XML 43 R17.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Loans and Leases Receivable and Allowance for Credit Losses on Loans and Leases | 12 Months Ended
--- | ---
Dec. 31, 2023
Receivables [Abstract] |
Loans and Leases Receivable and Allowance for Credit Losses on Loans and Leases | LOANS AND LEASES RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES ON LOANS AND LEASES The following table presents loans and leases receivable as of December 31, 2023 and 2022:
| December 31,
(amounts in thousands) | 2023 |  | 2022
Loans receivable, mortgage warehouse, at fair value | $ | 897,912 |  |  | $ | 1,323,312 |
Loans receivable, PPP | 74,735 |  |  | 998,153 |
Loans and leases receivable: |  |  |
Commercial: |  |  |
Commercial and industrial: |  |  |
Specialty lending (1) | 5,006,693 |  |  | 5,412,887 |
Other commercial and industrial | 1,204,412 |  |  | 1,259,943 |
Multifamily | 2,138,622 |  |  | 2,213,019 |
Commercial real estate owner occupied | 797,319 |  |  | 885,339 |
Commercial real estate non-owner occupied | 1,177,650 |  |  | 1,290,730 |
Construction | 166,393 |  |  | 162,009 |
Total commercial loans and leases receivable | 10,491,089 |  |  | 11,223,927 |
Consumer: |  |  |
Residential real estate | 484,435 |  |  | 497,952 |
Manufactured housing | 38,670 |  |  | 45,076 |
Installment: |  |  |
Personal | 555,533 |  |  | 964,641 |
Other | 319,393 |  |  | 413,298 |
Total consumer loans receivable | 1,398,031 |  |  | 1,920,967 |
Loans and leases receivable | 11,889,120 |  |  | 13,144,894 |
Allowance for credit losses on loans and leases | (135,311) |  |  | (130,924) |
Total loans and leases receivable, net of allowance for credit losses on loans and leases (2) | $ | 12,726,456 |  |  | $ | 15,335,435 |
(1)Includes direct finance equipment leases of $205.7 million and $157.4 million at December 31, 2023 and 2022, respectively. (2)Includes deferred (fees) costs and unamortized (discounts) premiums, net of $(22.7) million and $(21.5) million at December 31, 2023 and 2022, respectively. Customers’ total loans and leases receivable portfolio includes loans receivable which are reported at fair value based on an election made to account for these loans at fair value and loans and leases receivable which are predominately reported at their outstanding unpaid principal balance, net of charge-offs, deferred costs and fees and unamortized premiums and discounts, and are evaluated for impairment. The total amount of accrued interest recorded for total loans was $95.0 million and $105.5 million at December 31, 2023 and 2022, respectively, and is presented in accrued interest receivable in the consolidated balance sheet. At December 31, 2023 and 2022, there were $15.8 million and $11.5 million of individually evaluated loans that were collateral-dependent, respectively. Substantially all individually evaluated loans are collateral-dependent and consisted primarily of commercial and industrial, commercial real estate, and residential real estate loans. Collateral-dependent commercial and industrial loans were secured by accounts receivable, inventory and equipment; collateral-dependent commercial real estate loans were secured by commercial real estate assets; and residential real estate loans were secured by residential real estate assets. Loans receivable, mortgage warehouse, at fair value Mortgage warehouse loans consist of commercial loans to mortgage companies. These mortgage warehouse lending transactions are subject to master repurchase agreements. As a result of the contractual provisions, for accounting purposes, control of the underlying mortgage loan has not transferred and the rewards and risks of the mortgage loans are not assumed by Customers. The mortgage warehouse loans are designated as loans held for investment and reported at fair value based on an election made to account for the loans at fair value. Pursuant to the agreements, Customers funds the pipelines for these mortgage lenders by sending payments directly to the closing agents for funded mortgage loans and receives proceeds directly from third party investors when the underlying mortgage loans are sold into the secondary market. The fair value of the mortgage warehouse loans is estimated as the amount of cash initially advanced to fund the mortgage, plus accrued interest and fees, as specified in the respective agreements. The interest rates on these loans are variable, and the lending transactions are short-term, with an average life under 30 days from purchase to sale. The primary goal of these lending transactions is to provide liquidity to mortgage companies. At December 31, 2023 and 2022, all of Customers’ commercial mortgage warehouse loans were current in terms of payment. As these loans are reported at their fair value, they do not have an ACL and are therefore excluded from ACL-related disclosures. Loans receivable, PPP Customers had $74.7 million and $998.2 million of PPP loans outstanding as of December 31, 2023 and 2022, respectively, which are fully guaranteed by the SBA, provided that the SBA’s eligibility criteria are met and earn a fixed interest rate of 1.00%. Customers recognized interest income, including net origination fees, of $26.6 million, $79.4 million and $279.2 million for the years ended December 31, 2023, 2022 and 2021, respectively. PPP loans include an embedded credit enhancement from the SBA, which guarantees 100% of the principal and interest owed by the borrower provided that the SBA’s eligibility criteria are met. As a result, the eligible PPP loans do not have an ACL and are therefore excluded from ACL-related disclosures. PPP loans that are subsequently determined to be ineligible for SBA forgiveness and guarantee are included as part of the commercial and industrial loan portfolio. Loans and leases receivable The following tables summarize loans and leases receivable by loan and lease type and performance status as of December 31, 2023 and 2022:
| December 31, 2023
(amounts in thousands) | 30-59 Days past due (1) |  | 60-89 Days past due (1) |  | 90 Days or more past due (2) |  | Total past due |  | Loans and leases not past due (3)(4) |  | Total loans and leases (4)
Commercial and industrial, including specialty lending | $ | 1,516 |  |  | $ | 322 |  |  | $ | 4,153 |  |  | $ | 5,991 |  |  | $ | 6,205,114 |  |  | $ | 6,211,105 |
Multifamily | 16,003 |  |  | — |  |  | — |  |  | 16,003 |  |  | 2,122,619 |  |  | 2,138,622 |
Commercial real estate owner occupied | 449 |  |  | 3,814 |  |  | 5,827 |  |  | 10,090 |  |  | 787,229 |  |  | 797,319 |
Commercial real estate non-owner occupied | 16,653 |  |  | — |  |  | — |  |  | 16,653 |  |  | 1,160,997 |  |  | 1,177,650 |
Construction | — |  |  | — |  |  | — |  |  | — |  |  | 166,393 |  |  | 166,393 |
Residential real estate | 10,504 |  |  | 2,255 |  |  | 3,764 |  |  | 16,523 |  |  | 467,912 |  |  | 484,435 |
Manufactured housing | 1,152 |  |  | 343 |  |  | 2,869 |  |  | 4,364 |  |  | 34,306 |  |  | 38,670 |
Installment | 9,255 |  |  | 7,866 |  |  | 7,211 |  |  | 24,332 |  |  | 850,594 |  |  | 874,926 |
Total | $ | 55,532 |  |  | $ | 14,600 |  |  | $ | 23,824 |  |  | $ | 93,956 |  |  | $ | 11,795,164 |  |  | $ | 11,889,120 |
| December 31, 2022
(amounts in thousands) | 30-59 Days past due (1) |  | 60-89 Days past due (1) |  | 90 Days or more past due (2) |  | Total past due |  | Loans and leases not past due (3) |  |  |  | Total loans and leases (4)
Commercial and industrial, including specialty lending | $ | 3,123 |  |  | $ | 717 |  |  | $ | 1,415 |  |  | $ | 5,255 |  |  | $ | 6,667,575 |  |  |  |  | $ | 6,672,830 |
Multifamily | 10,684 |  |  | 5,217 |  |  | 1,143 |  |  | 17,044 |  |  | 2,195,975 |  |  |  |  | 2,213,019 |
Commercial real estate owner occupied | 5,173 |  |  | — |  |  | 2,704 |  |  | 7,877 |  |  | 877,462 |  |  |  |  | 885,339 |
Commercial real estate non-owner occupied | 2,136 |  |  | — |  |  | 11 |  |  | 2,147 |  |  | 1,288,583 |  |  |  |  | 1,290,730 |
Construction | — |  |  | — |  |  | — |  |  | — |  |  | 162,009 |  |  |  |  | 162,009 |
Residential real estate | 5,208 |  |  | 1,157 |  |  | 3,158 |  |  | 9,523 |  |  | 488,429 |  |  |  |  | 497,952 |
Manufactured housing | 901 |  |  | 537 |  |  | 3,346 |  |  | 4,784 |  |  | 40,292 |  |  |  |  | 45,076 |
Installment | 11,246 |  |  | 7,942 |  |  | 9,527 |  |  | 28,715 |  |  | 1,349,224 |  |  |  |  | 1,377,939 |
Total | $ | 38,471 |  |  | $ | 15,570 |  |  | $ | 21,304 |  |  | $ | 75,345 |  |  | $ | 13,069,549 |  |  |  |  | $ | 13,144,894 |
(1)Includes past due loans and leases that are accruing interest because collection is considered probable. (2)Includes loans amounting to $0.5 million and $1.9 million as of December 31, 2023 and 2022, respectively, that are still accruing interest because collection is considered probable. (3)Loans and leases where next payment due is less than 30 days from the report date. The tables exclude PPP loans of $74.7 million, of which $0.7 million were 30-59 days past due and $48.5 million were 60 days or more past due as of December 31, 2023, and PPP loans of $998.2 million, of which $0.6 million were 30-59 days past due and $36.0 million were 60 days or more past due as of December 31, 2022. Claims for guarantee payments are submitted to the SBA for eligible PPP loans that are more than 60 days past due. (4)Includes PCD loans of $157.2 million and $8.3 million at December 31, 2023 and 2022, respectively. On June 15, 2023, Customers acquired $631.0 million of Venture Banking loan portfolio (included within specialty lending above) from the FDIC, which included $228.7 million of PCD loans. Nonaccrual Loans and Leases The following table presents the amortized cost of loans and leases held for investment on nonaccrual status.
| December 31, 2023 |  | December 31, 2022 |  |  |  |
(amounts in thousands) | Nonaccrual loans with no related allowance |  | Nonaccrual loans with related allowance |  | Total nonaccrual loans |  | Nonaccrual loans with no related allowance |  | Nonaccrual loans with related allowance |  | Total nonaccrual loans |  |  |  |  |  |  |  |
Commercial and industrial, including specialty lending | $ | 3,365 |  |  | $ | 1,071 |  |  | $ | 4,436 |  |  | $ | 1,731 |  |  | $ | 30 |  |  | $ | 1,761 |  |  |  |  |  |  |  |  |
Multifamily | — |  |  | — |  |  | — |  |  | 1,143 |  |  | — |  |  | 1,143 |  |  |  |  |  |  |  |  |
Commercial real estate owner occupied | 5,869 |  |  | — |  |  | 5,869 |  |  | 2,768 |  |  | — |  |  | 2,768 |  |  |  |  |  |  |  |  |
Residential real estate | 6,685 |  |  | 117 |  |  | 6,802 |  |  | 6,922 |  |  | — |  |  | 6,922 |  |  |  |  |  |  |  |  |
Manufactured housing | — |  |  | 2,331 |  |  | 2,331 |  |  | — |  |  | 2,410 |  |  | 2,410 |  |  |  |  |  |  |  |  |
Installment | — |  |  | 7,211 |  |  | 7,211 |  |  | — |  |  | 9,527 |  |  | 9,527 |  |  |  |  |  |  |  |  |
Total | $ | 15,919 |  |  | $ | 10,730 |  |  | $ | 26,649 |  |  | $ | 12,564 |  |  | $ | 11,967 |  |  | $ | 24,531 |  |  |  |  |  |  |  |  |
Interest income recognized on nonaccrual loans was insignificant during the years ended December 31, 2023, 2022 and 2021. Accrued interest reversed when the loans went to nonaccrual status was insignificant during the years ended December 31, 2023, 2022 and 2021. Allowance for credit losses on loans and leases The changes in the ACL on loans and leases by loan and lease type for the years ended December 31, 2023, 2022 and 2021, are presented in the tables below. ACL as of December 31, 2023, 2022 and 2021 is calculated in accordance with the CECL methodology as described in NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION.
