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LOANS AND LEASES, NET

3 Months Ended

Dec. 31, 2023

Loans and Leases Receivable Disclosure [Abstract]

Loans and leases consist of the following:


(Dollars in thousands)	December 31, 2023		September 30, 2023
Term lending	$	1,452,274	$	1,308,133
Asset-based lending	379,681		382,371
Factoring	335,953		358,344
Lease financing	188,889		183,392
Insurance premium finance	671,035		800,077
SBA/USDA	546,048		524,750
Other commercial finance	160,628		166,091
Commercial finance	3,734,508		3,723,158


Consumer finance	301,510		254,416
Tax services	33,435		5,192
Warehouse finance	349,911		376,915
Total loans and leases	4,419,364		4,359,681
Net deferred loan origination costs	6,917		6,435
Total gross loans and leases	4,426,281		4,366,116
Allowance for credit losses	(53,785)		(49,705)
Total loans and leases, net	$	4,372,496	$	4,316,411

During the three months ended December 31, 2023 and 2022, the Company originated $631.9 million and $398.8 million of commercial finance and consumer finance as held for sale, respectively.

The Company sold held for sale loans resulting in proceeds of $626.3 million and a nominal gain on sale during the three months ended December 31, 2023. The Company sold held for sale loans resulting in proceeds of $402.9 million and gain on sale of $0.1 million during the three months ended December 31, 2022.

Loans purchased and sold by portfolio segment, including participation interests, were as follows:


	Three Months Ended December 31,
(Dollars in thousands)		2023		2022
Loans Purchased





Loans held for investment:



Warehouse finance		$	89,390	$	67,649
Total purchases		$	89,390	$	67,649
Loans Sold
Loans held for sale:
Commercial finance		$	3,872	$	855
Consumer finance		622,464		402,015







Total sales		$	626,336	$	402,870

Leasing Portfolio. The net investment in direct financing and sales-type leases was comprised of the following:


(Dollars in thousands)	December 31, 2023		September 30, 2023
Minimum lease payments receivable	$	197,829	$	191,807
Unguaranteed residual assets	14,388		12,709
Unamortized initial direct costs	114		141
Unearned income	(23,181)		(21,124)
Total net investment in direct financing and sales-type leases	$	189,150	$	183,533

The components of total lease income were as follows:


	Three Months Ended December 31,
(Dollars in thousands)		2023		2022
Interest income - loans and leases
Interest income on net investments in direct financing and sales-type leases		$	3,108	$	3,143

Leasing and equipment finance noninterest income
Lease income from operating lease payments		13,255		12,554

Other(1)		724		702
Total leasing and equipment finance noninterest income		13,979		13,256
Total lease income		$	17,087	$	16,399
(1) Other leasing and equipment finance noninterest income consists of gains (losses) on sales of leased equipment, fees and service charges on leases and gains (losses) on sales of leases.

Undiscounted future minimum lease payments receivable for direct financing and sales-type leases, and a reconciliation to the carrying amount recorded at December 31, 2023 were as follows:


(Dollars in thousands)
Remaining in 2024	$	60,302
2025	54,431
2026	33,348
2027	20,287
2028	15,912
Thereafter	13,549

Total undiscounted future minimum lease payments receivable for direct financing and sales-type leases	197,829
Third-party residual value guarantees	—
Total carrying amount of direct financing and sales-type leases	$	197,829

The Company did not record any contingent rental income from direct financing and sales-type leases in the three months ended December 31, 2023.

A number of factors affected the economic environment in 2023 including geopolitical conflict, supply chain disruptions, inflation, rising interest rates, and bank failures brought on by, among other things, rising interest rates, deposit outflows and liquidity crises. While the ultimate impact of these factors on the Company's loan and lease portfolio remains difficult to predict, management continues to evaluate the loan and lease portfolio in order to assess the impact on repayment sources and underlying collateral that could result in additional losses and the impact to our customers and businesses as a result of these factors impacting the economy and will refine its estimate as developments occur and more information becomes available.

