Heritage Commerce (HTBK) 10-Q9 Aug 212021 Q2 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2021	Jul. 30, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2021
Document Transition Report	false
Entity File Number	000-23877
Entity Registrant Name	HERITAGE COMMERCE CORP
Entity Incorporation, State or Country Code	CA
Entity Tax Identification Number	77-0469558
Entity Address, Address Line One	224 Airport Parkway
Entity Address, City or Town	San Jose
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95110
City Area Code	408
Local Phone Number	947-6900
Title of 12(b) Security	Common Stock, No Par Value
Trading Symbol	HTBK
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		60,206,566
Document Fiscal Year Focus	2021
Entity Central Index Key	0001053352
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--12-31
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2021	Dec. 31, 2020
Assets
Cash and due from banks	$ 41,904,000	$ 30,598,000
Other investments and interest-bearing deposits in other financial institutions	1,286,418,000	1,100,475,000
Total cash and cash equivalents	1,328,322,000	1,131,073,000
Securities available-for-sale, at fair value	145,955,000	235,774,000
Securities held-to-maturity, at amortized cost, net of allowance for credit losses of $51 at June 30, 2021 and $54 at December 31, 2020 (fair value of $426,755 at June 30, 2021 and $304,927 at December 31, 2020)	421,286,000	297,389,000
Loans held-for-sale - SBA, at lower of cost or fair value, including deferred costs	4,344,000	1,699,000
Loans, net of deferred fees	2,824,796,000	2,619,261,000
Allowance for credit losses on loans	(43,956,000)	(44,400,000)
Loans, net	2,780,840,000	2,574,861,000
Federal Home Loan Bank, Federal Reserve Bank stock and other investments, at cost	32,495,000	33,522,000
Company-owned life insurance	77,393,000	77,523,000
Premises and equipment, net	10,040,000	10,459,000
Goodwill	167,631,000	167,631,000
Other intangible assets	15,177,000	16,664,000
Accrued interest receivable and other assets	89,392,000	87,519,000
Total assets	5,072,875,000	4,634,114,000
Deposits:
Demand, noninterest-bearing	1,840,516,000	1,661,655,000
Demand, interest-bearing	1,140,867,000	960,179,000
Savings and money market	1,174,587,000	1,119,968,000
Time deposits - under $250	42,118,000	45,027,000
Time deposits - $250 and over	110,111,000	103,746,000
CDARS - interest-bearing demand, money market and time deposits	36,273,000	23,911,000
Total deposits	4,344,472,000	3,914,486,000
Subordinated debt, net of issuance costs	39,832,000	39,740,000
Accrued interest payable and other liabilities	105,127,000	101,999,000
Total liabilities	4,489,431,000	4,056,225,000
Shareholders' equity:
Preferred stock, no par value; 10,000,000 shares authorized; none issued and outstanding at June 30, 2021 and December 31, 2020
Common stock, no par value; 100,000,000 shares authorized; 60,202,766 shares issued and outstanding at June 30, 2021 and 59,917,457 shares issued and outstanding at December 31, 2020	495,665,000	493,707,000
Retained earnings	99,311,000	94,899,000
Accumulated other comprehensive loss	(11,532,000)	(10,717,000)
Total shareholders' equity	583,444,000	577,889,000
Total liabilities and shareholders' equity	$ 5,072,875,000	$ 4,634,114,000

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Securities held-to-maturity
Allowance for credit losses	$ 51	$ 54
Securities held-to-maturity, fair value (in dollars)	$ 426,755	$ 304,927
Preferred stock
Preferred stock, par value (in dollars per share)	$ 0	$ 0
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, outstanding (in shares)	0	0
Common stock
Common stock, par value (in dollars per share)	$ 0	$ 0
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	60,202,766	59,917,457
Common stock, shares outstanding	60,202,766	59,917,457

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Interest income:
Loans, including fees	$ 33,439	$ 32,845	$ 67,275	$ 67,627
Securities, taxable	1,944	3,155	3,672	7,103
Securities, exempt from Federal tax	404	484	833	995
Other investments, interest-bearing deposits in other financial institutions and Federal funds sold	845	648	1,613	2,349
Total interest income	36,632	37,132	73,393	78,074
Interest expense:
Deposits	1,179	1,615	2,411	3,400
Subordinated debt	577	577	1,148	1,154
Total interest expense	1,756	2,192	3,559	4,554
Net interest income before provision for credit losses on loans	34,876	34,940	69,834	73,520
Provision for (recapture of) credit losses on loans	(493)	1,114	(2,005)	14,384
Net interest income after provision for credit losses on loans	35,369	33,826	71,839	59,136
Noninterest income:
Increase in cash surrender value of life insurance	458	458	914	916
Gain on proceeds from company owned life insurance	396		462
Servicing income	104	205	286	388
Gain on sales of SBA loans	83		633	67
Gain on sales of securities		170		270
Other	469	595	915	1,220
Total noninterest income	2,169	2,078	4,470	5,271
Noninterest expense:
Salaries and employee benefits	12,572	12,300	26,530	26,503
Occupancy and equipment	2,247	1,766	4,521	3,538
Professional fees	1,771	1,155	3,490	2,590
Other	9,185	5,791	14,478	14,155
Total noninterest expense	25,775	21,012	49,019	46,786
Income before income taxes	11,763	14,892	27,290	17,621
Income tax expense	2,950	4,274	7,273	5,142
Net income	$ 8,813	$ 10,618	$ 20,017	$ 12,479
Earnings per common share:
Basic (in dollars per share)	$ 0.15	$ 0.18	$ 0.33	$ 0.21
Diluted (in dollars per share)	$ 0.15	$ 0.18	$ 0.33	$ 0.21
Service charges and fees on deposit accounts
Noninterest income:
Non-interest income	$ 659	$ 650	$ 1,260	$ 1,619
Revenue, Product and Service [Extensible List]	Service charges and fees on deposit accounts	Service charges and fees on deposit accounts	Service charges and fees on deposit accounts	Service charges and fees on deposit accounts
Gain on the disposition of foreclosed assets
Noninterest income:
Non-interest income				$ 791
Revenue, Product and Service [Extensible List]	Gain on the disposition of foreclosed assets	Gain on the disposition of foreclosed assets	Gain on the disposition of foreclosed assets	Gain on the disposition of foreclosed assets

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 8,813	$ 10,618	$ 20,017	$ 12,479
Other comprehensive income (loss):
Change in net unrealized holding (losses) gains on available-for-sale securities and I/O strips	(640)	(556)	(1,489)	6,621
Deferred income taxes	186	161	433	(1,920)
Change in net unamortized unrealized gain on securities available-for-sale that were reclassified to securities held-to-maturity	(13)	(13)	(26)	(26)
Deferred income taxes	4	4	8	8
Reclassification adjustment for gains realized in income		(170)		(270)
Deferred income taxes		50		79
Change in unrealized (losses) gains on securities and I/O strips, net of deferred income taxes	(463)	(524)	(1,074)	4,492
Change in net pension and other benefit plan liability adjustment	283	75	372	150
Deferred income taxes	(84)	(22)	(113)	(44)
Change in pension and other benefit plan liability, net of deferred income taxes	199	53	259	106
Other comprehensive (loss) income	(264)	(471)	(815)	4,598
Total comprehensive income	$ 8,549	$ 10,147	$ 19,202	$ 17,077

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Common StockAdjusted Balance	Common Stock	Retained EarningsAdjusted Balance	Retained EarningsAdjustment	Retained Earnings	Accumulated Other Comprehensive LossAdjusted Balance	Accumulated Other Comprehensive Loss	Adjusted Balance	Adjustment	Total
Balance at Dec. 31, 2019	$ 489,745	$ 489,745	$ 90,679	$ (6,062)	$ 96,741	$ (9,778)	$ (9,778)	$ 570,646	$ (6,062)	$ 576,708
Balance (in shares) at Dec. 31, 2019	59,368,156	59,368,156
Increase (Decrease) in Shareholders' Equity
Net income					1,861					1,861
Other comprehensive income (loss)							5,069			5,069
Amortization of restricted stock awards, net of forfeitures and taxes		$ 348								348
Cash dividend declared					(7,737)					(7,737)
Stock option expense, net of forfeitures and taxes		148								148
Stock options exercised		$ 1,106								1,106
Stock options exercised (in shares)		200,063
Balance at Mar. 31, 2020		$ 491,347			84,803		(4,709)			571,441
Balance (in shares) at Mar. 31, 2020		59,568,219
Balance at Dec. 31, 2019	$ 489,745	$ 489,745	$ 90,679	$ (6,062)	96,741	$ (9,778)	(9,778)	$ 570,646	$ (6,062)	576,708
Balance (in shares) at Dec. 31, 2019	59,368,156	59,368,156
Increase (Decrease) in Shareholders' Equity
Net income										12,479
Other comprehensive income (loss)							4,598			4,598
Balance at Jun. 30, 2020		$ 492,333			87,654		(5,180)			574,807
Balance (in shares) at Jun. 30, 2020		59,856,767
Balance at Mar. 31, 2020		$ 491,347			84,803		(4,709)			571,441
Balance (in shares) at Mar. 31, 2020		59,568,219
Increase (Decrease) in Shareholders' Equity
Net income					10,618					10,618
Other comprehensive income (loss)							(471)			(471)
Issuance (forfeitures) of restricted stock awards, net (in shares)		168,117
Amortization of restricted stock awards, net of forfeitures and taxes		$ 463								463
Cash dividend declared					(7,767)					(7,767)
Stock option expense, net of forfeitures and taxes		139								139
Stock options exercised		$ 384								384
Stock options exercised (in shares)		120,431
Balance at Jun. 30, 2020		$ 492,333			87,654		(5,180)			574,807
Balance (in shares) at Jun. 30, 2020		59,856,767
Balance at Dec. 31, 2020		$ 493,707			94,899		(10,717)			577,889
Balance (in shares) at Dec. 31, 2020		59,917,457
Increase (Decrease) in Shareholders' Equity
Net income					11,204					11,204
Other comprehensive income (loss)							(551)			(551)
Issuance (forfeitures) of restricted stock awards, net (in shares)		(34,358)
Amortization of restricted stock awards, net of forfeitures and taxes		$ 458								458
Cash dividend declared					(7,789)					(7,789)
Stock option expense, net of forfeitures and taxes		132								132
Stock options exercised		$ 320								320
Stock options exercised (in shares)		49,235
Balance at Mar. 31, 2021		$ 494,617			98,314		(11,268)			581,663
Balance (in shares) at Mar. 31, 2021		59,932,334
Balance at Dec. 31, 2020		$ 493,707			94,899		(10,717)			577,889
Balance (in shares) at Dec. 31, 2020		59,917,457
Increase (Decrease) in Shareholders' Equity
Net income										20,017
Other comprehensive income (loss)							(815)			(815)
Balance at Jun. 30, 2021		$ 495,665			99,311		(11,532)			583,444
Balance (in shares) at Jun. 30, 2021		60,202,766
Balance at Mar. 31, 2021		$ 494,617			98,314		(11,268)			581,663
Balance (in shares) at Mar. 31, 2021		59,932,334
Increase (Decrease) in Shareholders' Equity
Net income					8,813					8,813
Other comprehensive income (loss)							(264)			(264)
Issuance (forfeitures) of restricted stock awards, net (in shares)		187,325
Amortization of restricted stock awards, net of forfeitures and taxes		$ 438								438
Cash dividend declared					(7,816)					(7,816)
Stock option expense, net of forfeitures and taxes		146								146
Stock options exercised		$ 464								464
Stock options exercised (in shares)		83,107
Balance at Jun. 30, 2021		$ 495,665			$ 99,311		$ (11,532)			$ 583,444
Balance (in shares) at Jun. 30, 2021		60,202,766

CONSOLIDATED STATEMENTS OF CH_2

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares	3 Months Ended
	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2020	Mar. 31, 2020
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
Cash dividend declared per share (in dollars per share)	$ 0.13	$ 0.13	$ 0.13	$ 0.13

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 20,017	$ 12,479
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of discounts and premiums on securities	1,969	1,453
Gain on sale of securities available-for-sale		(270)
Gain on sale of SBA loans	(633)	(67)
Proceeds from sale of SBA loans originated for sale	6,676	916
SBA loans originated for sale	(8,688)	(4,121)
Provision for (recapture of) credit losses on loans	(2,005)	14,384
Increase in cash surrender value of life insurance	(914)	(916)
Depreciation and amortization	508	475
Amortization of other intangible assets	1,487	1,822
Stock option expense, net	278	287
Amortization of restricted stock awards, net	896	811
Amortization of subordinated debt issuance costs	92	92
Gain on proceeds from company-owned life insurance	(462)
Effect of changes in:
Accrued interest receivable and other assets	(1,574)	(23,437)
Accrued interest payable and other liabilities	3,472	21,963
Net cash provided by operating activities	21,119	25,871
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of securities held-to-maturity	(181,805)
Maturities/paydowns/calls of securities available-for-sale	87,503	30,810
Maturities/paydowns/calls of securities held-to-maturity	56,797	42,408
Proceeds from sales of securities available-for-sale		56,598
Purchase of mortgage loans	(140,030)
Net change in loans	(63,944)	(152,881)
Changes in Federal Home Loan Bank stock and other investments	1,027	(3,667)
Purchase of premises and equipment	(89)	(1,725)
Proceeds from redemption of company-owned life insurance	1,506
Net cash (used in) investing activities	(239,035)	(28,457)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in deposits	429,986	485,458
Net change in short-term borrowings		(328)
Exercise of stock options	784	1,490
Payment of cash dividends	(15,605)	(15,504)
Net cash provided by financing activities	415,165	471,116
Net increase in cash and cash equivalents	197,249	468,530
Cash and cash equivalents, beginning of period	1,131,073	457,370
Cash and cash equivalents, end of period	1,328,322	925,900
Supplemental disclosures of cash flow information:
Interest paid	3,464	4,584
Income taxes paid (refunds), net	$ 9,192	$ (524)

Basis of Presentation

Basis of Presentation	6 Months Ended
Basis of Presentation	Jun. 30, 2021
Basis of Presentation
Basis of Presentation	1) Basis of Presentation The unaudited consolidated financial statements of Heritage Commerce Corp (the “Company” or “HCC”) and its wholly owned subsidiary, Heritage Bank of Commerce (the “Bank” or “HBC”), have been prepared pursuant to the rules and regulations for reporting on Form 10-Q. Accordingly, certain information and notes required by accounting principles generally accepted in the United States of America (“GAAP”) for annual financial statements are not included herein. The interim statements should be read in conjunction with the consolidated financial statements and notes that were included in the Company’s Form 10-K for the year ended December 31, 2020. HBC is a commercial bank serving customers primarily located in Alameda, Contra Costa, Marin, San Benito, San Francisco, San Mateo, and Santa Clara counties of California. CSNK Working Capital Finance Corp. a California corporation, dba Bay View Funding (“Bay View Funding”) is a wholly owned subsidiary of HBC, and provides business-essential working capital factoring financing to various industries throughout the United States. No customer accounts for more than 10% of revenue for HBC or the Company. The Company reports its results for two segments: banking and factoring. The Company’s management uses segment results in its operating and strategic planning. In management’s opinion, all adjustments necessary for a fair presentation of these consolidated financial statements have been included and are of a normal and recurring nature. All intercompany transactions and balances have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ significantly from these estimates. Material estimates that are particularly susceptible to significant change include the determination of the allowance for credit losses and any impairment of goodwill or intangible assets. It is reasonably possible the Company’s estimate of the allowance for credit losses and evaluation of impairment of goodwill or intangible assets could change as a result of the continued impact of the COVID-19 pandemic on the economy. The resulting change in these estimates could be material to the Company’s consolidated financial statements. The results for the three and six months ended June 30, 2021 are not necessarily indicative of the results expected for any subsequent period or for the entire year ending December 31, 2021. COVID-19 Capital and Liquidity While the Company believes that it has sufficient capital to withstand an extended economic recession brought about by COVID-19, its reported and regulatory capital ratios could be adversely impacted by credit losses. The Company relies on cash on hand as well as dividends from its subsidiary bank to service its debt. If the Company’s capital deteriorates such that its subsidiary bank is unable to pay dividends to it for an extended period of time, the Company may not be able to service its debt. The Company maintains access to multiple sources of liquidity. Wholesale funding markets have remained open to us. If funding costs are elevated for an extended period of time, it could have an adverse effect on the Company’s net interest margin. If an extended recession caused large numbers of the Company’s deposit customers to withdraw their funds, the Company might become more reliant on volatile or more expensive sources of funding. Asset Valuation The extent to which the COVID-19 pandemic will impact our business, results of operations and financial condition will depend on future developments, which are highly uncertain and difficult to predict. Those developments and factors include the duration and spread of the pandemic, its severity, the actions to contain the pandemic or address its impact, and how quickly and to what extent normal economic and operating conditions can resume. We do not yet know the full extent of the impact. However, the effects could have a material adverse impact on our business, asset valuations, financial condition and results of operations. Material adverse impacts may include all or a combination of valuation impairments on our intangible assets, investments, loans, or deferred tax assets. Reclassifications Certain reclassifications of prior year balances have been made to conform to the current year presentation. These reclassifications had no impact on the Company’s consolidated financial position, results of operations or net change in cash and cash equivalents. Adoption of New Accounting Standards In December 2019, the FASB issued Accounting Standards Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes to simplify various aspects of the current guidance to promote consistent application of the standard among reporting entities by moving certain exceptions to the general principles. The amendments are effective as of January 1, 2021 and had no material impact on the consolidated financial statements. Accounting Guidance Issued But Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides temporary, optional guidance to ease the potential burden in accounting for, or recognizing the effects of, the transition away from the LIBOR or other interbank offered rate on financial reporting. To help with the transition to new reference rates, the ASU provides optional expedients and exceptions for applying GAAP to affected contract modifications and hedge accounting relationships. The main provisions include: ● A change in a contract’s reference interest rate would be accounted for as a continuation of that contract rather than as the creation of a new one for contracts, including loans, debt, leases, and other arrangements, that meet specific criteria. ● When updating its hedging strategies in response to reference rate reform, an entity would be allowed to preserve its hedge accounting. The guidance is applicable only to contracts or hedge accounting relationships that reference LIBOR or another reference rate expected to be discontinued. Because the guidance is meant to help entities through the transition period, it will be in effect for a limited time and will not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, for which an entity has elected certain optional expedients that are retained through the end of the hedging relationship. The amendments in this ASU are effective March 12, 2020 through December 31, 2022. ASU 2020-04 permits relief solely for reference rate reform actions and permits different elections over the effective date for legacy and new activity. Accordingly, the Company is evaluating and reassessing the elections on a quarterly basis. For current elections in effect regarding the assertion of the probability of forecasted transactions, the Company elects the expedient to assert the probability of the hedged interest payments and receipts regardless of any expected modification in terms related to reference rate reform. The Company believes the adoption of this guidance on activities subsequent to December 31, 2020 through December 31, 2022 will not have a material impact on the consolidated financial statements. London Inter-Bank Offered Rate (“LIBOR”) Transition and Phase-Out We have loans and borrowings that are tied to LIBOR benchmark interest rates. It is anticipated that the LIBOR index will be phased-out by the end of 2021 and the Federal Reserve Bank of New York has established the Secured Overnight Financing Rate (“SOFR”) as its recommended alternative to LIBOR. We have created a sub-committee of our Asset Liability Management Committee to address LIBOR transition and phase-out issues. We are currently reviewing loan documentation, technology systems and procedures we will need to implement for the transition. We do not expect the transition to have a material impact to the financial statements.

Earnings Per Share

Earnings Per Share	6 Months Ended
Earnings Per Share	Jun. 30, 2021
Shareholders' Equity and Earnings Per Share
Earnings Per Share	2) Earnings Per Share Basic earnings per common share is computed by dividing net income by the weighted average common shares outstanding. Diluted earnings per share reflect potential dilution from outstanding stock options using the treasury stock method. There were 1,057,945 and 1,722,342 weighted average stock options outstanding for the three months ended June 30, 2021 and 2020, and 1,072,945 and 1,490,688 for the six months ended June 30, 2021 and 2020, respectively, considered to be antidilutive and excluded from the computation of diluted earnings per share. A reconciliation of these factors used in computing basic and diluted earnings per common share is as follows: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands, except per share amounts) Net income $ 8,813 $ 10,618 $ 20,017 $ 12,479 Weighted average common shares outstanding for basic earnings per common share 60,089,327 59,420,592 60,008,071 59,353,759 Dilutive potential common shares 640,814 691,831 564,386 798,728 Shares used in computing diluted earnings per common share 60,730,141 60,112,423 60,572,457 60,152,487 Basic earnings per share $ 0.15 $ 0.18 $ 0.33 $ 0.21 Diluted earnings per share $ 0.15 $ 0.18 $ 0.33 $ 0.21

Accumulated Other Comprehensive

Accumulated Other Comprehensive Income (Loss) ("AOCI")	6 Months Ended
Accumulated Other Comprehensive Income (Loss) ("AOCI")	Jun. 30, 2021
Accumulated Other Comprehensive Income ("AOCI")
Accumulated Other Comprehensive Income ("AOCI")	3) Accumulated Other Comprehensive Income (Loss) (“AOCI”) The following table reflects the changes in AOCI by component for the periods indicated: Three Months Ended June 30, 2021 and 2020 Unamortized Unrealized Unrealized Gain on Gains (Losses) on Available- Available- for-Sale Defined for-Sale Securities Benefit Securities Reclassified Pension and I/O to Held-to- Plan Strips Maturity Items(1) Total (Dollars in thousands) Beginning balance April 1, 2021, net of taxes $ 3,327 $ 252 $ (14,847) $ (11,268) Other comprehensive income (loss) before reclassification, net of taxes (454) — 51 (403) Amounts reclassified from other comprehensive income (loss), net of taxes — (9) 148 139 Net current period other comprehensive income (loss), net of taxes (454) (9) 199 (264) Ending balance June 30, 2021, net of taxes $ 2,873 $ 243 $ (14,648) $ (11,532) Beginning balance April 1, 2020, net of taxes $ 6,627 $ 289 $ (11,625) $ (4,709) Other comprehensive loss before reclassification, net of taxes (395) — (10) (405) Amounts reclassified from other comprehensive income (loss), net of taxes (120) (9) 63 (66) Net current period other comprehensive income (loss), net of taxes (515) (9) 53 (471) Ending balance June 30, 2020, net of taxes $ 6,112 $ 280 $ (11,572) $ (5,180) (1) This AOCI component is included in the computation of net periodic benefit cost (see Note 8—Benefit Plans) and includes split-dollar life insurance benefit plan. Six Months Ended June 30, 2021 and 2020 Unamortized Unrealized Unrealized Gain on Gains (Losses) on Available- Available- for-Sale Defined for-Sale Securities Benefit Securities Reclassified Pension and I/O to Held-to- Plan Strips Maturity Items(1) Total (Dollars in thousands) Beginning balance January 1, 2021, net of taxes $ 3,929 $ 261 $ (14,907) $ (10,717) Other comprehensive loss before reclassification, net of taxes (1,056) — (2) (1,058) Amounts reclassified from other comprehensive income (loss), net of taxes — (18) 261 243 Net current period other comprehensive income (loss), net of taxes (1,056) (18) 259 (815) Ending balance June 30, 2021, net of taxes $ 2,873 $ 243 $ (14,648) $ (11,532) Beginning balance January 1, 2020, net of taxes $ 1,602 $ 298 $ (11,678) $ (9,778) Other comprehensive income (loss) before reclassification, net of taxes 4,701 — (6) 4,695 Amounts reclassified from other comprehensive income (loss), net of taxes (191) (18) 112 (97) Net current period other comprehensive income (loss), net of taxes 4,510 (18) 106 4,598 Ending balance June 30, 2020, net of taxes $ 6,112 $ 280 $ (11,572) $ (5,180) (1) This AOCI component is included in the computation of net periodic benefit cost (see Note 8—Benefit Plans) and includes split-dollar life insurance benefit plan. Amounts Reclassified from AOCI Three Months Ended June 30, Affected Line Item Where Details About AOCI Components 2021 2020 Net Income is Presented (Dollars in thousands) Unrealized gains on available-for-sale securities and I/O strips $ — $ 170 Gain on sales of securities — (50) Income tax expense — 120 Net of tax Amortization of unrealized gain on securities available- for-sale that were reclassified to securities held-to-maturity 13 13 Interest income on taxable securities (4) (4) Income tax expense 9 9 Net of tax Amortization of defined benefit pension plan items (1) Prior transition obligation and acturial losses (2) 1 15 Prior service cost and actuarial losses (3) (211) (105) (210) (90) Other noninterest expense 62 27 Income tax benefit (148) (63) Net of tax Total reclassification for the period $ (139) $ 66 Amounts Reclassified from AOCI Six Months Ended June 30, Affected Line Item Where Details About AOCI Components 2021 2020 Net Income is Presented (Dollars in thousands) Unrealized gains on available-for-sale securities and I/O strips $ — $ 270 Gain on sales of securities — (79) Income tax expense — 191 Net of tax Amortization of unrealized gain on securities available-for-sale that were reclassified to securities held-to-maturity 26 26 Interest income on taxable securities (8) (8) Income tax expense 18 18 Net of tax Amortization of defined benefit pension plan items (1) Prior transition obligation and actuarial losses (2) 2 30 Actuarial losses (3) (372) (190) (370) (160) Other noninterest expense 109 48 Income tax benefit (261) (112) Net of tax Total reclassification from AOCI for the period $ (243) $ 97 (1) This AOCI component is included in the computation of net periodic benefit cost (see Note 8—Benefit Plans). (2) This is related to the split dollar life insurance benefit plan. (3) This is related to the supplemental executive retirement plan.