(amounts in thousands) | Commercial and industrial (1) |  | Multifamily |  | Commercial real estate owner occupied |  | Commercial real estate non-owner occupied |  | Construction |  | Residential real estate |  | Manufactured housing |  | Installment |  |  |  | Total
Ending Balance, December 31, 2020 | $ | 12,239 |  |  | $ | 12,620 |  |  | $ | 9,512 |  |  | $ | 19,452 |  |  | $ | 5,871 |  |  | $ | 3,977 |  |  | $ | 5,190 |  |  | $ | 75,315 |  |  |  |  | $ | 144,176 |
Charge-offs | (1,550) |  |  | (1,132) |  |  | (749) |  |  | (944) |  |  | — |  |  | (130) |  |  | — |  |  | (35,876) |  |  |  |  | (40,381) |
Recoveries | 1,102 |  |  | — |  |  | 500 |  |  | 84 |  |  | 125 |  |  | 54 |  |  | — |  |  | 4,718 |  |  |  |  | 6,583 |
Provision (benefit) for credit losses on loans and leases | 911 |  |  | (7,011) |  |  | (6,050) |  |  | (12,382) |  |  | (5,304) |  |  | (1,518) |  |  | (912) |  |  | 59,692 |  |  |  |  | 27,426 |
Ending Balance, December 31, 2021 | $ | 12,702 |  |  | $ | 4,477 |  |  | $ | 3,213 |  |  | $ | 6,210 |  |  | $ | 692 |  |  | $ | 2,383 |  |  | $ | 4,278 |  |  | $ | 103,849 |  |  |  |  | $ | 137,804 |
Charge-offs | (16,248) |  |  | (1,990) |  |  | — |  |  | (6,075) |  |  | — |  |  | (17) |  |  | — |  |  | (52,866) |  |  |  |  | (77,196) |
Recoveries | 1,182 |  |  | 337 |  |  | 51 |  |  | 121 |  |  | 236 |  |  | 64 |  |  | — |  |  | 8,837 |  |  |  |  | 10,828 |
Provision (benefit) for credit losses on loans and leases | 19,946 |  |  | 11,717 |  |  | 3,190 |  |  | 10,963 |  |  | 985 |  |  | 3,664 |  |  | 152 |  |  | 8,871 |  |  |  |  | 59,488 |
Ending Balance, December 31, 2022 | $ | 17,582 |  |  | $ | 14,541 |  |  | $ | 6,454 |  |  | $ | 11,219 |  |  | $ | 1,913 |  |  | $ | 6,094 |  |  | $ | 4,430 |  |  | $ | 68,691 |  |  |  |  | $ | 130,924 |
Allowance for credit losses on FDIC PCD loans, net of charge-offs (2) | 2,576 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  |  |  | 2,576 |
Charge-offs | (16,915) |  |  | (3,574) |  |  | (39) |  |  | (4,527) |  |  | — |  |  | (69) |  |  | — |  |  | (69,942) |  |  |  |  | (95,066) |
Recoveries | 8,472 |  |  | — |  |  | 34 |  |  | 315 |  |  | 116 |  |  | 35 |  |  | — |  |  | 17,059 |  |  |  |  | 26,031 |
Provision (benefit) for credit losses on loans and leases | 11,788 |  |  | 5,376 |  |  | 3,433 |  |  | 9,852 |  |  | (547) |  |  | 526 |  |  | (191) |  |  | 40,609 |  |  |  |  | 70,846 |
Ending Balance, December 31, 2023 | $ | 23,503 |  |  | $ | 16,343 |  |  | $ | 9,882 |  |  | $ | 16,859 |  |  | $ | 1,482 |  |  | $ | 6,586 |  |  | $ | 4,239 |  |  | $ | 56,417 |  |  |  |  | $ | 135,311 |
(1) Includes specialty lending. (2) Represents $8.7 million of allowance for credit losses on PCD loans recognized upon acquisition of a Venture Banking loan portfolio (included within specialty lending) from the FDIC on June 15, 2023, net of $6.2 million of charge-offs for certain of these PCD loans upon acquisition. At December 31, 2023, the ACL on loans and leases was $135.3 million, an increase of $4.4 million from the December 31, 2022 balance of $130.9 million. The increase in ACL for the year ended December 31, 2023 resulted primarily from additional provision for credit losses from the recognition of weaker and increased uncertainties in macroeconomic forecasts and the recognition of ACL for PCD loans acquired from the FDIC, net of related charge-offs upon acquisition, partially offset by a decrease in loan balances held for investment. At December 31, 2022, the ACL was $130.9 million, a decrease of $6.9 million from the December 31, 2021 balance of $137.8 million. The decrease in ACL for the year ended December 31, 2022 resulted primarily from the sale of consumer installment loans to a third-party sponsored VIE, partially offset by loan growth, the recognition of weaker macroeconomic forecasts and increases in charge-offs primarily attributed to $11.0 million in commercial and industrial loans originated under the PPP that were subsequently determined to be ineligible for SBA forgiveness and guarantee and ultimately deemed uncollectible, a partial charge-off of a performing non-owner occupied commercial real estate loan that Customers decided to exit, and higher charge-offs in consumer installment loans and overdrawn deposit accounts. Refer to NOTE 6 – INVESTMENT SECURITIES for additional information on the sale of consumer installment loans in 2022. Loan Modifications for Borrowers Experiencing Financial Difficulty Customers adopted ASU 2022-02, Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures (“ASU 2022-02”) effective January 1, 2023. The amendments in ASU 2022-02 eliminated the recognition and measurement of TDRs and enhanced the disclosures for loan modifications to borrowers experiencing financial difficulty. Refer to NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION for additional information on the adoption. A borrower is considered to be experiencing financial difficulty when there is a significant doubt about the borrower’s ability to make the required principal and interest payments on the loan or to get an equivalent financing from another creditor at a market rate for a similar loan. When borrowers are experiencing financial difficulty, Customers may make certain loan modifications as part of loss mitigation strategies to maximize expected payment. To be classified as a modification made to a borrower experiencing financial difficulty, the modification must be in the form of an interest rate reduction, principal forgiveness, or an other-than-insignificant payment delay (payment deferral), term extension, or combinations thereof. Customers will generally try other forms of relief before principal forgiveness. Any contractual reduction in the amount of principal due without receiving payment or assets is considered forgiveness. For the purpose of this disclosure, Customers considers any contractual change in interest rate that results in a reduction in interest rate relative to the current stated interest rate as an interest rate reduction. Generally, Customers considers any delay in payment of greater than 90 days in the last 12 months to be significant. Term extensions extend the original contractual maturity of the loan. For the purpose of this disclosure, modification of contingent payment features or covenants that would have accelerated payment are not considered term extensions. The following table presents the amortized cost of loans that were modified to borrowers experiencing financial difficulty for the year ended December 31, 2023, disaggregated by class of financing receivable and type of modification granted.
|  |  | For the Year Ended December 31, 2023 |  |
(dollars in thousands) |  |  | Term Extension |  | Payment Deferral |  | Debt Forgiveness |  | Interest Rate Reduction and Term Extension |  | Total |  | Percentage of Total by Financing Class |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial, including specialty lending |  |  | $ | 250 |  |  | $ | 14,791 |  |  | $ | — |  |  | $ | — |  |  | $ | 15,041 |  |  | 0.24 | % |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate owner occupied |  |  | 169 |  |  | — |  |  | — |  |  | — |  |  | 169 |  |  | 0.02 | % |  |  |  |  |  |  |  |  |  |  |  |
Residential real estate |  |  | 46 |  |  | — |  |  | — |  |  | — |  |  | 46 |  |  | 0.01 | % |  |  |  |  |  |  |  |  |  |  |  |
Manufactured housing |  |  | 158 |  |  | — |  |  | — |  |  | 664 |  |  | 822 |  |  | 2.13 | % |  |  |  |  |  |  |  |  |  |  |  |
Personal installment |  |  | 14,075 |  |  | 756 |  |  | 312 |  |  | — |  |  | 15,143 |  |  | 2.73 | % |  |  |  |  |  |  |  |  |  |  |  |
Total |  |  | $ | 14,698 |  |  | $ | 15,547 |  |  | $ | 312 |  |  | $ | 664 |  |  | $ | 31,221 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
As of December 31, 2023, there was $3.0 million in commitments to lend additional funds to debtors experiencing financial difficulty whose loans have been modified during the year ended December 31, 2023. The following table summarizes the impacts of loan modifications made to borrowers experiencing financial difficulty for the year ended December 31, 2023.
