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Note 4 - Loans and the Allowance for Credit Losses | 12 Months Ended
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Dec. 31, 2022
Notes to Financial Statements |
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | Note 4 – Loans and the Allowance for Credit Losses Loans Receivable: The following table sets forth the composition of the Company’s loan portfolio segments, net of deferred fees, as of December 31, 2022 and December 31, 2021:
|  | 2022 |  |  | 2021 |
|  | (dollars in thousands) |
Commercial (1) |  | $ | 1,472,734 |  |  | $ | 1,299,428 |
Commercial real estate |  |  | 5,795,228 |  |  |  | 4,741,590 |
Commercial construction |  |  | 574,139 |  |  |  | 540,178 |
Residential real estate |  |  | 264,748 |  |  |  | 255,269 |
Consumer |  |  | 2,312 |  |  |  | 1,886 |
Gross loans |  |  | 8,109,161 |  |  |  | 6,838,351 |
Net deferred fees |  |  | (9,472 | ) |  |  | (9,729 | )
Loans receivable |  | $ | 8,099,689 |  |  | $ | 6,828,622 |
| (1) | Included in commercial loans as of December 31, 2022 and December 31, 2021 were Paycheck Protection Program (“PPP”) loans of $11.4 million and $93.1 million, respectively. These loans are 100% federally guaranteed and currently not subject to any allocation of allowance for credit losses.
As of December 31, 2022, and 2021, loan balances of approximately $2.7 billion and $2.5 billion, respectively, were pledged to secure borrowings from the Federal Home Loan Bank. The loan segments in the above table have unique risk characteristics with respect to credit quality:
| • | The repayment of commercial loans is generally dependent on the creditworthiness and cash flow of borrowers, and if applicable, guarantors, which may be negatively impacted by adverse economic conditions. While the majority of these loans are secured, collateral type, marketing, coverage, valuation and monitoring is not as uniform as in other portfolio classes and recovery from liquidation of such collateral may be subject to greater variability.
| • | Payment on commercial real estate is driven principally by operating results of the managed properties or underlying business and secondarily by the sale or refinance of such properties. Both primary and secondary sources of repayment, and value of the properties in liquidation, may be affected to a greater extent by adverse conditions in the real estate market or the economy in general.
| • | Properties underlying construction, land and land development loans often do not generate sufficient cash flows to service debt and thus repayment is subject to ability of the borrower and, if applicable, guarantors, to complete development or construction of the property and carry the project, often for extended periods of time. As a result, the performance of these loans is contingent upon future events whose probability at the time of origination is uncertain.
| • | The ability of borrowers to service debt in the residential and consumer loan portfolios is generally subject to personal income which may be impacted by general economic conditions, such as increased unemployment levels. These loans are predominately collateralized by first and/or second liens on single family properties. If a borrower cannot maintain the loan, the Company’s ability to recover against the collateral in sufficient amount and in a timely manner may be significantly influenced by market, legal and regulatory conditions.
| • | The Company considers loan classes and loan segments to be one and the same.
Loans Held-For-Sale: The following table presents loans held-for-sale by loan segment as of December 31, 2022 and December 31, 2021:
|  | 2022 |  |  | 2021 |
|  | (dollars in thousands) |
Commercial |  | $ | 13,473 |  |  | $ | - |
Residential real estate |  |  | 299 |  |  |  | 250 |
Total carrying amount |  | $ | 13,772 |  |  | $ | 250 |