Activity in the allowance for credit losses and balances of loans and leases by portfolio segment was as follows:


	Three Months Ended December 31, 2023
(Dollars in thousands)	Beginning Balance		Provision (Reversal)		Charge-offs		Recoveries		Ending Balance
Allowance for credit losses:
Term lending	$	25,686	$	5,822	$	(5,121)	$	626	$	27,013
Asset-based lending	2,738		(1,510)		—		142		1,370
Factoring	6,566		751		(23)		139		7,433
Lease financing	3,302		766		(153)		93		4,008
Insurance premium finance	2,637		(239)		(365)		90		2,123
SBA/USDA	2,962		327		—		—		3,289
Other commercial finance	3,089		223		—		—		3,312
Commercial finance	46,980		6,140		(5,662)		1,090		48,548


Consumer finance	2,346		2,097		(63)		—		4,380
Tax services	2		1,356		(1,145)		294		507
Warehouse finance	377		(27)		—		—		350
Total loans and leases	49,705		9,566		(6,870)		1,384		53,785
Unfunded commitments(1)	272		324		—		—		596
Total	$	49,977	$	9,890	$	(6,870)	$	1,384	$	54,381
(1) Reserve for unfunded commitments is recognized within other liabilities on the Condensed Consolidated Statements of Financial Condition.


	Three Months Ended December 31, 2022
(Dollars in thousands)	Beginning Balance		Provision (Reversal)		Charge-offs		Recoveries		Ending Balance
Allowance for credit losses:
Term lending	$	24,621	$	3,671	$	(1,817)	$	277	$	26,752
Asset-based lending	1,050		2,853		—		—		3,903
Factoring	6,556		(764)		(121)		3		5,674
Lease financing	5,902		(438)		(406)		180		5,238
Insurance premium finance	1,450		(47)		(185)		43		1,261
SBA/USDA	3,263		(651)		—		20		2,632
Other commercial finance	1,310		2,046		—		—		3,356
Commercial finance	44,152		6,670		(2,529)		523		48,816


Consumer finance	1,463		1,603		(179)		—		2,887
Tax services	5		1,637		(1,731)		698		609
Warehouse finance	327		(47)		—		—		280
Total loans and leases	45,947		9,863		(4,439)		1,221		52,592
Unfunded commitments(1)	366		(87)		—		—		279
Total	$	46,313	$	9,776	$	(4,439)	$	1,221	$	52,871
(1) Reserve for unfunded commitments is recognized within other liabilities on the Condensed Consolidated Statements of Financial Condition.

Information on loans and leases that are deemed to be collateral dependent and are evaluated individually for the ACL was as follows:


(Dollars in thousands)	At December 31, 2023		At September 30, 2023
Term lending	$	4,160	$	3,516
Asset-based lending	7,731		19,226
Factoring	3,562		1,133
Lease financing	593		630

SBA/USDA	2,591		750

Commercial finance(1)	18,637		25,255





Total	$	18,637	$	25,255
(1) For Commercial Finance, collateral dependent financial assets have collateral in the form of cash, equipment, or other business assets.

Management has identified certain structured finance credits for alternative energy projects in which a substantial cash collateral account has been established to mitigate credit risk. Due to the nature of the transactions and significant cash collateral positions, these credits are evaluated individually. The balance of these pass rated cash collateral loans totaled $114.3 million and $117.0 million at December 31, 2023 and at September 30, 2023, respectively.

Federal regulations provide for the classification of loans and other assets such as debt and equity securities considered by the Bank's primary regulator, the OCC, to be of lesser quality as “substandard,” “doubtful” or “loss.” The loan classification and risk rating definitions are as follows:

Pass - A pass asset is of sufficient quality in terms of repayment, collateral and management to preclude a special mention or an adverse rating.

Watch - A watch asset is generally a credit performing well under current terms and conditions but with identifiable weakness meriting additional scrutiny and corrective measures. Watch is not a regulatory classification but can be used to designate assets that are exhibiting one or more weaknesses that deserve management’s attention. These assets are of better quality than special mention assets.