Securities

Securities	6 Months Ended
Securities	Jun. 30, 2021
Securities
Securities	4) Securities The amortized cost and estimated fair value of securities were as follows for the periods indicated: Gross Gross Allowance Estimated Amortized Unrealized Unrealized for Credit Fair June 30, 2021 Cost Gains (Losses) Losses Value (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ 126,682 $ 4,210 $ — $ — $ 130,892 U.S. Treasury 14,969 94 — — 15,063 Total $ 141,651 $ 4,304 $ — $ — $ 145,955 Gross Gross Estimated Allowance Amortized Unrecognized Unrecognized Fair for Credit June 30, 2021 Cost Gains (Losses) Value Losses (Dollars in thousands) Securities held-to-maturity: Agency mortgage-backed securities $ 361,184 $ 5,330 $ (1,121) $ 365,393 $ — Municipals - exempt from Federal tax 60,153 1,209 — 61,362 (51) Total $ 421,337 $ 6,539 $ (1,121) $ 426,755 $ (51) Gross Gross Allowance Estimated Amortized Unrealized Unrealized for Credit Fair December 31, 2020 Cost Gains (Losses) Losses Value (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ 170,215 $ 5,111 $ — $ — $ 175,326 U.S. Treasury 59,797 651 — — 60,448 Total $ 230,012 $ 5,762 $ — $ — $ 235,774 Gross Gross Estimated Allowance Amortized Unrecognized Unrecognized Fair for Credit December 31, 2020 Cost Gains (Losses) Value Losses (Dollars in thousands) Securities held-to-maturity: Agency mortgage-backed securities $ 228,652 $ 6,075 $ (230) $ 234,497 $ — Municipals - exempt from Federal tax 68,791 1,639 — 70,430 (54) Total $ 297,443 $ 7,714 $ (230) $ 304,927 $ (54) Securities with unrealized losses at June 30, 2021 and December 31, 2020, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position are as follows: Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized June 30, 2021 Value (Losses) Value (Losses) Value (Losses) (Dollars in thousands) Securities held-to-maturity: Agency mortgage-backed securities $ 67,111 $ (1,121) $ — $ — $ 67,111 $ (1,121) Total $ 67,111 $ (1,121) $ — $ — $ 67,111 $ (1,121) Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2020 Value (Losses) Value (Losses) Value (Losses) (Dollars in thousands) Securities held-to-maturity: Agency mortgage-backed securities $ 30,930 $ (230) $ — $ — $ 30,930 $ (230) Total $ 30,930 $ (230) $ — $ — $ 30,930 $ (230) There were no holdings of securities of any one issuer, other than the U.S. Government and its sponsored entities, in an amount greater than 10% of shareholders’ equity. At June 30, 2021, the Company held 398 securities ( 107 available-for-sale and 291 held-to-maturity), of which twelve had fair value below amortized cost. At June 30, 2021, there were $67,111,000 of agency mortgage-backed securities held-to-maturity, carried with an unrealized loss for less than 12 months. The total unrealized loss for securities less than 12 months was ($1,121,000) at June 30, 2021. The unrealized loss was due to higher interest rates in comparison to when the security was purchased. The issuer is of high credit quality and all principal amounts are expected to be paid when securities mature. The fair value is expected to recover as the securities approach their maturity date and/or market rates decline. The Company does not believe that it is more likely than not that the Company will be required to sell a security in an unrealized loss position prior to recovery in value. Therefore, the Company does not consider these debt securities to have credit-related losses as of The proceeds from sales of securities and the resulting gains and losses were as follows for the periods indicated: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Proceeds $ — $ 30,085 $ — $ 56,598 Gross gains — 170 — 270 Gross losses — — — — The amortized cost and estimated fair values of securities as of June 30, 2021 are shown by contractual maturity below. The expected maturities will differ from contractual maturities if borrowers have the right to call or pre-pay obligations with or without call or pre-payment penalties. Securities not due at a single maturity date are shown separately. Available-for-sale Amortized Estimated Cost Fair Value (Dollars in thousands) Due 3 months or less $ 9,997 $ 10,044 Due after 3 months through one year 4,972 5,019 Agency mortgage-backed securities 126,682 130,892 Total $ 141,651 $ 145,955 Held-to-maturity Amortized Estimated Cost Fair Value (Dollars in thousands) Due after 3 months through one year $ 499 $ 500 Due after one through five years 10,605 10,865 Due after five through ten years 31,284 31,824 Due after ten years 17,765 18,173 Agency mortgage-backed securities 361,184 365,393 Total $ 421,337 $ 426,755 Securities with amortized cost of $39,825,000 and $40,238,000 as of June 30, 2021 and December 31, 2020 were pledged to secure public deposits and for other purposes as required or permitted by law or contract. The table below presents a rollforward by major security type for the six months ended June 30, 2021 of the allowance for credit losses on debt securities held-to-maturity held at period end: Municipals (Dollars in thousands) Beginning balance January 1, 2021 $ 54 Provision for (recapture of) credit losses (3) Ending balance June 30, 2021 $ 51 For the six months ended June 30, 2021, there was a reduction of $3,000 to the allowance for credit losses on the Company’s held-to-maturity municipal investment securities portfolio. This reduction was the result of a reduction in municipal securities amortized balances resulting from regular payments. The bond ratings for the Company’s municipal investment securities at June 30, 2021 were consistent with the ratings at December 31, 2020.

Loans and Allowance for Credit

Loans and Allowance for Credit Losses on Loans	6 Months Ended
Loans and Allowance for Credit Losses on Loans	Jun. 30, 2021
Loans and Allowance for Credit Losses on Loans
Loans and Allowance for Credit Losses on Loans	5) Loans and Allowance for Credit Losses on Loans The allowance for credit losses on loans was calculated by pooling loans of similar credit risk characteristics and credit monitoring procedures. The loan portfolio is classified into eight segments of loans - commercial, commercial real estate – owner occupied, commercial real estate – non-owner occupied, land and construction, home equity, multifamily, residential mortgages and consumer and other. The risk characteristics of each loan portfolio segment are as follows: Commercial Commercial loans primarily rely on the identified cash flows of the borrower for repayment and secondarily on the underlying collateral provided by the borrower. However, the cash flows of the borrowers may not be as expected and the collateral securing these loans may vary in value. Most commercial loans are secured by the assets being financed or other business assets such as accounts receivable, inventory or equipment and may incorporate a personal guarantee; however, some loans may be unsecured. Included in commercial loans are $286,461,000 of PPP loans at June 30, 2021 and $290,679,000 at December 31, 2020. No allowance for credit losses has been recorded for PPP loans as they are fully guaranteed by the SBA. Commercial Real Estate (“CRE”) CRE loans rely primarily on the cash flows of the properties securing the loan and secondarily on the value of the property that is securing the loan. CRE loans comprise two segments differentiated by owner occupied CRE and non-owner CRE. Owner occupied CRE loans are secured by commercial properties that are at least 50% occupied by the borrower or borrower affiliate. Non-owner occupied CRE loans are secured by commercial properties that are less than 50% occupied by the borrower or borrower affiliate. CRE loans may be adversely affected by conditions in the real estate markets or in the general economy. Land and Construction Land and construction loans are generally based on estimates of costs and value associated with the complete project. Construction loans usually involve the disbursement of funds with repayment substantially dependent on the success of the completion of the project. Sources of repayment for these loans may be permanent loans from HBC or other lenders, or proceeds from the sales of the completed project. These loans are monitored by on-site inspections and are considered to have higher risk than other real estate loans due to the final repayment dependent on numerous factors including general economic conditions. Home Equity Home equity loans are secured by 1-4 family residences that are generally owner occupied. Repayment of these loans depends primarily on the personal income of the borrower and secondarily by the value of the property securing the loan which can be impacted by changes in economic conditions such as the unemployment rate and property values. Multifamily Multifamily loans are loans on residential properties with five or more units. These loans rely primarily on the cash flows of the properties securing the loan for repayment and secondarily on the value of the properties securing the loan. The cash flows of these borrowers can fluctuate along with the values of the underlying property depending on general economic conditions. Residential Mortgages Residential mortgage loans are secured by 1-4 family residences which are generally owner-occupied. Repayment of these loans depends primarily on the personal income of the borrower and secondarily by the value of the property securing the loan which can be impacted by changes in economic conditions such as the unemployment rate and property values. During the second quarter of 2021, the Company purchased two single family residential mortgage loan portfolios totaling $140,030,000, all of which are domiciled in California, with an average principal balance of $585,000, and a weighted average yield of approximately 3.39% (excluding servicing costs, which are netted against interest income contributing to a lower overall average yield). Consumer and Other Consumer and other loans are secured by personal property or are unsecured and rely primarily on the income of the borrower for repayment and secondarily on the collateral value for secured loans. Borrower income and collateral value can vary dependent on economic conditions. Loans by portfolio segment and the allowance for credit losses on loans were as follows for the periods indicated: June 30, December 31, 2021 2020 (Dollars in thousands) Loans held-for-investment: Commercial $ 844,147 $ 846,386 Real estate: CRE - owner occupied 583,091 560,362 CRE - non-owner occupied 742,135 693,103 Land and construction 129,426 144,594 Home equity 107,873 111,885 Multifamily 198,771 166,425 Residential mortgages 205,904 85,116 Consumer and other 21,519 18,116 Loans 2,832,866 2,625,987 Deferred loan fees, net (8,070) (6,726) Loans, net of deferred fees 2,824,796 2,619,261 Allowance for credit losses on loans (43,956) (44,400) Loans, net $ 2,780,840 $ 2,574,861 Changes in the allowance for credit losses on loans were as follows for the periods indicated: Three Months Ended June 30, 2021 CRE CRE Owner Non-owner Land & Home Multi- Residential Consumer Commercial Occupied Occupied Construction Equity Family Mortgage and Other Total (Dollars in thousands) Beginning of period balance $ 11,600 $ 8,368 $ 16,431 $ 2,754 $ 1,171 $ 2,751 $ 918 $ 303 $ 44,296 Charge-offs (105) — — — — — — — (105) Recoveries 115 4 — 68 16 — — 55 258 Net recoveries 10 4 — 68 16 — — 55 153 Provision for (recapture of) credit losses on loans (753) (166) 54 (686) (118) 199 1,050 (73) (493) End of period balance $ 10,857 $ 8,206 $ 16,485 $ 2,136 $ 1,069 $ 2,950 $ 1,968 $ 285 $ 43,956 Three Months Ended June 30, 2020 CRE CRE Owner Non-owner Land & Home Multi- Residential Consumer Commercial Occupied Occupied Construction Equity Family Mortgage and Other Total (Dollars in thousands) Beginning of period balance $ 12,801 $ 7,737 $ 15,645 $ 2,603 $ 1,746 $ 1,622 $ 708 $ 1,841 $ 44,703 Charge-offs (465) - - - - - - - (465) Recoveries 46 1 - 13 31 - - 1 92 Net (charge-offs) recoveries (419) 1 - 13 31 - - 1 (373) Provision for (recapture of) credit losses on loans 797 809 (196) (64) 74 206 117 (629) 1,114 End of period balance $ 13,179 $ 8,547 $ 15,449 $ 2,552 $ 1,851 $ 1,828 $ 825 $ 1,213 $ 45,444 Six Months Ended June 30, 2021 CRE CRE Owner Non-owner Land & Home Multi- Residential Consumer Commercial Occupied Occupied Construction Equity Family Mortgage and Other Total (Dollars in thousands) Beginning of period balance $ 11,587 $ 8,560 $ 16,416 $ 2,509 $ 1,297 $ 2,804 $ 943 $ 284 $ 44,400 Charge-offs (368) — — — — — — — (368) Recoveries 928 8 — 884 39 — — 70 1,929 Net recoveries 560 8 — 884 39 — — 70 1,561 Provision for (recapture of) credit losses on loans (1,290) (362) 69 (1,257) (267) 146 1,025 (69) (2,005) End of period balance $ 10,857 $ 8,206 $ 16,485 $ 2,136 $ 1,069 $ 2,950 $ 1,968 $ 285 $ 43,956 Six Months Ended June 30, 2020 Owner Non-owner Land & Home Multi- Residential Consumer Commercial Occupied Occupied Construction Equity Family Mortgage and Other Total (Dollars in thousands) Beginning of period balance $ 10,453 $ 3,825 $ 3,760 $ 2,621 $ 2,244 $ 57 $ 243 $ 82 $ 23,285 Adoption of Topic 326 (3,663) 3,169 7,912 (1,163) (923) 1,196 435 1,607 8,570 Balance at adoption on January 1, 2020 6,790 6,994 11,672 1,458 1,321 1,253 678 1,689 31,855 Charge-offs (1,135) — — — — — — (3) (1,138) Recoveries 255 1 — 32 54 — — 1 343 Net (charge-offs) recoveries (880) 1 — 32 54 — — (2) (795) Provision for (recapture of) credit losses on loans 7,269 1,552 3,777 1,062 476 575 147 (474) 14,384 End of period balance $ 13,179 $ 8,547 $ 15,449 $ 2,552 $ 1,851 $ 1,828 $ 825 $ 1,213 $ 45,444 Management’s methodology for estimating the allowance balance consists of several key elements, which include pooling loans with similar characteristics into segments and using a discounted cash flow calculation to estimate losses. The discounted cash flow model inputs include loan level cash flow estimates for each loan segment based on peer and bank historic loss correlations with certain economic factors. Management uses a four quarter forecast of each economic factor that is used for each loan segment and the economic factors are assumed to revert to the historic mean over an eight quarter period after the forecast period. The economic factors management has selected include the California unemployment rate, California gross domestic product, California home price index, and a national CRE value index. These factors are evaluated and updated occasionally and as economic conditions change. Additionally, management uses qualitative adjustments to the discounted cash flow quantitative loss estimates in certain cases when management has assessed an adjustment is necessary. These qualitative adjustments are applied by pooled loan segment and have been made for increased risk due to loan quality trends, collateral risk, or other risks management determines are not adequately captured in the discounted cash flow loss estimation. Specific allowances on individually evaluated loans are combined to the allowance on pools of loans with similar risk characteristics to derive to total allowance for credit losses on loans. The decrease in the allowance for credit losses on loans and related recapture of provision for the six months ended June 30, 2021, was primarily attributed to a net decrease of ($56,000) in the reserve for pooled loans, driven by improvements in forecasted macroeconomic conditions offset by changes in the portfolio, and a ($388,000) decrease in specific reserves for individually evaluated loans compared to December 31, 2020. The decrease in the allowance for credit losses for pooled loans from December 31, 2020 is largely the result of improvements in the economic factors used in our methodology and reductions in qualitative adjustments for risks such as collateral values, concentrations of credit risk (geographic, large borrower, and industry), economic conditions, changes in underwriting standards, experience and depth of lending staff, trends in delinquencies, and the level of criticized loans to address asset-specific risks and current conditions that were not fully considered by the macroeconomic variables driving the quantitative estimate. The following tables presents the amortized cost basis of nonperforming loans and loans past due over 90 days and still accruing for the periods indicated: June 30, 2021 Restructured Nonaccrual Nonaccrual and Loans with no Specific with Specific over 90 Days Allowance for Allowance for Past Due Credit Credit and Still Losses Losses Accruing Total (Dollars in thousands) Commercial $ 415 $ 1,378 $ 164 $ 1,957 Real estate: CRE - Owner Occupied 1,774 — — 1,774 CRE - Non-Owner Occupied — — 725 725 Home equity 168 — — 168 Multifamily 1,149 — — 1,149 Consumer and other 407 — — 407 Total $ 3,913 $ 1,378 $ 889 $ 6,180 December 31, 2020 Restructured Nonaccrual Nonaccrual and Loans with no Specific with no Specific over 90 Days Allowance for Allowance for Past Due Credit Credit and Still Losses Losses Accruing Total (Dollars in thousands) Commercial $ 752 $ 1,974 $ 81 $ 2,807 Real estate: CRE - Owner Occupied 3,706 — — 3,706 Home equity 949 — — 949 Consumer and other 407 — — 407 Total $ 5,814 $ 1,974 $ 81 $ 7,869 The following tables presents the aging of past due loans by class for the periods indicated: June 30, 2021 30 - 59 60 - 89 90 Days or Days Days Greater Total Past Due Past Due Past Due Past Due Current Total (Dollars in thousands) Commercial $ 4,467 $ 1,187 $ 261 $ 5,915 $ 838,232 $ 844,147 Real estate: CRE - Owner Occupied 1,172 9 1,143 2,324 580,767 583,091 CRE - Non-Owner Occupied 145 — 725 870 741,265 742,135 Land and construction — — — — 129,426 129,426 Home equity — — — — 107,873 107,873 Multifamily — — — — 198,771 198,771 Residential mortgages — — — — 205,904 205,904 Consumer and other — — 407 407 21,112 21,519 Total $ 5,784 $ 1,196 $ 2,536 $ 9,516 $ 2,823,350 $ 2,832,866 December 31, 2020 30 - 59 60 - 89 90 Days or Days Days Greater Total Past Due Past Due Past Due Past Due Current Total (Dollars in thousands) Commercial $ 3,524 $ 259 $ 392 $ 4,175 $ 842,211 $ 846,386 Real estate: CRE - Owner Occupied 1,133 — 29 1,162 559,200 560,362 CRE - Non-Owner Occupied — 485 — 485 692,618 693,103 Land and construction — — — — 144,594 144,594 Home equity — — — 111,885 111,885 Multifamily — — — — 166,425 166,425 Residential mortgages — — — — 85,116 85,116 Consumer and other — — 407 407 17,709 18,116 Total $ 4,657 $ 744 $ 828 $ 6,229 $ 2,619,758 $ 2,625,987 Past due loans 30 days or greater totaled $9,516,000 and $6,229,000 at June 30, 2021 and December 31, 2020, respectively, of which $1,658,000 and $1,918,000 were on nonaccrual, at June 30, 2021 and December 31, 2020, respectively. At June 30, 2021, there were also $3,633,000 of loans less than 30 days past due included in nonaccrual loans held-for-investment. At December 31, 2020, there were also $5,870,000 loans less than 30 days past due included in nonaccrual loans held-for-investment. Management’s classification of a loan as “nonaccrual” is an indication that there is reasonable doubt as to the full recovery of principal or interest on the loan. At that point, the Company stops accruing interest income, and reverses any uncollected interest that had been accrued as income. The Company begins recognizing interest income only as cash interest payments are received and it has been determined the collection of all outstanding principal is not in doubt. Credit Quality Indicators Concentrations of credit risk arise when a number of customers are engaged in similar business activities, or activities in the same geographic region, or have similar features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions. The Company’s loan portfolio is concentrated in commercial (primarily manufacturing, wholesale, and service) and real estate lending, with the remaining balance in consumer loans. While no specific industry concentration is considered significant, the Company’s lending operations are located in the Company’s market areas that are dependent on the technology and real estate industries and their supporting companies. Thus, the Company’s borrowers could be adversely impacted by a downturn in these sectors of the economy which could reduce the demand for loans and adversely impact the borrowers’ ability to repay their loans. The Company categorizes 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, and other factors. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis is performed on a quarterly basis. Nonclassified loans generally include those loans that are expected to be repaid in accordance with their contractual loan terms. Loans categorized as special mention have potential weaknesses that may, if not checked or corrected, weaken the credit or inadequately protect the Company’s position at some future date. These loans pose elevated risk, but their weaknesses do not yet justify a substandard classification. Classified loans are those loans that are assigned a substandard, substandard-nonaccrual, or doubtful risk rating using the following definitions: Special Mention. A Special Mention asset has potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in a deterioration of the repayment prospects for the asset or in the credit position at some future date. Special Mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. 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 will 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. Substandard-Nonaccrual. Loans classified as substandard-nonaccrual are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any, and it is probable that the Company will not receive payment of the full contractual principal and interest. 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. In addition, the Company no longer accrues interest on the loan because of the underlying weaknesses. 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. Loss. Loans classified as loss are considered uncollectable or of so little value that their continuance as assets is not warranted. This classification does not necessarily mean that a loan has no recovery or salvage value; but rather, there is much doubt about whether, how much, or when the recovery would occur. Loans classified as loss are immediately charged off against the allowance for credit losses on loans. Therefore, there is no balance to report as of June 30, 2021 and December 31, 2020. Loans may be reviewed at any time throughout a loan’s duration. If new information is provided, a new risk assessment may be performed if warranted. The following tables present term loans amortized cost by vintage and loan grade classification, and revolving loans amortized cost by loan grade classification at June 30, 2021 and December 31, 2020. The loan grade classifications are based on the Bank’s internal loan grading methodology. Loan grade categories for doubtful and loss rated loans are not included on the tables below as there are no loans with those grades at June 30, 2021 and December 31, 2020. The vintage year represents the period the loan was originated or in the case of renewed loans, the period last renewed. The amortized balance is the loan balance less any purchase discounts, and plus any loan purchase premiums. The loan categories are based on the loan segmentation in the Company's CECL reserve methodology based on loan purpose and type. Revolving Loans Term Loans Amortized Cost Basis by Originated Period Amortized 2016 and Cost 6/30/2021 12/31/2020 12/31/2019 12/31/2018 12/31/2017 Prior Basis Total (Dollars in thousands) Commercial: Pass $ 302,753 $ 163,815 $ 19,144 $ 15,904 $ 9,543 $ 8,699 $ 307,122 $ 826,980 Special Mention 323 733 - 1,082 447 270 978 3,833 Substandard 1,349 3,337 - 16 452 30 6,357 11,541 Substandard-Nonaccrual 30 1,143 - - - 106 514 1,793 Total 304,455 169,028 19,144 17,002 10,442 9,105 314,971 844,147 CRE - Owner Occupied: Pass 78,046 154,477 74,843 66,269 37,006 135,709 24,038 570,388 Special Mention 531 2,648 680 1,495 770 1,089 - 7,213 Substandard 2,547 - 394 735 40 - 3,716 Substandard-Nonaccrual - 1,774 - - - - - 1,774 Total 78,577 161,446 75,523 68,158 38,511 136,838 24,038 583,091 CRE - Non-Owner Occupied: Pass 131,832 148,179 121,987 55,878 75,126 165,195 22,377 720,574 Special Mention - 2,808 - 2,527 606 6,338 2,165 14,444 Substandard - 5,240 - 1,392 - 485 - 7,117 Substandard-Nonaccrual - - - - - - - - Total 131,832 156,227 121,987 59,797 75,732 172,018 24,542 742,135 Land and construction: Pass 58,297 56,553 4,443 - - 1,321 7,453 128,067 Special Mention - - - - - - - - Substandard 1,359 - - - - - - 1,359 Substandard-Nonaccrual - - - - - - - - Total 59,656 56,553 4,443 - - 1,321 7,453 129,426 Home equity: Pass - - - 61 - - 104,746 104,807 Special Mention - - - - - - 1,932 1,932 Substandard - - - - - 143 823 966 Substandard-Nonaccrual - 107 - - - - 61 168 Total - 107 - 61 - 143 107,562 107,873 Multifamily: Pass 42,576 32,568 37,612 16,321 21,215 35,092 915 186,299 Special Mention - - - - - 10,444 - 10,444 Substandard - 879 - - - - - 879 Substandard-Nonaccrual 1,149 - - - - - - 1,149 Total 43,725 33,447 37,612 16,321 21,215 45,536 915 198,771 Residential mortgage: Pass 137,195 18,204 9,379 3,157 5,129 30,567 960 204,591 Special Mention - - - - - - - - Substandard - - - - - 1,313 - 1,313 Substandard-Nonaccrual - - - - - - - - Total 137,195 18,204 9,379 3,157 5,129 31,880 960 205,904 Consumer and other: Pass - 6 409 1,456 17 1,051 17,953 20,892 Special Mention - - - - - - - - Substandard 20 - - - - - 200 220 Substandard-Nonaccrual - - 407 - - - 407 Total 20 6 409 1,863 17 1,051 18,153 21,519 Total loans $ 755,460 $ 595,018 $ 268,497 $ 166,359 $ 151,046 $ 397,892 $ 498,594 $ 2,832,866 Risk Grades: Pass $ 750,699 $ 573,802 $ 267,817 $ 159,046 $ 148,036 $ 377,634 $ 485,564 $ 2,762,598 Special Mention 854 6,189 680 5,104 1,823 18,141 5,075 37,866 Substandard 2,728 12,003 - 1,802 1,187 2,011 7,380 27,111 Substandard-Nonaccrual 1,179 3,024 - 407 - 106 575 5,291 Grand Total $ 755,460 $ 595,018 $ 268,497 $ 166,359 $ 151,046 $ 397,892 $ 498,594 $ 2,832,866 Revolving Loans Term Loans Amortized Cost Basis by Originated Period Amortized 2015 and Cost 2020 2019 2018 2017 2016 Prior Basis Total (Dollars in thousands) Commercial: Pass $ 431,369 $ 33,350 $ 21,154 $ 13,840 $ 7,341 $ 8,292 $ 296,286 $ 811,632 Special Mention 15,720 716 1,301 953 713 170 1,937 21,510 Substandard 4,036 - 19 758 2,396 73 3,236 10,518 Substandard-Nonaccrual 2,106 56 36 - 115 26 387 2,726 Total 453,231 34,122 22,510 15,551 10,565 8,561 301,846 846,386 CRE - Owner Occupied: Pass 168,224 73,064 68,068 51,705 50,716 109,350 15,964 537,091 Special Mention 3,151 2,568 4,128 783 - 2,569 - 13,199 Substandard 2,561 - 400 2,954 - 451 - 6,366 Substandard-Nonaccrual 3,678 - - - - 28 - 3,706 Total 177,614 75,632 72,596 55,442 50,716 112,398 15,964 560,362 CRE - Non-Owner Occupied: Pass 166,550 128,361 68,796 99,816 57,422 150,683 1,926 673,554 Special Mention 11,930 - 2,557 - - - - 14,487 Substandard 3,166 - 1,411 - 485 - - 5,062 Substandard-Nonaccrual - - - - - - - - Total 181,646 128,361 72,764 99,816 57,907 150,683 1,926 693,103 Land and construction: Pass 114,932 22,054 - - - 1,343 4,906 143,235 Special Mention - - - - - - - - Substandard 1,359 - - - - - - 1,359 Substandard-Nonaccrual - - - - - - - - Total 116,291 22,054 - - - 1,343 4,906 144,594 Home equity: Pass 266 - 74 - - - 109,848 110,188 Special Mention - - - - - - - - Substandard - - - - - 143 605 748 Substandard-Nonaccrual 117 - - - - - 832 949 Total 383 - 74 - - 143 111,285 111,885 Multifamily: Pass 31,481 39,183 17,248 24,572 16,235 30,751 880 160,350 Special Mention - - - - - 5,186 - 5,186 Substandard 889 - - - - - - 889 Substandard-Nonaccrual - - - - - - - - Total 32,370 39,183 17,248 24,572 16,235 35,937 880 166,425 Residential mortgage: Pass 12,798 10,048 3,246 7,324 28,115 15,568 - 77,099 Special Mention 5,089 - 1,630 - - - 6,719 Substandard - - - - - 1,298 - 1,298 Substandard-Nonaccrual - - - - - - - - Total 17,887 10,048 4,876 7,324 28,115 16,866 - 85,116 Consumer and other: Pass 10 522 1,486 20 116 987 14,568 17,709 Special Mention - - - - - - - - Substandard - - - - - - - - Substandard-Nonaccrual - - 407 - - - - 407 Total 10 522 1,893 20 116 987 14,568 18,116 Total loans $ 979,432 $ 309,922 $ 191,961 $ 202,725 $ 163,654 $ 326,918 $ 451,375 $ 2,625,987 Risk Grades:. Pass $ 925,630 $ 306,582 $ 180,072 $ 197,277 $ 159,945 $ 316,974 $ 444,378 $ 2,530,858 Special Mention 35,890 3,284 9,616 1,736 713 7,925 1,937 61,101 Substandard 12,011 - 1,830 3,712 2,881 1,965 3,841 26,240 Substandard-Nonaccrual 5,901 56 443 - 115 54 1,219 7,788 Grand Total $ 979,432 $ 309,922 $ 191,961 $ 202,725 $ 163,654 $ 326,918 $ 451,375 $ 2,625,987 The following table presents the amortized cost basis of collateral-dependent loans by loan classification at June 30, 2021: Collateral Type Real Estate Business Property Assets Unsecured Total (Dollars in thousands) Commercial $ 25 $ 1,324 $ 29 $ 1,378 Total $ 25 $ 1,324 $ 29 $ 1,378 The following table presents the amortized cost basis of collateral-dependent loans by loan classification at December 31, 2020: Collateral Type Real Estate Business Property Assets Unsecured Total (Dollars in thousands) Commercial $ 29 $ 1,815 $ 130 $ 1,974 Total $ 29 $ 1,815 $ 130 $ 1,974 When management determines that foreclosures are probable, expected credit losses for collateral-dependent loans are based on the fair value of the collateral at the reporting date, adjusted for selling costs as app