| For the Year Ended December 31, 2023
| Weighted Average |  |
(dollars in thousands) | Interest Rate Reduction (%) |  | Term Extension (in months) |  | Payment Deferral (in months) |  | Debt Forgiven
Commercial and industrial, including specialty lending | —% |  | 56 |  | 10 |  | $ | — |
Commercial real estate owner occupied | — |  | 4 |  | 0 |  | — |
Residential real estate | — |  | 228 |  | 0 |  | — |
Manufactured housing | 2.5 |  | 56 |  | 0 |  | — |
Personal installment | — |  | 5 |  | 6 |  | 462 |
The performance of loans made to borrowers experiencing financial difficulty in which modifications were made is closely monitored to understand the effectiveness of modification efforts. Loans are considered to be in payment default at 90 days or more past due. The following table presents an aging analysis of loan modifications made to borrowers experiencing financial difficulty during the year ended December 31, 2023.
| December 31, 2023 |  |
(dollars in thousands) | 30-59 Days past due |  | 60-89 Days past due |  | 90 Days or more past due |  | Current |  | Total |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial, including specialty lending | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 15,041 |  |  | $ | 15,041 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate owner occupied | — |  |  | — |  |  | 169 |  |  | — |  |  | 169 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential real estate | — |  |  | — |  |  | — |  |  | 46 |  |  | 46 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Manufactured housing | 51 |  |  | 31 |  |  | — |  |  | 740 |  |  | 822 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Personal installment | 1,000 |  |  | 785 |  |  | 518 |  |  | 12,840 |  |  | 15,143 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total | $ | 1,051 |  |  | $ | 816 |  |  | $ | 687 |  |  | $ | 28,667 |  |  | $ | 31,221 |  |  |  |  |  |  |  |  |  |  |  |  |  |
As of December 31, 2023, the loans that were made to borrowers experiencing financial difficulty during the year ended December 31, 2023 that subsequently defaulted were not material. Customers’ ACL is influenced by loan level characteristics that inform the assessed propensity to default. As such, the provision for credit losses is impacted by changes in such loan level characteristics, such as payment performance. Loans made to borrowers experiencing financial difficulty can be classified as either accrual or nonaccrual. Troubled Debt Restructurings For the years ended December 31, 2022 and 2021, a loan for which the terms have been modified resulting in a concession, and for which the borrower is experiencing financial difficulties is considered to be a TDR. The ACL on a TDR is measured using the same method as all other loans held for investment, except in cases when the value of a concession cannot be measured using a method other than the discounted cash flow (“DCF”) method. When the value of a concession is measured using the DCF method, the ACL is determined by discounting the expected future cash flows at the original effective interest rate of the loan. At December 31, 2022 and 2021, there were $16.8 million and $16.5 million, respectively, in loans reported as TDRs. TDRs were reported as impaired loans in the calendar year of their restructuring and were evaluated to determine whether they should be placed on non-accrual status. In subsequent years, a TDR might be returned to accrual status if it satisfied a minimum performance requirement of six months, however, it would remain classified as impaired. Generally, the Bank required sustained performance for nine months before returning a TDR to accrual status. Customers had no lease receivables that had been restructured as a TDR as of December 31, 2022 and 2021, respectively. Section 4013 of the CARES Act, as amended by the CAA, gave entities temporary relief from the accounting and disclosure requirements for TDRs until January 1, 2022. In addition, on April 7, 2020, certain regulatory banking agencies issued an interagency statement that offered practical expedients for evaluating whether loan modifications in response to the COVID-19 pandemic were TDRs. For COVID-19 related loan modifications which met the loan modification criteria under either the CARES Act or the criteria specified by the regulatory agencies, Customers elected to suspend TDR accounting for such loan modifications. At December 31, 2022, there were no commercial or consumer deferments related to COVID-19. The following table presents loans modified in a TDR by type of concession for the years ended December 31, 2022 and 2021. There were no modifications that involved forgiveness of debt for the years ended December 31, 2022 and 2021.
|  |  |  |  | For the Years Ended December 31,
|  |  | 2022 |  | 2021
(dollars in thousands) |  |  |  |  | Number of loans |  | Recorded investment |  | Number of loans |  | Recorded investment
Interest-rate reductions |  |  |  |  | 18 |  |  | $ | 582 |  |  | 17 |  |  | $ | 622 |
Other (1) |  |  |  |  | 241 |  |  | 2,748 |  |  | 185 |  |  | 2,875 |
Total |  |  |  |  | 259 |  |  | $ | 3,330 |  |  | 202 |  |  | $ | 3,497 |
(1) Other includes covenant modifications, forbearance, loans discharged under Chapter 7 bankruptcy, or other concessions. As of December 31, 2022 and 2021, there were no commitments to lend additional funds to debtors whose loans have been modified in TDRs. 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, 2022 |  | December 31, 2021
(dollars in thousands) |  |  |  |  | Number of loans |  | Recorded investment |  | Number of loans |  | Recorded investment
Installment |  |  |  |  | 212 |  |  | $ | 2,206 |  |  | 21 |  |  | $ | 263 |
Residential real estate |  |  |  |  | 2 |  |  | 201 |  |  | 1 |  |  | 121 |
Manufactured housing |  |  |  |  | 15 |  |  | 491 |  |  | 2 |  |  | 71 |
Total loans |  |  |  |  | 229 |  |  | $ | 2,898 |  |  | 24 |  |  | $ | 455 |
Loans modified in TDRs were evaluated for impairment. The nature and extent of impairment of TDRs, including those which had experienced a subsequent default, were considered in the determination of an appropriate level of ACL. Credit Quality Indicators The ACL represents management’s estimate of expected losses in Customers’ loans and leases receivable portfolio, excluding commercial mortgage warehouse loans reported at fair value pursuant to a fair value option election and PPP loans receivable. Commercial and industrial, multifamily, owner occupied commercial real estate, non-owner occupied commercial real estate, and construction loans are rated based on an internally assigned risk rating system which is assigned at the time of loan origination and reviewed on a periodic, or on an “as needed” basis. Residential real estate loans, manufactured housing and installment loans are evaluated based on the payment activity of the loan. To facilitate the monitoring of credit quality within the commercial and industrial including specialty lending, multifamily, owner occupied commercial real estate, non-owner occupied commercial real estate, and construction loan portfolios, and as an input in the ACL