Special Mention - A special mention asset is a credit with potential weaknesses deserving management’s close attention and, if left uncorrected, may result in deterioration of the repayment prospects for the asset. Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. Special mention is a temporary status with aggressive credit management required to garner adequate progress and move to watch or higher.

The adverse classifications are as follows:

Substandard - A substandard asset is inadequately protected by the net worth and/or repayment ability or by a weak collateral position. Assets so classified will have well-defined weaknesses creating a distinct possibility the Bank will sustain some loss if the weaknesses are not corrected. Loss potential does not have to exist for an asset to be classified as substandard.

Doubtful - A doubtful asset has weaknesses similar to those classified substandard, with the degree of weakness causing the likely loss of some principal in any reasonable collection effort. Due to pending factors, the asset’s classification as loss is not yet appropriate.

Loss - A loss asset is considered uncollectible and of such little value that the asset’s continuance on the Bank’s balance sheet is no longer warranted. This classification does not necessarily mean an asset has no recovery or salvage value leaving room for future collection efforts.

Loans and leases, or portions thereof, are generally charged off when collection of principal becomes doubtful. Typically, this is associated with a delay or shortfall in payments of 210 days or more for insurance premium finance, 120 days or more for consumer credit products and leases, and 90 days or more for commercial finance loans. Action is taken to charge off electronic return originator ("ERO") loans if such loans have not been collected by the end of June and refund advance loans if such loans have not been collected by the end of the calendar year. The Company individually evaluates loans and leases that do not share similar risk characteristics with other financial assets, which generally means loans and leases identified as modifications or loans and leases on nonaccrual status.

The Company recognizes that concentrations of credit may naturally occur and may take the form of a large volume of related loans and leases to an individual, a specific industry, or a geographic location. Credit concentration is a direct, indirect, or contingent obligation that has a common bond where the aggregate exposure equals or exceeds a certain percentage of the Company’s Tier 1 Capital plus the allowable Allowance for Credit Losses.

The Company has various portfolios of consumer finance and tax services loans that present unique risks that are statistically managed. Due to the unique risks associated with these portfolios, the Company monitors other credit quality indicators in its evaluation of the appropriateness of the ACL on these portfolios, and as such, these loans are not included in the asset classification table below. The outstanding balances of consumer finance loans and tax services loans were $301.5 million and $33.4 million at December 31, 2023, respectively, and $254.4 million and $5.2 million at September 30, 2023, respectively. The amortized cost basis of loans and leases by asset classification and year of origination was as follows:


	Amortized Cost Basis
(Dollars in thousands)	Term Loans and Leases by Origination Year												Revolving Loans and Leases		Total
At December 31, 2023	2024		2023		2022		2021		2020		Prior
Term lending
Pass	$	234,250	$	496,789	$	138,710	$	110,564	$	59,710	$	55,391	$	—	$	1,095,414
Watch	61,518		32,021		43,154		23,282		13,908		2,416		—		176,299
Special mention	922		24,558		13,232		26,952		572		283		—		66,519
Substandard	9,393		25,451		27,768		13,345		23,610		4,953		—		104,520
Doubtful	715		1,202		4,300		976		879		1,450		—		9,522
Total	306,798		580,021		227,164		175,119		98,679		64,493		—		1,452,274
Current period charge-offs	—		118		2,524		1,673		618		188		—		5,121
Asset-based lending
Pass	—		—		—		—		—		—		187,835		187,835
Watch	—		—		—		—		—		—		159,962		159,962
Special mention	—		—		—		—		—		—		22,378		22,378


Substandard	—		—		—		—		—		—		9,506		9,506

Total	—		—		—		—		—		—		379,681		379,681
Current period charge-offs	—		—		—		—		—		—		—		—
Factoring
Pass	—		—		—		—		—		—		253,129		253,129
Watch	—		—		—		—		—		—		63,492		63,492
Special mention	—		—		—		—		—		—		5,528		5,528
Substandard	—		—		—		—		—		—		13,804		13,804