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets	6 Months Ended
Goodwill and Other Intangible Assets	Jun. 30, 2021
Goodwill and Other Intangible Assets
Goodwill and Other Intangible Assets	6) Goodwill and Other Intangible Assets Goodwill At June 30, 2021, the carrying value of goodwill was $167,631,000, which included $13,044,000 of goodwill related to its acquisition of Bay View Funding, $32,619,000 from its acquisition of Focus Business Bank, $13,819,000 from its acquisition of Tri-Valley Bank, $24,271,000 from its acquisition of United American Bank and $83,878,000 from Presidio Bank. Goodwill impairment exists when a reporting unit’s carrying value exceeds its fair value, which is determined through a qualitative assessment whether it is more likely than not that the fair value of equity of the reporting unit exceeds the carrying value (“Step Zero”). If the qualitative assessment indicates it is more likely than not that the fair value of equity of a reporting unit is less than book value, then a quantitative two-step impairment test is required. Step 1 includes the determination of the carrying value of the Company’s reporting units, including the existing goodwill and intangible assets, and estimating the fair value of each reporting unit. The Company completed its annual goodwill impairment analysis as of November 30, 2020 with the assistance of an independent valuation firm. The goodwill related to the acquisition of Bay View Funding was tested separately for impairment under this analysis. No events or circumstances since the November 30, 2020 annual impairment test were noted that would indicate it was more likely than not a goodwill impairment exists, for either the Company’s banking or factoring reporting units. The following table summarizes the carrying amount of goodwill by segment for the periods indicated: June 30, December 31, 2021 2020 (Dollars in thousands) Banking $ 154,587 $ 154,587 Factoring 13,044 13,044 Total Goodwill $ 167,631 $ 167,631 Other Intangible Assets The Company’s intangible assets are summarized as follows for the periods indicated: June 30, 2021 Gross Carrying Accumulated Amount Amortization Total (Dollars in thousands) Core deposit intangibles $ 25,023 $ (10,567) $ 14,456 Customer relationship and brokered relationship intangibles 1,900 (1,266) 634 Below market leases 770 (683) 87 Total $ 27,693 $ (12,516) $ 15,177 December 31, 2020 Gross Carrying Accumulated Amount Amortization Total (Dollars in thousands) Core deposit intangibles $ 25,023 $ (9,153) $ 15,870 Customer relationship and brokered relationship intangibles 1,900 (1,171) 729 Below market leases 770 (705) 65 Total $ 27,693 $ (11,029) $ 16,664 Estimated amortization expense for future years is as follows: Customer & Below/ Core Brokered (Above) Total Deposit Relationship Market Amortization Year Intangible Intangible Lease Expense (Dollars in thousands) 2021 remaining $ 1,415 $ 95 $ (1) $ 1,509 2022 2,447 190 (2) 2,635 2023 2,217 190 (2) 2,405 2024 2,023 159 5 2,187 2025 1,795 — 18 1,813 Thereafter 4,559 — 69 4,628 $ 14,456 $ 634 $ 87 $ 15,177 Impairment testing of the intangible assets is performed at the individual asset level. Impairment exists if the carrying amount of the asset is not recoverable and exceeds its fair value at the date of the impairment test. For intangible assets, estimates of expected future cash flows (cash inflows less cash outflows) that are directly associated with an intangible asset are used to determine the fair value of that asset. Management makes certain estimates and assumptions in determining the expected future cash flows from core deposit and customer relationship intangibles including account attrition, expected lives, discount rates, interest rates, servicing costs and other factors. Significant changes in these estimates and assumptions could adversely impact the valuation of these intangible assets. If an impairment loss exists, the carrying amount of the intangible asset is adjusted to a new cost basis. The new cost basis is then amortized over the remaining useful life of the asset. Based on its assessment, management concluded that there was no impairment of intangible assets at June 30, 2021 and December 31, 2020.

Income Taxes

Income Taxes	6 Months Ended
Income Taxes	Jun. 30, 2021
Income Taxes
Income Taxes	7) Income Taxes Some items of income and expense are recognized in one year for tax purposes, and another when applying generally accepted accounting principles, which leads to timing differences between the Company’s actual current tax liability and the amount accrued for this liability based on book income. These temporary differences comprise the “deferred” portion of the Company’s tax expense or benefit, which is accumulated on the Company’s books as a deferred tax asset or deferred tax liability until such time as they reverse. Under generally accepted accounting principles, a valuation allowance is required if it is “more likely than not” that a deferred tax asset will not be realized. The determination of the realizability of the deferred tax assets is highly subjective and dependent upon judgment concerning management’s evaluation of both positive and negative evidence, including forecasts of future income, cumulative losses, applicable tax planning strategies, and assessments of current and future economic and business conditions. The Company had net deferred tax assets of $26,917,000, and $28,221,000, at June 30, 2021 and December 31, 2020, respectively. After consideration of the matters in the preceding paragraph, the Company determined that it is more likely than not that the net deferred tax assets at June 30, 2021 and December 31, 2020 will be fully realized in future years. The following table reflects the carrying amounts of the low income housing investments included in accrued interest receivable and other assets, and the future commitments included in accrued interest payable and other liabilities for the periods indicated: June 30, December 31, 2021 2020 (Dollars in thousands) Low income housing investments $ 4,827 $ 5,246 Future commitments $ 596 $ 596 The Company expects $46,000 of the future commitments to be paid in 2021, and $550,000 in 2022 through 2025. For tax purposes, the Company had low income housing tax credits of $210,000 for the three months ended June 30, 2021 and June 30, 2020, and low income housing investment expense of $209,000 and $211,000, respectively. For tax purposes, the Company had low income housing tax credits of $420,000 for the six months ended June 30, 2021 and June 30, 2020, and low income housing investment expense of $418,000 and $420,000, respectively. The Company recognized low income housing investment expense as a component of income tax expense.

Benefit Plans

Benefit Plans	6 Months Ended
Benefit Plans	Jun. 30, 2021
Benefit Plans
Benefit Plans	8) Benefit Plans Supplemental Retirement Plan The Company has a supplemental retirement plan (the “Plan”) covering some current and some former key employees and directors. The Plan is a nonqualified defined benefit plan. Benefits are unsecured as there are no Plan assets. The following table presents the amount of periodic cost recognized for the periods indicated: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Components of net periodic benefit cost: Service cost $ 120 $ 123 $ 240 $ 246 Interest cost 190 236 380 467 Amortization of prior service cost 75 — 100 — Amortization of net actuarial loss 136 105 272 190 Net periodic benefit cost $ 521 $ 464 $ 992 $ 903 The components of net periodic benefit cost other than the service cost component are included in the line item “other noninterest expense” in the Consolidated Statements of Income. Split-Dollar Life Insurance Benefit Plan The Company maintains life insurance policies for some current and former directors and officers that are subject to split-dollar life insurance agreements. The following table sets forth the funded status of the split-dollar life insurance benefits for the periods indicated: June 30, December 31, 2021 2020 (Dollars in thousands) Change in projected benefit obligation: Projected benefit obligation at beginning of year $ 9,689 $ 8,198 Interest cost 110 246 Actuarial loss — 1,245 Projected benefit obligation at end of period $ 9,799 $ 9,689 June 30, December 31, 2021 2020 (Dollars in thousands) Net actuarial loss $ 5,217 $ 5,170 Prior transition obligation 925 970 Accumulated other comprehensive loss $ 6,142 $ 6,140 Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Amortization of prior transition obligation and actuarial losses $ (1) $ (15) $ (2) $ (30) Interest cost 55 62 110 124 Net periodic benefit cost $ 54 $ 47 $ 108 $ 94

Fair Value

Fair Value	6 Months Ended
Fair Value	Jun. 30, 2021
Fair Value
Fair Value	9) Fair Value Accounting guidance establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date. Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data (for example, interest rates and yield curves observable at commonly quoted intervals, prepayment speeds, credit risks, and default rates). Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. Financial Assets and Liabilities Measured on a Recurring Basis The fair values of securities available-for sale-are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs) or matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities, but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs). The fair value of interest-only (“I/O”) strip receivable assets is based on a valuation model used by a third party. The Company is able to compare the valuation model inputs and results to widely available published industry data for reasonableness (Level 2 inputs). Fair Value Measurements Using Significant Quoted Prices in Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Balance (Level 1) (Level 2) (Level 3) (Dollars in thousands) Assets at June 30, 2021 Available-for-sale securities: Agency mortgage-backed securities $ 130,892 $ — $ 130,892 $ — U.S. Treasury 15,063 15,063 — — I/O strip receivables 274 — 274 — Assets at December 31, 2020 Available-for-sale securities: Agency mortgage-backed securities $ 175,326 $ — $ 175,326 $ — U.S. Treasury 60,448 60,448 — — I/O strip receivables 305 — 305 — There were no transfers between Level 1 and Level 2 during the period for assets measured at fair value on a recurring basis. Assets and Liabilities Measured on a Non-Recurring Basis The fair value of collateral dependent loans individually evaluated with specific allocations of the allowance for credit losses on loans is generally based on recent real estate appraisals. The appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. There were no material collateral dependent loans carried at fair value on a non-recurring basis at June 30, 2021 or December 31, 2020. Foreclosed assets are valued at the time the loan is foreclosed upon and the asset is transferred to foreclosed assets. The fair value is based primarily on third party appraisals, less costs to sell. The appraisals may utilize a single valuation approach or a combination of approaches including the comparable sales and income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value. At June 30, 2021 and December 31, 2020, there were no foreclosed assets on the balance sheet. The carrying amounts and estimated fair values of financial instruments at June 30, 2021 are as follows: Estimated Fair Value Significant Quoted Prices in Other Significant Active Markets for Observable Unobservable Carrying Identical Assets Inputs Inputs Amounts (Level 1) (Level 2) (Level 3) Total (Dollars in thousands) Assets: Cash and cash equivalents $ 1,328,322 $ 1,328,322 $ — $ — $ 1,328,322 Securities available-for-sale 145,955 15,063 130,892 — 145,955 Securities held-to-maturity 421,286 — 426,755 — 426,755 Loans (including loans held-for-sale), net 2,785,184 — 4,344 2,796,339 2,800,683 FHLB stock, FRB stock, and other investments 32,495 — — — N/A Accrued interest receivable 10,397 103 1,510 8,784 10,397 I/O strips receivables 274 — 274 — 274 Liabilities: Time deposits $ 158,644 $ — $ 158,843 $ — $ 158,843 Other deposits 4,185,828 — 4,185,828 — 4,185,828 Subordinated debt 39,832 — 40,432 — 40,432 Accrued interest payable 548 — 548 — 548 The carrying amounts and estimated fair values of the Company’s financial instruments at December 31, 2020: Estimated Fair Value Significant Quoted Prices in Other Significant Active Markets for Observable Unobservable Carrying Identical Assets Inputs Inputs Amounts (Level 1) (Level 2) (Level 3) Total (Dollars in thousands) Assets: Cash and cash equivalents $ 1,131,073 $ 1,131,073 $ — $ — $ 1,131,073 Securities available-for-sale 235,774 60,448 175,326 — 235,774 Securities held-to-maturity 297,389 — 304,927 — 304,927 Loans (including loans held-for-sale), net 2,576,560 — 1,699 2,572,993 2,574,692 FHLB stock, FRB stock, and other investments 33,522 — — — N/A Accrued interest receivable 10,546 309 1,512 8,725 10,546 I/O strips receivables 305 — 305 — 305 Liabilities: Time deposits $ 153,407 $ — $ 153,740 $ — $ 153,740 Other deposits 3,761,079 — 3,761,079 — 3,761,079 Subordinated debt 39,740 — 40,340 — 40,340 Accrued interest payable 545 — 545 — 545

Equity Plan

Equity Plan	6 Months Ended
Equity Plan	Jun. 30, 2021
Equity Plan
Equity Plan	10) Equity Plan The Company maintained an Amended and Restated 2004 Equity Plan (the “2004 Plan”) for directors, officers, and key employees. The 2004 Plan was terminated on May 23, 2013. On May 23, 2013, the Company’s shareholders approved the 2013 Equity Incentive Plan (the “2013 Plan”). On May 21, 2020, the shareholders approved an amendment to the Heritage Commerce Corp 2013 Equity Incentive Plan to increase the number of shares available from 3,000,000 to 5,000,000 shares. The equity plans provide for the grant of incentive and nonqualified stock options and restricted stock. The equity plans provide that the option price for both incentive and nonqualified stock options will be determined by the Board of Directors at no less than the fair value at the date of grant. Options granted vest on a schedule determined by the Board of Directors at the time of grant. Generally, options vest over four years. All options expire no later than ten years from the date of grant. Restricted stock is subject to time vesting. For the six months ended June 30, 2021, the Company granted 350,750 shares of nonqualified stock options and 187,325 shares of restricted stock. The fair value of restricted stock awards that vested was $1,749,000 as of June 30, 2021. There were 1,940,811 shares available for the issuance of equity awards under the 2013 Plan as of June 30, 2021. Stock option activity under the equity plans is as follows: Weighted Weighted Average Average Remaining Aggregate Number Exercise Contractual Intrinsic Total Stock Options of Shares Price Life (Years) Value Outstanding at January 1, 2021 2,546,821 $ 9.30 Granted 350,750 $ 12.08 Exercised (132,342) $ 5.93 Forfeited or expired (36,766) $ 12.89 Outstanding at June 30, 2021 2,728,463 $ 9.77 5.71 $ 6,286,272 Vested or expected to vest 2,564,755 5.71 $ 5,909,096 Exercisable at June 30, 2021 1,996,727 4.51 $ 5,826,621 Information related to the equity plans for the periods indicated: Six Months Ended June 30, 2021 2020 Intrinsic value of options exercised $ 679,403 $ 2,057,914 Cash received from option exercise $ 784,264 $ 1,489,991 Tax benefit (expense) realized from option exercises $ 57,215 $ 33,783 Weighted average fair value of options granted $ 2.33 $ 1.15 As of June 30, 2021, there was $1,410,000 of total unrecognized compensation cost related to nonvested stock options granted under the equity plans. That cost is expected to be recognized over a weighted-average period of approximately 2.96 years. The fair value of each option grant is estimated on the date of grant using the Black Scholes option pricing model that uses the assumptions noted in the following table, including the weighted average assumptions for the option grants for the periods indicated: Six Months Ended June 30, 2021 2020 Expected life in months(1) 72 72 Volatility(1) 33 % 29 % Weighted average risk-free interest rate(2) 1.10 % 0.53 % Expected dividends(3) 4.30 % 5.71 % (1) The expected life of employee stock options represents the weighted average period the stock options are expected to remain outstanding based on historical experience. Volatility is based on the historical volatility of the stock price over the same period of the expected life of the option. (2) Based on the U.S. Treasury constant maturity interest rate with a term consistent with the expected life of the option granted. (3) Each grant’s dividend yield is calculated by annualizing the most recent quarterly cash dividend and dividing that amount by the market price of the Company’s common stock as of the grant date. Restricted stock activity under the equity plans is as follows: Weighted Average Grant Number Date Fair Total Restricted Stock Award of Shares Value Nonvested shares at January 1, 2021 298,700 $ 10.83 Granted 187,325 $ 12.01 Vested (153,101) $ 11.42 Forfeited or expired (34,358) $ 10.23 Nonvested shares at June 30, 2021 298,566 $ 11.03 As of June 30, 2021, there was $3,201,000 of total unrecognized compensation cost related to nonvested restricted stock awards granted under the equity plans. The cost is expected to be recognized over a weighted-average period of approximately 2.03 years.