Loans Receivable on Nonaccrual Status - The following tables present nonaccrual loans with an allowance for credit loss (“ACL”) as of December 31, 2022 and December 31, 2021 and nonaccrual loans without an ACL as of December 31, 2022 and December 31, 2021:
|  | December 31, 2022 |
|  | Nonaccrual loans with ACL |  |  | Nonaccrual loans without ACL |  |  | Total Nonaccrual loans |
|  | (dollars in thousands) |
Commercial |  | $ | 23,512 |  |  | $ | 1,745 |  |  | $ | 25,257 |
Commercial real estate |  |  | 10,220 |  |  |  | 6,597 |  |  |  | 16,817 |
Residential real estate |  |  | 604 |  |  |  | 1,776 |  |  |  | 2,380 |
Total |  | $ | 34,336 |  |  | $ | 10,118 |  |  | $ | 44,454 |
|  | December 31, 2021 |
|  | Nonaccrual loans with ACL |  |  | Nonaccrual loans without ACL |  |  | Total Nonaccrual loans |
|  | (dollars in thousands) |
Commercial |  | $ | 28,746 |  |  | $ | 1,316 |  |  | $ | 30,062 |
Commercial real estate |  |  | 15,362 |  |  |  | 10,031 |  |  |  | 25,393 |
Commercial construction |  |  | - |  |  |  | 3,150 |  |  |  | 3,150 |
Residential real estate |  |  | 1,239 |  |  |  | 1,856 |  |  |  | 3,095 |
Total |  | $ | 45,347 |  |  | $ | 16,353 |  |  | $ | 61,700 |
Nonaccrual loans include both smaller balance homogeneous loans that are collectively evaluated for impairment and loans individually evaluated for impairment. Credit Quality Indicators - The Company continuously monitors the credit quality of its loans receivable. In addition to its internal monitoring, the Company utilizes the services of a third-party loan review firm to periodically validate the credit quality of its loans receivable on a sample basis. Credit quality is monitored by reviewing certain credit quality indicators. Assets classified as “Pass” are deemed to possess average to superior credit quality, requiring no more than normal attention. Assets classified as “Special Mention” have generally acceptable credit quality yet possess higher risk characteristics/circumstances than satisfactory assets. Such conditions include strained liquidity, slow pay, stale financial statements, or other conditions that require more stringent attention from the lending staff. These conditions, if not corrected, may weaken the loan quality or inadequately protect the Company’s credit position at some future date. Assets are classified as “Substandard” if the asset has a well-defined weakness that requires management’s attention to a greater degree than for loans classified as special mention. Such weakness, if left uncorrected, could possibly result in the compromised ability of the loan to perform to contractual requirements. An asset is classified as “Doubtful” if it is inadequately protected by the net worth and/or paying capacity of the obligor or of the collateral, if any, that secures the obligation. Assets classified as doubtful include assets for which there is a “distinct possibility” that a degree of loss will occur if the inadequacies are not corrected. We evaluate whether a modification, extension or renewal of a loan is a current period origination in accordance with GAAP. Generally, loans up for renewal are subject to a full credit evaluation before the renewal is granted and such loans are considered current period originations for purpose of the table below. As of December 31, 2022, our loans based on year of origination and risk designation are as follows (dollars in thousands):
|  | Term loans amortized cost basis by origination year |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Revolving |  |  | Total |
|  | 2022 |  |  | 2021 |  |  | 2020 |  |  | 2019 |  |  | 2018 |  |  | Prior |  |  | Loans |  |  | Gross Loans |
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 301,636 |  |  | $ | 305,721 |  |  | $ | 47,952 |  |  | $ | 28,177 |  |  | $ | 52,950 |  |  | $ | 127,739 |  |  | $ | 550,483 |  |  | $ | 1,414,658 |