Total	—		—		—		—		—		—		335,953		335,953
Current period charge-offs	—		—		—		—		—		—		23		23
Lease financing
Pass	26,190		62,933		13,847		13,464		22,422		2,564		—		141,420
Watch	1,266		458		9,747		10,573		3,769		1,635		—		27,448
Special mention	—		2		—		175		360		265		—		802
Substandard	—		6,126		2,005		5,642		2,884		2,272		—		18,929
Doubtful	—		—		—		64		—		226		—		290
Total	27,456		69,519		25,599		29,918		29,435		6,962		—		188,889
Current period charge-offs	—		—		44		42		67		—		—		153
Insurance premium finance
Pass	238,408		430,949		352		—		—		—		—		669,709
Watch	—		251		—		—		—		—		—		251
Special mention	—		420		—		—		—		—		—		420
Substandard	—		317		4		—		—		—		—		321
Doubtful	—		326		8		—		—		—		—		334
Total	238,408		432,263		364		—		—		—		—		671,035
Current period charge-offs	—		202		163		—		—		—		—		365
SBA/USDA
Pass	27,424		154,580		147,067		24,847		35,508		26,629		—		416,055
Watch	—		53,475		48,374		650		61		3,309		—		105,869
Special mention	—		—		—		525		—		—		—		525
Substandard	—		252		2,339		1,706		5,377		13,925		—		23,599

Total	27,424		208,307		197,780		27,728		40,946		43,863		—		546,048
Current period charge-offs	—		—		—		—		—		—		—		—
Other commercial finance
Pass	—		2,300		18,958		32,615		1,105		76,911		—		131,889
Watch	—		1,736		—		—		—		—		—		1,736

Substandard	—		2,717		58		24,228		—		—		—		27,003

Total	—		6,753		19,016		56,843		1,105		76,911		—		160,628
Current period charge-offs	—		—		—		—		—		—		—		—
Warehouse finance
Pass	—		—		—		—		—		—		349,911		349,911




Total	—		—		—		—		—		—		349,911		349,911
Current period charge-offs	—		—		—		—		—		—		—		—
Total loans and leases
Pass	526,272		1,147,551		318,934		181,490		118,745		161,495		790,875		3,245,362
Watch	62,784		87,941		101,275		34,505		17,738		7,360		223,454		535,057
Special mention	922		24,980		13,232		27,652		932		548		27,906		96,172
Substandard	9,393		34,863		32,174		44,921		31,871		21,150		23,310		197,682
Doubtful	715		1,528		4,308		1,040		879		1,676		—		10,146
Total	$	600,086	$	1,296,863	$	469,923	$	289,608	$	170,165	$	192,229	$	1,065,545	$	4,084,419
Current period charge-offs	$	—	$	320	$	2,731	$	1,715	$	685	$	188	$	23	$	5,662


	Amortized Cost Basis
(Dollars in thousands)	Term Loans and Leases by Origination Year												Revolving Loans and Leases		Total
At September 30, 2023	2023		2022		2021		2020		2019		Prior
Term lending
Pass	$	539,448	$	149,190	$	99,677	$	73,132	$	14,368	$	85,812	$	—	$	961,627
Watch	53,481		51,036		58,041		12,230		4,483		727		—		179,998
Special mention	26,539		13,853		20,463		723		2,932		75		—		64,585
Substandard	20,437		30,451		14,729		24,613		3,872		764		—		94,866
Doubtful	200		2,655		1,691		1,121		165		1,225		—		7,057
Total	640,105		247,185		194,601		111,819		25,820		88,603		—		1,308,133
Asset-based lending
Pass	—		—		—		—		—		—		161,744		161,744
Watch	—		—		—		—		—		—		174,243		174,243
Special mention	—		—		—		—		—		—		26,382		26,382
Substandard	—		—		—		—		—		—		19,501		19,501
Doubtful	—		—		—		—		—		—		501		501
Total	—		—		—		—		—		—		382,371		382,371
Factoring
Pass	—		—		—		—		—		—		270,754		270,754
Watch	—		—		—		—		—		—		70,833		70,833
Special mention	—		—		—		—		—		—		8,892		8,892
Substandard	—		—		—		—		—		—		7,865		7,865

