| LOANS |
NOTE 4: LOANS The following is a summary of our loans held for investment as of: | | | | | | | | | September 30, | | December 31, | (dollars in thousands) | | 2025 | | 2024 | Outstanding principal balance: | | | | | | | Loans secured by real estate: | | | | | | | Residential properties: | | | | | | | Multifamily | | $ | 3,271,998 | | $ | 3,341,823 | Single-family | | | 822,923 | | | 873,491 | Total real estate loans secured by residential properties | | | 4,094,921 | | | 4,215,314 | Commercial properties | | | 746,028 | | | 904,167 | Land and construction | | | 37,734 | | | 69,246 | Total real estate loans | | | 4,878,683 | | | 5,188,727 | Commercial and industrial loans | | | 2,416,652 | | | 2,746,351 | Consumer loans | | | 1,560 | | | 1,137 | Total loans | | | 7,296,895 | | | 7,936,215 | Premiums, discounts and deferred fees and expenses | | | 5,520 | | | 5,178 | Total | | $ | 7,302,415 | | $ | 7,941,393 |
The Company’s loans held for investment portfolio is segmented according to loans that share similar attributes and risk characteristics. In addition, the Company’s loans held for sale portfolio, which is not included in the table above, and consisting entirely of multifamily loans, totaled $0.5 billion at September 30, 2025 and $1.3 billion at December 31, 2024, respectively. Loans secured by real estate include those secured by either residential or commercial real estate properties, such as multifamily and single-family residential loans; owner occupied and non-owner occupied commercial real estate loans; and land and construction loans. Commercial and industrial (“C&I”) loans are loans to businesses where the operating cash flow of the business is the primary source of payment. This segment includes commercial revolving lines of credit and term loans, municipal finance loans, equipment finance loans and SBA loans. Consumer loans include personal installment loans and line of credit, and home equity lines of credit. These loan products are offered as an accommodation to clients of our primary business lines. Loans with a collateral value totaling $173.6 million and $176.0 million were pledged as collateral to secure borrowings with the Federal Reserve Bank at September 30, 2025 and December 31, 2024, respectively. Loans with a market value of $3.1 billion and $4.1 billion were pledged as collateral to secure borrowings with the FHLB at September 30, 2025 and December 31, 2024, respectively. During the nine-month period ended September 30, 2025, loans totaling $858 million in unpaid principal balance were sold, resulting in a net loss on sale of loans of $10.4 million. During the nine-month period ended September 30, 2024, loans totaling $8.1 million in unpaid principal balance were sold, resulting in a net gain on sale of loans of $665 thousand. The following table summarizes our delinquent and nonaccrual loans as of: | | | | | | | | | | | | | | | | | | | | | | | | Past Due and Still Accruing | | | | | Total Past | | | | | | | | | | | | | | | 90 Days | | | | | Due and | | | | | | | (dollars in thousands) | | 30–59 Days | | 60-89 Days | | or More | | Nonaccrual | | Nonaccrual | | Current | | Total | September 30, 2025: | | | | | | | | | | | | | | | | | | | | | | Real estate loans: | | | | | | | | | | | | | | | | | | | | | | Residential properties | | $ | 9,617 | | $ | — | | $ | — | | $ | 19,761 | | $ | 29,378 | | $ | 4,075,011 | | $ | 4,104,389 | Commercial properties | | | — | | | — | | | 348 | | | 5,592 | | | 5,940 | | | 739,730 | | | 745,670 | Land and construction | | | — | | | — | | | — | | | — | | | — | | | 37,699 | | | 37,699 | Commercial and industrial loans | | | 632 | | | 165 | | | 344 | | | 32,078 | | | 33,219 | | | 2,379,877 | | | 2,413,096 | Consumer loans | | | — | | | — | | | — | | | — | | | — | | | 1,561 | | | 1,561 | Total | | $ | 10,249 | | $ | 165 | | $ | 692 | | $ | 57,431 | | $ | 68,537 | | $ | 7,233,878 | | $ | 7,302,415 | | | | | | | | | | | | | | | | | | | | | | | Percentage of total loans | | | 0.14 | % | | 0.00 | % | | 0.01 | % | | 0.79 | % | | 0.94 | % | | | | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2024: | | | | | | | | | | | | | | | | | | | | | | Real estate loans: | | | | | | | | | | | | | | | | | | | | | | Residential properties | | $ | 7,083 | | $ | — | | $ | — | | $ | 23,324 | | $ | 30,407 | | $ | 4,193,994 | | $ | 4,224,401 | Commercial properties | | | 7,944 | | | 428 | | | 12,900 | | | 7,946 | | | 29,218 | | | 874,463 | | | 903,681 | Land and construction | | | — | | | — | | | — | | | — | | | — | | | 69,134 | | | 69,134 | Commercial and industrial loans | | | 997 | | | 617 | | | — | | | 9,174 | | | 10,788 | | | 2,732,226 | | | 2,743,014 | Consumer loans | | | — | | | — | | | — | | | — | | | — | | | 1,163 | | | 1,163 | Total | | $ | 16,024 | | $ | 1,045 | | $ | 12,900 | | $ | 40,444 | | $ | 70,413 | | $ | 7,870,980 | | $ | 7,941,393 | | | | | | | | | | | | | | | | | | | | | | | Percentage of total loans | | | 0.20 | % | | 0.01 | % | | 0.16 | % | | 0.51 | % | | 0.89 | % | | | | | |
The following table summarizes our nonaccrual loans as of: | | | | | | | | | Nonaccrual | | Nonaccrual | | | with Allowance | | with no Allowance | (dollars in thousands) | | for Credit Losses | | for Credit Losses | September 30, 2025: | | | | | | | Real estate loans: | | | | | | | Residential properties | | $ | 660 | | $ | 19,100 | Commercial properties | | | 4,663 | | | 930 | Commercial and industrial loans | | | 31,903 | | | 175 | Total | | $ | 37,226 | | $ | 20,205 | | | | | | | | December 31, 2024: | | | | | | | Real estate loans: | | | | | | | Residential properties | | $ | 1,420 | | $ | 21,904 | Commercial properties | | | 3,449 | | | 4,497 | Commercial and industrial loans | | | 9,174 | | | — | Total | | $ | 14,043 | | $ | 26,401 |
The Company provides modifications to borrowers experiencing financial difficulty, which may include interest rate reduction, term extensions, principal forgiveness, other-than-insignificant payment delays, or a combination of any of these items. A loan modification or refinancing results in a new loan if the terms of the new loan are at least as favorable to the lender as the terms with customers with similar collection risks that are not refinancing or restructuring their loans and the modification to the terms of the loan are more than minor. If a loan modification or refinancing does not result in a new loan, it is classified as a loan modification. The following table presents our loan modifications made to borrowers experiencing financial difficulty by type of modification for the nine-month periods ended September 30, 2025 and 2024, respectively with related amortized cost balances, respective percentage share of the total class of loans, and the related financial effect: | | | | | | | | | | September 30, 2025: | | | Term Extension | | | | Amortized Cost Basis | | % of Total Class of Loans | | Financial Effect | Residential loans | | $ | 35 | | — | % | 1 loan with 4 months of payment deferrals. | Commercial and industrial loans | | $ | 12,417 | | 0.51 | % | 8 loans with payment deferrals of either 2 or 3 months with $100 monthly payments; 2 loans with payment deferrals of 2 months; 4 loans with term extensions and payment deferrals ranging from 6 to 52 months; 1 loan with term extension of 12 months with quarterly principal curtailments; 1 loan with term extension of 151 months and 50% payments until paid in full. | Total | | $ | 12,452 | | | | | | | | | | | | | | | Payment Deferrals | | | | Amortized Cost Basis | | % of Total Class of Loans | | Financial Effect | Residential loans | | $ | 10,911 | | 0.27 | % | 1 loan with 3 month forbearance | Total | | $ | 10,911 | | | | | | | | | | | | | | | Combination | | | | Amortized Cost Basis | | % of Total Class of Loans | | Financial Effect | Commercial and industrial loans | | $ | 2,429 | | 0.10 | % | 6 loans with extensions of loan maturity of 2 and 3 months and payment deferral. 2 loans with extensions of loan maturity of 12 months with principal curtailments. | Total | | $ | 2,429 | | | | | | | | | | | | | | | Total | | | | Amortized Cost Basis | | % of Total Class of Loans | | | Residential loans | | $ | 10,946 | | 0.27 | % | | Commercial and industrial loans | | | 14,846 | | 0.61 | % | | Total | | $ | 25,792 | | | | | | | | | | | | | | | September 30, 2024: | | | Term Extension | | | | Amortized Cost Basis | | % of Total Class of Loans | | Financial Effect | Residential loans | | $ | 6 | | — | % | 1 loan with term extension of 22 months. | Commercial real estate loans | | | 12,900 | | 1.40 | % | 1 loan with term extension of 10 months. | Commercial and industrial loans | | $ | 2,294 | | — | % | 6 loans with various extensions of loan maturity ranging from 3 to 60 months and payment deferral. 1 loan with 3-month extension and 3-month forbearance. 1 loan with $100 payments through 3 months. | Total | | $ | 15,194 | | | | | | | | | | | | | | | Combination | | | | Amortized Cost Basis | | % of Total Class of Loans | | Financial Effect | Commercial and industrial loans | | | 9,568 | | 0.40 | % | 5 loans with various extensions of loan maturity ranging from 6 to 7 months and payment deferral. 1 loan with 5 month forbearance and interest rate reduction. 2 loans with $100 payments through 3 months with payment deferral. 2 loans with term extension of 12 months and payment deferral. | Total | | $ | 9,568 | | | | | | | | | | | | | | | Total | | | | | | Amortized Cost Basis | | % of Total Class of Loans | | | Residential loans | | $ | 6 | | — | % | | Commercial real estate loans | | | 12,900 | | 1.40 | % | | Commercial and industrial loans | | | 11,862 | | 0.40 | % | | Total | | $ | 24,768 | | | | |
The following table presents the amortized cost basis of loans that had a payment default during the nine-month periods ended September 30, 2025 and September 30, 2024, respectively which were modified in the previous twelve-month periods of October 1, 2024 to September 30, 2025 and October 1, 2023 to September 30, 2024, respectively: | | | | | | | | | September 30, 2025: | | | Term Extension | | | | # of Loans Defaulted | | | Amortized Cost Basis | Commercial and industrial loans | | | 2 | | $ | 57 | Total | | | 2 | | $ | 57 | | | | | | | | | | Payment Deferrals | | | | # of Loans Defaulted | | | Amortized Cost Basis | Residential loans | | | 1 | | $ | 10,911 | Total | | | 1 | | | 10,911 | | | | | | | | | | Combination | | | | # of Loans Defaulted | | | Amortized Cost Basis | Commercial and industrial loans | | | 1 | | $ | 143 | Total | | | 1 | | $ | 143 | | | | | | | | | | Total | | | | # of Loans Defaulted | | | Amortized Cost Basis | Commercial and industrial loans | | | 4 | | $ | 11,111 | Total | | | 4 | | $ | 11,111 | | | | | | | | | | September 30, 2024: | | | Combination | | | | # of Loans Defaulted | | | Amortized Cost Basis | Commercial and industrial loans | | | 2 | | $ | 2,229 | Total | | | 2 | | $ | 2,229 | | | | | | | | | | Total | | | | # of Loans Defaulted | | | Amortized Cost Basis | Commercial and industrial loans | | | 2 | | $ | 2,229 | Total | | | 2 | | $ | 2,229 |
The following table presents the payment status of our loan modifications made during the previous twelve-month periods ended October 1, 2024 to September 30, 2025 and October 1, 2023 to September 30, 2024, respectively: | | | | | | | | | | | | | | | | | | | | | 30-89 Days | | 90+ Days | | | | | | | (dollars in thousands) | | | Current | | Past Due | | Past Due | | | Nonaccrual | | Total | September 30, 2025: | | | | | | | | | | | | | | | | Residential loans | | $ | 10,946 | | $ | — | | $ | — | | $ | — | | $ | 10,946 | Commercial and industrial loans | | | 9,088 | | | — | | | — | | | 7,806 | | | 16,894 | Total | | $ | 20,034 | | $ | — | | $ | — | | $ | 7,806 | | $ | 27,840 | | | | | | | | | | | | | | | | | | | | | | 30-89 Days | | 90+ Days | | | | | | | (dollars in thousands) | | | Current | | Past Due | | Past Due | | | Nonaccrual | | Total | September 30, 2024: | | | | | | | | | | | | | | | | Residential loans | | $ | 253 | | $ | — | | $ | — | | $ | — | | $ | 253 | Commercial real estate loans | | | 12,900 | | | — | | | — | | | — | | | 12,900 | Commercial and industrial loans | | | 6,104 | | | 7,060 | | | — | | | 8,252 | | | 21,416 | Total | | $ | 19,257 | | $ | 7,060 | | $ | — | | $ | 8,252 | | $ | 34,569 |
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