Special mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 583 |  |  |  | 26 |  |  |  | 8,551 |  |  |  | 3,292 |  |  |  | 12,452 |
Substandard |  |  | 7,615 |  |  |  | 146 |  |  |  | 15 |  |  |  | 1,769 |  |  |  | 11,214 |  |  |  | 22,596 |  |  |  | 2,269 |  |  |  | 45,624 |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Total Commercial |  | $ | 309,251 |  |  | $ | 305,867 |  |  | $ | 47,967 |  |  | $ | 30,529 |  |  | $ | 64,190 |  |  | $ | 158,886 |  |  | $ | 556,044 |  |  | $ | 1,472,734 |
Commercial Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 1,571,751 |  |  | $ | 1,608,023 |  |  | $ | 382,987 |  |  | $ | 358,578 |  |  | $ | 375,886 |  |  | $ | 987,982 |  |  | $ | 401,365 |  |  | $ | 5,686,572 |
Special mention |  |  | 3,040 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 37,774 |  |  |  | 8,839 |  |  |  | 49,653 |
Substandard |  |  | - |  |  |  | 1,929 |  |  |  | - |  |  |  | 6,526 |  |  |  | 19,138 |  |  |  | 23,287 |  |  |  | 8,123 |  |  |  | 59,003 |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Total Commercial Real Estate |  | $ | 1,574,791 |  |  | $ | 1,609,952 |  |  | $ | 382,987 |  |  | $ | 365,104 |  |  | $ | 395,024 |  |  | $ | 1,049,043 |  |  | $ | 418,327 |  |  | $ | 5,795,228 |
Commercial Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 8,615 |  |  | $ | 7,605 |  |  | $ | 6,720 |  |  | $ | 508 |  |  | $ | - |  |  | $ | - |  |  | $ | 542,460 |  |  | $ | 565,908 |
Special mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 8,231 |  |  |  | 8,231 |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Total Commercial Construction |  | $ | 8,615 |  |  | $ | 7,605 |  |  | $ | 6,720 |  |  | $ | 508 |  |  | $ | - |  |  | $ | - |  |  | $ | 550,691 |  |  | $ | 574,139 |
Residential Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 45,926 |  |  | $ | 25,318 |  |  | $ | 24,409 |  |  | $ | 21,557 |  |  | $ | 20,284 |  |  | $ | 78,314 |  |  | $ | 41,468 |  |  | $ | 257,276 |
Special mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3,379 |  |  |  | 4,093 |  |  |  | 7,472 |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Total Residential Real Estate |  | $ | 45,926 |  |  | $ | 25,318 |  |  | $ | 24,409 |  |  | $ | 21,557 |  |  | $ | 20,284 |  |  | $ | 81,693 |  |  | $ | 45,561 |  |  | $ | 264,748 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 2,219 |  |  | $ | - |  |  | $ | 9 |  |  | $ | - |  |  | $ | - |  |  | $ | 2 |  |  | $ | 82 |  |  | $ | 2,312 |
Special mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Total Consumer |  | $ | 2,219 |  |  | $ | - |  |  | $ | 9 |  |  | $ | - |  |  | $ | - |  |  | $ | 2 |  |  | $ | 82 |  |  | $ | 2,312 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 1,930,147 |  |  | $ | 1,946,667 |  |  | $ | 462,077 |  |  | $ | 408,820 |  |  | $ | 449,120 |  |  | $ | 1,194,037 |  |  | $ | 1,535,858 |  |  | $ | 7,926,726 |
Special mention |  |  | 3,040 |  |  |  | - |  |  |  | - |  |  |  | 583 |  |  |  | 26 |  |  |  | 46,325 |  |  |  | 12,131 |  |  |  | 62,105 |
Substandard |  |  | 7,615 |  |  |  | 2,075 |  |  |  | 15 |  |  |  | 8,295 |  |  |  | 30,352 |  |  |  | 49,262 |  |  |  | 22,716 |  |  |  | 120,330 |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Grand Total |  | $ | 1,940,802 |  |  | $ | 1,948,742 |  |  | $ | 462,092 |  |  | $ | 417,698 |  |  | $ | 479,498 |  |  | $ | 1,289,624 |  |  | $ | 1,570,705 |  |  | $ | 8,109,161 |
As of December 31, 2021, our loans based on year of origination and risk designation are as follows (dollars in thousands):
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Revolving |  |  | Total |
|  | 2021 |  |  | 2020 |  |  | 2019 |  |  | 2018 |  |  | 2017 |  |  | Prior |  |  | Loans |  |  | Gross Loans |
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 403,203 |  |  | $ | 58,534 |  |  | $ | 54,485 |  |  | $ | 60,409 |  |  | $ | 95,727 |  |  | $ | 86,556 |  |  | $ | 471,588 |  |  | $ | 1,230,502 |