Total	—		—		—		—		—		—		358,344		358,344
Lease financing
Pass	57,123		15,941		15,167		27,489		4,036		1,281		—		121,037
Watch	793		10,436		12,566		4,494		1,579		55		—		29,923
Special mention	—		—		847		415		195		—		—		1,457
Substandard	14,890		1,983		7,082		3,660		3,062		33		—		30,710
Doubtful	—		—		71		61		—		133		—		265
Total	72,806		28,360		35,733		36,119		8,872		1,502		—		183,392
Insurance premium finance
Pass	797,267		1,210		—		—		—		—		—		798,477
Watch	858		34		—		—		—		—		—		892
Special mention	250		15		—		—		—		—		—		265
Substandard	91		20		—		—		—		—		—		111
Doubtful	180		152		—		—		—		—		—		332
Total	798,646		1,431		—		—		—		—		—		800,077
SBA/USDA
Pass	158,675		148,525		26,244		36,274		8,798		18,252		—		396,768
Watch	49,010		48,833		658		51		357		2,572		—		101,481
Special mention	—		—		530		—		—		—		—		530
Substandard	252		2,356		1,718		5,418		8,509		7,718		—		25,971

Total	207,937		199,714		29,150		41,743		17,664		28,542		—		524,750
Other commercial finance
Pass	2,330		18,927		32,737		1,137		10,122		69,927		—		135,180
Watch	1,742		—		—		—		—		—		—		1,742

Substandard	2,753		450		25,708		—		—		258		—		29,169

Total	6,825		19,377		58,445		1,137		10,122		70,185		—		166,091
Warehouse finance
Pass	—		—		—		—		—		—		376,915		376,915




Total	—		—		—		—		—		—		376,915		376,915
Total loans and leases
Pass	1,554,843		333,793		173,825		138,032		37,324		175,272		809,413		3,222,502


Watch	105,884		110,339		71,265		16,775		6,419		3,354		245,076		559,112
Special mention	26,789		13,868		21,840		1,138		3,127		75		35,274		102,111
Substandard	38,423		35,260		49,237		33,691		15,443		8,773		27,366		208,193
Doubtful	380		2,807		1,762		1,182		165		1,358		501		8,155
Total	$	1,726,319	$	496,067	$	317,929	$	190,818	$	62,478	$	188,832	$	1,117,630	$	4,100,073

Past due loans and leases were as follows:


	At December 31, 2023
	Accruing and Nonaccruing Loans and Leases												Nonperforming Loans and Leases
(Dollars in thousands)	30-59 Days Past Due		60-89 Days Past Due		> 89 Days Past Due		Total Past Due		Current		Total Loans and Leases Receivable		> 89 Days Past Due and Accruing		Nonaccrual Balance		Total
Loans held for sale	$	1,173	$	786	$	661	$	2,620	$	66,898	$	69,518	$	661	$	—	$	661

Term lending	28,694		6,156		14,385		49,235		1,403,039		1,452,274		4,006		17,978		21,984
Asset-based lending	—		—		123		123		379,558		379,681		—		4,593		4,593
Factoring	—		—		—		—		335,953		335,953		—		1,173		1,173
Lease financing	1,944		1,107		2,161		5,212		183,677		188,889		1,488		1,645		3,133
Insurance premium finance	2,666		999		1,924		5,589		665,446		671,035		1,924		—		1,924
SBA/USDA	102		79		2,146		2,327		543,721		546,048		444		2,710		3,154
Other commercial finance	—		—		—		—		160,628		160,628		—		—		—
Commercial finance	33,406		8,341		20,739		62,486		3,672,022		3,734,508		7,862		28,099		35,961