lifetime loss rate model for the commercial and industrial portfolio, the Bank utilizes the following categories of risk ratings: pass/satisfactory (includes risk rating 1 through 6), special mention, substandard, doubtful and loss. The risk rating categories, which are derived from standard regulatory rating definitions, are assigned upon initial approval of credit to borrowers and updated periodically thereafter. Pass ratings, which are assigned to those borrowers who do not have identified potential or well-defined weaknesses and for whom there is a high likelihood of orderly repayment, are updated periodically based on the size and credit characteristics of the borrower. All other categories are updated on a quarterly basis during the month preceding the end of the calendar quarter. While assigning risk ratings involves judgment, the risk-rating process allows management to identify riskier credits in a timely manner and allocate the appropriate resources to manage those loans and leases. The risk rating grades are defined as follows: “1” – Pass/Excellent Loans and leases rated 1 represent a credit extension of the highest quality. The borrower’s historic (at least five years) cash flows manifest extremely large and stable margins of coverage. Balance sheets are conservative, well capitalized, and liquid. After considering debt service for proposed and existing debt, projected cash flows continue to be strong and provide ample coverage. The borrower typically reflects broad geographic and product diversification and has access to alternative financial markets. “2” – Pass/Superior Loans and leases rated 2 are those for which the borrower has a strong financial condition, balance sheet, operations, cash flow, debt capacity and coverage with ratios better than industry norms. The borrowers of these loans and leases exhibit a limited leverage position, are virtually immune to local economies, and are in stable growing industries. The management team is well respected, and the company has ready access to public markets. “3” – Pass/Strong Loans and leases rated 3 are those loans and leases for which the borrowers have above average financial condition and flexibility; more than satisfactory debt service coverage; balance sheet and operating ratios are consistent with or better than industry peers; operate in industries with little risk; move in diversified markets; and are experienced and competent in their industry. These borrowers’ access to capital markets is limited mostly to private sources, often secured, but the borrower typically has access to a wide range of refinancing alternatives. “4” – Pass/Good Loans and leases rated 4 have a sound primary and secondary source of repayment. The borrower may have access to alternative sources of financing, but sources are not as widely available as they are to a higher-grade borrower. These loans and leases carry a normal level of risk with very low loss exposure. The borrower has the ability to perform according to the terms of the credit facility. The margins of cash flow coverage are satisfactory but vulnerable to more rapid deterioration than the higher-quality loans and leases. “5” – Satisfactory Loans and leases rated 5 are extended to borrowers who are considered to be a reasonable credit risk and demonstrate the ability to repay the debt from normal business operations. Risk factors may include reliability of margins and cash flows, liquidity, dependence on a single product or industry, cyclical trends, depth of management, or limited access to alternative financing sources. The borrower’s historical financial information may indicate erratic performance, but current trends are positive and the quality of financial information is adequate, but is not as detailed and sophisticated as information found on higher grade loans. If adverse circumstances arise, the impact on the borrower may be significant. “6” – Satisfactory/Bankable with Care Loans and leases rated 6 are those for which the borrower has higher than normal credit risk; however, cash flow and asset values are generally intact. These borrowers may exhibit declining financial characteristics, with increasing leverage and decreasing liquidity and may have limited resources and access to financial alternatives. Signs of weakness in these borrowers may include delinquent taxes, trade slowness and eroding profit margins. “7” – Special Mention Loans and leases rated 7 are credit facilities that may have potential developing weaknesses and deserve extra attention from the account manager and other management personnel. In the event potential weaknesses are not corrected or mitigated, deterioration in the ability of the borrower to repay the debt in the future may occur. This grade is not assigned to loans and leases that bear certain peculiar risks normally associated with the type of financing involved, unless circumstances have caused the risk to increase to a level higher than would have been acceptable when the credit was originally approved. Loans and leases where significant actual, not potential, weaknesses or problems are clearly evident are graded in the category below. “8” – Substandard Loans and leases are rated 8 when the loans and leases are inadequately protected by the current sound worth and payment capacity of the obligor or of the collateral pledged, if any. Loans and leases so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt and are characterized by the distinct possibility that the company will sustain some loss if the weaknesses are not corrected. “9” – Doubtful The Bank assigns a doubtful rating to loans and leases that have all the attributes of a substandard rating 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. The possibility of loss is extremely high, but because of certain important and reasonable specific pending factors that may work to the advantage of and strengthen the credit quality of the loan or lease, its classification as an estimated loss is deferred until its more exact status may be determined. Pending factors may include a proposed merger or acquisition, liquidation proceeding, capital injection, perfecting liens on additional collateral or refinancing plans. “10” – Loss The Bank assigns a loss rating to loans and leases considered uncollectible and of such little value that their continuance as an active asset is not warranted. Amounts classified as loss are immediately charged off. PPP loans are excluded in the tables below as these loans are fully guaranteed by the SBA. Risk ratings are not established for certain consumer loans, including residential real estate, home equity, manufactured housing, and installment loans, mainly because these portfolios consist of a larger number of homogeneous loans with smaller balances. Instead, these portfolios are evaluated for risk mainly based upon aggregate payment history through the monitoring of delinquency levels and trends and are classified as performing and non-performing. The following tables present the credit ratings of loans and leases receivable and current period gross write-offs as of December 31, 2023 and 2022.
