,846		134,166		37,564		640,389		148,737		33,340		822,466
Total gross loans	$	84,046	405,375		134,166		37,564		661,151		188,242		33,355		882,748

2016 and prior
Special mention	$	2,412	35,304		101		—		37,817		119,048		362		157,227
Substandard	27,470		35,318		124		—		62,912		87,402		2,941		153,255
Doubtful	—		—		—		—		—		76		—		76
Loss	—		—		—		—		—		—		—		—
Total criticized and classified	29,882		70,622		225		—		100,729		206,526		3,303		310,558
Pass/Watch	805,888		2,041,598		869,536		111,225		3,828,247		1,094,013		257,095		5,179,355
Total gross loans	$	835,770	2,112,220		869,761		111,225		3,928,976		1,300,539		260,398		5,489,913

	At December 31, 2019
	Residential		Commercial mortgage		Multi-family		Construction		Total mortgages		Commercial		Consumer		Total loans
Special mention	$	2,402	46,758		—		—		49,160		79,248		286		128,694
Substandard	10,204		13,458		—		6,181		29,843		57,015		1,668		88,526
Doubtful	—		—		—		—		—		836		—		836
Loss	—		—		—		—		—		—		—		—
Total criticized and classified	12,606		60,216		—		6,181		79,003		137,099		1,954		218,056
Pass/Watch	1,065,083		2,518,177		1,225,551		423,631		5,232,442		1,497,660		389,406		7,119,508
Total	$	1,077,689	2,578,393		1,225,551		429,812		5,311,445		1,634,759		391,360		7,337,564

(1) Contained within criticized and classified loans at September 30, 2020 are loans that were granted payment deferrals related to COVID-19 totaling $310.8 million.