Subordinated Debt

Subordinated Debt	6 Months Ended
Subordinated Debt	Jun. 30, 2021
Subordinated Debt
Subordinated Debt	11) Subordinated Debt On May 26, 2017, the Company completed an underwritten public offering of $40,000,000 aggregate principal amount of its fixed-to-floating rate subordinated notes (“Subordinated Debt”) due June 1, 2027. The Subordinated Debt initially bears a fixed interest rate of 5.25% per year. Commencing on June 1, 2022, the interest rate on the Subordinated Debt resets quarterly to the three-month LIBOR rate plus a spread of 336.5 basis points, payable quarterly in arrears. Interest on the Subordinated Debt is payable semi-annually on June 1st and December 1st of each year through June 1, 2022 and quarterly thereafter on March 1st, June 1st, September 1st and December 1st of each year through the maturity date or early redemption date. The Subordinated Debt, net of unamortized issuance costs of LIBOR Transition and Phase–Out

Capital Requirements

Capital Requirements	6 Months Ended
Capital Requirements	Jun. 30, 2021
Capital Requirements
Capital Requirements	12) Capital Requirements The Company and its subsidiary bank are subject to various regulatory capital requirements administered by the banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory—and possibly additional discretionary—actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements and operations. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and HBC must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off balance sheet items as calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. There are no conditions or events since June 30, 2021, that management believes have changed the categorization of the Company or HBC as “well-capitalized.” The Company’s consolidated capital ratios and the HBC’s capital ratios exceeded the regulatory guidelines for a well-capitalized financial institution under the Basel III regulatory requirements at June 30, 2021. As permitted by the interim final rule issued on March 27, 2020 by our federal regulatory agency, we elected the option to delay the estimated impact of the adoption of the CECL Standard in our regulatory capital for two years. This two-year delay is in addition to the three-year transition period the agency had already made available. The adoption will delay the effects of CECL on our regulatory capital for the next two years, after which the effects will be phased-in over a three-year period from January 1, 2022 through December 31, 2024, with 75% recognized in 2022, 50% recognized in 2023, and 25% recognized in 2024. Under the interim final rule, the amount of adjustments to regulatory capital deferred until the phase-in period includes both the initial impact of adoption of the CECL Standard at January 1, 2020 and 25% of subsequent changes in our allowance for credit losses during each quarter of the two-year period ending December 31, 2021. Quantitative measures established by regulation to help ensure capital adequacy require the Company and HBC to maintain minimum amounts and ratios (set forth in the tables below) of total, Tier 1 capital, and common equity Tier 1 capital (as defined in the regulations) to risk weighted assets (as defined), and of Tier 1 capital to average assets (as defined). Management believes that, as of June 30, 2021 and December 31, 2020, the Company and HBC met all capital adequacy guidelines to which they were subject. The Company’s consolidated capital amounts and ratios are presented in the following table, together with capital adequacy requirements, under the Basel III regulatory requirements as of June 30, 2021 and December 31, 2020. Required For Capital Adequacy Purposes Actual Under Basel III Amount Ratio Amount Ratio (1) (Dollars in thousands) As of June 30, 2021 Total Capital $ 491,475 15.6 % $ 329,965 10.5 % (to risk-weighted assets) Tier 1 Capital $ 418,134 13.3 % $ 267,115 8.5 % (to risk-weighted assets) Common Equity Tier 1 Capital $ 418,134 13.3 % $ 219,977 7.0 % (to risk-weighted assets) Tier 1 Capital $ 418,134 8.6 % $ 194,156 4.0 % (to average assets) (1) Includes 2.5% capital conservation buffer, except the Tier 1 Capital to average assets ratio. Required For Capital Adequacy Purposes Actual Under Basel III Amount Ratio Amount Ratio (1) (Dollars in thousands) As of December 31, 2020 Total Capital $ 483,870 16.5 % $ 307,067 10.5 % (to risk-weighted assets) Tier 1 Capital $ 410,307 14.0 % $ 248,578 8.5 % (to risk-weighted assets) Common Equity Tier 1 Capital $ 410,307 14.0 % $ 204,711 7.0 % (to risk-weighted assets) Tier 1 Capital $ 410,307 9.1 % $ 180,281 4.0 % (to average assets) (2) Includes 2.5% capital conservation buffer, except the Tier 1 Capital to average assets ratio. HBC’s actual capital amounts and ratios are presented in the following table, together with capital adequacy requirements, under the Basel III regulatory requirements as of June 30, 2021, and December 31, 2020. Required For Capital To Be Well-Capitalized Adequacy Under Basel III PCA Regulatory Purposes Actual Requirements Under Basel III Amount Ratio Amount Ratio Amount Ratio (1) (Dollars in thousands) As of June 30, 2021 Total Capital $ 469,701 15.0 % $ 314,070 10.0 % $ 329,773 10.5 % (to risk-weighted assets) Tier 1 Capital $ 436,192 13.9 % $ 251,256 8.0 % $ 266,959 8.5 % (to risk-weighted assets) Common Equity Tier 1 Capital $ 436,192 13.9 % $ 204,145 6.5 % $ 219,849 7.0 % (to risk-weighted assets) Tier 1 Capital $ 436,192 9.0 % $ 242,600 5.0 % $ 194,080 4.0 % (to average assets) (1) Includes 2.5% capital conservation buffer, except the Tier 1 Capital to average assets ratio. Required For Capital To Be Well-Capitalized Adequacy Under Basel III PCA Regulatory Purposes Actual Requirements Under Basel III Amount Ratio Amount Ratio Amount Ratio (1) (Dollars in thousands) As of December 31, 2020 Total Capital $ 461,933 15.8 % $ 292,258 10.0 % $ 306,871 10.5 % (to risk-weighted assets) Tier 1 Capital $ 428,109 14.6 % $ 233,806 8.0 % $ 248,419 8.5 % (to risk-weighted assets) Common Equity Tier 1 Capital $ 428,109 14.6 % $ 189,968 6.5 % $ 204,580 7.0 % (to risk-weighted assets) Tier 1 Capital $ 428,109 9.5 % $ 225,263 5.0 % $ 180,211 4.0 % (to average assets) (1) Includes 2.5% capital conservation buffer, except the Tier 1 Capital to average assets ratio. The Subordinated Debt, net of unamortized issuance costs, totaled $39,832,000 at June 30, 2021, and qualifies as Tier 2 capital for the Company under the guidelines established by the Federal Reserve Bank. Under California General Corporation Law, the holders of common stock are entitled to receive dividends when and as declared by the Board of Directors, out of funds legally available. The California Financial Code provides that a state licensed bank may not make a cash distribution to its shareholders in excess of the lesser of the following: (i) the bank’s retained earnings; or (ii) the bank’s net income for its last three fiscal years, less the amount of any distributions made by the bank to its shareholders during such period. However, a bank, with the prior approval of the Commissioner of the California Department of Financial Protection and Innovation (“DFPI”) may make a distribution to its shareholders of an amount not to exceed the greater of (i) a bank’s retained earnings; (ii) its net income for its last fiscal year; or (iii) its net income for the current fiscal year. Also with the prior approval of the Commissioner of the DBO and the shareholders of the bank, the bank may make a distribution to its shareholders, as a reduction in capital of the bank. In the event that the Commissioner determines that the shareholders’ equity of a bank is inadequate or that the making of a distribution by a bank would be unsafe or unsound, the Commissioner may order a bank to refrain from making such a proposed distribution. As June 30, 2021, HBC would not be required to obtain regulatory approval, and the amount available for cash dividends is $35,173,000. Similar restrictions applied to the amount and sum of loan advances and other transfers of funds from HBC to the parent company. HBC distributed to HCC dividends of $8,000,000, during the second and first quarters of 2021, for a total of $16,000,000.

Commitments and Loss Contingenc

Commitments and Loss Contingencies	6 Months Ended
Commitments and Loss Contingencies	Jun. 30, 2021
Commitments and Loss Contingencies
Commitments and Loss Contingencies	13) Commitments and Loss Contingencies Loss Contingencies Within the ordinary course of our business, we are subject to private lawsuits, government audits, administrative proceedings and other claims. A number of these claims may exist at any given time, and some of the claims may be pled as class actions. We could be affected by adverse publicity and litigation costs resulting from such allegations, regardless of whether they are valid or whether we are legally determined to be liable. A summary of proceedings outstanding at June 30, 2021 follows: ● In January and February 2019, Double Jump, Inc. and a number of its affiliates (collectively, the “DC Solar Debtors”) each commenced bankruptcy cases in the United States Bankruptcy Court of Nevada. The chapter 7 trustee of the DC Solar Debtors had indicated that it may bring an adversary action against Heritage related to our former deposit relationships with the DC Solar Debtors and their sponsored investment funds. The Bank entered into a settlement agreement, dated July 7, 2021 with the trustee. The Bank settled all claims of the trustee against the Bank, its affiliates, past and current employees, including all direct and derivative claims arising out of the Bank’s allegedly negligent handling, supervision and management of depository accounts that were maintained for the DC Solar Debtors and related investment funds. The Bank has denied all liability. The Bank received a full and complete release of the trustee’s claims. The settlement is subject to Bankruptcy Court approval. The hearing for approval is scheduled for September 17, 2021, but is subject to change. The Bank considers the settlement to be an insured event subject to reimbursement by liability insurance. The Bank reserved $4,000,000 toward the settlement amount in the second quarter of 2021, and the Bank will pursue reimbursement from its insurance carriers. All legal fees incurred in connection with the trustee action and the settlement agreement have been expensed to date. ● In December 2020, Solar Eclipse Investment Fund III, et al v. Heritage Bank of Commerce, et al., was filed against Heritage, and others, in the Solano County Superior Court for the State of California (“Solar Eclipse”). Also in December 2020, Solarmore Management Services, Inc. v. Jeff Carpoff et al., (“Solarmore”) filed an amended complaint in the United States District Court for the Eastern District of California against Heritage and others. Both of these cases relate to our former deposit relationships with D.C. Solar and their affiliates (collectively “D.C. Solar”) and its sponsored investment funds. D.C. Solar is a former customer that allegedly perpetrated a Ponzi scheme and declared bankruptcy. These actions seek unspecified damages and are in an early phase. We intend to vigorously defend these actions. ● In November 2020, a former and a then-current bank employee purporting to represent a class of Bank employees, alleged in a lawsuit that the Bank violated the California Labor Code and California Business and Professions Code, by failing to permit required meal and rest breaks, and by failing to provide accurate wage statements, among other claims. The lawsuit seeks unspecified penalties under the California Private Attorneys General Act (“PAGA”) in addition to other monetary payments. In late December 2020 the same former and then-current bank employees filed a lawsuit asserting, as individual employees, causes of action against the Bank for gender discrimination, retaliation, constructive discharge of the former employee, and sexual harassment, among other claims. Plaintiffs allege denial of promotional opportunities, and harassment and discrimination by Bank employees and customers of the Bank. This case is in an early phase. Counsel for the plaintiffs have agreed to pause the litigation of the individual claims while the parties explore mediation. In February 2021, the Bank was notified of another set of PAGA and potential class claims alleged by letter to the California Labor and Workforce Development Agency transmitted on behalf of another former Bank employee. The notice to the California Labor and Workforce Development Agency, which is a prerequisite to a PAGA filing, alleged the same claims, class, and relief requests that are the subject of the lawsuit filed in November 2020, and disclosed no new claims. The former employee has also threatened individual claims similar to the other two former employees. Counsel for the plaintiffs have agreed to explore mediation of the threatened individual claims. We intend to vigorously defend the filed class and PAGA complaint, the action filed by the employees as individuals, any subsequent related class action and PAGA filing, and any action filed by the former employee on whose behalf the draft complaint was provided. The Company makes a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least quarterly and adjusted to reflect the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter. The outcomes of legal proceedings and other contingencies are, however, inherently unpredictable and subject to significant uncertainties. As a result, the Company is not able to reasonably estimate the amount or range of possible losses, including losses that could arise as a result of application of non-monetary remedies, with respect to the contingencies it faces, and the Company’s estimates may not prove to be accurate. At this time, we believe that the amount of reasonably possible losses resulting from final disposition of any pending lawsuits, audits, proceedings and claims will not have a material adverse effect individually or in the aggregate on our financial position, results of operations or liquidity. It is possible, however, that our future results of operations for a particular quarter or fiscal year could be impacted by changes in circumstances relating to lawsuits, audits, proceedings or claims. Legal costs related to such claims are expensed as incurred. Off-Balance Sheet Arrangements In the normal course of business the Company makes commitments to extend credit to its customers as long as there are no violations of any conditions established in the contractual arrangements. These commitments are obligations that represent a potential credit risk to the Company, but are not reflected on the Company’s consolidated balance sheets. Total unused commitments to extend credit were $1,168,495,000 at June 30, 2021, and $1,114,193,000 at December 31, 2020. Unused commitments represented 41% outstanding gross loans at June 30, 2021, 43% at June 30, 2020, and 42% at December 31, 2020. The effect on the Company’s revenues, expenses, cash flows and liquidity from the unused portion of the commitments to provide credit cannot be reasonably predicted because there is no certainty that lines of credit and letters of credit will ever be fully utilized. The following table presents the Company’s commitments to extend credit for the periods indicated: June 30, 2021 December 31, 2020 Fixed Variable Fixed Variable Rate Rate Total Rate Rate Total (Dollars in thousands) Unused lines of credit and commitments to make loans $ 131,878 $ 1,018,383 $ 1,150,261 $ 121,560 $ 970,614 $ 1,092,174 Standby letters of credit 2,877 15,357 18,234 3,049 18,970 22,019 $ 134,755 $ 1,033,740 $ 1,168,495 $ 124,609 $ 989,584 $ 1,114,193 For the six months ended June 30, 2021, there was an increase of $23,000 to the allowance for credit losses on the Company’s off-balance sheet credit exposures. The increase in the allowance for credit losses for off-balance sheet credit exposures in the first six months of 2021 was driven by an increase in unused loan commitments. The allowance for credit losses on the Company’s off-balance sheet credit exposures was $1,101,000 at June 30, 2021 and $1,078,000 at December 31, 2020.

Revenue Recognition

Revenue Recognition	6 Months Ended
Revenue Recognition	Jun. 30, 2021
Revenue Recognition
Revenue Recognition	14) Revenue Recognition On January 1, 2018, the Company adopted ASU No. 2014-09 (Topic 606) change significantly upon adoption of Topic 606. Substantially all of the Company’s revenue is generated from contracts with customers. The following noninterest income revenue streams are in-scope of Topic 606: Service charges and fees on deposit accounts consist of account analysis fees (i.e., net fees earned on analyzed business and public checking accounts), monthly service fees, check orders, and other deposit account related fees. We sometimes charge customers fees that are not specifically related to the customer accessing its funds, such as account maintenance or dormancy fees. The amount of deposit fees assessed varies based on a number of factors, such as the type of customer and account, the quantity of transactions, and the size of the deposit balance. We charge, and in some circumstances do not charge, fees to earn additional revenue and influence certain customer behavior. An example would be where we do not charge a monthly service fee, or do not charge for certain transactions, for customers that have a high deposit balance. Deposit fees are considered either transactional in nature (such as wire transfers, nonsufficient fund fees, and stop payment orders) or non-transactional (such as account maintenance and dormancy fees). These fees are recognized as earned or as transactions occur and services are provided. Check orders and other deposit account related fees are largely transactional based and, therefore, the Company’s performance obligation is satisfied, and related revenue recognized, at a point in time. Payment for service charges on deposit accounts is primarily received immediately or in the following month through a direct charge to customers’ accounts. The Company currently accounts for sales of foreclosed assets in accordance with Topic 360-20. In most cases the Company will seek to engage a real estate agent for the sale of foreclosed assets immediately upon foreclosure. However, in some cases, where there is clear demand for the property in question, the Company may elect to allow for a marketing period on no more than six months to attempt a direct sale of the property. We generally recognize the sale, and any associated gain or loss, of a real estate property when control of the property transfers. Any gains or losses from the sale are recorded to noninterest income/expense. The following presents noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the periods indicated: Three Months Ended June 30, 2021 2020 (Dollars in thousands) Noninterest Income In-scope of Topic 606: Service charges and fees on deposit accounts $ 659 $ 650 Gain on the disposition of foreclosed assets — — Total noninterest income in-scope of Topic 606 659 650 Noninterest Income Out-of-scope of Topic 606 1,510 1,428 Total noninterest income $ 2,169 $ 2,078 Six Months Ended June 30, 2021 2020 (Dollars in thousands) Noninterest Income In-scope of Topic 606: Service charges and fees on deposit accounts $ 1,260 $ 1,619 Gain on the disposition of foreclosed assets — 791 Total noninterest income in-scope of Topic 606 1,260 2,410 Noninterest Income Out-of-scope of Topic 606 3,210 2,861 Total noninterest income $ 4,470 $ 5,271

Noninterest Expense

Noninterest Expense	6 Months Ended
Noninterest Expense	Jun. 30, 2021
Noninterest Expense
Noninterest Expense	15) Noninterest Expense The following table sets forth the various components of the Company’s noninterest expense for the periods indicated: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Salaries and employee benefits $ 12,572 $ 12,300 $ 26,530 $ 26,503 Reserve for legal settlement 4,000 — 4,000 — Occupancy and equipment 2,247 1,766 4,521 3,538 Professional fees 1,771 1,155 3,490 2,590 Amortization of intangible assets 754 964 1,487 1,822 Insurance expense 661 516 1,324 1,034 Data processing 583 779 1,117 1,755 Software subscriptions 501 746 977 1,635 Other 2,686 2,786 5,573 7,909 Total noninterest expense $ 25,775 $ 21,012 $ 49,019 $ 46,786 The following table presents the merger-related costs included in other and salaries and employee benefits by category for the periods indicated: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Salaries and employee benefits $ — $ — $ — $ 356 Other (24) 59 34 2,127 Total merger-related costs $ (24) $ 59 $ 34 $ 2,483

Leases

Leases	6 Months Ended
Leases	Jun. 30, 2021
Leases
Leases	16) Leases The Company recognizes the following for all leases, at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use (“ROU”) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The Company is impacted as a lessee of the offices and real estate used for operations. The Company's lease agreements include liabilities The following table presents the quantitative information for the Company’s leases for the periods indicated: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Operating Lease Cost (Cost resulting from lease payments) $ 1,621 $ 1,733 $ 3,292 $ 3,502 Operating Lease - Operating Cash Flows (Fixed Payments) $ 1,220 $ 1,379 $ 2,406 $ 2,570 Operating Lease - ROU assets $ 36,601 $ 37,137 $ 36,601 $ 37,137 Operating Lease - Liabilities $ 36,601 $ 37,137 $ 36,601 $ 37,137 Weighted Average Lease Term - Operating Leases 7.79 yrs 8.50 years 7.79 yrs 8.50 years Weighted Average Discount Rate - Operating Leases 4.48% 4.53% 4.48% 4.53% The following maturity analysis shows the undiscounted cash flows due on the Company’s operating lease liabilities: (Dollars in thousands) 2021 remaining $ 2,998 2022 6,353 2023 5,724 2024 5,341 2025 4,929 Thereafter 19,011 Total undiscounted cash flows 44,356 Discount on cash flows (7,755) Total lease liability $ 36,601

Business Segment Information

Business Segment Information	6 Months Ended
Business Segment Information	Jun. 30, 2021
Business Segment Information
Business Segment Information	17) Business Segment Information The following presents the Company’s operating segments. The Company operates through two business segments: Banking segment and Factoring segment. Transactions between segments consist primarily of borrowed funds. Intersegment interest expense is allocated to the Factoring segment based on the Company’s prime rate and funding costs. The provision for credit losses on loans is allocated based on the segment’s allowance for loan loss determination which considers the effects of charge-offs. Noninterest income and expense directly attributable to a segment are assigned to it. Taxes are paid on a consolidated basis and allocated for segment purposes. The Factoring segment includes only factoring originated by Bay View Funding. Three Months Ended June 30, 2021 Banking (1) Factoring Consolidated (Dollars in thousands) Interest income $ 33,860 $ 2,772 $ 36,632 Intersegment interest allocations 202 (202) — Total interest expense 1,756 — 1,756 Net interest income 32,306 2,570 34,876 Provision for (recapture of) credit losses on loans (486) (7) (493) Net interest income after provision 32,792 2,577 35,369 Noninterest income 2,049 120 2,169 Noninterest expense 24,331 1,444 25,775 Intersegment expense allocations 127 (127) — Income before income taxes 10,637 1,126 11,763 Income tax expense 2,617 333 2,950 Net income $ 8,020 $ 793 $ 8,813 Total assets $ 5,003,894 $ 68,981 $ 5,072,875 Loans, net of deferred fees $ 2,777,685 $ 47,111 $ 2,824,796 Goodwill $ 154,587 $ 13,044 $ 167,631 Three Months Ended June 30, 2020 Banking (1) Factoring Consolidated (Dollars in thousands) Interest income $ 34,570 2,562 $ 37,132 Intersegment interest allocations 218 (218) — Total interest expense 2,192 — 2,192 Net interest income 32,596 2,344 34,940 Provision for credit losses on loans 1,107 7 1,114 Net interest income after provision 31,489 2,337 33,826 Noninterest income 1,883 195 2,078 Noninterest expense 19,336 1,676 21,012 Intersegment expense allocations 106 (106) — Income before income taxes 14,142 750 14,892 Income tax expense 4,052 222 4,274 Net income $ 10,090 $ 528 $ 10,618 Total assets $ 4,546,199 $ 68,202 $ 4,614,401 Loans, net of deferred fees $ 2,644,480 $ 41,909 $ 2,686,389 Goodwill $ 154,587 $ 13,044 $ 167,631 (1) Includes the holding company’s results of operations Six Months Ended June 30, 2021 Banking (1) Factoring Consolidated (Dollars in thousands) Interest income $ 67,971 $ 5,422 $ 73,393 Intersegment interest allocations 413 (413) — Total interest expense 3,559 — 3,559 Net interest income 64,825 5,009 69,834 Provision for (recapture of) credit losses on loans (1,949) (56) (2,005) Net interest income after provision 66,774 5,065 71,839 Noninterest income 4,209 261 4,470 Noninterest expense 46,228 2,791 49,019 Intersegment expense allocations 233 (233) — Income before income taxes 24,988 2,302 27,290 Income tax expense 6,593 680 7,273 Net income $ 18,395 $ 1,622 $ 20,017 Total assets $ 5,003,894 $ 68,981 $ 5,072,875 Loans, net of deferred fees $ 2,777,685 $ 47,111 $ 2,824,796 Goodwill $ 154,587 $ 13,044 $ 167,631 Six Months Ended June 30, 2020 Banking (1) Factoring Consolidated (Dollars in thousands) Interest income $ 72,635 $ 5,439 $ 78,074 Intersegment interest allocations 502 (502) — Total interest expense 4,554 — 4,554 Net interest income 68,583 4,937 73,520 Provision for credit losses on loans 13,981 403 14,384 Net interest income after provision 54,602 4,534 59,136 Noninterest income 4,906 365 5,271 Noninterest expense 43,519 3,267 46,786 Intersegment expense allocations 235 (235) — Income before income taxes 16,224 1,397 17,621 Income tax expense 4,729 413 5,142 Net income $ 11,495 $ 984 $ 12,479 Total assets $ 4,546,199 $ 68,202 $ 4,614,401 Loans, net of deferred fees $ 2,644,480 $ 41,909 $ 2,686,389 Goodwill $ 154,587 $ 13,044 $ 167,631 (1) Includes the holding company’s results of operations

Subsequent Events

Subsequent Events	6 Months Ended
Subsequent Events	Jun. 30, 2021
Subsequent Events
Subsequent Events	18) Subsequent Events On July 22, 2021, the Company announced that its Board of Directors declared a $0.13 per share quarterly cash dividend to holders of common stock. The dividend will be payable on August 26, 2021, to shareholders of record at close of business day on August 12, 2021.

Basis of Presentation (Policies

Basis of Presentation (Policies)	6 Months Ended
Basis of Presentation (Policies)	Jun. 30, 2021
Basis of Presentation
Basis of Presentation	Basis of Presentation The unaudited consolidated financial statements of Heritage Commerce Corp (the “Company” or “HCC”) and its wholly owned subsidiary, Heritage Bank of Commerce (the “Bank” or “HBC”), have been prepared pursuant to the rules and regulations for reporting on Form 10-Q. Accordingly, certain information and notes required by accounting principles generally accepted in the United States of America (“GAAP”) for annual financial statements are not included herein. The interim statements should be read in conjunction with the consolidated financial statements and notes that were included in the Company’s Form 10-K for the year ended December 31, 2020. HBC is a commercial bank serving customers primarily located in Alameda, Contra Costa, Marin, San Benito, San Francisco, San Mateo, and Santa Clara counties of California. CSNK Working Capital Finance Corp. a California corporation, dba Bay View Funding (“Bay View Funding”) is a wholly owned subsidiary of HBC, and provides business-essential working capital factoring financing to various industries throughout the United States. No customer accounts for more than 10% of revenue for HBC or the Company. The Company reports its results for two segments: banking and factoring. The Company’s management uses segment results in its operating and strategic planning. In management’s opinion, all adjustments necessary for a fair presentation of these consolidated financial statements have been included and are of a normal and recurring nature. All intercompany transactions and balances have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ significantly from these estimates. Material estimates that are particularly susceptible to significant change include the determination of the allowance for credit losses and any impairment of goodwill or intangible assets. It is reasonably possible the Company’s estimate of the allowance for credit losses and evaluation of impairment of goodwill or intangible assets could change as a result of the continued impact of the COVID-19 pandemic on the economy. The resulting change in these estimates could be material to the Company’s consolidated financial statements. The results for the three and six months ended June 30, 2021 are not necessarily indicative of the results expected for any subsequent period or for the entire year ending December 31, 2021.
Capital and Liquidity	Capital and Liquidity While the Company believes that it has sufficient capital to withstand an extended economic recession brought about by COVID-19, its reported and regulatory capital ratios could be adversely impacted by credit losses. The Company relies on cash on hand as well as dividends from its subsidiary bank to service its debt. If the Company’s capital deteriorates such that its subsidiary bank is unable to pay dividends to it for an extended period of time, the Company may not be able to service its debt. The Company maintains access to multiple sources of liquidity. Wholesale funding markets have remained open to us. If funding costs are elevated for an extended period of time, it could have an adverse effect on the Company’s net interest margin. If an extended recession caused large numbers of the Company’s deposit customers to withdraw their funds, the Company might become more reliant on volatile or more expensive sources of funding.
Asset Valuation	Asset Valuation The extent to which the COVID-19 pandemic will impact our business, results of operations and financial condition will depend on future developments, which are highly uncertain and difficult to predict. Those developments and factors include the duration and spread of the pandemic, its severity, the actions to contain the pandemic or address its impact, and how quickly and to what extent normal economic and operating conditions can resume. We do not yet know the full extent of the impact. However, the effects could have a material adverse impact on our business, asset valuations, financial condition and results of operations. Material adverse impacts may include all or a combination of valuation impairments on our intangible assets, investments, loans, or deferred tax assets.
Reclassifications	Reclassifications Certain reclassifications of prior year balances have been made to conform to the current year presentation. These reclassifications had no impact on the Company’s consolidated financial position, results of operations or net change in cash and cash equivalents.
Adoption of New Accounting Standards	Adoption of New Accounting Standards In December 2019, the FASB issued Accounting Standards Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes to simplify various aspects of the current guidance to promote consistent application of the standard among reporting entities by moving certain exceptions to the general principles. The amendments are effective as of January 1, 2021 and had no material impact on the consolidated financial statements.
Accounting Guidance Issued But Not Yet Adopted	Accounting Guidance Issued But Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides temporary, optional guidance to ease the potential burden in accounting for, or recognizing the effects of, the transition away from the LIBOR or other interbank offered rate on financial reporting. To help with the transition to new reference rates, the ASU provides optional expedients and exceptions for applying GAAP to affected contract modifications and hedge accounting relationships. The main provisions include: ● A change in a contract’s reference interest rate would be accounted for as a continuation of that contract rather than as the creation of a new one for contracts, including loans, debt, leases, and other arrangements, that meet specific criteria. ● When updating its hedging strategies in response to reference rate reform, an entity would be allowed to preserve its hedge accounting. The guidance is applicable only to contracts or hedge accounting relationships that reference LIBOR or another reference rate expected to be discontinued. Because the guidance is meant to help entities through the transition period, it will be in effect for a limited time and will not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, for which an entity has elected certain optional expedients that are retained through the end of the hedging relationship. The amendments in this ASU are effective March 12, 2020 through December 31, 2022. ASU 2020-04 permits relief solely for reference rate reform actions and permits different elections over the effective date for legacy and new activity. Accordingly, the Company is evaluating and reassessing the elections on a quarterly basis. For current elections in effect regarding the assertion of the probability of forecasted transactions, the Company elects the expedient to assert the probability of the hedged interest payments and receipts regardless of any expected modification in terms related to reference rate reform. The Company believes the adoption of this guidance on activities subsequent to December 31, 2020 through December 31, 2022 will not have a material impact on the consolidated financial statements.
London Inter-Bank Offered Rate ("LIBOR") Transition and Phase-Out	London Inter-Bank Offered Rate (“LIBOR”) Transition and Phase-Out We have loans and borrowings that are tied to LIBOR benchmark interest rates. It is anticipated that the LIBOR index will be phased-out by the end of 2021 and the Federal Reserve Bank of New York has established the Secured Overnight Financing Rate (“SOFR”) as its recommended alternative to LIBOR. We have created a sub-committee of our Asset Liability Management Committee to address LIBOR transition and phase-out issues. We are currently reviewing loan documentation, technology systems and procedures we will need to implement for the transition. We do not expect the transition to have a material impact to the financial statements.

Earnings Per Share (Tables)

Earnings Per Share (Tables)	6 Months Ended
Earnings Per Share (Tables)	Jun. 30, 2021
Shareholders' Equity and Earnings Per Share
Schedule of reconciliation of factors used in computing basic and diluted earnings per common share	Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands, except per share amounts) Net income $ 8,813 $ 10,618 $ 20,017 $ 12,479 Weighted average common shares outstanding for basic earnings per common share 60,089,327 59,420,592 60,008,071 59,353,759 Dilutive potential common shares 640,814 691,831 564,386 798,728 Shares used in computing diluted earnings per common share 60,730,141 60,112,423 60,572,457 60,152,487 Basic earnings per share $ 0.15 $ 0.18 $ 0.33 $ 0.21 Diluted earnings per share $ 0.15 $ 0.18 $ 0.33 $ 0.21

Accumulated Other Comprehensi_2

Accumulated Other Comprehensive Income ("AOCI") (Tables)	6 Months Ended
Accumulated Other Comprehensive Income ("AOCI") (Tables)	Jun. 30, 2021
Accumulated Other Comprehensive Income ("AOCI")
Schedule of changes in AOCI by component	Three Months Ended June 30, 2021 and 2020 Unamortized Unrealized Unrealized Gain on Gains (Losses) on Available- Available- for-Sale Defined for-Sale Securities Benefit Securities Reclassified Pension and I/O to Held-to- Plan Strips Maturity Items(1) Total (Dollars in thousands) Beginning balance April 1, 2021, net of taxes $ 3,327 $ 252 $ (14,847) $ (11,268) Other comprehensive income (loss) before reclassification, net of taxes (454) — 51 (403) Amounts reclassified from other comprehensive income (loss), net of taxes — (9) 148 139 Net current period other comprehensive income (loss), net of taxes (454) (9) 199 (264) Ending balance June 30, 2021, net of taxes $ 2,873 $ 243 $ (14,648) $ (11,532) Beginning balance April 1, 2020, net of taxes $ 6,627 $ 289 $ (11,625) $ (4,709) Other comprehensive loss before reclassification, net of taxes (395) — (10) (405) Amounts reclassified from other comprehensive income (loss), net of taxes (120) (9) 63 (66) Net current period other comprehensive income (loss), net of taxes (515) (9) 53 (471) Ending balance June 30, 2020, net of taxes $ 6,112 $ 280 $ (11,572) $ (5,180) (1) This AOCI component is included in the computation of net periodic benefit cost (see Note 8—Benefit Plans) and includes split-dollar life insurance benefit plan. Six Months Ended June 30, 2021 and 2020 Unamortized Unrealized Unrealized Gain on Gains (Losses) on Available- Available- for-Sale Defined for-Sale Securities Benefit Securities Reclassified Pension and I/O to Held-to- Plan Strips Maturity Items(1) Total (Dollars in thousands) Beginning balance January 1, 2021, net of taxes $ 3,929 $ 261 $ (14,907) $ (10,717) Other comprehensive loss before reclassification, net of taxes (1,056) — (2) (1,058) Amounts reclassified from other comprehensive income (loss), net of taxes — (18) 261 243 Net current period other comprehensive income (loss), net of taxes (1,056) (18) 259 (815) Ending balance June 30, 2021, net of taxes $ 2,873 $ 243 $ (14,648) $ (11,532) Beginning balance January 1, 2020, net of taxes $ 1,602 $ 298 $ (11,678) $ (9,778) Other comprehensive income (loss) before reclassification, net of taxes 4,701 — (6) 4,695 Amounts reclassified from other comprehensive income (loss), net of taxes (191) (18) 112 (97) Net current period other comprehensive income (loss), net of taxes 4,510 (18) 106 4,598 Ending balance June 30, 2020, net of taxes $ 6,112 $ 280 $ (11,572) $ (5,180) (1) This AOCI component is included in the computation of net periodic benefit cost (see Note 8—Benefit Plans) and includes split-dollar life insurance benefit plan.
Schedule of reclassifications out of AOCI into net income	Amounts Reclassified from AOCI Three Months Ended June 30, Affected Line Item Where Details About AOCI Components 2021 2020 Net Income is Presented (Dollars in thousands) Unrealized gains on available-for-sale securities and I/O strips $ — $ 170 Gain on sales of securities — (50) Income tax expense — 120 Net of tax Amortization of unrealized gain on securities available- for-sale that were reclassified to securities held-to-maturity 13 13 Interest income on taxable securities (4) (4) Income tax expense 9 9 Net of tax Amortization of defined benefit pension plan items (1) Prior transition obligation and acturial losses (2) 1 15 Prior service cost and actuarial losses (3) (211) (105) (210) (90) Other noninterest expense 62 27 Income tax benefit (148) (63) Net of tax Total reclassification for the period $ (139) $ 66 Amounts Reclassified from AOCI Six Months Ended June 30, Affected Line Item Where Details About AOCI Components 2021 2020 Net Income is Presented (Dollars in thousands) Unrealized gains on available-for-sale securities and I/O strips $ — $ 270 Gain on sales of securities — (79) Income tax expense — 191 Net of tax Amortization of unrealized gain on securities available-for-sale that were reclassified to securities held-to-maturity 26 26 Interest income on taxable securities (8) (8) Income tax expense 18 18 Net of tax Amortization of defined benefit pension plan items (1) Prior transition obligation and actuarial losses (2) 2 30 Actuarial losses (3) (372) (190) (370) (160) Other noninterest expense 109 48 Income tax benefit (261) (112) Net of tax Total reclassification from AOCI for the period $ (243) $ 97 (1) This AOCI component is included in the computation of net periodic benefit cost (see Note 8—Benefit Plans). (2) This is related to the split dollar life insurance benefit plan. (3) This is related to the supplemental executive retirement plan.

Securities (Tables)

Securities (Tables)	6 Months Ended
Securities (Tables)	Jun. 30, 2021
Securities
Schedule of amortized cost and estimated fair value of securities	Gross Gross Allowance Estimated Amortized Unrealized Unrealized for Credit Fair June 30, 2021 Cost Gains (Losses) Losses Value (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ 126,682 $ 4,210 $ — $ — $ 130,892 U.S. Treasury 14,969 94 — — 15,063 Total $ 141,651 $ 4,304 $ — $ — $ 145,955 Gross Gross Estimated Allowance Amortized Unrecognized Unrecognized Fair for Credit June 30, 2021 Cost Gains (Losses) Value Losses (Dollars in thousands) Securities held-to-maturity: Agency mortgage-backed securities $ 361,184 $ 5,330 $ (1,121) $ 365,393 $ — Municipals - exempt from Federal tax 60,153 1,209 — 61,362 (51) Total $ 421,337 $ 6,539 $ (1,121) $ 426,755 $ (51) Gross Gross Allowance Estimated Amortized Unrealized Unrealized for Credit Fair December 31, 2020 Cost Gains (Losses) Losses Value (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ 170,215 $ 5,111 $ — $ — $ 175,326 U.S. Treasury 59,797 651 — — 60,448 Total $ 230,012 $ 5,762 $ — $ — $ 235,774 Gross Gross Estimated Allowance Amortized Unrecognized Unrecognized Fair for Credit December 31, 2020 Cost Gains (Losses) Value Losses (Dollars in thousands) Securities held-to-maturity: Agency mortgage-backed securities $ 228,652 $ 6,075 $ (230) $ 234,497 $ — Municipals - exempt from Federal tax 68,791 1,639 — 70,430 (54) Total $ 297,443 $ 7,714 $ (230) $ 304,927 $ (54)
Schedule of securities with unrealized losses	Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized June 30, 2021 Value (Losses) Value (Losses) Value (Losses) (Dollars in thousands) Securities held-to-maturity: Agency mortgage-backed securities $ 67,111 $ (1,121) $ — $ — $ 67,111 $ (1,121) Total $ 67,111 $ (1,121) $ — $ — $ 67,111 $ (1,121) Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2020 Value (Losses) Value (Losses) Value (Losses) (Dollars in thousands) Securities held-to-maturity: Agency mortgage-backed securities $ 30,930 $ (230) $ — $ — $ 30,930 $ (230) Total $ 30,930 $ (230) $ — $ — $ 30,930 $ (230)
Schedule of proceeds from sales of securities and the resulting gains and losses	Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Proceeds $ — $ 30,085 $ — $ 56,598 Gross gains — 170 — 270 Gross losses — — — —
Schedule of amortized cost and estimated fair values of securities, by contractual maturity	Available-for-sale Amortized Estimated Cost Fair Value (Dollars in thousands) Due 3 months or less $ 9,997 $ 10,044 Due after 3 months through one year 4,972 5,019 Agency mortgage-backed securities 126,682 130,892 Total $ 141,651 $ 145,955 Held-to-maturity Amortized Estimated Cost Fair Value (Dollars in thousands) Due after 3 months through one year $ 499 $ 500 Due after one through five years 10,605 10,865 Due after five through ten years 31,284 31,824 Due after ten years 17,765 18,173 Agency mortgage-backed securities 361,184 365,393 Total $ 421,337 $ 426,755
Schedule of roll-forward by major security type of the allowance for credit losses on debt securities held-to-maturity	Municipals (Dollars in thousands) Beginning balance January 1, 2021 $ 54 Provision for (recapture of) credit losses (3) Ending balance June 30, 2021 $ 51

Loans and Allowance for Credi_2

Loans and Allowance for Credit Losses on Loans (Tables)	6 Months Ended
Loans and Allowance for Credit Losses on Loans (Tables)	Jun. 30, 2021
Loans and Allowance for Credit Losses on Loans
Schedule of loans	June 30, December 31, 2021 2020 (Dollars in thousands) Loans held-for-investment: Commercial $ 844,147 $ 846,386 Real estate: CRE - owner occupied 583,091 560,362 CRE - non-owner occupied 742,135 693,103 Land and construction 129,426 144,594 Home equity 107,873 111,885 Multifamily 198,771 166,425 Residential mortgages 205,904 85,116 Consumer and other 21,519 18,116 Loans 2,832,866 2,625,987 Deferred loan fees, net (8,070) (6,726) Loans, net of deferred fees 2,824,796 2,619,261 Allowance for credit losses on loans (43,956) (44,400) Loans, net $ 2,780,840 $ 2,574,861
Schedule of changes in allowance for loan (credit) losses	Changes in the allowance for credit losses on loans were as follows for the periods indicated: Three Months Ended June 30, 2021 CRE CRE Owner Non-owner Land & Home Multi- Residential Consumer Commercial Occupied Occupied Construction Equity Family Mortgage and Other Total (Dollars in thousands) Beginning of period balance $ 11,600 $ 8,368 $ 16,431 $ 2,754 $ 1,171 $ 2,751 $ 918 $ 303 $ 44,296 Charge-offs (105) — — — — — — — (105) Recoveries 115 4 — 68 16 — — 55 258 Net recoveries 10 4 — 68 16 — — 55 153 Provision for (recapture of) credit losses on loans (753) (166) 54 (686) (118) 199 1,050 (73) (493) End of period balance $ 10,857 $ 8,206 $ 16,485 $ 2,136 $ 1,069 $ 2,950 $ 1,968 $ 285 $ 43,956 Three Months Ended June 30, 2020 CRE CRE Owner Non-owner Land & Home Multi- Residential Consumer Commercial Occupied Occupied Construction Equity Family Mortgage and Other Total (Dollars in thousands) Beginning of period balance $ 12,801 $ 7,737 $ 15,645 $ 2,603 $ 1,746 $ 1,622 $ 708 $ 1,841 $ 44,703 Charge-offs (465) - - - - - - - (465) Recoveries 46 1 - 13 31 - - 1 92 Net (charge-offs) recoveries (419) 1 - 13 31 - - 1 (373) Provision for (recapture of) credit losses on loans 797 809 (196) (64) 74 206 117 (629) 1,114 End of period balance $ 13,179 $ 8,547 $ 15,449 $ 2,552 $ 1,851 $ 1,828 $ 825 $ 1,213 $ 45,444 Six Months Ended June 30, 2021 CRE CRE Owner Non-owner Land & Home Multi- Residential Consumer Commercial Occupied Occupied Construction Equity Family Mortgage and Other Total (Dollars in thousands) Beginning of period balance $ 11,587 $ 8,560 $ 16,416 $ 2,509 $ 1,297 $ 2,804 $ 943 $ 284 $ 44,400 Charge-offs (368) — — — — — — — (368) Recoveries 928 8 — 884 39 — — 70 1,929 Net recoveries 560 8 — 884 39 — — 70 1,561 Provision for (recapture of) credit losses on loans (1,290) (362) 69 (1,257) (267) 146 1,025 (69) (2,005) End of period balance $ 10,857 $ 8,206 $ 16,485 $ 2,136 $ 1,069 $ 2,950 $ 1,968 $ 285 $ 43,956 Six Months Ended June 30, 2020 Owner Non-owner Land & Home Multi- Residential Consumer Commercial Occupied Occupied Construction Equity Family Mortgage and Other Total (Dollars in thousands) Beginning of period balance $ 10,453 $ 3,825 $ 3,760 $ 2,621 $ 2,244 $ 57 $ 243 $ 82 $ 23,285 Adoption of Topic 326 (3,663) 3,169 7,912 (1,163) (923) 1,196 435 1,607 8,570 Balance at adoption on January 1, 2020 6,790 6,994 11,672 1,458 1,321 1,253 678 1,689 31,855 Charge-offs (1,135) — — — — — — (3) (1,138) Recoveries 255 1 — 32 54 — — 1 343 Net (charge-offs) recoveries (880) 1 — 32 54 — — (2) (795) Provision for (recapture of) credit losses on loans 7,269 1,552 3,777 1,062 476 575 147 (474) 14,384 End of period balance $ 13,179 $ 8,547 $ 15,449 $ 2,552 $ 1,851 $ 1,828 $ 825 $ 1,213 $ 45,444
Schedule of nonperforming loans by class	June 30, 2021 Restructured Nonaccrual Nonaccrual and Loans with no Specific with Specific over 90 Days Allowance for Allowance for Past Due Credit Credit and Still Losses Losses Accruing Total (Dollars in thousands) Commercial $ 415 $ 1,378 $ 164 $ 1,957 Real estate: CRE - Owner Occupied 1,774 — — 1,774 CRE - Non-Owner Occupied — — 725 725 Home equity 168 — — 168 Multifamily 1,149 — — 1,149 Consumer and other 407 — — 407 Total $ 3,913 $ 1,378 $ 889 $ 6,180 December 31, 2020 Restructured Nonaccrual Nonaccrual and Loans with no Specific with no Specific over 90 Days Allowance for Allowance for Past Due Credit Credit and Still Losses Losses Accruing Total (Dollars in thousands) Commercial $ 752 $ 1,974 $ 81 $ 2,807 Real estate: CRE - Owner Occupied 3,706 — — 3,706 Home equity 949 — — 949 Consumer and other 407 — — 407 Total $ 5,814 $ 1,974 $ 81 $ 7,869
Schedule of aging of past due loans by class of loans	June 30, 2021 30 - 59 60 - 89 90 Days or Days Days Greater Total Past Due Past Due Past Due Past Due Current Total (Dollars in thousands) Commercial $ 4,467 $ 1,187 $ 261 $ 5,915 $ 838,232 $ 844,147 Real estate: CRE - Owner Occupied 1,172 9 1,143 2,324 580,767 583,091 CRE - Non-Owner Occupied 145 — 725 870 741,265 742,135 Land and construction — — — — 129,426 129,426 Home equity — — — — 107,873 107,873 Multifamily — — — — 198,771 198,771 Residential mortgages — — — — 205,904 205,904 Consumer and other — — 407 407 21,112 21,519 Total $ 5,784 $ 1,196 $ 2,536 $ 9,516 $ 2,823,350 $ 2,832,866 December 31, 2020 30 - 59 60 - 89 90 Days or Days Days Greater Total Past Due Past Due Past Due Past Due Current Total (Dollars in thousands) Commercial $ 3,524 $ 259 $ 392 $ 4,175 $ 842,211 $ 846,386 Real estate: CRE - Owner Occupied 1,133 — 29 1,162 559,200 560,362 CRE - Non-Owner Occupied — 485 — 485 692,618 693,103 Land and construction — — — — 144,594 144,594 Home equity — — — 111,885 111,885 Multifamily — — — — 166,425 166,425 Residential mortgages — — — — 85,116 85,116 Consumer and other — — 407 407 17,709 18,116 Total $ 4,657 $ 744 $ 828 $ 6,229 $ 2,619,758 $ 2,625,987
Summary of loan portfolio by loan type and credit quality classification	Revolving Loans Term Loans Amortized Cost Basis by Originated Period Amortized 2016 and Cost 6/30/2021 12/31/2020 12/31/2019 12/31/2018 12/31/2017 Prior Basis Total (Dollars in thousands) Commercial: Pass $ 302,753 $ 163,815 $ 19,144 $ 15,904 $ 9,543 $ 8,699 $ 307,122 $ 826,980 Special Mention 323 733 - 1,082 447 270 978 3,833 Substandard 1,349 3,337 - 16 452 30 6,357 11,541 Substandard-Nonaccrual 30 1,143 - - - 106 514 1,793 Total 304,455 169,028 19,144 17,002 10,442 9,105 314,971 844,147 CRE - Owner Occupied: Pass 78,046 154,477 74,843 66,269 37,006 135,709 24,038 570,388 Special Mention 531 2,648 680 1,495 770 1,089 - 7,213 Substandard 2,547 - 394 735 40 - 3,716 Substandard-Nonaccrual - 1,774 - - - - - 1,774 Total 78,577 161,446 75,523 68,158 38,511 136,838 24,038 583,091 CRE - Non-Owner Occupied: Pass 131,832 148,179 121,987 55,878 75,126 165,195 22,377 720,574 Special Mention - 2,808 - 2,527 606 6,338 2,165 14,444 Substandard - 5,240 - 1,392 - 485 - 7,117 Substandard-Nonaccrual - - - - - - - - Total 131,832 156,227 121,987 59,797 75,732 172,018 24,542 742,135 Land and construction: Pass 58,297 56,553 4,443 - - 1,321 7,453 128,067 Special Mention - - - - - - - - Substandard 1,359 - - - - - - 1,359 Substandard-Nonaccrual - - - - - - - - Total 59,656 56,553 4,443 - - 1,321 7,453 129,426 Home equity: Pass - - - 61 - - 104,746 104,807 Special Mention - - - - - - 1,932 1,932 Substandard - - - - - 143 823 966 Substandard-Nonaccrual - 107 - - - - 61 168 Total - 107 - 61 - 143 107,562 107,873 Multifamily: Pass 42,576 32,568 37,612 16,321 21,215 35,092 915 186,299 Special Mention - - - - - 10,444 - 10,444 Substandard - 879 - - - - - 879 Substandard-Nonaccrual 1,149 - - - - - - 1,149 Total 43,725 33,447 37,612 16,321 21,215 45,536 915 198,771 Residential mortgage: Pass 137,195 18,204 9,379 3,157 5,129 30,567 960 204,591 Special Mention - - - - - - - - Substandard - - - - - 1,313 - 1,313 Substandard-Nonaccrual - - - - - - - - Total 137,195 18,204 9,379 3,157 5,129 31,880 960 205,904 Consumer and other: Pass - 6 409 1,456 17 1,051 17,953 20,892 Special Mention - - - - - - - - Substandard 20 - - - - - 200 220 Substandard-Nonaccrual - - 407 - - - 407 Total 20 6 409 1,863 17 1,051 18,153 21,519 Total loans $ 755,460 $ 595,018 $ 268,497 $ 166,359 $ 151,046 $ 397,892 $ 498,594 $ 2,832,866 Risk Grades: Pass $ 750,699 $ 573,802 $ 267,817 $ 159,046 $ 148,036 $ 377,634 $ 485,564 $ 2,762,598 Special Mention 854 6,189 680 5,104 1,823 18,141 5,075 37,866 Substandard 2,728 12,003 - 1,802 1,187 2,011 7,380 27,111 Substandard-Nonaccrual 1,179 3,024 - 407 - 106 575 5,291 Grand Total $ 755,460 $ 595,018 $ 268,497 $ 166,359 $ 151,046 $ 397,892 $ 498,594 $ 2,832,866 Revolving Loans Term Loans Amortized Cost Basis by Originated Period Amortized 2015 and Cost 2020 2019 2018 2017 2016 Prior Basis Total (Dollars in thousands) Commercial: Pass $ 431,369 $ 33,350 $ 21,154 $ 13,840 $ 7,341 $ 8,292 $ 296,286 $ 811,632 Special Mention 15,720 716 1,301 953 713 170 1,937 21,510 Substandard 4,036 - 19 758 2,396 73 3,236 10,518 Substandard-Nonaccrual 2,106 56 36 - 115 26 387 2,726 Total 453,231 34,122 22,510 15,551 10,565 8,561 301,846 846,386 CRE - Owner Occupied: Pass 168,224 73,064 68,068 51,705 50,716 109,350 15,964 537,091 Special Mention 3,151 2,568 4,128 783 - 2,569 - 13,199 Substandard 2,561 - 400 2,954 - 451 - 6,366 Substandard-Nonaccrual 3,678 - - - - 28 - 3,706 Total 177,614 75,632 72,596 55,442 50,716 112,398 15,964 560,362 CRE - Non-Owner Occupied: Pass 166,550 128,361 68,796 99,816 57,422 150,683 1,926 673,554 Special Mention 11,930 - 2,557 - - - - 14,487 Substandard 3,166 - 1,411 - 485 - - 5,062 Substandard-Nonaccrual - - - - - - - - Total 181,646 128,361 72,764 99,816 57,907 150,683 1,926 693,103 Land and construction: Pass 114,932 22,054 - - - 1,343 4,906 143,235 Special Mention - - - - - - - - Substandard 1,359 - - - - - - 1,359 Substandard-Nonaccrual - - - - - - - - Total 116,291 22,054 - - - 1,343 4,906 144,594 Home equity: Pass 266 - 74 - - - 109,848 110,188 Special Mention - - - - - - - - Substandard - - - - - 143 605 748 Substandard-Nonaccrual 117 - - - - - 832 949 Total 383 - 74 - - 143 111,285 111,885 Multifamily: Pass 31,481 39,183 17,248 24,572 16,235 30,751 880 160,350 Special Mention - - - - - 5,186 - 5,186 Substandard 889 - - - - - - 889 Substandard-Nonaccrual - - - - - - - - Total 32,370 39,183 17,248 24,572 16,235 35,937 880 166,425 Residential mortgage: Pass 12,798 10,048 3,246 7,324 28,115 15,568 - 77,099 Special Mention 5,089 - 1,630 - - - 6,719 Substandard - - - - - 1,298 - 1,298 Substandard-Nonaccrual - - - - - - - - Total 17,887 10,048 4,876 7,324 28,115 16,866 - 85,116 Consumer and other: Pass 10 522 1,486 20 116 987 14,568 17,709 Special Mention - - - - - - - - Substandard - - - - - - - - Substandard-Nonaccrual - - 407 - - - - 407 Total 10 522 1,893 20 116 987 14,568 18,116 Total loans $ 979,432 $ 309,922 $ 191,961 $ 202,725 $ 163,654 $ 326,918 $ 451,375 $ 2,625,987 Risk Grades:. Pass $ 925,630 $ 306,582 $ 180,072 $ 197,277 $ 159,945 $ 316,974 $ 444,378 $ 2,530,858 Special Mention 35,890 3,284 9,616 1,736 713 7,925 1,937 61,101 Substandard 12,011 - 1,830 3,712 2,881 1,965 3,841 26,240 Substandard-Nonaccrual 5,901 56 443 - 115 54 1,219 7,788 Grand Total $ 979,432 $ 309,922 $ 191,961 $ 202,725 $ 163,654 $ 326,918 $ 451,375 $ 2,625,987
Schedule of amortized cost basis of collateral-dependent loans	The following table presents the amortized cost basis of collateral-dependent loans by loan classification at June 30, 2021: Collateral Type Real Estate Business Property Assets Unsecured Total (Dollars in thousands) Commercial $ 25 $ 1,324 $ 29 $ 1,378 Total $ 25 $ 1,324 $ 29 $ 1,378 The following table presents the amortized cost basis of collateral-dependent loans by loan classification at December 31, 2020: Collateral Type Real Estate Business Property Assets Unsecured Total (Dollars in thousands) Commercial $ 29 $ 1,815 $ 130 $ 1,974 Total $ 29 $ 1,815 $ 130 $ 1,974
Schedule of loans by class modified as troubled debt restructurings	During the Six Months Ended June 30, 2021 Pre-modification Post-modification Number Outstanding Outstanding of Recorded Recorded Troubled Debt Restructurings: Contracts Investment Investment (Dollars in thousands) Commercial 1 $ 3 $ 3 Total 1 $ 3 $ 3 During the Six Months Ended June 30, 2020 Pre-modification Post-modification Number Outstanding Outstanding of Recorded Recorded Troubled Debt Restructurings: Contracts Investment Investment (Dollars in thousands) Commercial 3 $ 13 $ 13 Total 3 $ 13 $ 13