| Term Loans Amortized Cost Basis by Origination Year as of December 31, 2023 |  |  |  |  |  |
(amounts in thousands) | 2023 |  | 2022 |  | 2021 |  | 2020 |  | 2019 |  | Prior |  | Revolving loans amortized cost basis |  | Revolving loans converted to term |  | Total
Commercial and industrial loans and leases, including specialty lending: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 1,184,923 |  |  | $ | 1,909,592 |  |  | $ | 483,039 |  |  | $ | 170,384 |  |  | $ | 59,213 |  |  | $ | 63,480 |  |  | $ | 1,722,559 |  |  | $ | 384,947 |  |  | $ | 5,978,137 |
Special mention | 18,000 |  |  | 3,377 |  |  | 5,127 |  |  | 1,986 |  |  | — |  |  | 595 |  |  | 7,916 |  |  | 2,903 |  |  | 39,904 |
Substandard | 14,738 |  |  | 39,258 |  |  | 61,533 |  |  | 26,660 |  |  | 4,803 |  |  | 42,062 |  |  | 4,010 |  |  | — |  |  | 193,064 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total commercial and industrial loans and leases | $ | 1,217,661 |  |  | $ | 1,952,227 |  |  | $ | 549,699 |  |  | $ | 199,030 |  |  | $ | 64,016 |  |  | $ | 106,137 |  |  | $ | 1,734,485 |  |  | $ | 387,850 |  |  | $ | 6,211,105 |
Commercial and industrial loans and leases charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 (1)(2) | $ | 1,483 |  |  | $ | 381 |  |  | $ | 3,169 |  |  | $ | 10,348 |  |  | $ | 24 |  |  | $ | 1,510 |  |  | $ | — |  |  | $ | — |  |  | $ | 16,915 |
Multifamily loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 845 |  |  | $ | 1,229,198 |  |  | $ | 371,016 |  |  | $ | 127,493 |  |  | $ | 43,046 |  |  | $ | 253,806 |  |  | $ | — |  |  | $ | — |  |  | $ | 2,025,404 |
Special mention | — |  |  | — |  |  | — |  |  | — |  |  | 6,468 |  |  | 67,035 |  |  | — |  |  | — |  |  | 73,503 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 39,715 |  |  | — |  |  | — |  |  | 39,715 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total multifamily loans | $ | 845 |  |  | $ | 1,229,198 |  |  | $ | 371,016 |  |  | $ | 127,493 |  |  | $ | 49,514 |  |  | $ | 360,556 |  |  | $ | — |  |  | $ | — |  |  | $ | 2,138,622 |
Multifamily loans charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 3,574 |  |  | $ | — |  |  | $ | — |  |  | $ | 3,574 |
Commercial real estate owner occupied loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 41,011 |  |  | $ | 254,878 |  |  | $ | 180,289 |  |  | $ | 77,821 |  |  | $ | 44,382 |  |  | $ | 120,248 |  |  | $ | — |  |  | $ | 11,318 |  |  | $ | 729,947 |
Special mention | — |  |  | — |  |  | 15,432 |  |  | — |  |  | 35,691 |  |  | 47 |  |  | — |  |  | — |  |  | 51,170 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | 347 |  |  | 15,855 |  |  | — |  |  | — |  |  | 16,202 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total commercial real estate owner occupied loans | $ | 41,011 |  |  | $ | 254,878 |  |  | $ | 195,721 |  |  | $ | 77,821 |  |  | $ | 80,420 |  |  | $ | 136,150 |  |  | $ | — |  |  | $ | 11,318 |  |  | $ | 797,319 |
Commercial real estate owner occupied loans charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 39 |  |  | $ | — |  |  | $ | — |  |  | $ | 39 |
Commercial real estate non-owner occupied loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 12,906 |  |  | $ | 325,881 |  |  | $ | 109,521 |  |  | $ | 152,227 |  |  | $ | 88,586 |  |  | $ | 367,996 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,057,117 |
Special mention | — |  |  | — |  |  | — |  |  | 20,702 |  |  | — |  |  | 9,148 |  |  | — |  |  | — |  |  | 29,850 |
Substandard | — |  |  | 10,910 |  |  | — |  |  | — |  |  | 8,113 |  |  | 71,660 |  |  | — |  |  | — |  |  | 90,683 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  |  |  | — |  |  | — |  |  | — |  |  | — |
Total commercial real estate non-owner occupied loans | $ | 12,906 |  |  | $ | 336,791 |  |  | $ | 109,521 |  |  | $ | 172,929 |  |  | $ | 96,699 |  |  | $ | 448,804 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,177,650 |
Commercial real estate non-owner occupied loans charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 4,527 |  |  | $ | — |  |  | $ | — |  |  | $ | 4,527 |
| Term Loans Amortized Cost Basis by Origination Year as of December 31, 2023 |  |  |  |  |  |
(amounts in thousands) | 2023 |  | 2022 |  | 2021 |  | 2020 |  | 2019 |  | Prior |  | Revolving loans amortized cost basis |  | Revolving loans converted to term |  | Total
Construction loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 17,594 |  |  | $ | 138,797 |  |  | $ | 2,567 |  |  | $ | — |  |  | $ | — |  |  | $ | 4,580 |  |  | $ | — |  |  | $ | 1,100 |  |  | $ | 164,638 |
Special mention | 1,755 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,755 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total construction loans | $ | 19,349 |  |  | $ | 138,797 |  |  | $ | 2,567 |  |  | $ | — |  |  | $ | — |  |  | $ | 4,580 |  |  | $ | — |  |  | $ | 1,100 |  |  | $ | 166,393 |
Construction loans charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Total commercial loans and leases receivable | $ | 1,291,772 |  |  | $ | 3,911,891 |  |  | $ | 1,228,524 |  |  | $ | 577,273 |  |  | $ | 290,649 |  |  | $ | 1,056,227 |  |  | $ | 1,734,485 |  |  | $ | 400,268 |  |  | $ | 10,491,089 |
Total commercial loans and leases receivable charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 | $ | 1,483 |  |  | $ | 381 |  |  | $ | 3,169 |  |  | $ | 10,348 |  |  | $ | 24 |  |  | $ | 9,650 |  |  | $ | — |  |  | $ | — |  |  | $ | 25,055 |
Residential real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | $ | 22,613 |  |  | $ | 173,424 |  |  | $ | 131,621 |  |  | $ | 6,458 |  |  | $ | 15,508 |  |  | $ | 71,433 |  |  | $ | 56,844 |  |  | $ | — |  |  | $ | 477,901 |
Non-performing | — |  |  | 350 |  |  | 1,236 |  |  | 229 |  |  | 545 |  |  | 3,993 |  |  | 181 |  |  | — |  |  | 6,534 |
Total residential real estate loans | $ | 22,613 |  |  | $ | 173,774 |  |  | $ | 132,857 |  |  | $ | 6,687 |  |  | $ | 16,053 |  |  | $ | 75,426 |  |  | $ | 57,025 |  |  | $ | — |  |  | $ | 484,435 |
Residential real estate loans charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 69 |  |  | $ | — |  |  | $ | — |  |  | $ | 69 |
Manufactured housing loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 98 |  |  | $ | 36,464 |  |  | $ | — |  |  | $ | — |  |  | $ | 36,562 |
Non-performing | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 2,108 |  |  | — |  |  | — |  |  | 2,108 |
Total manufactured housing loans | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 98 |  |  | $ | 38,572 |  |  | $ | — |  |  | $ | — |  |  | $ | 38,670 |
Manufactured housing loans charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Installment loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | $ | 253,958 |  |  | $ | 307,566 |  |  | $ | 158,381 |  |  | $ | 50,354 |  |  | $ | 39,953 |  |  | $ | 3,448 |  |  | $ | 51,480 |  |  | $ | — |  |  | $ | 865,140 |
Non-performing | 2,634 |  |  | 4,102 |  |  | 1,751 |  |  | 546 |  |  | 477 |  |  | 86 |  |  | 190 |  |  | — |  |  | 9,786 |
Total installment loans | $ | 256,592 |  |  | $ | 311,668 |  |  | $ | 160,132 |  |  | $ | 50,900 |  |  | $ | 40,430 |  |  | $ | 3,534 |  |  | $ | 51,670 |  |  | $ | — |  |  | $ | 874,926 |
Installment loans charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 | $ | 7,728 |  |  | $ | 24,605 |  |  | $ | 23,984 |  |  | $ | 5,590 |  |  | $ | 6,797 |  |  | $ | 1,238 |  |  | $ | — |  |  | $ | — |  |  | $ | 69,942 |
Total consumer loans | $ | 279,205 |  |  | $ | 485,442 |  |  | $ | 292,989 |  |  | $ | 57,587 |  |  | $ | 56,581 |  |  | $ | 117,532 |  |  | $ | 108,695 |  |  | $ | — |  |  | $ | 1,398,031 |
Total consumer loans charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 | $ | 7,728 |  |  | $ | 24,605 |  |  | $ | 23,984 |  |  | $ | 5,590 |  |  | $ | 6,797 |  |  | $ | 1,307 |  |  | $ | — |  |  | $ | — |  |  | $ | 70,011 |
Loans and leases receivable | $ | 1,570,977 |  |  | $ | 4,397,333 |  |  | $ | 1,521,513 |  |  | $ | 634,860 |  |  | $ | 347,230 |  |  | $ | 1,173,759 |  |  | $ | 1,843,180 |  |  | $ | 400,268 |  |  | $ | 11,889,120 |
Loans and leases receivable charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2023 | $ | 9,211 |  |  | $ | 24,986 |  |  | $ | 27,153 |  |  | $ | 15,938 |  |  | $ | 6,821 |  |  | $ | 10,957 |  |  | $ | — |  |  | $ | — |  |  | $ | 95,066 |
(1) Excludes $6.2 million of charge-offs for certain PCD loans against $8.7 million of allowance for credit losses on PCD loans recognized upon acquisition of a Venture Banking loan portfolio (included within specialty lending) from the FDIC on June 15, 2023. These PCD loans were originated in years 2016 to 2022. (2) Charge-offs for the years ended December 31, 2023 and 2022 included $10.7 million and $11.0 million, respectively, of commercial and industrial loans originated under the PPP that were subsequently determined to be ineligible for SBA forgiveness and guarantee and were ultimately deemed uncollectible.