Special mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1 |  |  |  | 4,045 |  |  |  | 4,266 |  |  |  | 8,312 |
Substandard |  |  | 170 |  |  |  | - |  |  |  | 1,842 |  |  |  | 13,298 |  |  |  | 9,740 |  |  |  | 21,024 |  |  |  | 14,540 |  |  |  | 60,614 |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Total Commercial |  | $ | 403,373 |  |  | $ | 58,534 |  |  | $ | 56,327 |  |  | $ | 73,707 |  |  | $ | 105,468 |  |  | $ | 111,625 |  |  | $ | 490,394 |  |  | $ | 1,299,428 |
Commercial Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 1,692,098 |  |  | $ | 533,315 |  |  | $ | 420,995 |  |  | $ | 452,262 |  |  | $ | 497,065 |  |  | $ | 842,244 |  |  | $ | 170,721 |  |  | $ | 4,608,700 |
Special mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 5,142 |  |  |  | 50,438 |  |  |  | 6,601 |  |  |  | 62,181 |
Substandard |  |  | 1,968 |  |  |  | 9,039 |  |  |  | 4,006 |  |  |  | 20,624 |  |  |  | - |  |  |  | 26,108 |  |  |  | 8,964 |  |  |  | 70,709 |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Total Commercial Real Estate |  | $ | 1,694,066 |  |  | $ | 542,354 |  |  | $ | 425,001 |  |  | $ | 472,886 |  |  | $ | 502,207 |  |  | $ | 918,790 |  |  | $ | 186,286 |  |  | $ | 4,741,590 |
Commercial Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 8,018 |  |  | $ | 7,370 |  |  | $ | 12,625 |  |  | $ | 2,600 |  |  | $ | 2,339 |  |  | $ | - |  |  | $ | 490,119 |  |  | $ | 523,071 |
Special mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 350 |  |  |  | - |  |  |  | 1,443 |  |  |  | 1,793 |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 15,314 |  |  |  | 15,314 |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Total Commercial Construction |  | $ | 8,018 |  |  | $ | 7,370 |  |  | $ | 12,625 |  |  | $ | 2,600 |  |  | $ | 2,689 |  |  | $ | - |  |  | $ | 506,876 |  |  | $ | 540,178 |
Residential Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 27,081 |  |  | $ | 29,539 |  |  | $ | 23,611 |  |  | $ | 25,070 |  |  | $ | 28,701 |  |  | $ | 66,249 |  |  | $ | 44,221 |  |  | $ | 244,472 |
Special mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 7,262 |  |  |  | 3,535 |  |  |  | 10,797 |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Total Residential Real Estate |  | $ | 27,081 |  |  | $ | 29,539 |  |  | $ | 23,611 |  |  | $ | 25,070 |  |  | $ | 28,701 |  |  | $ | 73,511 |  |  | $ | 47,756 |  |  | $ | 255,269 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 1,590 |  |  | $ | 85 |  |  | $ | 39 |  |  | $ | 21 |  |  | $ | 28 |  |  | $ | - |  |  | $ | 123 |  |  | $ | 1,886 |
Special mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Total Consumer |  | $ | 1,590 |  |  | $ | 85 |  |  | $ | 39 |  |  | $ | 21 |  |  | $ | 28 |  |  | $ | - |  |  | $ | 123 |  |  | $ | 1,886 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 2,131,990 |  |  | $ | 628,843 |  |  | $ | 511,755 |  |  | $ | 540,362 |  |  | $ | 623,860 |  |  | $ | 995,049 |  |  | $ | 1,176,772 |  |  | $ | 6,608,631 |
Special mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 5,493 |  |  |  | 54,483 |  |  |  | 12,310 |  |  |  | 72,286 |
Substandard |  |  | 2,138 |  |  |  | 9,039 |  |  |  | 5,848 |  |  |  | 33,922 |  |  |  | 9,740 |  |  |  | 54,394 |  |  |  | 42,353 |  |  |  | 157,434 |
Doubtful |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Grand Total |  | $ | 2,134,128 |  |  | $ | 637,882 |  |  | $ | 517,603 |  |  | $ | 574,284 |  |  | $ | 639,093 |  |  | $ | 1,103,926 |  |  | $ | 1,231,435 |  |  | $ | 6,838,351 |
Collateral Dependent Loans: Loans which meet certain criteria are individually evaluated as part of the process of calculating the allowance for credit losses. The evaluation is determined on an individual basis using the fair value of the collateral as of the reporting date. The following table presents collateral dependent loans that were individually evaluated for impairment as of December 31, 2022 and 2021:
|  | December 31, 2022 |
|  | Real Estate |  |  | Other |  |  | Total |
|  | (dollars in thousands) |
Commercial |  | $ | 5,352 |  |  | $ | 22,517 |  |  | $ | 27,869 |
Commercial real estate |  |  | 52,477 |  |  |  | - |  |  |  | 52,477 |
Commercial construction |  |  | 8,232 |  |  |  | - |  |  |  | 8,232 |
Residential real estate |  |  | 5,864 |  |  |  | - |  |  |  | 5,864 |
Total |  | $ | 71,925 |  |  | $ | 22,517 |  |  | $ | 94,442 |
|  | December 31, 2021 |
|  | Real Estate |  |  | Other |  |  | Total |
|  | (dollars in thousands) |
Commercial |  | $ | 6,385 |  |  | $ | 26,182 |  |  | $ | 32,567 |
Commercial real estate |  |  | 55,244 |  |  |  | - |  |  |  | 55,244 |
Commercial construction |  |  | 13,196 |  |  |  | - |  |  |  | 13,196 |
Residential real estate |  |  | 8,856 |  |  |  | - |  |  |  | 8,856 |
Total |  | $ | 83,681 |  |  | $ | 26,182 |  |  | $ | 109,863 |
Aging Analysis - The following table provides an analysis of the aging of the loans by class, excluding the effect of net deferred fees, which are past due as of December 31, 2022 and December 31, 2021 (dollars in thousands):
|  | December 31, 2022 |
|  | 30-59 Days Past Due |  |  | 60-89 Days Past Due |  |  | 90 Days or Greater Past Due and Still Accruing |  |  | Nonaccrual |  |  | Total Past Due and Nonaccrual |  |  | Current |  |  | Gross Loans |
Commercial |  | $ | 306 |  |  | $ | - |  |  | $ | - |  |  | $ | 25,257 |  |  | $ | 25,563 |  |  | $ | 1,447,171 |  |  | $ | 1,472,734 |
Commercial real Estate |  |  | 90 |  |  |  | - |  |  |  | 5,591 |  |  |  | 16,817 |  |  |  | 22,498 |  |  |  | 5,772,730 |  |  |  | 5,795,228 |
Commercial construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 574,139 |  |  |  | 574,139 |
Residential real Estate |  |  | 1,569 |  |  |  | - |  |  |  | - |  |  |  | 2,380 |  |  |  | 3,949 |  |  |  | 260,799 |  |  |  | 264,748 |
Consumer |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 2,312 |  |  |  | 2,312 |
Total |  | $ | 1,965 |  |  | $ | - |  |  | $ | 5,591 |  |  | $ | 44,454 |  |  | $ | 52,010 |  |  | $ | 8,057,151 |  |  | $ | 8,109,161 |
The 90 days or greater past due and still accruing category reflects purchased credit-deteriorated loans, net of fair value marks, which accrete income per the valuation at date of acquisition.
|  | December 31, 2021 |
|  | 30-59 Days Past Due |  |  | 60-89 Days Past Due |  |  | 90 Days or Greater Past Due and Still Accruing |  |  | Nonaccrual |  |  | Total Past Due and Nonaccrual |  |  | Current |  |  | Total Loans Receivable |
Commercial |  | $ | 4,305 |  |  | $ | 729 |  |  | $ | 4,457 |  |  | $ | 30,062 |  |  | $ | 39,553 |  |  | $ | 1,259,875 |  |  | $ | 1,299,428 |
Commercial real estate |  |  | 1,622 |  |  |  | 1,009 |  |  |  | 5,935 |  |  |  | 25,393 |  |  |  | 33,959 |  |  |  | 4,707,631 |  |  |  | 4,741,590 |
Commercial construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3,150 |  |  |  | 3,150 |  |  |  | 537,028 |  |  |  | 540,178 |
Residential real estate |  |  | 1,437 |  |  |  | 292 |  |  |  | 3,139 |  |  |  | 3,095 |  |  |  | 7,963 |  |  |  | 247,306 |  |  |  | 255,269 |
Consumer |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,886 |  |  |  | 1,886 |
Total |  | $ | 7,364 |  |  | $ | 2,030 |  |  | $ | 13,531 |  |  | $ | 61,700 |  |  | $ | 84,625 |  |  | $ | 6,753,726 |  |  | $ | 6,838,351 |
The 90 days or greater past due and still accruing category reflects purchased credit-deteriorated loans, net of fair value marks, which accrete income per the valuation at date of acquisition. The following tables detail the amount of gross loans that are individually evaluated for impairment, collectively evaluated for impairment, and loans acquired with deteriorated quality, and the related portion of the allowance for credit losses for loans that are allocated to each loan portfolio segment.
|  | December 31, 2022 |
|  | Commercial |  |  | Commercial real estate |  |  | Commercial construction |  |  | Residential real estate |  |  | Consumer |  |  | Total |
|  | (dollars in thousands) |
Allowance for credit losses - loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Individually evaluated |  | $ | 7,426 |  |  | $ | 1,003 |  |  | $ | - |  |  | $ | 50 |  |  | $ | - |  |  | $ | 8,479 |
Collectively evaluated |  |  | 19,319 |  |  |  | 50,818 |  |  |  | 3,718 |  |  |  | 4,093 |  |  |  | 7 |  |  |  | 77,955 |
Acquired with deteriorated credit quality individually analyzed​​ |  |  | 2,158 |  |  |  | 1,921 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 4,079 |
Total |  | $ | 28,903 |  |  | $ | 53,742 |  |  | $ | 3,718 |  |  | $ | 4,143 |  |  | $ | 7 |  |  | $ | 90,513 |
Gross loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Individually evaluated |  | $ | 30,994 |  |  | $ | 46,886 |  |  | $ | 8,232 |  |  | $ | 5,864 |  |  | $ | - |  |  | $ | 91,976 |
Collectively evaluated |  |  | 1,436,866 |  |  |  | 5,742,751 |  |  |  | 565,907 |  |  |  | 258,884 |  |  |  | 2,312 |  |  |  | 8,006,720 |
Acquired with deteriorated credit quality individually analyzed​​ |  |  | 4,874 |  |  |  | 5,591 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 10,465 |
Total |  | $ | 1,472,734 |  |  | $ | 5,795,228 |  |  | $ | 574,139 |  |  | $ | 264,748 |  |  | $ | 2,312 |  |  | $ | 8,109,161 |
|  | December 31, 2021 |
|  | Commercial |  |  | Commercial real estate |  |  | Commercial construction |  |  | Residential real estate |  |  | Consumer |  |  | Total |
|  | (dollars in thousands) |
Allowance for credit losses - loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Individually evaluated |  | $ | 15,131 |  |  | $ | 955 |  |  | $ | - |  |  | $ | 131 |  |  | $ | - |  |  | $ | 16,217 |
Collectively evaluated |  |  | 8,561 |  |  |  | 42,713 |  |  |  | 3,580 |  |  |  | 3,497 |  |  |  | 7 |  |  |  | 58,358 |
Acquired with deteriorated credit quality individually analyzed​​ |  |  | 2,277 |  |  |  | 1,921 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 4,198 |
Total |  | $ | 25,969 |  |  | $ | 45,589 |  |  | $ | 3,580 |  |  | $ | 3,628 |  |  | $ | 7 |  |  | $ | 78,773 |
Gross loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Individually evaluated |  | $ | 33,726 |  |  | $ | 49,310 |  |  | $ | 13,196 |  |  | $ | 5,717 |  |  | $ | - |  |  | $ | 101,949 |
Collectively evaluated |  |  | 1,260,537 |  |  |  | 4,686,346 |  |  |  | 526,982 |  |  |  | 246,413 |  |  |  | 1,886 |  |  |  | 6,722,164 |
Acquired with deteriorated credit quality individually analyzed​​ |  |  | 5,165 |  |  |  | 5,934 |  |  |  | - |  |  |  | 3,139 |  |  |  | - |  |  |  | 14,238 |
Total |  | $ | 1,299,428 |  |  | $ | 4,741,590 |  |  | $ | 540,178 |  |  | $ | 255,269 |  |  | $ | 1,886 |  |  | $ | 6,838,351 |
A summary of the activity in the allowance for credit losses for loans by loan segment is as follows:
|  | Commercial |  |  | Commercial real estate |  |  | Commercial construction |  |  | Residential real estate |  |  | Consumer |  |  | Unallocated |  |  | Total |
|  | (dollars in thousands) |
Balance as of January 1, 2022 |  | $ | 25,969 |  |  | $ | 45,589 |  |  | $ | 3,580 |  |  | $ | 3,628 |  |  | $ | 7 |  |  | $ | - |  |  | $ | 78,773 |
Charge-offs |  |  | (2,612 | ) |  |  | (2,819 | ) |  |  | - |  |  |  | (9 | ) |  |  | (3 | ) |  |  | - |  |  |  | (5,443 | )
Recoveries |  |  | 54 |  |  |  | - |  |  |  | - |  |  |  | 63 |  |  |  | - |  |  |  | - |  |  |  | 117 |
Provision for credit losses |  |  | 5,492 |  |  |  | 10,972 |  |  |  | 138 |  |  |  | 461 |  |  |  | 3 |  |  |  | - |  |  |  | 17,066 |
Balance as of December 31, 2022 |  | $ | 28,903 |  |  | $ | 53,742 |  |  | $ | 3,718 |  |  | $ | 4,143 |  |  | $ | 7 |  |  | $ | - |  |  | $ | 90,513 |
On January 1, 2021, the Company adopted CECL, which replaced the incurred loss method we used in prior periods for determining the provision for credit losses and the allowance for credit losses. Under CECL, we record an expected loss of all cash flows we do not expect to collect at the inception of the loan. The adoption of CECL resulted in an increase in our allowance for credit losses for loans of $6.6 million, which did not impact our consolidated income statement.
|  | Commercial |  |  | Commercial real estate |  |  | Commercial construction |  |  | Residential real estate |  |  | Consumer |  |  | Unallocated |  |  | Total |
|  | (dollars in thousands) |
Balance as of January 1, 2021 |  | $ | 28,443 |  |  | $ | 39,330 |  |  | $ | 8,194 |  |  | $ | 2,687 |  |  | $ | 4 |  |  | $ | 568 |  |  | $ | 79,226 |
Day 1 Adjustment CECL |  |  | (4,225 | ) |  |  | 9,605 |  |  |  | (961 | ) |  |  | 2,697 |  |  |  | 9 |  |  |  | (568 | ) |  |  | 6,557 |
Balance as of January 1, 2021 |  |  | 24,218 |  |  |  | 48,935 |  |  |  | 7,233 |  |  |  | 5,384 |  |  |  | 13 |  |  |  | - |  |  |  | 85,783 |
Charge-offs |  |  | (382 | ) |  |  | (1,780 | ) |  |  | - |  |  |  | (235 | ) |  |  | - |  |  |  | - |  |  |  | (2,397 | )
Recoveries |  |  | 289 |  |  |  | 85 |  |  |  | - |  |  |  | 20 |  |  |  | 11 |  |  |  | - |  |  |  | 405 |
Provision for (reversal of) credit losses |  |  | 1,844 |  |  |  | (1,651 | ) |  |  | (3,653 | ) |  |  | (1,541 | ) |  |  | (17 | ) |  |  | - |  |  |  | (5,018 | )
Balance as of December 31, 2021 |  | $ | 25,969 |  |  | $ | 45,589 |  |  | $ | 3,580 |  |  | $ | 3,628 |  |  | $ | 7 |  |  | $ | - |  |  | $ | 78,773 |
|  | Commercial |  |  | Commercial real estate |  |  | Commercial construction |  |  | Residential real estate |  |  | Consumer |  |  | Unallocated |  |  | Total |
|  | (dollars in thousands) |
Balance as of January 1, 2020 |  | $ | 8,349 |  |  | $ | 20,853 |  |  | $ | 7,304 |  |  | $ | 1,685 |  |  | $ | 3 |  |  | $ | 99 |  |  | $ | 38,293 |
Charge-offs |  |  | (552 | ) |  |  | - |  |  |  | - |  |  |  | (341 | ) |  |  | (7 | ) |  |  | - |  |  |  | (900 | )
Recoveries |  |  | 4 |  |  |  | 802 |  |  |  | - |  |  |  | 23 |  |  |  | 4 |  |  |  | - |  |  |  | 833 |
Provision for loan losses |  |  | 20,642 |  |  |  | 17,675 |  |  |  | 890 |  |  |  | 1,320 |  |  |  | 4 |  |  |  | 469 |  |  |  | 41,000 |
Balance as of December 31, 2020 |  | $ | 28,443 |  |  | $ | 39,330 |  |  | $ | 8,194 |  |  | $ | 2,687 |  |  | $ | 4 |  |  | $ | 568 |  |  | $ | 79,226 |
Troubled Debt Restructurings Loans are considered to have been modified in a troubled debt restructuring (“TDR”) when, except as discussed below, due to a borrower’s financial difficulties, the Company makes certain concessions to the borrower that it would not otherwise consider. Modifications may include interest rate reductions, maturity extensions, principal or interest forgiveness, forbearance, and other actions intended to minimize economic loss and to avoid foreclosure or repossession of collateral. Generally, a nonaccrual loan that has been modified in a TDR remains on nonaccrual status for a period of nine months to demonstrate that the borrower is able to meet the terms of the modified loan. However, performance prior to the modification, or significant events that coincide with the modification, are included in assessing whether the borrower can meet the new terms and may result in the loan being returned to accrual status at the time of loan modification or after a shorter performance period. If the borrower’s ability to meet the revised payment schedule is uncertain, the loan remains on nonaccrual status. As of December 31, 2022, there were no commitments to lend additional funds to borrowers whose loans were on nonaccrual status or were contractually past due 90 days or greater and still accruing interest, or whose terms have been modified in a TDR. As of December 31, 2022, TDRs totaled $75.1 million, of which $23.7 million were on nonaccrual status and $51.4 million were classified as accruing and were performing under their restructured terms. As of December 31, 2021, TDRs totaled $79.5 million, of which $35.9 million were on nonaccrual status and $43.6 million were classified as accruing and were performing under their restructured terms. The Company has allocated $4.2 million and $10.4 million of specific allowance related to TDRs as of December 31, 2022 and December 31, 2021, respectively. There were no TDRs for which there was a payment default within twelve months following the modification during the year ended December 31, 2022, 2021 and 2020. The following table presents loans by class modified as TDRs during the year ended December 31, 2022:
|  |  |  |  |  | Pre-Modification |  |  | Post-Modification |
|  |  |  |  |  | Outstanding |  |  | Outstanding |
|  | Number of |  |  | Recorded |  |  | Recorded |
|  | Loans |  |  | Investment |  |  | Investment |
|  | (dollars in thousands) |
Troubled debt restructurings: |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 2 |  |  | $ | 633 |  |  | $ | 633 |
Commercial real estate |  |  | 3 |  |  |  | 12,083 |  |  |  | 11,583 |
Residential real estate |  |  | 3 |  |  |  | 949 |  |  |  | 949 |
Total |  |  | 8 |  |  | $ | 13,665 |  |  | $ | 13,165 |
The loans modified as TDRs during the year ended December 31, 2022 included maturity extensions and interest rate reductions. One of the commercial real estate loans included a one-time principal paydown of $500,000 at the time of modification. The eight loans modified during the year ended December 31, 2022 resulted in a $0.3 million increase to the allowance for credit losses at the time of their modification. The following table presents loans by class modified as TDRs during the year ended December 31, 2021
|  |  |  |  |  | Pre-Modification |  |  | Post-Modification |
|  |  |  |  |  | Outstanding |  |  | Outstanding |
|  | Number of |  |  | Recorded |  |  | Recorded |
|  | Loans |  |  | Investment |  |  | Investment |
|  | (dollars in thousands) |
Troubled debt restructurings: |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 4 |  |  | $ | 1,276 |  |  | $ | 1,276 |
Commercial real estate |  |  | 11 |  |  |  | 35,635 |  |  |  | 35,635 |
Commercial construction |  |  | 1 |  |  |  | 1,641 |  |  |  | 1,641 |
Residential real estate |  |  | 3 |  |  |  | 1,758 |  |  |  | 1,758 |
Total |  |  | 19 |  |  | $ | 40,310 |  |  | $ | 40,310 |
The loans modified as TDRs during the year ended December 31, 2021 included maturity extensions and interest rate reductions. The following table presents loans by class modified as TDRs during the year ended December 31, 2020:
|  |  |  |  |  | Pre-Modification |  |  | Post-Modification |
|  |  |  |  |  | Outstanding |  |  | Outstanding |
|  | Number of |  |  | Recorded |  |  | Recorded |
|  | Loans |  |  | Investment |  |  | Investment |
|  | (dollars in thousands) |
Troubled debt restructurings: |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | 1 |  |  | $ | 188 |  |  | $ | 188 |
Commercial real estate |  |  | 1 |  |  |  | 93 |  |  |  | 93 |
Commercial construction |  |  | 1 |  |  |  | 4,021 |  |  |  | 4,021 |
Residential real estate |  |  | 2 |  |  |  | 2,184 |  |  |  | 2,184 |
Total |  |  | 5 |  |  | $ | 6,486 |  |  | $ | 6,486 |
The five loan modifications during the year ended December 31, 2020 were maturity extensions. Allowance for Credit Losses for Unfunded Commitments The Company has recorded an ACL for unfunded credit commitments, which is recorded in other liabilities. The provision is recorded within the (reversal of) provision for credit losses on the Company’s income statement. The following table presents the allowance for credit losses for unfunded commitments for the year ended December 31, 2022 and 2021 (dollars in thousands):
|  | 2022 |  |  | 2021 |
Balance as of beginning of period |  | $ | 2,351 |  |  | $ | - |
Day 1 Effect of CECL |  |  | - |  |  |  | 2,833 |
Provision for (reversal of) credit losses - unfunded commitments |  |  | 684 |  |  |  | (482 | )
Balance as of end of period |  | $ | 3,035 |  |  | $ | 2,351 |
Components of (Reversal of) Provision for Credit Losses The following table summarizes the provision for (reversal of) provision for credit losses for the year ended December 31, 2022 and 2021 (dollars in thousands):
|  | 2022 |  |  | 2021 |
Provision for (reversal of) credit losses - loans |  | $ | 17,066 |  |  | $ | (5,018 | )
Provision for (reversal of) credit losses - unfunded commitments |  |  | 684 |  |  |  | (482 | )
Provision for (reversal of) credit losses |  | $ | 17,750 |  |  | $ | (5,500 | )

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- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -URI https://asc.fasb.org/subtopic&trid=2196772 + Details
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