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Note 4 - Loans Receivable and Allowance for Credit Losses on Loans

12 Months Ended

Dec. 31, 2024

NOTE 4 – LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES ON LOANS

The composition of the loan portfolio was as follows at the dates indicated:

	December 31,
REAL ESTATE LOANS	2024			2023
Commercial (“CRE”)	$	345,317		$	366,328
Construction and development		330,700			303,054
Home equity		75,147			69,488
One-to-four-family (excludes loans held for sale)		617,322			567,742
Multi-family		245,222			223,769
Total real estate loans		1,613,708			1,530,381
CONSUMER LOANS
Indirect home improvement		541,946			569,903
Marine		74,931			73,310
Other consumer		3,304			3,540
Total consumer loans		620,181			646,753
COMMERCIAL BUSINESS LOANS
Commercial and industrial (“C&I”)		287,014			238,301
Warehouse lending		12,918			17,580
Total commercial business loans		299,932			255,881
Total loans receivable, gross		2,533,821			2,433,015
ACL on loans		(31,870	)		(31,534	)
Total loans receivable, net	$	2,501,951		$	2,401,481

Loan amounts are net of unearned loan fees in excess of unamortized costs and premiums of $6.0 million as of December 31, 2024 and $8.4 million as of December 31, 2023. Net loans include unamortized net discounts on acquired loans of $2.0 million and $2.6 million as of December 31, 2024 and 2023, respectively. Net loans do not include accrued interest receivable. Accrued interest receivable on loans was $12.2 million as of December 31, 2024 and $11.5 million as of December 31, 2023 and was reported in “Accrued interest receivable” on the Consolidated Balance Sheets.

Most of the Company’s CRE and multi-family real estate, construction, residential, and/or commercial business lending activities are with customers located in Western Washington, the Oregon Coast, or near our loan production offices in Vancouver and the Tri-Cities, Washington. The Company originates real estate, consumer, and commercial business loans concentrated in these areas. However, indirect home improvement loans, including solar-related home improvement loans, are originated through a network of home improvement contractors and dealers located throughout Washington, Oregon, California, Idaho, Colorado, Arizona, Minnesota, Nevada, Texas, Utah, Massachusetts, Montana, and New Hampshire. These loans are generally secured by collateral with legal documentation outlining rights to collateral as practicable. Local economic conditions may affect borrowers’ ability to meet the stated repayment terms.

At December 31, 2024, the Company held approximately $1.11 billion in loans that are pledged as collateral for FHLB advances, compared to approximately $1.07 billion at December 31, 2023. The Company held approximately $606.5 million in loans that are pledged as collateral for the FRB line of credit at December 31, 2024, compared to approximately $631.1 million at December 31, 2023.

The Company has defined its loan portfolio into three segments that reflect the structure of the lending function, the Company’s strategic plan and the way management monitors performance and credit quality. The three loan portfolio segments are: (a) real estate, (b) consumer, and (c) commercial business. Each of these segments is disaggregated into classes based on the risk characteristics of the borrower and/or the collateral type securing the loan. The following is a summary of each of the Company’s loan portfolio segments and classes:

Real Estate Loans

One-to-Four-Family Real Estate Lending. One-to-four-family residential loans include both owner-occupied properties (including second homes) and non-owner-occupied properties with up to four units. These loans either originated by the Company or periodically purchased from other banks, are secured by first mortgages on one-to-four-family residences within our market areas and are intended to be held in the Company's portfolio (excludes loans held for sale).

Multi-family Lending. Apartment term lending (five or more units) to current banking customers and community reinvestment loans for low to moderate income individuals in the Company’s footprint.

CRE Lending. Loans originated by the Company primarily secured by income-producing properties, including retail centers, warehouses, and office buildings located in our market areas.

Construction and Development Lending. Loans originated by the Company for the construction of, and secured by, commercial real estate, one-to-four-family, and multi-family residences and tracts of land for development that are not pre-sold. A portion of the one-to-four-family construction portfolio is custom construction loans to the intended occupant of the residence.

Home Equity Lending. Loans originated by the Company secured by second mortgages on one-to-four-family residences, including home equity lines of credit in our market areas.

Consumer Loans

Indirect Home Improvement. Fixture secured loans for home improvement are originated by the Company through its network of home improvement contractors and dealers and are secured by the personal property installed in, on, or at the borrower’s real property, and may be perfected with a UCC‑2 financing statement filed in the county of the borrower’s residence. These indirect home improvement loans include replacement windows, siding, roofing, spas, and other home fixture installations, including solar related home improvement projects.

Marine. Loans originated by the Company, secured by boats, to borrowers primarily located in the states where the Company originates consumer loans.

Other Consumer. Loans originated by the Company to consumers in our retail branch footprint, including automobiles, recreational vehicles, direct home improvement loans, loans on deposits, and other consumer loans, primarily consisting of personal lines of credit and credit cards.

Commercial Business Loans

C&I Lending. C&I loans originated by the Company to local small- and mid-sized businesses in our market area are secured primarily by accounts receivable, inventory, or personal property, plant and equipment. Some C&I loans purchased by the Company are outside of the greater Puget Sound market area. C&I loans are made on the basis of the borrower’s ability to make repayment from the cash flow of the borrower’s business. At December 31, 2024 and 2023, C&I loans included Small Business Administration and United States Department of Agriculture guaranteed certificates of $52.6 million and $10.6 million, respectively.

Warehouse Lending. Loans originated to non-depository financial institutions and secured by notes originated by the non-depository financial institution. The Company has two distinct warehouse lending divisions: commercial warehouse re-lending secured by notes on construction loans and mortgage warehouse re-lending secured by notes on one-to-four-family loans. The Company’s commercial construction warehouse lines are secured by notes on construction loans and typically guaranteed by principals with experience in construction lending. Mortgage warehouse lending loans are funded through third-party residential mortgage bankers. Under this program, the Company provides short-term funding to the mortgage banking companies for the purpose of originating residential mortgage loans for sale into the secondary market.

Allowance for Credit Losses

The following tables detail activity in the ACL on loans by loan categories, at or for the years indicated:

	At or For the Year Ended December 31, 2024
	Real					Commercial
ACL ON LOANS	Estate		Consumer			Business			Unallocated		Total
Beginning balance	$	14,107	$	13,357		$	4,070		$	—	$	31,534
Provision for credit losses on loans		334		5,221			80			—		5,635
Charge-offs		—		(5,994	)		(1,141	)		—		(7,135	)
Recoveries		—		1,601			235			—		1,836
Net charge-offs		—		(4,393	)		(906	)		—		(5,299	)
Ending balance	$	14,441	$	14,185		$	3,244		$	—	$	31,870

	At or For the Year Ended December 31, 2023
	Real						Commercial
ACL ON LOANS	Estate			Consumer			Business			Unallocated		Total
Beginning balance	$	12,123		$	12,109		$	3,760		$	—	$	27,992
Provision for credit losses on loans		1,994			3,465			311			—		5,770
Charge-offs		(10	)		(3,465	)		(1	)		—		(3,476	)
Recoveries		—			1,248			—			—		1,248
Net charge-offs		(10	)		(2,217	)		(1	)		—		(2,228	)
Ending balance	$	14,107		$	13,357		$	4,070		$	—	$	31,534

	At or For the Year Ended December 31, 2022
							Commercial
ACL ON LOANS	Real Estate			Consumer			Business			Unallocated			Total
Beginning balance	$	14,798		$	4,280		$	6,536		$	21		$	25,635
Impact of adopting ASC 326		(5,234	)		6,078			(3,682	)		(21	)		(2,859	)
Provision for credit losses on loans		2,559			3,158			906			—			6,623
Charge-offs		—			(2,465	)		—			—			(2,465	)
Recoveries		—			1,058			—			—			1,058
Net charge-offs		—			(1,407	)		—			—			(1,407	)
Ending balance	$	12,123		$	12,109		$	3,760		$	—		$	27,992

The main reason for the 2024 provision for credit losses on loans was elevated net charge-offs. Additionally, the increase in the ACL on loans reflected organic loan growth, shifts in credit quality (including changes in classified, past due and nonperforming loans), and adjustments to qualitative factors. The most significant qualitative factor change was an increase in qualitative reserves, attributable to higher levels of past due, nonperforming, and net charge-offs on consumer loans relative to prior periods.

Nonaccrual and Past Due Loans. Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. Loans are automatically placed on nonaccrual once the loan is 90 days past due or sooner if, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, or as required by regulatory authorities.

Loan Modifications to Borrowers Experiencing Financial Difficulty

The Company may modify the contractual terms of a loan to a borrower experiencing financial difficulty as a part of ongoing loss mitigation strategies. These modifications may result in an interest rate reduction, term extension, an other-than-insignificant payment delay, or a combination thereof. The Company typically does not offer principal forgiveness. An assessment of whether a borrower is experiencing financial difficulty is made on the date of modification. The effect of most modifications made to borrowers experiencing financial difficulty is already included in the ACL on loans because of the measurement methodologies used to estimate the allowance.

The following tables present the amortized cost basis of loans at December 31, 2024 and 2023 that were both experiencing financial difficulty and modified during the years ended December 31, 2024 and 2023, by class and by type of modification. The percentage of the amortized cost basis of loans that were modified to borrowers experiencing financial difficulty as compared to the amortized cost basis of each class of financing receivable is also presented below:

	December 31, 2024
							Combination		Combination
							Term		Term		Total
							Extension		Extension		Class of
	Principal		Payment		Term		and Principal		Payment		Financing
REAL ESTATE LOANS	Forgiveness		Delay		Extension		Forgiveness		Delay		Receivable
CRE	$	—	$	—	$	—	$	—	$	1,146		0.33	%
Construction and development		—		—		—		—		4,979		1.51

December 31, 2023

Combination

Term

Total

Extension

Class of

Principal

Payment

Term

and Principal

Interest Rate

Financing

REAL ESTATE LOANS

Forgiveness

Delay

Extension

Forgiveness

Reduction

Receivable

CRE

—

1,088

0.30

The Company has committed to lend additional amounts totaling $5.3 million to the borrowers included in the previous tables as of December 31, 2024.

The Company closely monitors the performance of loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table presents the performance of such loans that have been modified in the last 12 months:

	December 31, 2024
	30-59		60-89
	Days		Days		90 Days		Total
	Past		Past		or More		Past
REAL ESTATE LOANS	Due		Due		Past Due		Due
Construction and development	$	—	$	—	$	4,979	$	4,979

There were no loans to borrowers experiencing financial difficulty that had a payment default during the years ended December 31, 2024, 2023 and 2022 and were modified in the twelve months prior to that default.

The following tables present the financial effect of the loan modifications presented above to borrowers experiencing financial difficulty for the years ended December 31, 2024 and 2023:

	December 31, 2024
	Weighted-
	Average
	Term Extension
	Payment Delay
REAL ESTATE LOANS	(in years)
CRE		2.5
Construction and development		0.5

	December 31, 2023
	Weighted-
	Average
	Term Extension
	Payment Delay
REAL ESTATE LOANS	(in years)
CRE		1.5

Nonaccrual and Past Due Loans

The following tables provide information pertaining to the aging analysis of contractually past due loans and nonaccrual loans at the dates indicated:

	December 31, 2024
	30-59		60-89
	Days		Days		90 Days		Total				Total
	Past		Past		or More		Past				Loans		Non-
REAL ESTATE LOANS	Due		Due		Past Due		Due		Current		Receivable		Accrual (1)
CRE	$	845	$	—	$	1,625	$	2,470	$	342,847	$	345,317	$	2,771
Construction and development		822		—		4,979		5,801		324,899		330,700		4,979
Home equity		20		—		251		271		74,876		75,147		261
One-to-four-family		2,507		253		76		2,836		614,486		617,322		164
Multi-family		—		—		—		—		245,222		245,222		—
Total real estate loans		4,194		253		6,931		11,378		1,602,330		1,613,708		8,175
CONSUMER LOANS
Indirect home improvement		3,920		1,787		758		6,465		535,481		541,946		1,677
Marine		718		150		40		908		74,023		74,931		289
Other consumer		17		1		13		31		3,273		3,304		14
Total consumer loans		4,655		1,938		811		7,404		612,777		620,181		1,980
COMMERCIAL BUSINESS LOANS
C&I		118		—		3,331		3,449		283,565		287,014		3,446
Warehouse lending		—		—		—		—		12,918		12,918		—
Total commercial business loans		118		—		3,331		3,449		296,483		299,932		3,446
Total loans	$	8,967	$	2,191	$	11,073	$	22,231	$	2,511,590	$	2,533,821	$	13,601

	December 31, 2023
	30-59		60-89
	Days		Days		90 Days		Total				Total
	Past		Past		or More		Past				Loans		Non-
REAL ESTATE LOANS	Due		Due		Past Due		Due		Current		Receivable		Accrual (1)
CRE	$	—	$	—	$	—	$	—	$	366,328	$	366,328	$	1,088
Construction and development		—		—		—		—		303,054		303,054		4,699
Home equity		79		25		136		240		69,248		69,488		173
One-to-four-family		—		96		—		96		567,646		567,742		96
Multi-family		—		—		—		—		223,769		223,769		—
Total real estate loans		79		121		136		336		1,530,045		1,530,381		6,056
CONSUMER LOANS
Indirect home improvement		1,759		1,248		777		3,784		566,119		569,903		1,863
Marine		373		243		137		753		72,557		73,310		342
Other consumer		57		18		6		81		3,459		3,540		8
Total consumer loans		2,189		1,509		920		4,618		642,135		646,753		2,213
COMMERCIAL BUSINESS LOANS
C&I		—		—		2,514		2,514		235,787		238,301		2,683
Warehouse lending		—		—		—		—		17,580		17,580		—
Total commercial business loans		—		—		2,514		2,514		253,367		255,881		2,683
Total loans	$	2,268	$	1,630	$	3,570	$	7,468	$	2,425,547	$	2,433,015	$	10,952

______________________________

(1)

Includes loans less than 90 days past due as applicable.

There were no loans 90 days or more past due and still accruing interest at both December 31, 2024 and 2023.

Credit Quality Indicators

As part of the Company’s on-going monitoring of credit quality of the loan portfolio, management tracks certain credit quality indicators including trends related to (i) the risk grading of loans, (ii) the level of classified loans, (iii) net charge-offs, (iv) nonperforming loans and (v) the general economic conditions in the Company’s markets.

The Company utilizes a risk grading matrix to assign a risk grade to its real estate and commercial business loans. Loans are graded on a scale of 1 to 10, with loans in risk grades 1 to 6 reported as “Pass” and loans in risk grades 7 to 10 reported as classified loans in the Company’s ACL analysis.

A description of the 10 risk grades is as follows:

●	Grades 1 and 2 - These grades include loans to very high-quality borrowers with excellent or desirable business credit.

●	Grade 3 - This grade includes loans to borrowers of good business credit with moderate risk.

●	Grades 4 and 5 - These grades include “Pass” grade loans to borrowers of average credit quality and risk.

●	Grade 6 - This grade includes loans on management’s “Watch” list and is intended to be utilized on a temporary basis for “Pass” grade borrowers where frequent and thorough monitoring is required due to credit weaknesses and where significant risk-modifying action is anticipated in the near term.

●	Grade 7 - This grade is for “Other Assets Especially Mentioned (OAEM)” or “Special Mention” loans in accordance with regulatory guidelines and includes borrowers where performance is poor or significantly less than expected.

●	Grade 8 - This grade includes “Substandard” loans in accordance with regulatory guidelines which represent an unacceptable business credit where a loss is possible if loan weakness is not corrected.

●	Grade 9 - This grade includes “Doubtful” loans in accordance with regulatory guidelines where a loss is highly probable.

●	Grade 10 - This grade includes “Loss” loans in accordance with regulatory guidelines for which total loss is expected and when identified are charged off.

Homogeneous loans are risk rated based upon the Federal Financial Institutions Examination Council’s Uniform Retail Credit Classification and Account Management Policy. Loans classified under this policy at the Company are consumer loans which include indirect home improvement, solar, marine, other consumer, and one-to-four-family first and second liens. Under the Uniform Retail Credit Classification and Account Management Policy, loans that are current or less than 90 days past due are graded “Pass” and risk graded “4” or “5” internally. Loans that are past due more than 90 days are classified “Substandard” risk graded “8” internally until the loan has demonstrated consistent performance, typically six months of contractual payments. Closed-end loans that are 120 days past due and open-end loans that are 180 days past due are charged off based on the value of the collateral less cost to sell. Management may choose to conservatively risk rate credits even if paying in accordance with the loan’s repayment terms.

CRE, construction and development, multi-family and commercial business loans are evaluated individually for their risk classification and may be classified as “Substandard” even if current on their loan payment obligations. We regularly review our credits for accuracy of risk grades whenever we receive new information. Borrowers are generally required to submit financial information at regular intervals. Typically, commercial borrowers with lines of credit are required to submit financial information with reporting intervals ranging from monthly to annually depending on credit size, risk, and complexity. In addition, nonowner-occupied CRE borrowers with loans exceeding a certain dollar threshold are usually required to submit rent rolls or property income statements annually. We monitor construction loans monthly. We also review loans graded “Watch” or worse, regardless of loan type, no less than quarterly.

The following tables summarize risk rated loan balances and total current period gross charge-offs by category as of December 31, 2024 and 2023. Term loans that were renewed or extended for periods longer than 90 days are presented as new originations in the year of the most recent renewal or extension.

	December 31, 2024
															Revolving
															Loans
REAL ESTATE LOANS	Term Loans by Year of Origination												Revolving		Converted		Total
CRE	2024		2023		2022		2021		2020		Prior		Loans		to Term		Loans
Pass	$	13,023	$	48,434	$	84,077	$	51,874	$	43,652	$	66,142	$	—	$	679	$	307,881
Watch		—		3,135		10,689		12,654		—		6,948		—		—		33,426
Special mention		—		—		—		—		—		394		—		—		394
Substandard		—		—		—		—		1,625		1,991		—		—		3,616
Total CRE		13,023		51,569		94,766		64,528		45,277		75,475		—		679		345,317
Construction and development
Pass		167,942		87,012		30,200		29,851		—		380		10,336		—		325,721
Substandard		—		—		4,979		—		—		—		—		—		4,979
Total construction and development		167,942		87,012		35,179		29,851		—		380		10,336		—		330,700
Home equity
Pass		6,501		2,379		326		1,538		5,930		1,631		56,430		151		74,886
Substandard		—		—		—		—		—		14		247		—		261
Total home equity		6,501		2,379		326		1,538		5,930		1,645		56,677		151		75,147
One-to-four-family
Pass		77,602		110,505		174,355		109,006		76,653		66,426		—		—		614,547
Substandard		—		—		735		—		—		2,040		—		—		2,775
Total one-to-four-family		77,602		110,505		175,090		109,006		76,653		68,466		—		—		617,322
Multi-family
Pass		20,662		7,030		20,098		89,733		59,886		47,813		—		—		245,222
Total multi-family		20,662		7,030		20,098		89,733		59,886		47,813		—		—		245,222
Total real estate loans	$	285,730	$	258,495	$	325,459	$	294,656	$	187,746	$	193,779	$	67,013	$	830	$	1,613,708

	December 31, 2024
															Revolving
															Loans
CONSUMER LOANS	Term Loans by Year of Origination												Revolving		Converted		Total
Indirect home improvement	2024		2023		2022		2021		2020		Prior		Loans		to Term		Loans
Pass	$	98,516	$	130,254	$	167,896	$	74,577	$	28,045	$	40,981	$	—	$	—	$	540,269
Substandard		99		403		712		100		106		257		—		—		1,677
Total indirect home improvement		98,615		130,657		168,608		74,677		28,151		41,238		—		—		541,946
Indirect home improvement gross charge-offs		381		1,477		1,627		677		568		523		—		—		5,253
Marine
Pass		13,322		11,386		20,449		8,521		10,958		10,006		—		—		74,642
Substandard		—		—		—		—		106		183		—		—		289
Total marine		13,322		11,386		20,449		8,521		11,064		10,189		—		—		74,931
Marine gross charge-offs		—		21		128		51		128		237		—		—		565
Other consumer
Pass		310		93		334		56		35		126		2,336		—		3,290
Substandard		—		—		—		3		—		—		11		—		14
Total other consumer		310		93		334		59		35		126		2,347		—		3,304
Other consumer gross charge-offs		1		33		6		—		—		45		91		—		176
Total consumer loans	$	112,247	$	142,136	$	189,391	$	83,257	$	39,250	$	51,553	$	2,347	$	—	$	620,181

	December 31, 2024
															Revolving
COMMERCIAL															Loans
BUSINESS LOANS	Term Loans by Year of Origination												Revolving		Converted		Total
C&I	2024		2023		2022		2021		2020		Prior		Loans		to Term		Loans
Pass	$	65,491	$	20,084	$	20,091	$	16,468	$	6,135	$	8,791	$	120,899	$	602	$	258,561
Watch		—		4,987		—		722		1,799		—		4,183		—		11,691
Special mention		—		—		—		543		—		556		6,375		—		7,474
Substandard		—		2,373		—		2,243		1,255		1,296		2,121		—		9,288
Total C&I		65,491		27,444		20,091		19,976		9,189		10,643		133,578		602		287,014
C&I gross charge-offs		—		—		—		—		—		380		761		—		1,141
Warehouse lending
Pass		—		—		—		—		—		—		11,060		—		11,060
Special mention		—		—		—		—		—		—		1,858		—		1,858
Total warehouse lending		—		—		—		—		—		—		12,918		—		12,918
Total commercial business loans	$	65,491	$	27,444	$	20,091	$	19,976	$	9,189	$	10,643	$	146,496	$	602	$	299,932

TOTAL LOANS RECEIVABLE, GROSS
Pass	$	463,369	$	417,177	$	517,826	$	381,624	$	231,294	$	242,296	$	201,061	$	1,432	$	2,456,079
Watch		—		8,122		10,689		13,376		1,799		6,948		4,183		—		45,117
Special mention		—		—		—		543		—		950		8,233		—		9,726
Substandard		99		2,776		6,426		2,346		3,092		5,781		2,379		—		22,899
Total loans receivable, gross	$	463,468	$	428,075	$	534,941	$	397,889	$	236,185	$	255,975	$	215,856	$	1,432	$	2,533,821
Total gross charge-offs	$	382	$	1,531	$	1,761	$	728	$	696	$	1,185	$	852	$	—	$	7,135

	December 31, 2023
															Revolving
															Loans
REAL ESTATE LOANS	Term Loans by Year of Origination												Revolving		Converted		Total
CRE	2023		2022		2021		2020		2019		Prior		Loans		to Term		Loans
Pass	$	48,551	$	91,144	$	61,689	$	46,117	$	27,957	$	61,764	$	499	$	—	$	337,721
Watch		3,201		5,446		12,894		—		453		2,226		45		—		24,265
Special mention		—		—		—		—		409		—		—		—		409
Substandard		—		—		—		1,650		—		1,957		—		326		3,933
Total CRE		51,752		96,590		74,583		47,767		28,819		65,947		544		326		366,328
Construction and development
Pass		120,155		106,168		46,989		15,219		—		540		9,284		—		298,355
Substandard		—		4,699		—		—		—		—		—		—		4,699
Total construction and development		120,155		110,867		46,989		15,219		—		540		9,284		—		303,054
Home equity
Pass		4,583		398		1,584		6,525		11		2,137		54,077		—		69,315
Substandard		—		—		—		—		—		36		137		—		173
Total home equity		4,583		398		1,584		6,525		11		2,173		54,214		—		69,488
Home equity gross charge-offs														10				10
One-to-four-family														—
Pass		103,165		175,412		122,406		80,815		30,595		52,008		—		472		564,873
Substandard		—		866		—		—		—		2,003		—		—		2,869
Total one-to-four-family		103,165		176,278		122,406		80,815		30,595		54,011		—		472		567,742
Multi-family
Pass		7,106		20,404		91,047		42,511		37,990		24,711		—		—		223,769
Total multi-family		7,106		20,404		91,047		42,511		37,990		24,711		—		—		223,769
Total real estate loans	$	286,761	$	404,537	$	336,609	$	192,837	$	97,415	$	147,382	$	64,042	$	798	$	1,530,381

	December 31, 2023
															Revolving
															Loans
CONSUMER LOANS	Term Loans by Year of Origination												Revolving		Converted		Total
Indirect home improvement	2023		2022		2021		2020		2019		Prior		Loans		to Term		Loans
Pass	$	171,208	$	212,661	$	93,664	$	36,032	$	23,977	$	30,492	$	6	$	—	$	568,040
Substandard		212		663		448		141		258		141		—		—		1,863
Total indirect home improvement		171,420		213,324		94,112		36,173		24,235		30,633		6		—		569,903
Indirect home improvement gross charge-offs		204		1,386		567		290		145		336		—		—		2,928
Marine
Pass		13,619		23,963		9,987		13,082		5,267		7,050		—		—		72,968
Substandard		—		—		52		85		—		205		—		—		342
Total marine		13,619		23,963		10,039		13,167		5,267		7,255		—		—		73,310
Marine gross charge-offs		—		47		93		—		7		256		—		—		403
Other consumer
Pass		309		559		175		69		3		159		2,258		—		3,532
Substandard		—		—		—		—		—		—		8		—		8
Total other consumer		309		559		175		69		3		159		2,266		—		3,540
Other consumer gross charge-offs		—		2		12		—		—		—		120		—		134
Total consumer loans	$	185,348	$	237,846	$	104,326	$	49,409	$	29,505	$	38,047	$	2,272	$	—	$	646,753

	December 31, 2023
															Revolving
COMMERCIAL															Loans
BUSINESS LOANS	Term Loans by Year of Origination												Revolving		Converted		Total
C&I	2023		2022		2021		2020		2019		Prior		Loans		to Term		Loans
Pass	$	13,971	$	32,334	$	19,634	$	11,537	$	5,122	$	9,707	$	119,844	$	145	$	212,294
Watch		2,322		—		1,382		2,366		—		953		5,754		—		12,777
Special mention		143		—		—		—		498		253		1,345		—		2,239
Substandard		2,940		—		2,321		1,391		1,766		169		2,005		—		10,592
Doubtful		—		—		—		—		—		—		399		—		399
Total C&I		19,376		32,334		23,337		15,294		7,386		11,082		129,347		145		238,301
C&I gross charge-offs		—		—		1		—		—		—		—		—		1
Warehouse lending
Pass		—		—		—		—		—		—		17,003		—		17,003
Watch		—		—		—		—		—		—		577		—		577
Total warehouse lending		—		—		—		—		—		—		17,580		—		17,580
Total commercial business loans	$	19,376	$	32,334	$	23,337	$	15,294	$	7,386	$	11,082	$	146,927	$	145	$	255,881

TOTAL LOANS RECEIVABLE, GROSS
Pass	$	482,667	$	663,043	$	447,175	$	251,907	$	130,922	$	188,568	$	202,971	$	617	$	2,367,870
Watch		5,523		5,446		14,276		2,366		453		3,179		6,376		—		37,619
Special mention		143		—		—		—		907		253		1,345		—		2,648
Substandard		3,152		6,228		2,821		3,267		2,024		4,511		2,150		326		24,479
Doubtful		—		—		—		—		—		—		399		—		399
Total loans receivable, gross	$	491,485	$	674,717	$	464,272	$	257,540	$	134,306	$	196,511	$	213,241	$	943	$	2,433,015
Total gross charge-offs	$	204	$	1,435	$	673	$	290	$	152	$	592	$	130	$	—	$	3,476

The following table presents the amortized cost basis of loans on nonaccrual status at the dates indicated:

	December 31, 2024						December 31, 2023
	Nonaccrual with		Nonaccrual with		Total		Nonaccrual with		Nonaccrual with		Total
REAL ESTATE LOANS	No ACL		ACL		Nonaccrual		No ACL		ACL		Nonaccrual
CRE	$	2,771	$	—	$	2,771	$	1,088	$	—	$	1,088
Construction and development		—		4,979		4,979		—		4,699		4,699
Home equity		261		—		261		173		—		173
One-to-four-family		164		—		164		96		—		96
		3,196		4,979		8,175		1,357		4,699		6,056
CONSUMER LOANS
Indirect home improvement		—		1,677		1,677		—		1,863		1,863
Marine		—		289		289		—		342		342
Other consumer		—		14		14		—		8		8
		—		1,980		1,980		—		2,213		2,213
COMMERCIAL BUSINESS LOANS
C&I		2,486		960		3,446		—		2,683		2,683
Total	$	5,682	$	7,919	$	13,601	$	1,357	$	9,595	$	10,952

The Company recognized interest income on a cash basis for nonaccrual loans of $427,000, $579,000, and $506,000 during the years ended December 31, 2024, 2023 and 2022, respectively.

The following table presents the amortized cost basis of collateral dependent loans by class of loans as of dates indicated:

	December 31, 2024								December 31, 2023
			Residential		Other						Residential		Other
			Real		Non-Real						Real		Non-Real
REAL ESTATE LOANS	CRE		Estate		Estate		Total		CRE		Estate		Estate		Total
CRE	$	2,771	$	—	$	—	$	2,771	$	1,088	$	—	$	—	$	1,088
Construction and development		4,979		—		—		4,979		4,699		—				4,699
Home equity		—		261		—		261		—		173		—		173
One-to-four-family		—		164		—		164		—		96		—		96
		7,750		425		—		8,175		5,787		269		—		6,056
CONSUMER LOANS
Indirect home improvement		—		—		1,677		1,677		—		—		1,863		1,863
Marine		—		—		289		289		—		—		342		342
		—		—		1,966		1,966		—		—		2,205		2,205
COMMERCIAL BUSINESS LOANS
C&I		—		—		3,446		3,446		—		—		2,683		2,683
Total	$	7,750	$	425	$	5,412	$	13,587	$	5,787	$	269	$	4,888	$	10,944

Related Party Loans

Certain directors and executive officers or their related affiliates are customers of and have had banking transactions with the Company. Total loans to directors, executive officers, and their affiliates are subject to regulatory limitations.

Outstanding loan balances of related party loans, all of which were within regulatory limits, were as follows:

	At December 31,
	2024			2023
Beginning balance	$	3,343		$	3,445
Additions		345			—
Repayments		(113	)		(102	)
Ending balance	$	3,575		$	3,343

The aggregate maximum loan balance of extended credit to related parties was $3.6 million and $3.7 million at December 31, 2024 and 2023, respectively, and includes the ending balances from the tables above. These loans and lines of credit were made in compliance with applicable laws on substantially the same terms (including interest rates and collateral) as those prevailing at the time for comparable transactions with unrelated third parties and do not involve more than the normal risk of collectability.