| Term Loans Amortized Cost Basis by Origination Year as of December 31, 2022 |  |  |  |  |  |
(amounts in thousands) | 2022 |  | 2021 |  | 2020 |  | 2019 |  | 2018 |  | Prior |  | Revolving loans amortized cost basis |  | Revolving loans converted to term |  | Total
Commercial and industrial loans and leases, including specialty lending: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 3,206,250 |  |  | $ | 682,132 |  |  | $ | 242,516 |  |  | $ | 198,866 |  |  | $ | 56,572 |  |  | $ | 83,417 |  |  | $ | 2,066,349 |  |  | $ | — |  |  | $ | 6,536,102 |
Special mention | 11,134 |  |  | 6,023 |  |  | 27,780 |  |  | — |  |  | 1,501 |  |  | 172 |  |  | 2,599 |  |  | — |  |  | 49,209 |
Substandard | — |  |  | 22,917 |  |  | 967 |  |  | 8,431 |  |  | 6,713 |  |  | 39,554 |  |  | 8,937 |  |  | — |  |  | 87,519 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total commercial and industrial loans and leases | $ | 3,217,384 |  |  | $ | 711,072 |  |  | $ | 271,263 |  |  | $ | 207,297 |  |  | $ | 64,786 |  |  | $ | 123,143 |  |  | $ | 2,077,885 |  |  | $ | — |  |  | $ | 6,672,830 |
Multifamily loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 1,260,544 |  |  | $ | 364,047 |  |  | $ | 130,656 |  |  | $ | 22,167 |  |  | $ | 112,212 |  |  | $ | 203,215 |  |  | $ | — |  |  | $ | — |  |  | $ | 2,092,841 |
Special mention | — |  |  | — |  |  | — |  |  | — |  |  | 4,959 |  |  | 50,858 |  |  | — |  |  | — |  |  | 55,817 |
Substandard | — |  |  | 1,500 |  |  | — |  |  | — |  |  | — |  |  | 62,861 |  |  | — |  |  | — |  |  | 64,361 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total multifamily loans | $ | 1,260,544 |  |  | $ | 365,547 |  |  | $ | 130,656 |  |  | $ | 22,167 |  |  | $ | 117,171 |  |  | $ | 316,934 |  |  | $ | — |  |  | $ | — |  |  | $ | 2,213,019 |
Commercial real estate owner occupied loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 293,096 |  |  | $ | 220,515 |  |  | $ | 105,925 |  |  | $ | 90,752 |  |  | $ | 34,196 |  |  | $ | 121,616 |  |  | $ | — |  |  | $ | — |  |  | $ | 866,100 |
Special mention | — |  |  | — |  |  | — |  |  | — |  |  | 134 |  |  | 1,841 |  |  | — |  |  | — |  |  | 1,975 |
Substandard | — |  |  | — |  |  | — |  |  | 134 |  |  | 10,569 |  |  | 6,561 |  |  | — |  |  | — |  |  | 17,264 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total commercial real estate owner occupied loans | $ | 293,096 |  |  | $ | 220,515 |  |  | $ | 105,925 |  |  | $ | 90,886 |  |  | $ | 44,899 |  |  | $ | 130,018 |  |  | $ | — |  |  | $ | — |  |  | $ | 885,339 |
Commercial real estate non-owner occupied loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 339,044 |  |  | $ | 119,304 |  |  | $ | 156,281 |  |  | $ | 73,827 |  |  | $ | 62,237 |  |  | $ | 386,235 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,136,928 |
Special mention | — |  |  | — |  |  | 21,211 |  |  | — |  |  | — |  |  | 10,617 |  |  | — |  |  | — |  |  | 31,828 |
Substandard | 10,910 |  |  | — |  |  | — |  |  | 28,656 |  |  | 8,198 |  |  | 74,210 |  |  | — |  |  | — |  |  | 121,974 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total commercial real estate non-owner occupied loans | $ | 349,954 |  |  | $ | 119,304 |  |  | $ | 177,492 |  |  | $ | 102,483 |  |  | $ | 70,435 |  |  | $ | 471,062 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,290,730 |
Construction loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 72,177 |  |  | $ | 36,114 |  |  | $ | 9,537 |  |  | $ | 28,644 |  |  | $ | 4,696 |  |  | $ | 9,112 |  |  | $ | 1,729 |  |  | $ | — |  |  | $ | 162,009 |
Special mention | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total construction loans | $ | 72,177 |  |  | $ | 36,114 |  |  | $ | 9,537 |  |  | $ | 28,644 |  |  | $ | 4,696 |  |  | $ | 9,112 |  |  | $ | 1,729 |  |  | $ | — |  |  | $ | 162,009 |
Total commercial loans and leases receivable | $ | 5,193,155 |  |  | $ | 1,452,552 |  |  | $ | 694,873 |  |  | $ | 451,477 |  |  | $ | 301,987 |  |  | $ | 1,050,269 |  |  | $ | 2,079,614 |  |  | $ | — |  |  | $ | 11,223,927 |
Residential real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | $ | 162,217 |  |  | $ | 148,217 |  |  | $ | 7,224 |  |  | $ | 17,128 |  |  | $ | 10,739 |  |  | $ | 77,762 |  |  | $ | 67,782 |  |  | $ | — |  |  | $ | 491,069 |
Non-performing | 271 |  |  | 366 |  |  | 238 |  |  | 441 |  |  | 1,425 |  |  | 3,357 |  |  | 785 |  |  | — |  |  | 6,883 |
Total residential real estate loans | $ | 162,488 |  |  | $ | 148,583 |  |  | $ | 7,462 |  |  | $ | 17,569 |  |  | $ | 12,164 |  |  | $ | 81,119 |  |  | $ | 68,567 |  |  | $ | — |  |  | $ | 497,952 |
Manufactured housing loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 213 |  |  | $ | 103 |  |  | $ | 41,918 |  |  | $ | — |  |  | $ | — |  |  | $ | 42,234 |
Non-performing | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 2,842 |  |  | — |  |  | — |  |  | 2,842 |
Total manufactured housing loans | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 213 |  |  | $ | 103 |  |  | $ | 44,760 |  |  | $ | — |  |  | $ | — |  |  | $ | 45,076 |
Installment loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | $ | 785,699 |  |  | $ | 305,729 |  |  | $ | 100,173 |  |  | $ | 100,570 |  |  | $ | 8,430 |  |  | $ | 782 |  |  | $ | 64,690 |  |  | $ | — |  |  | $ | 1,366,073 |
Non-performing | 5,164 |  |  | 4,356 |  |  | 1,023 |  |  | 1,111 |  |  | 61 |  |  | 59 |  |  | 92 |  |  | — |  |  | 11,866 |
Total installment loans | $ | 790,863 |  |  | $ | 310,085 |  |  | $ | 101,196 |  |  | $ | 101,681 |  |  | $ | 8,491 |  |  | $ | 841 |  |  | $ | 64,782 |  |  | $ | — |  |  | $ | 1,377,939 |
