Loans outstanding, excluding those held for sale, by general ledger classification, as of March 31, 2021 and December 31, 2020, consisted of the following:

			% of					% of
	March 31,		Totals			December 31,		Total
(Dollars in thousands)	2021		Loans			2020		Loans
Residential mortgage	$	489,665		11.18	%	$	502,829		11.50	%
Multifamily mortgage		1,178,940		26.93			1,126,946		25.77
Commercial mortgage		697,599		15.94			691,294		15.81
Commercial loans (including equipment financing) (A)		1,911,520		43.66			1,950,981		44.62
Commercial construction		17,865		0.41			12,600		0.29
Home equity lines of credit		45,623		1.04			50,545		1.15
Consumer loans, including fixed rate home equity loans		36,519		0.83			37,016		0.85
Other loans		200		0.01			226		0.01
Total loans	$	4,377,931		100.00	%	$	4,372,437		100.00	%

In determining an appropriate amount for the allowance, the Bank segments and evaluates the loan portfolio based on federal Call Report codes. The following portfolio classes have been identified as of March 31, 2021 and December 31, 2020:

			% of					% of
	March 31,		Totals			December 31,		Total
(Dollars in thousands)	2021		Loans			2020		Loans
Primary residential mortgage	$	498,570		11.39	%	$	512,841		11.74	%
Home equity lines of credit		45,623		1.04			50,545		1.16
Junior lien loan on residence		4,686		0.11			4,527		0.10
Multifamily property		1,178,940		26.95			1,126,946		25.79
Owner-occupied commercial real estate		241,094		5.51			253,447		5.80
Investment commercial real estate		966,287		22.09			995,613		22.79
Commercial and industrial (A)		1,064,133		24.32			1,059,399		24.24
Lease financing		312,358		7.14			305,931		7.00
Farmland/agricultural production		3,349		0.08			3,068		0.07
Commercial construction loans		18,035		0.41			12,773		0.29
Consumer and other loans		42,080		0.96			44,483		1.02
Total loans	$	4,375,155		100.00	%	$	4,369,573		100.00	%
Net deferred costs		2,776					2,864
Total loans including net deferred costs	$	4,377,931				$	4,372,437

The following tables present the loan balances by portfolio class, based on impairment method, and the corresponding balances in the allowance for loan and lease losses (ALLL) as of March 31, 2021 and December 31, 2020:

	March 31, 2021
	Total		Ending ALLL		Total		Ending ALLL
	Loans		Attributable		Loans		Attributable
	Individually		To Loans		Collectively		To Loans
	Evaluated		Individually		Evaluated		Collectively				Total
	For		Evaluated for		For		Evaluated for		Total		Ending
(In thousands)	Impairment		Impairment		Impairment		Impairment		Loans		ALLL
Primary residential mortgage	$	2,264	$	1	$	496,306	$	2,775	$	498,570	$	2,776
Home equity lines of credit		—		—		45,623		198		45,623		198
Junior lien loan on residence		—		—		4,686		16		4,686		16
Multifamily property		—		—		1,178,940		10,427		1,178,940		10,427
Owner-occupied commercial real estate		564		—		240,530		2,864		241,094		2,864
Investment commercial real estate		—		—		966,287		26,693		966,287		26,693
Commercial and industrial (A)		9,136		3,200		1,054,997		16,925		1,064,133		20,125
Lease financing		—		—		312,358		3,967		312,358		3,967
Farmland/agricultural production		—		—		3,349		47		3,349		47
Commercial construction loans		—		—		18,035		161		18,035		161
Consumer and other loans		—		—		42,080		262		42,080		262
Total ALLL	$	11,964	$	3,201	$	4,363,191	$	64,335	$	4,375,155	$	67,536

	December 31, 2020
	Total		Ending ALLL		Total		Ending ALLL
	Loans		Attributable		Loans		Attributable
	Individually		To Loans		Collectively		To Loans
	Evaluated		Individually		Evaluated		Collectively				Total
	For		Evaluated for		For		Evaluated for		Total		Ending
(In thousands)	Impairment		Impairment		Impairment		Impairment		Loans		ALLL
Primary residential mortgage	$	1,490	$	3	$	511,351	$	2,902	$	512,841	$	2,905
Home equity lines of credit		—		—		50,545		218		50,545		218
Junior lien loan on residence		—		—		4,527		15		4,527		15
Multifamily property		—		—		1,126,946		9,945		1,126,946		9,945
Owner-occupied commercial real estate		807		—		252,640		3,050		253,447		3,050
Investment commercial real estate		4,593		—		991,020		27,713		995,613		27,713
Commercial and industrial		9,314		2,700		1,050,085		16,347		1,059,399		19,047
Lease financing		—		—		305,931		3,936		305,931		3,936
Farmland/agricultural production		—		—		3,068		43		3,068		43
Commercial construction loans		—		—		12,773		158		12,773		158
Consumer and other loans		—		—		44,483		279		44,483		279
Total ALLL	$	16,204	$	2,703	$	4,353,369	$	64,606	$	4,369,573	$	67,309

Impaired loans include nonaccrual loans of $11.8 million at March 31, 2021 and $11.4 million at December 31, 2020. Impaired loans also include performing TDR loans of $197,000 at March 31, 2021 and $201,000 at December 31, 2020. The allowance allocated to TDR loans totaled $1,000 and $3,000 at March 31, 2021 and December 31, 2020, respectively, of which none was allocated to nonaccrual loans. All accruing TDR loans were paying in accordance with restructured terms as of March 31, 2021. The Company has not committed to lend additional amounts as of March 31, 2021 to customers with outstanding loans that are classified as TDR loans.

The following tables present loans individually evaluated for impairment by class of loans as of March 31, 2021 and December 31, 2020 (The average impaired loans on the following tables represent year to date impaired loans):

	March 31, 2021
	Unpaid						Average
	Principal		Recorded		Specific		Impaired
(In thousands)	Balance		Investment		Reserves		Loans
With no related allowance recorded:
Primary residential mortgage	$	2,384	$	2,104	$	—	$	1,579
Owner-occupied commercial real estate		577		564		—		645
Commercial and industrial		7,033		4,136		—		4,198
Total loans with no related allowance	$	9,994	$	6,804	$	—	$	6,422
With related allowance recorded:
Primary residential mortgage	$	160	$	160	$	1	$	161
Commercial and industrial		5,000		5,000		3,200		5,000
Total loans with related allowance	$	5,160	$	5,160	$	3,201	$	5,161
Total loans individually evaluated for impairment	$	15,154	$	11,964	$	3,201	$	11,583

	December 31, 2020
	Unpaid						Average
	Principal		Recorded		Specific		Impaired
(In thousands)	Balance		Investment		Reserves		Loans
With no related allowance recorded:
Primary residential mortgage	$	1,601	$	1,328	$	—	$	5,544
Owner-occupied commercial real estate		817		807		—		516
Investment commercial real estate		4,593		4,593		—		6,582
Commercial and industrial		7,137		4,314		—		1,677
Total loans with no related allowance	$	14,148	$	11,042	$	—	$	14,319
With related allowance recorded:
Primary residential mortgage	$	162	$	162	$	3	$	526
Commercial and industrial		5,000		5,000		2,700		4,140
Total loans with related allowance	$	5,162	$	5,162	$	2,703	$	4,666
Total loans individually evaluated for impairment	$	19,310	$	16,204	$	2,703	$	18,985

Interest income recognized on impaired loans for the quarters ended March 31, 2021 and 2020 was not material. The Company did not recognize any income on non-accruing impaired loans for the three months ended March 31, 2021 and 2020.

The following tables present the recorded investment in nonaccrual and loans past due over 90 days still on accrual by class of loans as of March 31, 2021 and December 31, 2020:

The following tables present the aging of the recorded investment in past due loans as of March 31, 2021 and December 31, 2020 by class of loans, excluding nonaccrual loans:

	March 31, 2021
	30-59		60-89		Greater Than
	Days		Days		90 Days		Total
(In thousands)	Past Due		Past Due		Past Due		Past Due
Primary residential mortgage	$	990	$	—	$	—	$	990
Owner occupied commercial real estate		550		—		—		550
Commercial and industrial		81		—		—		81
Consumer and other loans		—		1		—		1
Total	$	1,621	$	1	$	—	$	1,622

	December 31, 2020
	30-59		60-89		Greater Than
	Days		Days		90 Days		Total
(In thousands)	Past Due		Past Due		Past Due		Past Due
Primary residential mortgage	$	2,900	$	141	$	—	$	3,041
Home equity lines of credit		181		—		—		181
Junior lien loan on residence		—		25		—		25
Multifamily property		—		269		—		269
Owner-occupied commercial real estate		268		—		—		268
Commercial and industrial		497		772		—		1,269
Total	$	3,846	$	1,207	$	—	$	5,053

The Company places all commercial loans into various credit risk rating categories based on an assessment of the expected ability of the borrowers to properly service their debt. The assessment considers numerous factors including, but not limited to, current financial information on the borrower, historical payment experience, strength of any guarantor, nature of and value of any collateral, acceptability of the loan structure and documentation, relevant public information and current economic trends. This credit risk rating analysis is performed when the loan is initially underwritten and then annually based on set criteria in the loan policy.

In addition, the Bank has engaged an independent loan review firm to validate risk ratings and to ensure compliance with our policies and procedures. This review of the following types of loans is performed quarterly:

The Company uses the following regulatory definitions for criticized and classified risk ratings:

Special Mention: These loans have a potential weakness that deserves Management’s close attention. If left uncorrected, the potential weaknesses may result in deterioration of the repayment prospects for the loans or of the institution’s credit position at some future date.

Substandard: These loans 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 institution will sustain some loss if the deficiencies are not corrected.

Doubtful: These loans have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable, based on currently existing facts, conditions and values.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass-rated loans.

Loans that are considered to be impaired are individually evaluated for potential loss and allowance adequacy. Loans not deemed impaired are collectively evaluated for potential loss and allowance adequacy.

As of March 31, 2021, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

			Special
(In thousands)	Pass		Mention		Substandard		Doubtful
Primary residential mortgage	$	488,941	$	3,014	$	6,615	$	—
Home equity lines of credit		45,149		—		474		—
Junior lien loan on residence		4,668		—		18		—
Multifamily property		1,174,380		4,206		354		—
Owner-occupied commercial real estate		228,790		10,187		2,117		—
Investment commercial real estate		868,088		98,199		—		—
Commercial and industrial		997,669		50,328		16,136		—
Lease financing		312,358		—		—		—
Farmland/agricultural production		3,349		—		—		—
Commercial construction loans		17,956		79		—		—
Consumer and other loans		42,080		—		—		—
Total	$	4,183,428	$	166,013	$	25,714	$	—

As of December 31, 2020, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

			Special
(In thousands)	Pass		Mention		Substandard		Doubtful
Primary residential mortgage	$	504,795	$	1,398	$	6,648	$	—
Home equity lines of credit		50,068		—		477		—
Junior lien loan on residence		4,483		—		44		—
Multifamily property		1,121,145		5,441		360		—
Owner-occupied commercial real estate		240,638		10,417		2,392		—
Investment commercial real estate		893,115		91,162		11,336		—
Commercial and industrial		989,281		53,604		16,514		—
Lease financing		305,931		—		—		—
Farmland/agricultural production		3,068		—		—		—
Commercial construction loans		12,692		81		—		—
Consumer and other loans		44,483		—		—		—
Total	$	4,169,699	$	162,103	$	37,771	$	—

At March 31, 2021, $12.0 million of substandard loans were also considered impaired, compared to December 31, 2020, when $16.2 million of substandard loans were also considered impaired.

The activity in the allowance for loan and lease losses for the three months ended March 31, 2021 is summarized below:

	January 1,										March 31,
	2021										2021
	Beginning							Provision			Ending
(In thousands)	ALLL		Charge-offs			Recoveries		(Credit)			ALLL
Primary residential mortgage	$	2,905	$	—		$	—	$	(129	)	$	2,776
Home equity lines of credit		218		—			9		(29	)		198
Junior lien loan on residence		15		—			—		1			16
Multifamily property		9,945		—			—		482			10,427
Owner-occupied commercial real estate		3,050		—			—		(186	)		2,864
Investment commercial real estate		27,713		—			—		(1,020	)		26,693
Commercial and industrial		19,047		—			7		1,071			20,125
Lease financing		3,936		—			—		31			3,967
Farmland/agricultural production		43		—			—		4			47
Commercial construction loans		158		—			—		3			161
Consumer and other loans		279		(15	)		1		(3	)		262
Total ALLL	$	67,309	$	(15	)	$	17	$	225		$	67,536

The activity in the allowance for loan and lease losses for the three months ended March 31, 2020 is summarized below:

	January 1,									March 31,
	2020									2020
	Beginning							Provision		Ending
(In thousands)	ALLL		Charge-offs			Recoveries		(Credit)		ALLL
Primary residential mortgage	$	2,090	$	—		$	77	$	1,006	$	3,173
Home equity lines of credit		128		—			3		106		237
Junior lien loan on residence		13		—			—		10		23
Multifamily property		6,037		—			—		3,067		9,104
Owner-occupied commercial real estate		2,064		—			—		774		2,838
Investment commercial real estate		15,988		—			31		11,652		27,671
Commercial and industrial		14,353		—			3		2,768		17,124
Lease financing		2,642		—			—		499		3,141
Farmland/agricultural production		38		—			—		—		38
Commercial construction loans		27		—			—		13		40
Consumer and other loans		296		(8	)		1		105		394
Total ALLL	$	43,676	$	(8	)	$	115	$	20,000	$	63,783

The CARES Act allows financial institutions to suspend application of certain current TDR accounting guidance under ASC 310-40 for loan modifications related to the COVID-19 pandemic made between March 1, 2020 and the earlier of December 31, 2020 or 60 days after the end of the COVID-19 national emergency, provided certain criteria are met. The revised CARES Act extended loan modifications through January 1, 2022. This relief can be applied to loan modifications for borrowers that were not more than 30 days past due as of December 31, 2019 and to loan modifications that defer or delay the payment of principal or interest or change the interest rate on the loan. In April 2020, federal and state banking regulators issued the Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus to provide further interpretation of when a borrower is experiencing financial difficulty, specifically indicating that if the modification is either short-term (e.g., six months) or mandated by a federal or state government in response to the COVID-19 pandemic, the borrower is not experiencing financial difficulty under ASC 310-40.

As of March 31, 2021, the Bank has modified 540 loans with a balance of $946.7 million resulting in the deferral of principal and/or interest. The table below summarizes the deferrals as of March 31, 2021. All of these loans were performing in accordance with their terms prior to modification and are in conformance with the CARES Act. Included in the table below is 1 loan related to our back to back swap program totaling $19.9 million. Details with respect to loan modifications are as follows:

			Post-Modification
			Outstanding
	Number of		Recorded
(Dollars in thousands)	Loans		Investment
Primary residential mortgage		21	$	7,477
Junior lien loan on residence		1		18
Multifamily property		1		921
Owner-occupied commercial real estate		1		117
Investment commercial real estate		1		19,887
Commercial and industrial		6		12,993
Commercial construction loans		1		1,344
Total		32	$	42,757

The future performance of these loans, specifically beyond the term of the deferral, is uncertain. To recognize a credit allowance commensurate with the existing risk, the Company assigned qualitative factors for each of the above portfolio classes for allowance purposes.

The Company has allocated $1,000 and $3,000 of specific reserves on TDRs as of March 31, 2021 and December 31, 2020, respectively. There were no unfunded commitments to lend additional amounts to customers with outstanding loans that are classified as TDRs.

There were no loans modified as TDRs during the three-month period ended March 31, 2021.

The following table presents loans by class modified as TDRs during the three-month period ended March 31, 2020:

The identification of the TDRs did not have a significant impact on the allowance for loan and lease losses.

The following table presents loans by class modified as TDRs that failed to comply with the modified terms in the twelve months following modification and resulted in a payment default at March 31, 2021:

In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under the Company’s internal underwriting policy. The modification of the terms of such loans may include one or more of the following: (1) a reduction of the stated interest rate of the loan to a rate that is lower than the current market rate for new debt with similar risk; (2) an extension of an interest only period for a predetermined period of time; (3) an extension of the maturity date; or (4) an extension of the amortization period over which future payments will be computed. At the time a loan is restructured, the Bank performs a full re-underwriting analysis, which includes, at a minimum, obtaining current financial statements and tax returns, copies of all leases, and an updated independent appraisal of the property. A loan will continue to accrue interest if it can be reasonably determined that the borrower should be able to perform under the modified terms, that the loan has not been chronically delinquent (both to debt service and real estate taxes) or in nonaccrual status since its inception, and that there have been no charge-offs on the loan. Restructured loans with previous charge-offs would not accrue interest at the time of the TDR. At a minimum, six consecutive months of contractual payments would need to be made on a restructured loan before returning it to accrual status. Once a loan is classified as a TDR, the loan is reported as a TDR until the loan is paid in full, sold or charged-off. In rare circumstances, a loan may be removed from TDR status if it meets the requirements of ASC 310-40-50-2.