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LOANS

12 Months Ended

Dec. 31, 2024

LOANS

LOANS

NOTE 5 — LOANS

Loans, net of deferred fees and costs, consist of the following (in thousands):


		At			At
		December 31,			December 31,
		2024			2023
Real estate
Commercial		$	4,317,361		$	3,857,711
Construction			206,960			153,512
Multi-family			376,737			467,536
One-to four-family			90,880			94,704
Total real estate loans			4,991,938			4,573,463
Commercial and industrial			1,046,146			1,051,463
Consumer			12,961			17,086
Total loans			6,051,045			5,642,012
Deferred fees, net of origination costs			(16,969)			(17,215)
Loans, net of deferred fees and costs			6,034,076			5,624,797
Allowance for credit losses			(63,273)			(57,965)
Net loans		$	5,970,803		$	5,566,832

At December 31, 2024, there were $3.3 billion of loans pledged to support wholesale funding, of which $348.8 million were encumbered. At December 31, 2023, there were $3.3 billion of loans pledged to support wholesale funding, of which $548.6 million were encumbered.

The following tables present the activity in the ACL by segment. The portfolio segments represent the categories that the Company uses to determine its ACL (in thousands):


											Multi-			One-to four-
Year ended December 31, 2024		CRE			C&I			Construction			family			family			Consumer			Total
Allowance for credit losses:
Beginning balance		$	35,635		$	11,207		$	1,765		$	8,215		$	663		$	480		$	57,965
Provision/(credit) for credit losses			6,434			(336)			197			(925)			(86)			147			5,431
Loans charged-off			—			—			—			—			—			(247)			(247)
Recoveries			1			120			—			—			—			3			124
Total ending allowance balance		$	42,070		$	10,991		$	1,962		$	7,290		$	577		$	383		$	63,273


											Multi-			One-to four-
Year ended December 31, 2023		CRE			C&I			Construction			family			family			Consumer			Total
Allowance for credit losses:
Beginning balance		$	29,496		$	10,274		$	1,983		$	2,823		$	105		$	195		$	44,876
Cumulative effect of changes in accounting principle			48			471			424			705			181			421			2,250
Provision/(credit) for credit losses			6,091			1,408			(642)			4,687			377			137			12,058
Loans charged-off			—			(946)			—			—			—			(273)			(1,219)
Recoveries			—			—			—			—			—			—			—
Total ending allowance balance		$	35,635		$	11,207		$	1,765		$	8,215		$	663		$	480		$	57,965

Net charge-offs (recoveries) for the years ended December 31, 2024 and 2023 were $123,000 and $1.2 million, respectively.

The following table presents the activity in the ACL for unfunded loan commitments (in thousands):


		Year ended December 31,
		2024			2023
Balance at the beginning of period		$	1,182		$	180
Cumulative effect of changes in accounting principle			—			777
Provision/(credit) for credit losses			826			225
Total ending allowance balance		$	2,008		$	1,182

The following tables present the recorded investment in non-accrual loans, loans past due over 90 days and still accruing by class of loans (in thousands):


								Loans Past Due
					Non-accrual			90 Days and
					Without an			Greater and
At December 31, 2024		Non-accrual			ACL			Still Accruing
Commercial real estate		$	25,087		$	25,087		$	—
Commercial & industrial			6,989			6,989			—
Multi-family			—			—			—
One-to-four family			452			452			—
Consumer			—			—			72
Total		$	32,528		$	32,528		$	72


								Loans Past Due
					Non-accrual			90 Days and
					Without an			Greater and
At December 31, 2023		Non-accrual			ACL			Still Accruing
Commercial real estate		$	24,000		$	24,000		$	—
Commercial & industrial			6,934			6,934			—
Multi-family			20,939			—			—
One-to-four family			—			—			—
Consumer			24			—			—
Total		$	51,897		$	30,934		$	—

Interest income on nonaccrual loans recognized on a cash basis for the years ended December 31, 2024 and 2023 was immaterial.

The following tables present the aging of the recorded investment in past due loans by class of loans (in thousands):


								90
		30-59			60-89			Days and			Total Past			Current
At December 31, 2024		Days			Days			Greater			Due			Loans			Total
Commercial real estate		$	7,115		$	—		$	25,087		$	32,202		$	4,285,159		$	4,317,361
Commercial & industrial			—			—			6,989			6,989			1,039,157			1,046,146
Construction			—			—			—			—			206,960			206,960
Multi-family			—			—			—			—			376,737			376,737
One-to four-family			2,049			—			452			2,501			88,379			90,880
Consumer			124			22			72			218			12,743			12,961
Total		$	9,288		$	22		$	32,600		$	41,910		$	6,009,135		$	6,051,045


								90
		30-59			60-89			Days and			Total Past			Current
At December 31, 2023		Days			Days			Greater			Due			Loans			Total
Commercial real estate		$	—		$	—		$	24,000		$	24,000		$	3,833,711		$	3,857,711
Commercial & industrial			20			19			6,934			6,973			1,044,490			1,051,463
Construction			—			—			—			—			153,512			153,512
Multi-family			—			—			20,939			20,939			446,597			467,536
One-to four-family			612			—			—			612			94,092			94,704
Consumer			—			—			24			24			17,062			17,086
Total		$	632		$	19		$	51,897		$	52,548		$	5,589,464		$	5,642,012

Credit Quality Indicators

The Company aggregates loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. Except for one-to four-family loans and consumer loans, the Company analyzes loans individually by classifying the loans as to credit risk at least annually. For one-to four-family loans and consumer loans, the Company evaluates credit quality based on the aging status of the loan, which was previously presented. An analysis is performed on a quarterly basis for loans classified as special mention, substandard, or doubtful. The Company uses the following definitions for risk ratings. Loans not meeting these definitions are considered to be pass rated loans.

Special Mention - Loans classified as special mention have a potential weakness that deserves management’s attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the Company’s credit position at some future date.

Substandard - Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected.

Doubtful - Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, 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 following table presents loan balances by credit quality indicator and year of origination at December 31, 2024 (in thousands):


																	2019
		2024			2023			2022			2021			2020			& Prior			Revolving			Total
CRE
Pass		$	1,613,785		$	1,114,212		$	927,851		$	241,340		$	125,676		$	149,727		$	26,569		$	4,199,160
Special Mention			73,859			—			5,000			14,255			—			—			—			93,114
Substandard			1,087			—			24,000			—			—			—			—			25,087
Total		$	1,688,731		$	1,114,212		$	956,851		$	255,595		$	125,676		$	149,727		$	26,569		$	4,317,361

Construction
Pass		$	104,503		$	65,231		$	8,693		$	—		$	—		$	—		$	28,533		$	206,960
Total		$	104,503		$	65,231		$	8,693		$	—		$	—		$	—		$	28,533		$	206,960

Multi-family
Pass		$	110,440		$	38,143		$	74,120		$	63,086		$	23,005		$	13,480		$	3,224		$	325,498
Substandard			—			—			30,300			20,939			—			—			—			51,239
Total		$	110,440		$	38,143		$	104,420		$	84,025		$	23,005		$	13,480		$	3,224		$	376,737

One-to four-family
Current		$	—		$	45,000		$	3,469		$	—		$	9,531		$	30,379		$	—		$	88,379
Past Due			—			—			—			—			—			2,501			—			2,501
Total		$	—		$	45,000		$	3,469		$	—		$	9,531		$	32,880		$	—		$	90,880

C&I
Pass		$	238,850		$	96,201		$	119,601		$	62,865		$	14,987		$	1,929		$	452,477		$	986,910
Special Mention			—			1,497			10,246			—			—			—			1,000			12,743
Substandard			—			7,643			20,968			4,697			—			—			13,185			46,493
Total		$	238,850		$	105,341		$	150,815		$	67,562		$	14,987		$	1,929		$	466,662		$	1,046,146

Consumer
Current		$	—		$	—		$	—		$	—		$	—		$	12,743		$	—		$	12,743
Past due			—			—			—			—			—			218			—			218
Total		$	—		$	—		$	—		$	—		$	—		$	12,961		$	—		$	12,961

Total
Pass/Current		$	2,067,578		$	1,358,787		$	1,133,734		$	367,291		$	173,199		$	208,258		$	510,803		$	5,819,650
Special Mention			73,859			1,497			15,246			14,255			—			—			1,000			105,857
Substandard/Past due			1,087			7,643			75,268			25,636			—			2,719			13,185			125,538
Total		$	2,142,524		$	1,367,927		$	1,224,248		$	407,182		$	173,199		$	210,977		$	524,988		$	6,051,045

Charge-offs
Consumer		$	—		$	—		$	—		$	—		$	—		$	247		$	—		$	247

At December 31, 2024, there were $24.0 million and $51.2 million of CRE and Multi-family substandard classified collateral dependent loans, respectively.

The following table presents loan balances by credit quality indicator and year of origination at December 31, 2023 (in thousands):


																	2018
		2023			2022			2021			2020			2019			& Prior			Revolving			Total
CRE
Pass		$	1,500,873		$	1,268,550		$	512,497		$	128,320		$	200,304		$	83,309		$	44,672		$	3,738,525
Special Mention			24,500			38,867			14,561			304			—			—			—			78,232
Substandard			—			40,954			—			—			—			—			—			40,954
Total		$	1,525,373		$	1,348,371		$	527,058		$	128,624		$	200,304		$	83,309		$	44,672		$	3,857,711

Construction
Pass		$	84,881		$	56,065		$	—		$	—		$	—		$	—		$	12,566		$	153,512
Total		$	84,881		$	56,065		$	—		$	—		$	—		$	—		$	12,566		$	153,512

Multi-family
Pass		$	115,761		$	114,652		$	51,768		$	23,655		$	34,533		$	69,510		$	6,415		$	416,294
Special Mention			—			30,303			—			—			—			—			—			30,303
Substandard			—			—			20,939			—			—			—			—			20,939
Total		$	115,761		$	144,955		$	72,707		$	23,655		$	34,533		$	69,510		$	6,415		$	467,536

One-to four-family
Current		$	45,000		$	4,081		$	—		$	9,784		$	12,157		$	23,682		$	—		$	94,704
Total		$	45,000		$	4,081		$	—		$	9,784		$	12,157		$	23,682		$	—		$	94,704

C&I
Pass		$	178,814		$	252,359		$	98,753		$	23,943		$	14,390		$	5,904		$	402,247		$	976,410
Special Mention			3,840			33,918			—			2,080			—			—			28,281			68,119
Substandard			3,435			—			—			—			—			—			3,499			6,934
Total		$	186,089		$	286,277		$	98,753		$	26,023		$	14,390		$	5,904		$	434,027		$	1,051,463

Consumer
Current		$	—		$	—		$	—		$	—		$	—		$	17,062		$	—		$	17,062
Past due			—			—			—			—			—			24			—			24
Total		$	—		$	—		$	—		$	—		$	—		$	17,086		$	—		$	17,086

Total
Pass/Current		$	1,925,329		$	1,695,707		$	663,018		$	185,702		$	261,384		$	199,467		$	465,900		$	5,396,507
Special Mention			28,340			103,088			14,561			2,384			—			—			28,281			176,654
Substandard/Past due			3,435			40,954			20,939			—			—			24			3,499			68,851
Total		$	1,957,104		$	1,839,749		$	698,518		$	188,086		$	261,384		$	199,491		$	497,680		$	5,642,012

Charge-offs
Commercial and industrial		$	—		$	—		$	915		$	—		$	—		$	31		$	—		$	946
Consumer			—			—			—			—			—			273			—			273
		$	—		$	—		$	915		$	—		$	—		$	304		$	—		$	1,219

At December 31, 2023, there were $41.0 million and $20.9 million of CRE and Multi-family substandard classified collateral dependent loans, respectively.

The following tables show the amortized cost basis of modified loans to borrowers experiencing financial difficulty (in thousands):


		Combination
		Term									Modifications
		Extension and			Interest Rate						as a % of
Year ended December 31, 2024		Interest Rate			Reduction			Total			Loan Class
Commercial & industrial		$	11,686		$	—		$	11,686		1.1	%
Multi-family			48,224			3,015			51,239		13.6	%
Total		$	59,910		$	3,015		$	62,925


		Types of Modifications
				Weighted
				Average
				Interest
		Term		Rate
		Extension		Reduction
Year ended December 31, 2024
Commercial real estate
Commercial & industrial		11-12 months		2.9%
Multi-family		6-12 months		4.1%

During the year ended December 31, 2024, $7.0 million of modified loans to borrowers experiencing financial difficulty were not in compliance with their modified terms by 90 days and greater. At December 31, 2024, there were no additional commitments to lend to borrowers experiencing financial difficulty whose loans have been modified. There were no loan modifications where the borrower was experiencing financial difficulty for the year ended December 31, 2023.