Total consumer loans | $ | 953,351 |  |  | $ | 458,668 |  |  | $ | 108,658 |  |  | $ | 119,463 |  |  | $ | 20,758 |  |  | $ | 126,720 |  |  | $ | 133,349 |  |  | $ | — |  |  | $ | 1,920,967 |
Loans and leases receivable | $ | 6,146,506 |  |  | $ | 1,911,220 |  |  | $ | 803,531 |  |  | $ | 570,940 |  |  | $ | 322,745 |  |  | $ | 1,176,989 |  |  | $ | 2,212,963 |  |  | $ | — |  |  | $ | 13,144,894 |
Loan Purchases and Sales Purchases and sales of loans held for investment were as follows for the years ended December 31, 2023, 2022 and 2021:
| For the Years Ended December 31,
(amounts in thousands) | 2023 |  | 2022 |  | 2021
Purchases (1) |  |  |  |  |
Specialty lending | $ | 631,252 |  |  | $ | — |  |  | $ | — |
Other commercial and industrial | 22,073 |  |  | 2,975 |  |  | — |
Commercial real estate owner occupied | 2,867 |  |  | — |  |  | — |
Loans receivable, PPP | — |  |  | — |  |  | 1,536,213 |
Residential real estate | 4,238 |  |  | 207,251 |  |  | 92,939 |
Personal installment (2) | — |  |  | 123,785 |  |  | 178,970 |
Other installment (2) | 96,758 |  |  | 149,969 |  |  | 99,100 |
Total | $ | 757,188 |  |  | $ | 483,980 |  |  | $ | 1,907,222 |
Sales (3) |  |  |  |  |
Specialty lending (4) | $ | 287,185 |  |  | $ | 2,200 |  |  | $ | — |
Other commercial and industrial (5) | 54,083 |  |  | 22,880 |  |  | 47,142 |
Multifamily | — |  |  | 2,879 |  |  | 36,900 |
Commercial real estate owner occupied (5) | 24,522 |  |  | 8,960 |  |  | 19,420 |
Commercial real estate non-owner occupied | 16,000 |  |  | — |  |  | 18,366 |
Residential real estate | — |  |  | — |  |  | 63,932 |
Personal installment (6) | — |  |  | 500,001 |  |  | 212,255 |
Other installment | 154,042 |  |  | — |  |  | — |
Total | $ | 535,832 |  |  | $ | 536,920 |  |  | $ | 398,015 |
(1)Amounts reported represent the unpaid principal balance at time of purchase. The purchase price was 87.9%, 99.1% and 100.8% of the loans’ unpaid principal balance for the years ended December 31, 2023, 2022 and 2021, respectively. (2)Installment loan purchases for the years ended December 31, 2023, 2022 and 2021 consist of third-party originated unsecured consumer loans. None of the loans held for investment are considered sub-prime at the time of origination. Customers considers sub-prime borrowers to be those with FICO scores below 660. (3)For the years ended December 31, 2023, 2022 and 2021, sales of loans held for investment resulted in net gains of $0.2 million, $3.2 million and $11.3 million, respectively, included in gain (loss) on sale of SBA and other loans in the consolidated statements of income. (4)Includes a loss of $5.0 million from the sale of $670.0 million of short-term syndicated capital call lines of credit ($280.7 million of loans held for investment in unpaid principal balance and $389.3 million of unfunded loan commitments) included in loss on sale of capital call lines of credit in the consolidated statement of income for the year ended December 31, 2023. (5)Primarily sales of SBA loans. (6)Customers sold $521.8 million of consumer installment loans held for investment, inclusive of accrued interest and unamortized deferred loan origination costs, to a third-party sponsored VIE for a loss of $23.5 million included in loss on sale of consumer installment loans in the consolidated statement of income for the year ended December 31, 2022. Customers provided financing to the purchaser for a portion of the sales price in the form of $400.0 million of asset-backed securities. $100.7 million of the remaining sales proceeds were paid in cash. Refer to “NOTE 6 – INVESTMENT SECURITIES” for additional information. On June 15, 2023, Customers acquired $631.0 million of a Venture Banking loan portfolio at a discount from the FDIC, including $228.7 million of PCD loans. The reconciliation between the purchase price and the unpaid principal balance of the PCD loans was as follows:
(amounts in thousands) |  |
PCD loans acquired: |  |
Unpaid principal balance |  | $ | 228,700 |
Unamortized discount |  | (25,509) |
Allowance for credit losses |  | (8,736) |
Purchase price |  | $ | 194,455 |
Loans Pledged as Collateral Customers has pledged eligible real estate, commercial and industrial, PPP and consumer installment loans as collateral for borrowings outstanding or available immediately from the FHLB and FRB in the amount of $7.0 billion and $7.1 billion at December 31, 2023 and 2022, respectively.

X
- Definition The entire disclosure for financing receivable. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 310 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 42 -Subparagraph (a)(2) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481962/310-10-50-42 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 310 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 12A -Publisher FASB -URI https://asc.fasb.org//1943274/2147481933/310-10-55-12A Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 310 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 44 -Subparagraph (a)(1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481962/310-10-50-44 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 310 -SubTopic 10 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//310-10/tableOfContent Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 310 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//310-20/tableOfContent + Details
Name: | us-gaap_FinancingReceivablesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_ReceivablesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration