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Loans and Leases Receivable and Allowance for Loan and Lease Losses (Tables)

12 Months Ended

Dec. 31, 2019

The following table presents loans and leases receivable as of December 31, 2019 and 2018:


	December 31,
(amounts in thousands)	2019		2018
Loans receivable, mortgage warehouse, at fair value	$	2,245,758	$	1,405,420
Loans receivable:
Commercial:
Multi-family	1,909,274		3,285,297
Commercial and industrial (including owner occupied commercial real estate) ⁽¹⁾	2,441,987		1,951,277
Commercial real estate non-owner occupied	1,223,529		1,125,106
Construction	118,418		56,491
Total commercial loans and leases receivable	5,693,208		6,418,171
Consumer:
Residential real estate	375,014		566,561
Manufactured housing	70,398		79,731
Other consumer	1,178,283		74,035
Total consumer loans receivable	1,623,695		720,327
Loans and leases receivable	7,316,903		7,138,498
Deferred (fees) costs and unamortized (discounts) premiums, net	2,085		(424)
Allowance for loan and lease losses	(56,379)		(39,972)
Total loans and leases receivable, net of allowance for loan and lease losses	$	9,508,367	$	8,503,522

(1)Includes direct finance equipment leases of $89.2 million and $54.5 million at December 31, 2019 and 2018, respectively.

Loans Receivable by Class and Performance Status

The following tables summarize loans and leases receivable by loan and lease type and performance status as of December 31, 2019 and 2018:


	December 31, 2019
(amounts in thousands)	30-89 Days past due ⁽¹⁾		90 Days or more past due ⁽¹⁾		Total past due ⁽¹⁾		Non- accrual		Current ⁽²⁾		Purchased-credit-impaired loans ⁽³⁾		Total loans and leases ⁽⁴⁾
Multi-family	$	2,133	$	—	$	2,133	$	4,117	$	1,901,336	$	1,688	$	1,909,274
Commercial and industrial	2,395		—		2,395		4,531		1,882,700		354		1,889,980
Commercial real estate owner occupied	5,388		—		5,388		1,963		537,992		6,664		552,007
Commercial real estate non-owner occupied	8,034		—		8,034		76		1,211,892		3,527		1,223,529
Construction	—		—		—		—		118,418		—		118,418
Residential real estate	5,924		—		5,924		6,128		359,491		3,471		375,014
Manufactured housing ⁽⁵⁾	3,699		1,794		5,493		1,655		61,649		1,601		70,398
Other consumer	5,756		—		5,756		1,551		1,170,793		183		1,178,283
Total	$	33,329	$	1,794	$	35,123	$	20,021	$	7,244,271	$	17,488	$	7,316,903


	December 31, 2018
(amounts in thousands)	30-89 Days past due ⁽¹⁾		90 Days or more past due ⁽¹⁾		Total past due ⁽¹⁾		Non- accrual		Current ⁽²⁾		Purchased-credit-impaired loans ⁽³⁾		Total loans and leases ⁽⁴⁾
Multi-family	$	—	$	—	$	—	$	1,155	$	3,282,452	$	1,690	$	3,285,297
Commercial and industrial	1,914		—		1,914		17,764		1,353,586		536		1,373,800
Commercial real estate owner occupied	193		—		193		1,037		567,809		8,438		577,477
Commercial real estate non-owner occupied	1,190		—		1,190		129		1,119,443		4,344		1,125,106
Construction	—		—		—		—		56,491		—		56,491
Residential real estate	5,940		—		5,940		5,605		550,679		4,337		566,561
Manufactured housing ⁽⁵⁾	3,926		2,188		6,114		1,693		69,916		2,008		79,731
Other consumer	200		—		200		111		73,503		221		74,035
Total	$	13,363	$	2,188	$	15,551	$	27,494	$	7,073,879	$	21,574	$	7,138,498

(1)Includes past-due loans and leases that are accruing interest because collection is considered probable.

(2)Loans and leases where next payment due is less than 30 days from the report date.

(3)Purchased-credit-impaired loans aggregated into a pool are accounted for as a single asset with a single composite interest rate and an aggregate expectation of cash flows, and the past due status of the pools, or that of the individual loans within the pools, is not meaningful. Due to the credit impaired nature of the loans, the loans are recorded at a discount reflecting estimated future cash flows and the Bank recognizes interest income on each pool of loans reflecting the estimated yield and passage of time. Such loans are considered to be performing. Purchased-credit-impaired loans that are not in pools accrete interest when the timing and amount of their expected cash flows are reasonably estimable, and are reported as performing loans.

(4)Amounts exclude deferred costs and fees, unamortized premiums and discounts, and the ALLL.

(5)Certain manufactured housing loans purchased in 2010 are supported by cash reserves held at the Bank of $0.1 million and $0.5 million at December 31, 2019 and 2018, respectively, which are used to fund past-due payments when the loan becomes 90 days or more delinquent. Each quarter, these funds are evaluated to determine if they would be sufficient to absorb the probable incurred losses within the manufactured housing portfolio.

Schedule of Allowance for Loan Losses

The changes in the ALLL for the years ended December 31, 2019 and 2018, and the loans and leases and ALLL by loan and lease type based on impairment-evaluation method as of December 31, 2019 and 2018 are presented in the tables below.


Twelve months ended December 31, 2019	Multi-family		Commercial and industrial		Commercial real estate owner occupied		Commercial real estate non-owner occupied		Construction		Residential real estate		Manufactured housing		Other consumer		Total
(amounts in thousands)
Ending Balance, December 31, 2018	$	11,462	$	12,145	$	3,320	$	6,093	$	624	$	3,654	$	145	$	2,529	$	39,972
Charge-offs	(541)		(532)		(119)		—		—		(297)		—		(8,101)		(9,590)
Recoveries	7		1,050		236		—		136		27		—		314		1,770
Provision for loan and lease losses	(4,771)		2,893		(1,202)		150		502		(166)		915		25,906		24,227
Ending Balance, December 31, 2019	$	6,157	$	15,556	$	2,235	$	6,243	$	1,262	$	3,218	$	1,060	$	20,648	$	56,379

As of December 31, 2019
(amounts in thousands)
Loans and leases receivable:
Individually evaluated for impairment	$	4,117	$	4,591	$	1,976	$	76	$	—	$	9,063	$	9,898	$	1,551	$	31,272
Collectively evaluated for impairment	1,903,469		1,885,035		543,367		1,219,926		118,418		362,480		58,899		1,176,549		7,268,143
Loans acquired with credit deterioration	1,688		354		6,664		3,527		—		3,471		1,601		183		17,488
Total loans and leases receivable	$	1,909,274	$	1,889,980	$	552,007	$	1,223,529	$	118,418	$	375,014	$	70,398	$	1,178,283	$	7,316,903
Allowance for loan and lease losses:
Individually evaluated for impairment	$	—	$	523	$	83	$	—	$	—	$	44	$	129	$	73	$	852
Collectively evaluated for impairment	6,157		14,768		2,113		4,361		1,262		2,923		897		20,420		52,901
Loans acquired with credit deterioration	—		265		39		1,882		—		251		34		155		2,626
Total allowance for loan and lease losses	$	6,157	$	15,556	$	2,235	$	6,243	$	1,262	$	3,218	$	1,060	$	20,648	$	56,379


Twelve months ended December 31, 2018	Multi-family		Commercial and industrial		Commercial real estate owner occupied		Commercial real estate non-owner occupied		Construction		Residential real estate		Manufactured housing		Other consumer		Total
(amounts in thousands)
Ending Balance, December 31, 2017	$	12,168	$	10,918	$	3,232	$	7,437	$	979	$	2,929	$	180	$	172	$	38,015
Charge-offs	—		(1,722)		(747)		—		—		(466)		—		(1,822)		(4,757)
Recoveries	—		403		326		5		241		76		—		21		1,072
Provision for loan and lease losses	(706)		2,546		509		(1,349)		(596)		1,115		(35)		4,158		5,642
Ending Balance, December 31, 2018	$	11,462	$	12,145	$	3,320	$	6,093	$	624	$	3,654	$	145	$	2,529	$	39,972

As of December 31, 2018
(amounts in thousands)
Loans and leases receivable:
Individually evaluated for impairment	$	1,155	$	17,828	$	1,069	$	129	$	—	$	8,631	$	10,195	$	111	$	39,118
Collectively evaluated for impairment	3,282,452		1,355,436		567,970		1,120,633		56,491		553,593		67,528		73,703		7,077,806
Loans acquired with credit deterioration	1,690		536		8,438		4,344		—		4,337		2,008		221		21,574
Total loans and leases receivable	$	3,285,297	$	1,373,800	$	577,477	$	1,125,106	$	56,491	$	566,561	$	79,731	$	74,035	$	7,138,498
Allowance for loan and lease losses:
Individually evaluated for impairment	$	539	$	261	$	1	$	—	$	—	$	41	$	3	$	—	$	845
Collectively evaluated for impairment	10,923		11,516		3,319		4,161		624		3,227		89		2,390		36,249
Loans acquired with credit deterioration	—		368		—		1,932		—		386		53		139		2,878
Total allowance for loan and lease losses	$	11,462	$	12,145	$	3,320	$	6,093	$	624	$	3,654	$	145	$	2,529	$	39,972

Summary of Impaired Loans

Purchased-credit-impaired loans are considered to be performing and are not included in the tables below.


	December 31, 2019										For the Year Ended December 31, 2019
(amounts in thousands)	Recorded investment net of charge-offs		Unpaid principal balance		Related allowance		Average recorded investment		Interest income recognized
With no related allowance recorded:
Multi-family	$	4,117	$	4,117	$	—	$	1,223	$	239
Commercial and industrial	3,084		4,726		—		7,439		1,077
Commercial real estate owner occupied	1,109		1,880		—		1,111		55
Commercial real estate non-owner occupied	76		187		—		97		7

Residential real estate	4,559		4,861		—		2,766		129
Manufactured housing	4,169		4,169		—		5,638		325
Other consumer	140		140		—		4,127		266
With an allowance recorded:
Multi-family	—		—		—		231		—
Commercial and industrial	1,507		1,507		523		3,723		64
Commercial real estate owner occupied	867		878		83		278		54


Residential real estate	4,504		4,522		44		2,523		119
Manufactured housing	5,729		5,729		129		3,792		253
Other consumer	1,411		1,411		73		584		—
Total	$	31,272	$	34,127	$	852	$	33,532	$	2,588


	December 31, 2018										For the Year Ended, December 31, 2018				For the Year Ended, December 31, 2017
(amounts in thousands)	Recorded investment net of charge-offs		Unpaid principal balance		Related allowance		Average recorded investment		Interest income recognized		Average recorded investment		Interest income recognized
With no related allowance recorded:
Multi-family	$	—	$	—	$	—	$	537	$	8	$	—	$	—
Commercial and industrial	13,660		15,263		—		8,831		673		8,865		214
Commercial real estate owner occupied	1,037		1,766		—		776		19		1,439		70
Commercial real estate non-owner occupied	129		241		—		645		48		898		2

Residential real estate	4,842		5,128		—		4,129		151		4,617		24
Manufactured housing	10,027		10,027		—		10,015		561		10,003		558
Other consumer	111		111		—		89		1		51		—
With an allowance recorded:
Multi-family	1,155		1,155		539		231		37		—		—
Commercial and industrial	4,168		4,351		261		6,504		25		5,984		230
Commercial real estate owner occupied	32		32		1		443		3		882		—


Residential real estate	3,789		3,789		41		4,566		131		3,307		187
Manufactured housing	168		168		3		214		14		131		8

Total	$	39,118	$	42,031	$	845	$	36,980	$	1,671	$	36,177	$	1,293

Schedule of Total TDRs Based on Loan Type and Accrual Status

The following table presents total TDRs based on loan type and accrual status at December 31, 2019, 2018 and 2017. Nonaccrual TDRs are included in the reported amount of total non-accrual loans.


	December 31,
	2019										2018								2017
	Accruing TDRs		Nonaccrual TDRs		Total		Accruing TDRs		Nonaccrual TDRs		Total		Accruing TDRs		Nonaccrual TDRs		Total
(amounts in thousands)
Commercial and industrial	$	60	$	23	$	83	$	64	$	5,273	$	5,337	$	63	$	5,939	$	6,002
Commercial real estate owner occupied	13		—		13		32		—		32		—		—		—

Residential real estate	2,935		631		3,566		3,026		667		3,693		3,828		703		4,531
Manufactured housing	8,243		1,382		9,625		8,502		1,620		10,122		8,130		1,766		9,896
Other consumer	—		10		10		—		12		12		—		—		—
Total TDRs	$	11,251	$	2,046	$	13,297	$	11,624	$	7,572	$	19,196	$	12,021	$	8,408	$	20,429

Analysis of Loans Modified in Troubled Debt Restructuring by Type of Concession

The following table presents loans modified in a TDR by type of concession for the years ended December 31, 2019, 2018 and 2017. There were no modifications that involved forgiveness of debt for the years ended December 31, 2019, 2018 and 2017.


	For the Years Ended December 31,
	2019				2018					2017
(dollars in thousands)	Number of loans	Recorded investment		Number of loans	Recorded investment		Number of loans	Recorded investment
Extensions of maturity	2	$	514	2	$	60	5	$	6,497
Interest-rate reductions	26	923		39	1,615		35	1,574
Total	28	$	1,437	41	$	1,675	40	$	8,071

Summary of Loans and Leases Modified in Troubled Debt Restructurings and Recorded Investments

The following table provides, by loan type, the number of loans modified in TDRs and the related recorded investment for the years ended December 31, 2019, 2018 and 2017.


	For the Years Ended December 31,
	2019				2018					2017
(dollars in thousands)	Number of loans	Recorded investment		Number of loans	Recorded investment		Number of loans	Recorded investment
Commercial and industrial	1	$	431	—	$	—	4	$	6,437


Residential real estate	1	83		2	352		—	—
Manufactured housing	26	923		38	1,310		36	1,634
Other consumer	—	—		1	13		—	—
Total loans	28	$	1,437	41	$	1,675	40	$	8,071

Summary of Loans Modified in Troubled Debt Restructurings and Related Recorded Investment Within Twelve Months

The following table presents, by loan type, the number of loans modified in TDRs and the related recorded investment, for which there was a payment default within twelve months following the modification:


	December 31, 2019						December 31, 2018						December 31, 2017
(dollars in thousands)	Number of loans		Recorded investment		Number of loans		Recorded investment		Number of loans		Recorded investment



Residential real estate	$	1	$	81	$	—	$	—	$	—	$	—
Manufactured housing	3		73		4		92		5		211

Total loans	4		$	154	4		$	92	5		$	211

Changes in Accretable Discount Related to Purchased Credit Impaired Loans

The changes in accretable yield related to PCI loans for the years ended December 31, 2019, 2018 and 2017 were as follows:


	For the Years Ended December 31,
(amounts in thousands)	2019		2018		2017
Accretable yield balance, beginning of period	$	6,178	$	7,825	$	10,202
Accretion to interest income	(1,144)		(1,455)		(1,673)
Reclassification from nonaccretable difference and disposals, net	44		(192)		(704)
Accretable yield balance, end of period	$	5,078	$	6,178	$	7,825

Credit Quality Tables

The following tables present the credit ratings of loans and leases receivable as of December 31, 2019 and 2018.


	December 31, 2019
(amounts in thousands)	Multi-family		Commercial and industrial		Commercial real estate owner occupied		Commercial real estate non-owner occupied		Construction		Residential real estate		Manufactured housing		Other consumer		Total ⁽³⁾
Pass/Satisfactory	$	1,816,200	$	1,841,074	$	536,777	$	1,129,838	$	118,418	$	—	$	—	$	—	$	5,442,307
Special Mention	69,637		26,285		8,286		6,949		—		—		—		—		111,157
Substandard	23,437		22,621		6,944		86,742		—		—		—		—		139,744
Performing ⁽¹⁾	—		—		—		—		—		362,962		63,250		1,170,976		1,597,188
Non-performing ⁽²⁾	—		—		—		—		—		12,052		7,148		7,307		26,507
Total	$	1,909,274	$	1,889,980	$	552,007	$	1,223,529	$	118,418	$	375,014	$	70,398	$	1,178,283	$	7,316,903


	December 31, 2018
(amounts in thousands)	Multi-family		Commercial and industrial		Commercial real estate owner occupied		Commercial real estate non-owner occupied		Construction		Residential real estate		Manufactured housing		Other consumer		Total ⁽³⁾
Pass/Satisfactory	$	3,201,822	$	1,306,466	$	562,639	$	1,054,493	$	56,491	$	—	$	—	$	—	$	6,181,911
Special Mention	55,696		30,551		9,730		30,203		—		—		—		—		126,180
Substandard	27,779		36,783		5,108		40,410		—		—		—		—		110,080
Performing ⁽¹⁾	—		—		—		—		—		555,016		71,924		73,724		700,664
Non-performing ⁽²⁾	—		—		—		—		—		11,545		7,807		311		19,663
Total	$	3,285,297	$	1,373,800	$	577,477	$	1,125,106	$	56,491	$	566,561	$	79,731	$	74,035	$	7,138,498

(1)Includes residential real estate, manufactured housing, and other consumer loans not assigned internal ratings.

(2)Includes residential real estate, manufactured housing, and other consumer loans that are past due and still accruing interest or on nonaccrual status.

(3)Excludes commercial mortgage warehouse loans reported at fair value

Schedule of Loan Purchases and Sales

Purchases and sales of loans were as follows for the years ended December 31, 2019, 2018 and 2017:


	For the Years Ended December 31,
(amounts in thousands)	2019		2018		2017
Purchases ⁽¹⁾





Residential real estate	$	105,858	$	368,402	$	264,090

Other consumer ⁽²⁾	1,058,261		30,066		—
Total	$	1,164,119	$	398,468	$	264,090
Sales ⁽³⁾
Multi-family	$	—	$	(54,638)	$	(226,831)
Commercial and industrial ⁽⁴⁾	(22,267)		(32,263)		(19,974)
Commercial real estate owner occupied ⁽⁴⁾	(16,320)		(20,218)		(19,813)


Residential real estate	(230,285)		—		(191,574)


Total	$	(268,872)	$	(107,119)	$	(458,192)

(1)Amounts reported represent the unpaid principal balance at time of purchase. The purchase price was 100.3%, 99.9% and 99.4% of loans outstanding for the years ended December 31, 2019, 2018 and 2017, respectively.

(2)Other consumer loan purchases for the year ended December 31, 2019 and 2018, consist of third-party originated unsecured consumer loans. None of the loans are considered sub-prime at the time of origination. Customers considers sub-prime borrowers to be those with FICO scores below 660.

(3)Amounts reported represent the unpaid principal balance at time of sale. For the years ended December 31, 2019, 2018 and 2017, loan sales resulted in net gains of $2.8 million, $3.3 million and $4.2 million, respectively.

(4)Primarily sales of SBA loans.