Consumer finance	4,258		3,345		2,859		10,462		291,048		301,510		2,859		—		2,859
Tax services	—		—		—		—		33,435		33,435		—		—		—
Warehouse finance	—		—		—		—		349,911		349,911		—		—		—
Total loans and leases held for investment	37,664		11,686		23,598		72,948		4,346,416		4,419,364		10,721		28,099		38,820
Total loans and leases	$	38,837	$	12,472	$	24,259	$	75,568	$	4,413,314	$	4,488,882	$	11,382	$	28,099	$	39,481


	At September 30, 2023
	Accruing and Nonaccruing Loans and Leases												Nonperforming Loans and Leases
(Dollars in thousands)	30-59 Days Past Due		60-89 Days Past Due		> 89 Days Past Due		Total Past Due		Current		Total Loans and Leases Receivable		> 89 Days Past Due and Accruing		Nonaccrual Balance		Total
Loans held for sale	$	626	$	549	$	306	$	1,481	$	76,298	$	77,779	$	306	$	—	$	306

Term lending	13,898		7,723		11,136		32,757		1,275,376		1,308,133		3,737		15,324		19,061
Asset-based lending	—		—		123		123		382,248		382,371		—		18,082		18,082
Factoring	—		—		—		—		358,344		358,344		—		1,298		1,298
Lease financing	6,865		158		4,828		11,851		171,541		183,392		4,242		1,666		5,908
Insurance premium finance	2,159		1,262		2,339		5,760		794,317		800,077		2,339		—		2,339
SBA/USDA	512		—		1,835		2,347		522,403		524,750		833		1,002		1,835
Other commercial finance	—		—		91		91		166,000		166,091		91		—		91
Commercial finance	23,434		9,143		20,352		52,929		3,670,229		3,723,158		11,242		37,372		48,614


Consumer finance	2,992		2,425		2,210		7,627		246,789		254,416		2,210		—		2,210
Tax services	—		—		5,082		5,082		110		5,192		5,082		—		5,082
Warehouse finance	—		—		—		—		376,915		376,915		—		—		—
Total loans and leases held for investment	26,426		11,568		27,644		65,638		4,294,043		4,359,681		18,534		37,372		55,906
Total loans and leases	$	27,052	$	12,117	$	27,950	$	67,119	$	4,370,341	$	4,437,460	$	18,840	$	37,372	$	56,212

Nonaccrual loans and leases by year of origination were as follows:


	Amortized Cost Basis
(Dollars in thousands)	Term Loans and Leases by Origination Year												Revolving Loans and Leases		Total		Nonaccrual with No ACL
At December 31, 2023	2024		2023		2022		2021		2020		Prior
Term lending	$	1,264	$	2,002	$	7,666	$	2,082	$	1,925	$	3,039	$	—	$	17,978	$	—
Asset-based lending	—		—		—		—		—		—		4,593		4,593		4,469
Factoring	—		—		—		—		—		—		1,173		1,173		—
Lease financing	—		—		—		439		781		425		—		1,645		593

SBA/USDA	—		1,008		—		—		1,301		401		—		2,710		750

Commercial finance	1,264		3,010		7,666		2,521		4,007		3,865		5,766		28,099		5,812





Total nonaccrual loans and leases	$	1,264	$	3,010	$	7,666	$	2,521	$	4,007	$	3,865	$	5,766	$	28,099	$	5,812


	Amortized Cost Basis
(Dollars in thousands)	Term Loans and Leases by Origination Year												Revolving Loans and Leases		Total		Nonaccrual with No ACL
At September 30, 2023	2023		2022		2021		2020		2019		Prior
Term lending	$	865	$	4,942	$	2,933	$	2,165	$	3,134	$	1,285	$	—	$	15,324	$	—
Asset-based lending	—		—		—		—		—		—		18,082		18,082		—
Factoring	—		—		—		—		—		—		1,298		1,298		—
Lease financing	—		—		446		660		—		560		—		1,666		1

SBA/USDA	—		750		—		—		—		252		—		1,002		—

Commercial finance	865		5,692		3,379		2,825		3,134		2,097		19,380		37,372		1





Total nonaccrual loans and leases	$	865	$	5,692	$	3,379	$	2,825	$	3,134	$	2,097	$	19,380	$	37,372	$	1

Loans and leases that are 90 days or more delinquent and accruing by year of origination were as follows:


	Amortized Cost Basis
(Dollars in thousands)	Term Loans and Leases by Origination Year												Revolving Loans and Leases		Total
At December 31, 2023	2024		2023		2022		2021		2020		Prior
Loans held for sale	$	—	$	661	$	—	$	—	$	—	$	—	$	—	$	661
Term lending	—		1,139		2,290		186		383		8		—		4,006


Lease financing	—		—		498		895		95		—		—		1,488
Insurance premium finance	—		—		910		5		—		1,009		—		1,924
SBA/USDA	—		—		—		—		191		253		—		444

Commercial finance	—		1,139		3,698		1,086		669		1,270		—		7,862


Consumer finance	—		1,898		706		235		—		—		20		2,859


Total loans and leases held for investment	—		3,037		4,404		1,321		669		1,270		20		10,721
Total 90 days or more delinquent and accruing	$	—	$	3,698	$	4,404	$	1,321	$	669	$	1,270	$	20	$	11,382


	Amortized Cost Basis
(Dollars in thousands)	Term Loans and Leases by Origination Year												Revolving Loans and Leases		Total
At September 30, 2023	2023		2022		2021		2020		2019		Prior
Loans held for sale	$	306	$	—	$	—	$	—	$	—	$	—	$	—	$	306
Term lending	1,604		1,371		500		233		29		—		—		3,737


Lease financing	151		490		979		784		1,794		44		—		4,242
Insurance premium finance	—		414		114		—		334		1,477		—		2,339
SBA/USDA	—		—		—		833		—		—		—		833
Other commercial finance	—		—		—		—		—		91		—		91
Commercial finance	1,755		2,275		1,593		1,850		2,157		1,612		—		11,242


Consumer finance	891		1,045		246		—		—		—		28		2,210
Tax services	5,082		—		—		—		—		—		—		5,082

Total loans and leases held for investment	7,728		3,320		1,839		1,850		2,157		1,612		28		18,534
Total 90 days or more delinquent and accruing	$	8,034	$	3,320	$	1,839	$	1,850	$	2,157	$	1,612	$	28	$	18,840

Certain loans and leases 90 days or more past due as to interest or principal continue to accrue because they are (1) well-secured and in the process of collection or (2) consumer loans exempt under regulatory rules from being classified as nonaccrual until later delinquency, usually 120 days past due.

The following table provides the average recorded investment in nonaccrual loans and leases:


	Three Months Ended December 31,
(Dollars in thousands)		2023		2022
Term lending		$	17,419	$	8,796
Asset-based lending		9,711		4,272
Factoring		1,180		708
Lease financing		1,623		3,623

SBA/USDA		1,488		1,420

Commercial finance		31,421		18,819





Total loans and leases		$	31,421	$	18,819

The recognized interest income on the Company's nonaccrual loans and leases for the three months ended December 31, 2023 and 2022 was not significant.

Effective October 1, 2023, the Company adopted ASU 2022-02, Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures on a prospective basis. Financial information at and for the quarter ended December 31, 2023 is reflected as such. The historical information disclosed is in accordance with Subtopic ASC 310-40, Receivables – Troubled Debt Restructurings by Creditors.

Modifications made to borrowers experiencing financial difficulty during the three months ended December 31, 2023 were insignificant.

No loans were modified in a TDR during the three months ended December 31, 2022. The Company had $0.1 million of commercial finance loans that were modified within the previous 12 months experience a payment default during the three months ended December 31, 2022. TDR net charge-offs and the impact of TDRs on the Company's allowance for credit losses were insignificant during the three months ended December 31, 2022.