Goodwill and Other Intangible_2

Goodwill and Other Intangible Assets (Tables)	6 Months Ended
Goodwill and Other Intangible Assets (Tables)	Jun. 30, 2021
Goodwill and Other Intangible Assets
Schedule of carrying amount of goodwill by segment	June 30, December 31, 2021 2020 (Dollars in thousands) Banking $ 154,587 $ 154,587 Factoring 13,044 13,044 Total Goodwill $ 167,631 $ 167,631
Summary of Company's intangible assets	June 30, 2021 Gross Carrying Accumulated Amount Amortization Total (Dollars in thousands) Core deposit intangibles $ 25,023 $ (10,567) $ 14,456 Customer relationship and brokered relationship intangibles 1,900 (1,266) 634 Below market leases 770 (683) 87 Total $ 27,693 $ (12,516) $ 15,177 December 31, 2020 Gross Carrying Accumulated Amount Amortization Total (Dollars in thousands) Core deposit intangibles $ 25,023 $ (9,153) $ 15,870 Customer relationship and brokered relationship intangibles 1,900 (1,171) 729 Below market leases 770 (705) 65 Total $ 27,693 $ (11,029) $ 16,664
Schedule of estimated amortization expense	Customer & Below/ Core Brokered (Above) Total Deposit Relationship Market Amortization Year Intangible Intangible Lease Expense (Dollars in thousands) 2021 remaining $ 1,415 $ 95 $ (1) $ 1,509 2022 2,447 190 (2) 2,635 2023 2,217 190 (2) 2,405 2024 2,023 159 5 2,187 2025 1,795 — 18 1,813 Thereafter 4,559 — 69 4,628 $ 14,456 $ 634 $ 87 $ 15,177

Income Taxes (Tables)

Income Taxes (Tables)	6 Months Ended
Income Taxes (Tables)	Jun. 30, 2021
Income Taxes
Summary of carrying amount of low income tax housing investment	June 30, December 31, 2021 2020 (Dollars in thousands) Low income housing investments $ 4,827 $ 5,246 Future commitments $ 596 $ 596

Benefit Plans (Tables)

Benefit Plans (Tables)	6 Months Ended
Benefit Plans (Tables)	Jun. 30, 2021
Supplemental Retirement Plan
Benefit plans
Schedule of components of net periodic benefit cost	Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Components of net periodic benefit cost: Service cost $ 120 $ 123 $ 240 $ 246 Interest cost 190 236 380 467 Amortization of prior service cost 75 — 100 — Amortization of net actuarial loss 136 105 272 190 Net periodic benefit cost $ 521 $ 464 $ 992 $ 903
Split-Dollar Life Insurance Benefit Plan
Benefit plans
Schedule of change in projected benefit obligation	June 30, December 31, 2021 2020 (Dollars in thousands) Change in projected benefit obligation: Projected benefit obligation at beginning of year $ 9,689 $ 8,198 Interest cost 110 246 Actuarial loss — 1,245 Projected benefit obligation at end of period $ 9,799 $ 9,689
Schedule of amounts recognized in accumulated other comprehensive loss	June 30, December 31, 2021 2020 (Dollars in thousands) Net actuarial loss $ 5,217 $ 5,170 Prior transition obligation 925 970 Accumulated other comprehensive loss $ 6,142 $ 6,140
Schedule of components of net periodic benefit cost	Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Amortization of prior transition obligation and actuarial losses $ (1) $ (15) $ (2) $ (30) Interest cost 55 62 110 124 Net periodic benefit cost $ 54 $ 47 $ 108 $ 94

Fair Value (Tables)

Fair Value (Tables)	6 Months Ended
Fair Value (Tables)	Jun. 30, 2021
Fair Value
Schedule of financial assets and liabilities measured on a recurring basis	Fair Value Measurements Using Significant Quoted Prices in Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Balance (Level 1) (Level 2) (Level 3) (Dollars in thousands) Assets at June 30, 2021 Available-for-sale securities: Agency mortgage-backed securities $ 130,892 $ — $ 130,892 $ — U.S. Treasury 15,063 15,063 — — I/O strip receivables 274 — 274 — Assets at December 31, 2020 Available-for-sale securities: Agency mortgage-backed securities $ 175,326 $ — $ 175,326 $ — U.S. Treasury 60,448 60,448 — — I/O strip receivables 305 — 305 —
Schedule of carrying amounts and estimated fair values of financial instruments	Estimated Fair Value Significant Quoted Prices in Other Significant Active Markets for Observable Unobservable Carrying Identical Assets Inputs Inputs Amounts (Level 1) (Level 2) (Level 3) Total (Dollars in thousands) Assets: Cash and cash equivalents $ 1,328,322 $ 1,328,322 $ — $ — $ 1,328,322 Securities available-for-sale 145,955 15,063 130,892 — 145,955 Securities held-to-maturity 421,286 — 426,755 — 426,755 Loans (including loans held-for-sale), net 2,785,184 — 4,344 2,796,339 2,800,683 FHLB stock, FRB stock, and other investments 32,495 — — — N/A Accrued interest receivable 10,397 103 1,510 8,784 10,397 I/O strips receivables 274 — 274 — 274 Liabilities: Time deposits $ 158,644 $ — $ 158,843 $ — $ 158,843 Other deposits 4,185,828 — 4,185,828 — 4,185,828 Subordinated debt 39,832 — 40,432 — 40,432 Accrued interest payable 548 — 548 — 548 Estimated Fair Value Significant Quoted Prices in Other Significant Active Markets for Observable Unobservable Carrying Identical Assets Inputs Inputs Amounts (Level 1) (Level 2) (Level 3) Total (Dollars in thousands) Assets: Cash and cash equivalents $ 1,131,073 $ 1,131,073 $ — $ — $ 1,131,073 Securities available-for-sale 235,774 60,448 175,326 — 235,774 Securities held-to-maturity 297,389 — 304,927 — 304,927 Loans (including loans held-for-sale), net 2,576,560 — 1,699 2,572,993 2,574,692 FHLB stock, FRB stock, and other investments 33,522 — — — N/A Accrued interest receivable 10,546 309 1,512 8,725 10,546 I/O strips receivables 305 — 305 — 305 Liabilities: Time deposits $ 153,407 $ — $ 153,740 $ — $ 153,740 Other deposits 3,761,079 — 3,761,079 — 3,761,079 Subordinated debt 39,740 — 40,340 — 40,340 Accrued interest payable 545 — 545 — 545

Equity Plan (Tables)

Equity Plan (Tables)	6 Months Ended
Equity Plan (Tables)	Jun. 30, 2021
Equity Plan
Schedule of stock option activity under the equity plans	Weighted Weighted Average Average Remaining Aggregate Number Exercise Contractual Intrinsic Total Stock Options of Shares Price Life (Years) Value Outstanding at January 1, 2021 2,546,821 $ 9.30 Granted 350,750 $ 12.08 Exercised (132,342) $ 5.93 Forfeited or expired (36,766) $ 12.89 Outstanding at June 30, 2021 2,728,463 $ 9.77 5.71 $ 6,286,272 Vested or expected to vest 2,564,755 5.71 $ 5,909,096 Exercisable at June 30, 2021 1,996,727 4.51 $ 5,826,621
Schedule of information related to the equity Plan	Six Months Ended June 30, 2021 2020 Intrinsic value of options exercised $ 679,403 $ 2,057,914 Cash received from option exercise $ 784,264 $ 1,489,991 Tax benefit (expense) realized from option exercises $ 57,215 $ 33,783 Weighted average fair value of options granted $ 2.33 $ 1.15
Schedule of assumptions used to estimate the fair value of each option grant on the date of grant	Six Months Ended June 30, 2021 2020 Expected life in months(1) 72 72 Volatility(1) 33 % 29 % Weighted average risk-free interest rate(2) 1.10 % 0.53 % Expected dividends(3) 4.30 % 5.71 % (1) The expected life of employee stock options represents the weighted average period the stock options are expected to remain outstanding based on historical experience. Volatility is based on the historical volatility of the stock price over the same period of the expected life of the option. (2) Based on the U.S. Treasury constant maturity interest rate with a term consistent with the expected life of the option granted. (3) Each grant’s dividend yield is calculated by annualizing the most recent quarterly cash dividend and dividing that amount by the market price of the Company’s common stock as of the grant date.
Schedule of restricted stock activity under the equity plans	Weighted Average Grant Number Date Fair Total Restricted Stock Award of Shares Value Nonvested shares at January 1, 2021 298,700 $ 10.83 Granted 187,325 $ 12.01 Vested (153,101) $ 11.42 Forfeited or expired (34,358) $ 10.23 Nonvested shares at June 30, 2021 298,566 $ 11.03

Capital Requirements (Tables)

Capital Requirements (Tables)	6 Months Ended
Capital Requirements (Tables)	Jun. 30, 2021
Capital Requirements
Schedule of actual capital and required amounts and ratios	Required For Capital Adequacy Purposes Actual Under Basel III Amount Ratio Amount Ratio (1) (Dollars in thousands) As of June 30, 2021 Total Capital $ 491,475 15.6 % $ 329,965 10.5 % (to risk-weighted assets) Tier 1 Capital $ 418,134 13.3 % $ 267,115 8.5 % (to risk-weighted assets) Common Equity Tier 1 Capital $ 418,134 13.3 % $ 219,977 7.0 % (to risk-weighted assets) Tier 1 Capital $ 418,134 8.6 % $ 194,156 4.0 % (to average assets) (1) Includes 2.5% capital conservation buffer, except the Tier 1 Capital to average assets ratio. Required For Capital Adequacy Purposes Actual Under Basel III Amount Ratio Amount Ratio (1) (Dollars in thousands) As of December 31, 2020 Total Capital $ 483,870 16.5 % $ 307,067 10.5 % (to risk-weighted assets) Tier 1 Capital $ 410,307 14.0 % $ 248,578 8.5 % (to risk-weighted assets) Common Equity Tier 1 Capital $ 410,307 14.0 % $ 204,711 7.0 % (to risk-weighted assets) Tier 1 Capital $ 410,307 9.1 % $ 180,281 4.0 % (to average assets) (2) Includes 2.5% capital conservation buffer, except the Tier 1 Capital to average assets ratio.
HBC (Wholly-owned Subsidiary)
Capital Requirements
Schedule of actual capital and required amounts and ratios	Required For Capital To Be Well-Capitalized Adequacy Under Basel III PCA Regulatory Purposes Actual Requirements Under Basel III Amount Ratio Amount Ratio Amount Ratio (1) (Dollars in thousands) As of June 30, 2021 Total Capital $ 469,701 15.0 % $ 314,070 10.0 % $ 329,773 10.5 % (to risk-weighted assets) Tier 1 Capital $ 436,192 13.9 % $ 251,256 8.0 % $ 266,959 8.5 % (to risk-weighted assets) Common Equity Tier 1 Capital $ 436,192 13.9 % $ 204,145 6.5 % $ 219,849 7.0 % (to risk-weighted assets) Tier 1 Capital $ 436,192 9.0 % $ 242,600 5.0 % $ 194,080 4.0 % (to average assets) (1) Includes 2.5% capital conservation buffer, except the Tier 1 Capital to average assets ratio. Required For Capital To Be Well-Capitalized Adequacy Under Basel III PCA Regulatory Purposes Actual Requirements Under Basel III Amount Ratio Amount Ratio Amount Ratio (1) (Dollars in thousands) As of December 31, 2020 Total Capital $ 461,933 15.8 % $ 292,258 10.0 % $ 306,871 10.5 % (to risk-weighted assets) Tier 1 Capital $ 428,109 14.6 % $ 233,806 8.0 % $ 248,419 8.5 % (to risk-weighted assets) Common Equity Tier 1 Capital $ 428,109 14.6 % $ 189,968 6.5 % $ 204,580 7.0 % (to risk-weighted assets) Tier 1 Capital $ 428,109 9.5 % $ 225,263 5.0 % $ 180,211 4.0 % (to average assets) (1) Includes 2.5% capital conservation buffer, except the Tier 1 Capital to average assets ratio.

Commitments and Loss Continge_2

Commitments and Loss Contingencies (Tables)	6 Months Ended
Commitments and Loss Contingencies (Tables)	Jun. 30, 2021
Commitments and Loss Contingencies
Schedule of commitments to extend credit	June 30, 2021 December 31, 2020 Fixed Variable Fixed Variable Rate Rate Total Rate Rate Total (Dollars in thousands) Unused lines of credit and commitments to make loans $ 131,878 $ 1,018,383 $ 1,150,261 $ 121,560 $ 970,614 $ 1,092,174 Standby letters of credit 2,877 15,357 18,234 3,049 18,970 22,019 $ 134,755 $ 1,033,740 $ 1,168,495 $ 124,609 $ 989,584 $ 1,114,193

Revenue Recognition (Tables)

Revenue Recognition (Tables)	6 Months Ended
Revenue Recognition (Tables)	Jun. 30, 2021
Revenue Recognition
Schedule of noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606	Three Months Ended June 30, 2021 2020 (Dollars in thousands) Noninterest Income In-scope of Topic 606: Service charges and fees on deposit accounts $ 659 $ 650 Gain on the disposition of foreclosed assets — — Total noninterest income in-scope of Topic 606 659 650 Noninterest Income Out-of-scope of Topic 606 1,510 1,428 Total noninterest income $ 2,169 $ 2,078 Six Months Ended June 30, 2021 2020 (Dollars in thousands) Noninterest Income In-scope of Topic 606: Service charges and fees on deposit accounts $ 1,260 $ 1,619 Gain on the disposition of foreclosed assets — 791 Total noninterest income in-scope of Topic 606 1,260 2,410 Noninterest Income Out-of-scope of Topic 606 3,210 2,861 Total noninterest income $ 4,470 $ 5,271

Noninterest Expense (Tables)

Noninterest Expense (Tables)	6 Months Ended
Noninterest Expense (Tables)	Jun. 30, 2021
Noninterest Expense
Schedule of noninterest expense	Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Salaries and employee benefits $ 12,572 $ 12,300 $ 26,530 $ 26,503 Reserve for legal settlement 4,000 — 4,000 — Occupancy and equipment 2,247 1,766 4,521 3,538 Professional fees 1,771 1,155 3,490 2,590 Amortization of intangible assets 754 964 1,487 1,822 Insurance expense 661 516 1,324 1,034 Data processing 583 779 1,117 1,755 Software subscriptions 501 746 977 1,635 Other 2,686 2,786 5,573 7,909 Total noninterest expense $ 25,775 $ 21,012 $ 49,019 $ 46,786 The following table presents the merger-related costs included in other and salaries and employee benefits by category for the periods indicated: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Salaries and employee benefits $ — $ — $ — $ 356 Other (24) 59 34 2,127 Total merger-related costs $ (24) $ 59 $ 34 $ 2,483

Leases (Tables)

Leases (Tables)	6 Months Ended
Leases (Tables)	Jun. 30, 2021
Leases
Schedule of leases	Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 (Dollars in thousands) Operating Lease Cost (Cost resulting from lease payments) $ 1,621 $ 1,733 $ 3,292 $ 3,502 Operating Lease - Operating Cash Flows (Fixed Payments) $ 1,220 $ 1,379 $ 2,406 $ 2,570 Operating Lease - ROU assets $ 36,601 $ 37,137 $ 36,601 $ 37,137 Operating Lease - Liabilities $ 36,601 $ 37,137 $ 36,601 $ 37,137 Weighted Average Lease Term - Operating Leases 7.79 yrs 8.50 years 7.79 yrs 8.50 years Weighted Average Discount Rate - Operating Leases 4.48% 4.53% 4.48% 4.53%
Schedule of maturity analysis shows the undiscounted cash flows due on the Company's operating lease liabilities	(Dollars in thousands) 2021 remaining $ 2,998 2022 6,353 2023 5,724 2024 5,341 2025 4,929 Thereafter 19,011 Total undiscounted cash flows 44,356 Discount on cash flows (7,755) Total lease liability $ 36,601

Business Segment Information (T

Business Segment Information (Tables)	6 Months Ended
Business Segment Information (Tables)	Jun. 30, 2021
Business Segment Information
Schedule of information by operating segment	Three Months Ended June 30, 2021 Banking (1) Factoring Consolidated (Dollars in thousands) Interest income $ 33,860 $ 2,772 $ 36,632 Intersegment interest allocations 202 (202) — Total interest expense 1,756 — 1,756 Net interest income 32,306 2,570 34,876 Provision for (recapture of) credit losses on loans (486) (7) (493) Net interest income after provision 32,792 2,577 35,369 Noninterest income 2,049 120 2,169 Noninterest expense 24,331 1,444 25,775 Intersegment expense allocations 127 (127) — Income before income taxes 10,637 1,126 11,763 Income tax expense 2,617 333 2,950 Net income $ 8,020 $ 793 $ 8,813 Total assets $ 5,003,894 $ 68,981 $ 5,072,875 Loans, net of deferred fees $ 2,777,685 $ 47,111 $ 2,824,796 Goodwill $ 154,587 $ 13,044 $ 167,631 Three Months Ended June 30, 2020 Banking (1) Factoring Consolidated (Dollars in thousands) Interest income $ 34,570 2,562 $ 37,132 Intersegment interest allocations 218 (218) — Total interest expense 2,192 — 2,192 Net interest income 32,596 2,344 34,940 Provision for credit losses on loans 1,107 7 1,114 Net interest income after provision 31,489 2,337 33,826 Noninterest income 1,883 195 2,078 Noninterest expense 19,336 1,676 21,012 Intersegment expense allocations 106 (106) — Income before income taxes 14,142 750 14,892 Income tax expense 4,052 222 4,274 Net income $ 10,090 $ 528 $ 10,618 Total assets $ 4,546,199 $ 68,202 $ 4,614,401 Loans, net of deferred fees $ 2,644,480 $ 41,909 $ 2,686,389 Goodwill $ 154,587 $ 13,044 $ 167,631 (1) Includes the holding company’s results of operations Six Months Ended June 30, 2021 Banking (1) Factoring Consolidated (Dollars in thousands) Interest income $ 67,971 $ 5,422 $ 73,393 Intersegment interest allocations 413 (413) — Total interest expense 3,559 — 3,559 Net interest income 64,825 5,009 69,834 Provision for (recapture of) credit losses on loans (1,949) (56) (2,005) Net interest income after provision 66,774 5,065 71,839 Noninterest income 4,209 261 4,470 Noninterest expense 46,228 2,791 49,019 Intersegment expense allocations 233 (233) — Income before income taxes 24,988 2,302 27,290 Income tax expense 6,593 680 7,273 Net income $ 18,395 $ 1,622 $ 20,017 Total assets $ 5,003,894 $ 68,981 $ 5,072,875 Loans, net of deferred fees $ 2,777,685 $ 47,111 $ 2,824,796 Goodwill $ 154,587 $ 13,044 $ 167,631 Six Months Ended June 30, 2020 Banking (1) Factoring Consolidated (Dollars in thousands) Interest income $ 72,635 $ 5,439 $ 78,074 Intersegment interest allocations 502 (502) — Total interest expense 4,554 — 4,554 Net interest income 68,583 4,937 73,520 Provision for credit losses on loans 13,981 403 14,384 Net interest income after provision 54,602 4,534 59,136 Noninterest income 4,906 365 5,271 Noninterest expense 43,519 3,267 46,786 Intersegment expense allocations 235 (235) — Income before income taxes 16,224 1,397 17,621 Income tax expense 4,729 413 5,142 Net income $ 11,495 $ 984 $ 12,479 Total assets $ 4,546,199 $ 68,202 $ 4,614,401 Loans, net of deferred fees $ 2,644,480 $ 41,909 $ 2,686,389 Goodwill $ 154,587 $ 13,044 $ 167,631 (1) Includes the holding company’s results of operations

Basis of Presentation - Segment

Basis of Presentation - Segment Reporting (Details)	6 Months Ended
Basis of Presentation - Segment Reporting (Details)	Jun. 30, 2021USD ($)segment
Segment Reporting
Number of customers accounting for more than 10 percent of revenue for HBC or the Company \| $	0
Number of Operating Segments \| segment	2

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2021	Jun. 30, 2020
Reconciliation of factors used in computing basic and diluted earnings per common share
Net income	$ 8,813	$ 11,204	$ 10,618	$ 1,861	$ 20,017	$ 12,479
Weighted average common shares outstanding for basic earnings per common share (in shares)	60,089,327		59,420,592		60,008,071	59,353,759
Dilutive potential common shares	640,814		691,831		564,386	798,728
Shares used in computing diluted earnings per common share (in shares)	60,730,141		60,112,423		60,572,457	60,152,487
Basic earnings per share (in dollars per share)	$ 0.15		$ 0.18		$ 0.33	$ 0.21
Diluted earnings per share (in dollars per share)	$ 0.15		$ 0.18		$ 0.33	$ 0.21
Number of shares not in computing diluted earnings per common share	1,057,945		1,722,342		1,072,945	1,490,688

Accumulated Other Comprehensi_3

Accumulated Other Comprehensive Income (''AOCI'') - Changes in AOCI by Component (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2021	Jun. 30, 2020
Changes in AOCI by Component
Balance at the beginning of the period, net of taxes		$ (10,717)			$ (10,717)
Net current period other comprehensive income (loss), net of taxes	$ (264)	(551)	$ (471)	$ 5,069	(815)	$ 4,598
Balance at the end of the period, net of taxes	(11,532)				(11,532)
Accumulated Other Comprehensive Loss
Changes in AOCI by Component
Balance at the beginning of the period, net of taxes	(11,268)	(10,717)	(4,709)	(9,778)	(10,717)	(9,778)
Other comprehensive income (loss) before reclassification, net of taxes	(403)		(405)		(1,058)	4,695
Amounts reclassified from other comprehensive income (loss), net of taxes	139		(66)		243	(97)
Net current period other comprehensive income (loss), net of taxes	(264)	(551)	(471)	5,069	(815)	4,598
Balance at the end of the period, net of taxes	(11,532)	(11,268)	(5,180)	(4,709)	(11,532)	(5,180)
Unrealized Gains (Losses) on Available-for-Sale Securities and I/O Strips
Changes in AOCI by Component
Balance at the beginning of the period, net of taxes	3,327	3,929	6,627	1,602	3,929	1,602
Other comprehensive income (loss) before reclassification, net of taxes	(454)		(395)		(1,056)	4,701
Amounts reclassified from other comprehensive income (loss), net of taxes			(120)			(191)
Net current period other comprehensive income (loss), net of taxes	(454)		(515)		(1,056)	4,510
Balance at the end of the period, net of taxes	2,873	3,327	6,112	6,627	2,873	6,112
Unamortized Unrealized Gain on Available-for-Sale Securities Reclassified to Held-to-Maturity
Changes in AOCI by Component
Balance at the beginning of the period, net of taxes	252	261	289	298	261	298
Amounts reclassified from other comprehensive income (loss), net of taxes	(9)		(9)		(18)	(18)
Net current period other comprehensive income (loss), net of taxes	(9)		(9)		(18)	(18)
Balance at the end of the period, net of taxes	243	252	280	289	243	280
Defined Benefit Pension Plan Items
Changes in AOCI by Component
Balance at the beginning of the period, net of taxes	(14,847)	(14,907)	(11,625)	(11,678)	(14,907)	(11,678)
Other comprehensive income (loss) before reclassification, net of taxes	51		(10)		(2)	(6)
Amounts reclassified from other comprehensive income (loss), net of taxes	148		63		261	112
Net current period other comprehensive income (loss), net of taxes	199		53		259	106
Balance at the end of the period, net of taxes	$ (14,648)	$ (14,847)	$ (11,572)	$ (11,625)	$ (14,648)	$ (11,572)

Accumulated Other Comprehensi_4

Accumulated Other Comprehensive Income (''AOCI'') - Amount Reclassified from AOCI (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2021	Jun. 30, 2020
Amount Reclassified from AOCI
Gain on sales of securities			$ 170			$ 270
Interest income on taxable securities	$ 1,944		3,155		$ 3,672	7,103
Income tax expense	(2,950)		(4,274)		(7,273)	(5,142)
Net income	8,813	$ 11,204	10,618	$ 1,861	20,017	12,479
Unrealized Gains (Losses) on Available-for-Sale Securities and I/O Strips
Amount Reclassified from AOCI
Net of tax			120			191
Unrealized Gains (Losses) on Available-for-Sale Securities and I/O Strips \| Amount Reclassified from AOCI
Amount Reclassified from AOCI
Gain on sales of securities			170			270
Income tax expense			(50)			(79)
Net income			120			191
Unamortized Unrealized Gain on Available-for-Sale Securities Reclassified to Held-to-Maturity
Amount Reclassified from AOCI
Net of tax	9		9		18	18
Unamortized Unrealized Gain on Available-for-Sale Securities Reclassified to Held-to-Maturity \| Amount Reclassified from AOCI
Amount Reclassified from AOCI
Interest income on taxable securities	13		13		26	26
Income tax expense	(4)		(4)		(8)	(8)
Net income	9		9		18	18
Defined Benefit Pension Plan Items
Amount Reclassified from AOCI
Net of tax	(148)		(63)		(261)	(112)
Defined Benefit Pension Plan Items \| Amount Reclassified from AOCI
Amount Reclassified from AOCI
Other noninterest expense	(210)		(90)		(370)	(160)
Income tax benefit	62		27		109	48
Net of tax	(148)		(63)		(261)	(112)
Prior transition obligation \| Amount Reclassified from AOCI
Amount Reclassified from AOCI
Other noninterest expense	1		15		2	30
Prior service cost \| Amount Reclassified from AOCI
Amount Reclassified from AOCI
Other noninterest expense	(211)		(105)
Actuarial losses \| Amount Reclassified from AOCI
Amount Reclassified from AOCI
Other noninterest expense					(372)	(190)
Accumulated Other Comprehensive Loss
Amount Reclassified from AOCI
Net of tax	(139)		66		(243)	97
Accumulated Other Comprehensive Loss \| Amount Reclassified from AOCI
Amount Reclassified from AOCI
Net of tax	$ (139)		$ 66		$ (243)	$ 97

Securities - Amortized Cost and

Securities - Amortized Cost and Estimated Fair Value of Securities - Securities Available-for-sale (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Securities available-for-sale:
Amortized Cost	$ 141,651	$ 230,012
Gross Unrealized Gains	4,304	5,762
Estimated Fair Value	145,955	235,774
Agency mortgage-backed securities
Securities available-for-sale:
Amortized Cost	126,682	170,215
Gross Unrealized Gains	4,210	5,111
Estimated Fair Value	130,892	175,326
U.S. Treasury
Securities available-for-sale:
Amortized Cost	14,969	59,797
Gross Unrealized Gains	94	651
Estimated Fair Value	$ 15,063	$ 60,448

Securities - Amortized Cost a_2

Securities - Amortized Cost and Estimated Fair Value of Securities - Securities Held-to-maturity (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Securities held-to-maturity:
Amortized Cost	$ 421,337	$ 297,443
Gross Unrealized Gains	6,539	7,714
Gross Unrealized (Losses)	(1,121)	(230)
Estimated Fair Value	426,755	304,927
Allowance for credit losses	(51)	(54)
Agency mortgage-backed securities
Securities held-to-maturity:
Amortized Cost	361,184	228,652
Gross Unrealized Gains	5,330	6,075
Gross Unrealized (Losses)	(1,121)	(230)
Estimated Fair Value	365,393	234,497
Municipals - exempt from Federal tax
Securities held-to-maturity:
Amortized Cost	60,153	68,791
Gross Unrealized Gains	1,209	1,639
Estimated Fair Value	61,362	70,430
Allowance for credit losses	$ (51)	$ (54)

Securities - Securities with Un

Securities - Securities with Unrealized Losses - Securities Held-to-maturity (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020
Held-to-maturity, Fair Value
Less Than 12 Months	$ 67,111,000	$ 30,930,000
Total	67,111,000	30,930,000
Held-to-maturity, Unrealized (Losses)
Less Than 12 Months	(1,121,000)	(230,000)
Total	(1,121,000)	(230,000)
Agency mortgage-backed securities
Held-to-maturity, Fair Value
Less Than 12 Months	67,111,000	30,930,000
Total	67,111,000	30,930,000
Held-to-maturity, Unrealized (Losses)
Less Than 12 Months	(1,121,000)	(230,000)
Total	$ (1,121,000)	$ (230,000)

Securities - Additional Informa

Securities - Additional Information (Details)	6 Months Ended
Securities - Additional Information (Details)	Jun. 30, 2021USD ($)itemsecurity	Dec. 31, 2020USD ($)
Additional Information
The number of holdings of securities of any one issuer other than the U.S. Government and its sponsored entities \| security	0
Holdings of securities as percentage of shareholders' equity, considered as threshold for disclosure purpose	10.00%
Number of securities held	398
Number of available for sale securities held	107
Number of held to maturity securities held	291
Number of securities with fair values below amortized cost	12
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value \| $	$ 67,111,000	$ 30,930,000
Total unrealized loss for securities less than 12 months \| $	1,121,000
Agency mortgage-backed securities
Additional Information
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value \| $	$ 67,111,000	$ 30,930,000

Securities - Proceeds from Sale

Securities - Proceeds from Sales of Securities and the Resulting Gains and Losses (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2020
Proceeds from Sales of Securities and the Resulting Gains and Losses
Proceeds	$ 30,085	$ 56,598
Gross gains	$ 170	$ 270

Securities - Amortized Cost a_3

Securities - Amortized Cost and Fair Value of Debt Securities by Contractual Maturity - Securities Available-for-sale (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Available-for-sale, Amortized Cost
Due 3 months or less	$ 9,997
Due after 3 months through one year	4,972
Agency mortgage-backed securities	126,682
Total	141,651	$ 230,012
Available-for-sale, Estimated Fair Value
Due 3 months or less	10,044
Due after 3 months through one year	5,019
Agency mortgage-backed securities	130,892
Total	$ 145,955	$ 235,774

Securities - Amortized Cost a_4

Securities - Amortized Cost and Fair Value of Debt Securities by Contractual Maturity - Securities Held-to-maturity (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Held-to-maturity, Amortized Cost
Due after 3 months through one year	$ 499
Due after one year through five years	10,605
Due after five years through ten years	31,284
Due after ten years	17,765
Agency mortgage-backed securities	361,184
Total	421,337
Held-to-maturity, Estimated Fair Value
Due after 3 months through one year	500
Due after one year through five years	10,865
Due after five years through ten years	31,824
Due after ten years	18,173
Agency mortgage-backed securities	365,393
Total	$ 426,755	$ 304,927

Securities - Securities Pledged

Securities - Securities Pledged to Secure Public Deposits and for Other Purposes (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Securities Pledged to Secure Public Deposits and for Other Purposes
Amortized cost of securities pledged to secure public deposits and for other purposes as required or permitted by law or contract	$ 39,825	$ 40,238

Securities - Roll-forward by ma

Securities - Roll-forward by major security type (Details)	6 Months Ended
Securities - Roll-forward by major security type (Details)	Jun. 30, 2021USD ($)
Securities
Debt Securities, Held-to-maturity, Allowance for Credit Loss, Beginning Balance	$ 54,000
Provision for (recapture of) credit losses	(3,000)
Debt Securities, Held-to-maturity, Allowance for Credit Loss, Ending Balance	$ 51,000

Loans and Allowance for Credi_3

Loans and Allowance for Credit Losses on Loans - Loans Balance (Details)	3 Months Ended
	Jun. 30, 2021USD ($)loan	Mar. 31, 2021USD ($)	Dec. 31, 2020USD ($)	Jun. 30, 2020USD ($)	Mar. 31, 2020USD ($)	Jan. 01, 2020USD ($)	Dec. 31, 2019USD ($)
Loans held-for-investment:
Total loan balance	$ 2,832,866,000		$ 2,625,987,000
Deferred loan fees, net	(8,070,000)		(6,726,000)
Loans, net of deferred fees	2,824,796,000		2,619,261,000	$ 2,686,389,000
Allowance for credit losses on loans	(43,956,000)	$ (44,296,000)	(44,400,000)	(45,444,000)	$ (44,703,000)	$ (31,855,000)	$ (23,285,000)
Loans, net	2,780,840,000		2,574,861,000
Commercial \| SBA Paycheck Protection Program ("PPP")
Loans held-for-investment:
Allowance for credit losses on loans	0		0
Loans, net	286,461,000		290,679,000
Commercial
Loans held-for-investment:
Total loan balance	844,147,000		846,386,000
Allowance for credit losses on loans	(10,857,000)	(11,600,000)	(11,587,000)	(13,179,000)	(12,801,000)
Commercial \| Commercial
Loans held-for-investment:
Total loan balance	844,147,000		846,386,000
Commercial Loans excluding SBA Paycheck Protection Program [Member] \| Commercial
Loans held-for-investment:
Total loan balance	844,147,000		846,386,000
CRE
Loans held-for-investment:
Allowance for credit losses on loans				(13,179,000)		(6,790,000)	(10,453,000)
CRE - owner occupied
Loans held-for-investment:
Total loan balance	583,091,000		560,362,000
Allowance for credit losses on loans	(8,206,000)	(8,368,000)	(8,560,000)	(8,547,000)	(7,737,000)	(6,994,000)	(3,825,000)
CRE - owner occupied \| Real estate
Loans held-for-investment:
Total loan balance	583,091,000		560,362,000
CRE - non-owner occupied
Loans held-for-investment:
Total loan balance	742,135,000		693,103,000
Allowance for credit losses on loans	(16,485,000)	(16,431,000)	(16,416,000)	(15,449,000)	(15,645,000)	(11,672,000)	(3,760,000)
CRE - non-owner occupied \| Real estate
Loans held-for-investment:
Total loan balance	742,135,000		693,103,000
Land and construction
Loans held-for-investment:
Total loan balance	129,426,000		144,594,000
Allowance for credit losses on loans	(2,136,000)	(2,754,000)	(2,509,000)	(2,552,000)	(2,603,000)	(1,458,000)	(2,621,000)
Land and construction \| Real estate
Loans held-for-investment:
Total loan balance	129,426,000		144,594,000
Home equity
Loans held-for-investment:
Total loan balance	107,873,000		111,885,000
Allowance for credit losses on loans	(1,069,000)	(1,171,000)	(1,297,000)	(1,851,000)	(1,746,000)	(1,321,000)	(2,244,000)
Home equity \| Real estate
Loans held-for-investment:
Total loan balance	107,873,000		111,885,000
Multi-family
Loans held-for-investment:
Total loan balance	198,771,000		166,425,000
Allowance for credit losses on loans	(2,950,000)	(2,751,000)	(2,804,000)	(1,828,000)	(1,622,000)	(1,253,000)	(57,000)
Multi-family \| Real estate
Loans held-for-investment:
Total loan balance	198,771,000		166,425,000
Residential mortgages
Loans held-for-investment:
Total loan balance	205,904,000		85,116,000
Allowance for credit losses on loans	$ (1,968,000)	(918,000)	(943,000)	(825,000)	(708,000)	(678,000)	(243,000)
Number of loan portfolios purchased \| loan	2
Value of loan portfolios purchased	$ 140,030,000
Average principal balance	$ 585,000
Weighted average yield	3.39%
Residential mortgages \| Real estate
Loans held-for-investment:
Total loan balance	$ 205,904,000		85,116,000
Consumer and other
Loans held-for-investment:
Total loan balance	21,519,000		18,116,000
Allowance for credit losses on loans	(285,000)	$ (303,000)	(284,000)	$ (1,213,000)	$ (1,841,000)	$ (1,689,000)	(82,000)
Consumer and other \| Consumer
Loans held-for-investment:
Total loan balance	$ 21,519,000		$ 18,116,000
ASU 2016-03 - Topic 326
Loans held-for-investment:
Allowance for credit losses on loans							(8,570,000)
ASU 2016-03 - Topic 326 \| CRE
Loans held-for-investment:
Allowance for credit losses on loans							3,663,000
ASU 2016-03 - Topic 326 \| CRE - owner occupied
Loans held-for-investment:
Allowance for credit losses on loans							(3,169,000)
ASU 2016-03 - Topic 326 \| CRE - non-owner occupied
Loans held-for-investment:
Allowance for credit losses on loans							(7,912,000)
ASU 2016-03 - Topic 326 \| Land and construction
Loans held-for-investment:
Allowance for credit losses on loans							1,163,000
ASU 2016-03 - Topic 326 \| Home equity
Loans held-for-investment:
Allowance for credit losses on loans							923,000
ASU 2016-03 - Topic 326 \| Multi-family
Loans held-for-investment:
Allowance for credit losses on loans							(1,196,000)
ASU 2016-03 - Topic 326 \| Residential mortgages
Loans held-for-investment:
Allowance for credit losses on loans							(435,000)
ASU 2016-03 - Topic 326 \| Consumer and other
Loans held-for-investment:
Allowance for credit losses on loans							$ (1,607,000)

Loans and Allowance for Credi_4

Loans and Allowance for Credit Losses on Loans - Changes in the Allowance for Loan Losses (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Changes in the Allowance for Loan Losses
Beginning of period balance	$ 44,296,000	$ 44,703,000	$ 44,400,000	$ 23,285,000
Charge-offs	(105,000)	(465,000)	(368,000)	(1,138,000)
Recoveries	258,000	92,000	1,929,000	343,000
Net (charge-offs) recoveries	153,000	(373,000)	1,561,000	(795,000)
Provision for (recapture of) credit losses on loans	(493,000)	1,114,000	(2,005,000)	14,384,000
End of period balance	43,956,000	45,444,000	43,956,000	45,444,000
Decrease in the allowance of credit loss	(388,000)
Decrease in reserve for pooled loans	(56,000)
ASU 2016-03 - Topic 326
Changes in the Allowance for Loan Losses
Beginning of period balance				8,570,000
Commercial
Changes in the Allowance for Loan Losses
Beginning of period balance	11,600,000	12,801,000	11,587,000
Charge-offs	(105,000)	(465,000)	(368,000)
Recoveries	115,000	46,000	928,000
Net (charge-offs) recoveries	10,000	(419,000)	560,000
Provision for (recapture of) credit losses on loans	(753,000)	797,000	(1,290,000)
End of period balance	10,857,000	13,179,000	10,857,000	13,179,000
CRE
Changes in the Allowance for Loan Losses
Beginning of period balance				10,453,000
Charge-offs				(1,135,000)
Recoveries				255,000
Net (charge-offs) recoveries				(880,000)
Provision for (recapture of) credit losses on loans				7,269,000
End of period balance		13,179,000		13,179,000
CRE \| ASU 2016-03 - Topic 326
Changes in the Allowance for Loan Losses
Beginning of period balance				(3,663,000)
CRE - owner occupied
Changes in the Allowance for Loan Losses
Beginning of period balance	8,368,000	7,737,000	8,560,000	3,825,000
Recoveries	4,000	1,000	8,000	1,000
Net (charge-offs) recoveries	4,000	1,000	8,000	1,000
Provision for (recapture of) credit losses on loans	(166,000)	809,000	(362,000)	1,552,000
End of period balance	8,206,000	8,547,000	8,206,000	8,547,000
CRE - owner occupied \| ASU 2016-03 - Topic 326
Changes in the Allowance for Loan Losses
Beginning of period balance				3,169,000
CRE - non-owner occupied
Changes in the Allowance for Loan Losses
Beginning of period balance	16,431,000	15,645,000	16,416,000	3,760,000
Provision for (recapture of) credit losses on loans	54,000	(196,000)	69,000	3,777,000
End of period balance	16,485,000	15,449,000	16,485,000	15,449,000
CRE - non-owner occupied \| ASU 2016-03 - Topic 326
Changes in the Allowance for Loan Losses
Beginning of period balance				7,912,000
Land and construction
Changes in the Allowance for Loan Losses
Beginning of period balance	2,754,000	2,603,000	2,509,000	2,621,000
Recoveries	68,000	13,000	884,000	32,000
Net (charge-offs) recoveries	68,000	13,000	884,000	32,000
Provision for (recapture of) credit losses on loans	(686,000)	(64,000)	(1,257,000)	1,062,000
End of period balance	2,136,000	2,552,000	2,136,000	2,552,000
Land and construction \| ASU 2016-03 - Topic 326
Changes in the Allowance for Loan Losses
Beginning of period balance				(1,163,000)
Home equity
Changes in the Allowance for Loan Losses
Beginning of period balance	1,171,000	1,746,000	1,297,000	2,244,000
Recoveries	16,000	31,000	39,000	54,000
Net (charge-offs) recoveries	16,000	31,000	39,000	54,000
Provision for (recapture of) credit losses on loans	(118,000)	74,000	(267,000)	476,000
End of period balance	1,069,000	1,851,000	1,069,000	1,851,000
Home equity \| ASU 2016-03 - Topic 326
Changes in the Allowance for Loan Losses
Beginning of period balance				(923,000)
Multi-family
Changes in the Allowance for Loan Losses
Beginning of period balance	2,751,000	1,622,000	2,804,000	57,000
Provision for (recapture of) credit losses on loans	199,000	206,000	146,000	575,000
End of period balance	2,950,000	1,828,000	2,950,000	1,828,000
Multi-family \| ASU 2016-03 - Topic 326
Changes in the Allowance for Loan Losses
Beginning of period balance				1,196,000
Residential mortgages
Changes in the Allowance for Loan Losses
Beginning of period balance	918,000	708,000	943,000	243,000
Provision for (recapture of) credit losses on loans	1,050,000	117,000	1,025,000	147,000
End of period balance	1,968,000	825,000	1,968,000	825,000
Residential mortgages \| ASU 2016-03 - Topic 326
Changes in the Allowance for Loan Losses
Beginning of period balance				435,000
Consumer and other
Changes in the Allowance for Loan Losses
Beginning of period balance	303,000	1,841,000	284,000	82,000
Charge-offs				(3,000)
Recoveries	55,000	1,000	70,000	1,000
Net (charge-offs) recoveries	55,000	1,000	70,000	(2,000)
Provision for (recapture of) credit losses on loans	(73,000)	(629,000)	(69,000)	(474,000)
End of period balance	$ 285,000	$ 1,213,000	$ 285,000	1,213,000
Consumer and other \| ASU 2016-03 - Topic 326
Changes in the Allowance for Loan Losses
Beginning of period balance				$ 1,607,000

Loans and Allowance for Credi_5

Loans and Allowance for Credit Losses on Loans - Nonaccrual Status and Loans Past Due Over 90 Days (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Nonperforming Loans by Class
Nonaccrual Financing Receivable, no special allowance	$ 3,913	$ 5,814
Nonaccrual Financing Receivable, with special allowance	1,378	1,974
Loans Over 90 Days Past Due and Still Accruing	889	81
Total	6,180	7,869
Commercial
Nonperforming Loans by Class
Nonaccrual Financing Receivable, no special allowance	415	752
Nonaccrual Financing Receivable, with special allowance	1,378	1,974
Loans Over 90 Days Past Due and Still Accruing	164	81
Total	1,957	2,807
CRE - owner occupied \| Real estate
Nonperforming Loans by Class
Nonaccrual Financing Receivable, no special allowance	1,774	3,706
Total	1,774	3,706
CRE - non-owner occupied \| Real estate
Nonperforming Loans by Class
Loans Over 90 Days Past Due and Still Accruing	725
Total	725
Home equity \| Real estate
Nonperforming Loans by Class
Nonaccrual Financing Receivable, no special allowance	168	949
Total	168	949
Multi-family \| Real estate
Nonperforming Loans by Class
Nonaccrual Financing Receivable, no special allowance	1,149
Total	1,149
Consumer and other \| Consumer
Nonperforming Loans by Class
Nonaccrual Financing Receivable, no special allowance	407	407
Total	$ 407	$ 407

Loans and Allowance for Credi_6

Loans and Allowance for Credit Losses on Loans - Aging of Past Due Loans by Class of Loans (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020
Aging of Past Due Loans by Class of Loans
Total Past Due	$ 9,516,000	$ 6,229,000
Current	2,823,350,000	2,619,758,000
Total loan balance	2,832,866,000	2,625,987,000
30-59 Days Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	5,784,000	4,657,000
60-89 Days Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	1,196,000	744,000
90 Days or Greater Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	2,536,000	828,000
Commercial
Aging of Past Due Loans by Class of Loans
Total loan balance	844,147,000	846,386,000
Commercial \| Commercial
Aging of Past Due Loans by Class of Loans
Total Past Due	5,915,000	4,175,000
Current	838,232,000	842,211,000
Total loan balance	844,147,000	846,386,000
Commercial \| Commercial \| 30-59 Days Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	4,467,000	3,524,000
Commercial \| Commercial \| 60-89 Days Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	1,187,000	259,000
Commercial \| Commercial \| 90 Days or Greater Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	261,000	392,000
CRE - owner occupied
Aging of Past Due Loans by Class of Loans
Total loan balance	583,091,000	560,362,000
CRE - owner occupied \| Real estate
Aging of Past Due Loans by Class of Loans
Total Past Due	2,324,000	1,162,000
Current	580,767,000	559,200,000
Total loan balance	583,091,000	560,362,000
CRE - owner occupied \| Real estate \| 30-59 Days Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	1,172,000	1,133,000
CRE - owner occupied \| Real estate \| 60-89 Days Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	9,000
CRE - owner occupied \| Real estate \| 90 Days or Greater Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	1,143,000	29,000
CRE - non-owner occupied
Aging of Past Due Loans by Class of Loans
Total loan balance	742,135,000	693,103,000
CRE - non-owner occupied \| Real estate
Aging of Past Due Loans by Class of Loans
Total Past Due	870,000	485,000
Current	741,265,000	692,618,000
Total loan balance	742,135,000	693,103,000
CRE - non-owner occupied \| Real estate \| 30-59 Days Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	145,000
CRE - non-owner occupied \| Real estate \| 60-89 Days Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due		485,000
CRE - non-owner occupied \| Real estate \| 90 Days or Greater Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	725,000
Land and construction
Aging of Past Due Loans by Class of Loans
Total loan balance	129,426,000	144,594,000
Land and construction \| Real estate
Aging of Past Due Loans by Class of Loans
Current	129,426,000	144,594,000
Total loan balance	129,426,000	144,594,000
Home equity
Aging of Past Due Loans by Class of Loans
Total loan balance	107,873,000	111,885,000
Home equity \| Real estate
Aging of Past Due Loans by Class of Loans
Current	107,873,000	111,885,000
Total loan balance	107,873,000	111,885,000
Multi-family
Aging of Past Due Loans by Class of Loans
Total loan balance	198,771,000	166,425,000
Multi-family \| Real estate
Aging of Past Due Loans by Class of Loans
Current	198,771,000	166,425,000
Total loan balance	198,771,000	166,425,000
Residential mortgages
Aging of Past Due Loans by Class of Loans
Total loan balance	205,904,000	85,116,000
Residential mortgages \| Real estate
Aging of Past Due Loans by Class of Loans
Current	205,904,000	85,116,000
Total loan balance	205,904,000	85,116,000
Consumer and other
Aging of Past Due Loans by Class of Loans
Total loan balance	21,519,000	18,116,000
Consumer and other \| Consumer
Aging of Past Due Loans by Class of Loans
Total Past Due	407,000	407,000
Current	21,112,000	17,709,000
Total loan balance	21,519,000	18,116,000
Consumer and other \| Consumer \| 90 Days or Greater Past Due
Aging of Past Due Loans by Class of Loans
Total Past Due	$ 407,000	$ 407,000

Loans and Allowance for Credi_7

Loans and Allowance for Credit Losses on Loans - Aging of Past Due Loans by Class of Loans - Additional Information (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020
Aging of Past Due Loans by Class of Loans
Past due loans 30 day or greater	$ 9,516,000	$ 6,229,000
30 days or greater past due
Aging of Past Due Loans by Class of Loans
Nonaccrual loans	1,658,000	1,918,000
Less than 30 days past due
Aging of Past Due Loans by Class of Loans
Nonaccrual loans	$ 3,633,000
Less than 30 days past due nonaccrual loans held-for-investment		$ 5,870,000

Loans and Allowance for Credi_8

Loans and Allowance for Credit Losses on Loans - Credit Quality Indicators (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Loans
2021	$ 755,460	$ 979,432
2020	595,018	309,922
2019	268,497	191,961
2018	166,359	202,725
2017	151,046	163,654
2016 and Prior	397,892	326,918
Revolving	498,594	451,375
Total loan balance	2,832,866	2,625,987
Balance to report	2,780,840	2,574,861
Loan classified as loss
Loans
Balance to report	0	0
Commercial
Loans
2021	304,455	453,231
2020	169,028	34,122
2019	19,144	22,510
2018	17,002	15,551
2017	10,442	10,565
2016 and Prior	9,105	8,561
Revolving	314,971	301,846
Total loan balance	844,147	846,386
Commercial \| Pass [Member]
Loans
2021	302,753	431,369
2020	163,815	33,350
2019	19,144	21,154
2018	15,904	13,840
2017	9,543	7,341
2016 and Prior	8,699	8,292
Revolving	307,122	296,286
Total loan balance	826,980	811,632
Commercial \| Special Mention [Member]
Loans
2021	323	15,720
2020	733	716
2019		1,301
2018	1,082	953
2017	447	713
2016 and Prior	270	170
Revolving	978	1,937
Total loan balance	3,833	21,510
Commercial \| Substandard [Member]
Loans
2021	1,349	4,036
2020	3,337
2019		19
2018	16	758
2017	452	2,396
2016 and Prior	30	73
Revolving	6,357	3,236
Total loan balance	11,541	10,518
Commercial \| Substandard-Nonaccrual [Member]
Loans
2021	30	2,106
2020	1,143	56
2019		36
2017		115
2016 and Prior	106	26
Revolving	514	387
Total loan balance	1,793	2,726
CRE - owner occupied
Loans
2021	78,577	177,614
2020	161,446	75,632
2019	75,523	72,596
2018	68,158	55,442
2017	38,511	50,716
2016 and Prior	136,838	112,398
Revolving	24,038	15,964
Total loan balance	583,091	560,362
CRE - owner occupied \| Pass [Member]
Loans
2021	78,046	168,224
2020	154,477	73,064
2019	74,843	68,068
2018	66,269	51,705
2017	37,006	50,716
2016 and Prior	135,709	109,350
Revolving	24,038	15,964
Total loan balance	570,388	537,091
CRE - owner occupied \| Special Mention [Member]
Loans
2021	531	3,151
2020	2,648	2,568
2019	680	4,128
2018	1,495	783
2017	770
2016 and Prior	1,089	2,569
Total loan balance	7,213	13,199
CRE - owner occupied \| Substandard [Member]
Loans
2021		2,561
2020	2,547
2019		400
2018	394	2,954
2017	735
2016 and Prior	40	451
Total loan balance	3,716	6,366
CRE - owner occupied \| Substandard-Nonaccrual [Member]
Loans
2021		3,678
2020	1,774
2016 and Prior		28
Total loan balance	1,774	3,706
CRE - non-owner occupied
Loans
2021	131,832	181,646
2020	156,227	128,361
2019	121,987	72,764
2018	59,797	99,816
2017	75,732	57,907
2016 and Prior	172,018	150,683
Revolving	24,542	1,926
Total loan balance	742,135	693,103
CRE - non-owner occupied \| Pass [Member]
Loans
2021	131,832	166,550
2020	148,179	128,361
2019	121,987	68,796
2018	55,878	99,816
2017	75,126	57,422
2016 and Prior	165,195	150,683
Revolving	22,377	1,926
Total loan balance	720,574	673,554
CRE - non-owner occupied \| Special Mention [Member]
Loans
2021		11,930
2020	2,808
2019		2,557
2018	2,527
2017	606
2016 and Prior	6,338
Revolving	2,165
Total loan balance	14,444	14,487
CRE - non-owner occupied \| Substandard [Member]
Loans
2021		3,166
2020	5,240
2019		1,411
2018	1,392
2017		485
2016 and Prior	485
Total loan balance	7,117	5,062
Land and construction
Loans
2021	59,656	116,291
2020	56,553	22,054
2019	4,443
2016 and Prior	1,321	1,343
Revolving	7,453	4,906
Total loan balance	129,426	144,594
Land and construction \| Pass [Member]
Loans
2021	58,297	114,932
2020	56,553	22,054
2019	4,443
2016 and Prior	1,321	1,343
Revolving	7,453	4,906
Total loan balance	128,067	143,235
Land and construction \| Substandard [Member]
Loans
2021	1,359	1,359
Total loan balance	1,359	1,359
Home equity
Loans
2021		383
2020	107
2019		74
2018	61
2016 and Prior	143	143
Revolving	107,562	111,285
Total loan balance	107,873	111,885
Home equity \| Pass [Member]
Loans
2021		266
2019		74
2018	61
Revolving	104,746	109,848
Total loan balance	104,807	110,188
Home equity \| Special Mention [Member]
Loans
Revolving	1,932
Total loan balance	1,932
Home equity \| Substandard [Member]
Loans
2016 and Prior	143	143
Revolving	823	605
Total loan balance	966	748
Home equity \| Substandard-Nonaccrual [Member]
Loans
2021		117
2020	107
Revolving	61	832
Total loan balance	168	949
Multi-family
Loans
2021	43,725	32,370
2020	33,447	39,183
2019	37,612	17,248
2018	16,321	24,572
2017	21,215	16,235
2016 and Prior	45,536	35,937
Revolving	915	880
Total loan balance	198,771	166,425
Multi-family \| Pass [Member]
Loans
2021	42,576	31,481
2020	32,568	39,183
2019	37,612	17,248
2018	16,321	24,572
2017	21,215	16,235
2016 and Prior	35,092	30,751
Revolving	915	880
Total loan balance	186,299	160,350
Multi-family \| Special Mention [Member]
Loans
2016 and Prior	10,444	5,186
Total loan balance	10,444	5,186
Multi-family \| Substandard [Member]
Loans
2021		889
2020	879
Total loan balance	879	889
Multi-family \| Substandard-Nonaccrual [Member]
Loans
2021	1,149
Total loan balance	1,149
Residential mortgages
Loans
2021	137,195	17,887
2020	18,204	10,048
2019	9,379	4,876
2018	3,157	7,324
2017	5,129	28,115
2016 and Prior	31,880	16,866
Revolving	960
Total loan balance	205,904	85,116
Residential mortgages \| Pass [Member]
Loans
2021	137,195	12,798
2020	18,204	10,048
2019	9,379	3,246
2018	3,157	7,324
2017	5,129	28,115
2016 and Prior	30,567	15,568
Revolving	960
Total loan balance	204,591	77,099
Residential mortgages \| Special Mention [Member]
Loans
2021		5,089
2019		1,630
Total loan balance		6,719
Residential mortgages \| Substandard [Member]
Loans
2016 and Prior	1,313	1,298
Total loan balance	1,313	1,298
Consumer and other
Loans
2021	20	10
2020	6	522
2019	409	1,893
2018	1,863	20
2017	17	116
2016 and Prior	1,051	987
Revolving	18,153	14,568
Total loan balance	21,519	18,116
Consumer and other \| Pass [Member]
Loans
2021		10
2020	6	522
2019	409	1,486
2018	1,456	20
2017	17	116
2016 and Prior	1,051	987
Revolving	17,953	14,568
Total loan balance	20,892	17,709
Consumer and other \| Substandard [Member]
Loans
2021	20
Revolving	200
Total loan balance	220
Consumer and other \| Substandard-Nonaccrual [Member]
Loans
2019		407
2018	407
Total loan balance	407	407
Risk Grades [Member]
Loans
2021	755,460	979,432
2020	595,018	309,922
2019	268,497	191,961
2018	166,359	202,725
2017	151,046	163,654
2016 and Prior	397,892	326,918
Revolving	498,594	451,375
Total loan balance	2,832,866	2,625,987
Risk Grades [Member] \| Pass [Member]
Loans
2021	750,699	925,630
2020	573,802	306,582
2019	267,817	180,072
2018	159,046	197,277
2017	148,036	159,945
2016 and Prior	377,634	316,974
Revolving	485,564	444,378
Total loan balance	2,762,598	2,530,858
Risk Grades [Member] \| Special Mention [Member]
Loans
2021	854	35,890
2020	6,189	3,284
2019	680	9,616
2018	5,104	1,736
2017	1,823	713
2016 and Prior	18,141	7,925
Revolving	5,075	1,937
Total loan balance	37,866	61,101
Risk Grades [Member] \| Substandard [Member]
Loans
2021	2,728	12,011
2020	12,003
2019		1,830
2018	1,802	3,712
2017	1,187	2,881
2016 and Prior	2,011	1,965
Revolving	7,380	3,841
Total loan balance	27,111	26,240
Risk Grades [Member] \| Substandard-Nonaccrual [Member]
Loans
2021	1,179	5,901
2020	3,024	56
2019		443
2018	407
2017		115
2016 and Prior	106	54
Revolving	575	1,219
Total loan balance	$ 5,291	$ 7,788

Loans and Allowance for Credi_9

Loans and Allowance for Credit Losses on Loans - Amortized Cost Basis of Collateral-dependent Loans (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Financing Receivable, Recorded Investment, Past Due [Line Items]
Collateral dependent loans	$ 1,378	$ 1,974
Real Estate
Financing Receivable, Recorded Investment, Past Due [Line Items]
Collateral dependent loans	25	29
Business Assets
Financing Receivable, Recorded Investment, Past Due [Line Items]
Collateral dependent loans	1,324	1,815
Unsecured
Financing Receivable, Recorded Investment, Past Due [Line Items]
Collateral dependent loans	29	130
Commercial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Collateral dependent loans	1,378	1,974
Commercial \| Real Estate
Financing Receivable, Recorded Investment, Past Due [Line Items]
Collateral dependent loans	25	29
Commercial \| Business Assets
Financing Receivable, Recorded Investment, Past Due [Line Items]
Collateral dependent loans	1,324	1,815
Commercial \| Unsecured
Financing Receivable, Recorded Investment, Past Due [Line Items]
Collateral dependent loans	$ 29	$ 130

Loans and Allowance for Cred_10

Loans and Allowance for Credit Losses on Loans - Troubled Debt Restructurings (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Loans and Allowance for Credit Losses on Loans
Recorded investment of troubled debt restructurings	$ 552	$ 674
Troubled debt restructurings, nonaccrual loans	448	468
Troubled debt restructurings, accruing loans	104	206
Specific reserves	$ 331	$ 352

Loans and Allowance for Cred_11

Loans and Allowance for Credit Losses on Loans - Troubled Debt Restructurings by Class (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2021loan	Jun. 30, 2020loan	Jun. 30, 2021USD ($)loan	Jun. 30, 2020USD ($)
Troubled Debt Restructurings by Class
Number of loans modified as troubled debt restructurings during the period	0	0	1	3,000
Pre-modification Outstanding Recorded Investment			$ 3,000	$ 13,000
Post-modification Outstanding Recorded Investment			$ 3,000	$ 13,000
Commercial
Troubled Debt Restructurings by Class
Number of loans modified as troubled debt restructurings during the period			1,000	3,000
Pre-modification Outstanding Recorded Investment			$ 3,000	$ 13,000
Post-modification Outstanding Recorded Investment			$ 3,000	$ 13,000

Loans and Allowance for Cred_12

Loans and Allowance for Credit Losses on Loans - Defaults on Troubled Debt Restructurings (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2021loanitem	Jun. 30, 2020item	Jun. 30, 2021loan
Loans and Allowance for Credit Losses on Loans
Number of troubled debt restructurings in which the amount of principal or accrued interest owed from the borrower was forgiven \| loan	0		0
Default period contractually past due under modified terms (in days)			30 days
Number of defaults on troubled debt restructurings \| item	0	0
Period of consecutive payments (in months)			6 months

Loans and Allowance for Cred_13

Loans and Allowance for Credit Losses on Loans - Schedule of loan deferrals by loan category (Details)	6 Months Ended
	Jun. 30, 2021USD ($)loanitem	Dec. 31, 2020USD ($)
Loans, net \| $	$ 2,780,840,000	$ 2,574,861,000
Number of remaining second deferments \| item	3
2nd Deferments \| Collateral Pledged
Loans, net \| $	$ 1,800,000
2nd Deferments \| Real Estate
Number of remaining second deferments \| loan	2
2nd Deferments \| Business Assets
Number of remaining second deferments \| loan	1

Goodwill and Other Intangible_3

Goodwill and Other Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2021	Dec. 31, 2020	Jun. 30, 2020
Goodwill
Goodwill	$ 167,631	$ 167,631	$ 167,631
BVF/CSNK
Goodwill
Goodwill acquired	13,044
Focus
Goodwill
Goodwill acquired	32,619
Tri Valley Bank
Goodwill
Goodwill acquired	13,819
United American Bank
Goodwill
Goodwill acquired	24,271
Presidio bank
Goodwill
Goodwill acquired	83,878
Banking
Goodwill
Goodwill	154,587	154,587	154,587
Factoring
Goodwill
Goodwill	$ 13,044	$ 13,044	$ 13,044

Goodwill and Other Intangible_4

Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Other Intangible Assets
Gross Carrying amount	$ 27,693	$ 27,693
Accumulated Amortization	(12,516)	(11,029)
Total	15,177	16,664
Core deposit
Other Intangible Assets
Gross Carrying amount	25,023	25,023
Accumulated Amortization	(10,567)	(9,153)
Total	14,456	15,870
Below/ (Above) market-value lease
Other Intangible Assets
Total	87
Below market-value lease
Other Intangible Assets
Gross Carrying amount	770	770
Accumulated Amortization	(683)	(705)
Total	87	65
Customer relationship and brokered relationship
Other Intangible Assets
Gross Carrying amount	1,900	1,900
Accumulated Amortization	(1,266)	(1,171)
Total	$ 634	$ 729

Goodwill and Other Intangible_5

Goodwill and Other Intangible Assets - Estimated Amortization Expense (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Estimated Amortization Expense
2021 remaining	$ 1,509
2022	2,635
2023	2,405
2024	2,187
2025	1,813
Thereafter	4,628
Total	15,177	$ 16,664
Core deposit
Estimated Amortization Expense
2021 remaining	1,415
2022	2,447
2023	2,217
2024	2,023
2025	1,795
Thereafter	4,559
Total	14,456	15,870
Customer relationship and brokered relationship
Estimated Amortization Expense
2021 remaining	95
2022	190
2023	190
2024	159
Total	634	$ 729
Below/ (Above) market-value lease
Estimated Amortization Expense
2021 remaining	(1)
2022	(2)
2023	(2)
2024	5
2025	18
Thereafter	69
Total	$ 87

Goodwill and Other Intangible_6

Goodwill and Other Intangible Assets - Impairment of Intangible Assets (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020
Impairment of Intangible Assets
Impairment of intangible assets	$ 0	$ 0

Income Taxes - Net Deferred Tax

Income Taxes - Net Deferred Tax Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Net deferred tax assets
Net deferred tax assets	$ 26,917	$ 28,221
Deferred Tax Assets, Valuation Allowance	$ 0	$ 0

Income Taxes - Carry Amounts of

Income Taxes - Carry Amounts of the Low Income Housing Investments (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Income Taxes
Low income housing investments	$ 4,827	$ 5,246
Future commitments	$ 596	$ 596

Income Taxes - Future Commitmen

Income Taxes - Future Commitments of the Low Income Housing Investments (Details) - Low income housing investments $ in Thousands	Jun. 30, 2021USD ($)
Future Commitments
2021	$ 46
2022 through 2025	$ 550

Income Taxes - Components of Lo

Income Taxes - Components of Low Income Housing Investment (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Income Taxes
Low income housing tax credits	$ 210	$ 210	$ 420	$ 420
Low income housing investment expense	$ 209	$ 211	$ 418	$ 420

Benefit Plans - Defined Benefit

Benefit Plans - Defined Benefit Plans - Components of Pension Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Supplemental Retirement Plan
Components of net periodic benefit cost:
Service cost	$ 120	$ 123	$ 240	$ 246
Interest cost	190	236	380	467
Amortization of prior service cost	75		100
Amortization of net actuarial loss	136	105	272	190
Net periodic benefit cost	521	464	992	903
Defined Benefit Plan, Assets for Plan Benefits	0		0
Split-Dollar Life Insurance Benefit Plan
Components of net periodic benefit cost:
Interest cost	55	62	110	124	$ 246
Amortization of prior transition obligation	(1)	(15)	(2)	(30)
Net periodic benefit cost	$ 54	$ 47	$ 108	$ 94

Benefit Plans - Defined Benef_2

Benefit Plans - Defined Benefit Plans - Change in Projected Benefit Obligation (Details) - Split-Dollar Life Insurance Benefit Plan - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Change in projected benefit obligation:
Projected benefit obligation at beginning of year			$ 9,689	$ 8,198	$ 8,198
Interest cost	$ 55	$ 62	110	$ 124	246
Actuarial loss					1,245
Projected benefit obligation at end of period	$ 9,799		$ 9,799		$ 9,689

Benefit Plans - Defined Benef_3

Benefit Plans - Defined Benefit Plans - Amounts Recognized in Accumulated Other Comprehensive Loss (Details) - Split-Dollar Life Insurance Benefit Plan - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Amounts Recognized in Accumulated Other Comprehensive Loss
Net actuarial loss	$ 5,217	$ 5,170
Prior transition obligation	925	970
Accumulated other comprehensive loss	$ 6,142	$ 6,140

Fair Value - Financial Assets a

Fair Value - Financial Assets and Liabilities Measured on a Recurring Basis (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Financial Assets and Liabilities Measured on a Recurring Basis
Securities available-for-sale	$ 145,955	$ 235,774
I/O strip receivables	274	305
Agency mortgage-backed securities
Financial Assets and Liabilities Measured on a Recurring Basis
Securities available-for-sale	130,892	175,326
U.S. Treasury
Financial Assets and Liabilities Measured on a Recurring Basis
Securities available-for-sale	15,063	60,448
Quoted Prices in Active Markets for Identical Assets (Level 1) \| U.S. Treasury
Financial Assets and Liabilities Measured on a Recurring Basis
Securities available-for-sale	15,063	60,448
Significant Other Observable Inputs (Level 2)
Financial Assets and Liabilities Measured on a Recurring Basis
I/O strip receivables	274	305
Significant Other Observable Inputs (Level 2) \| Agency mortgage-backed securities
Financial Assets and Liabilities Measured on a Recurring Basis
Securities available-for-sale	130,892	175,326
Recurring basis
Transfers between Level 1 and Level 2
Transfers between Level 1 and Level 2	0	0
Transfers between Level 2 and Level 1	$ 0	$ 0

Fair Value - Impaired Loans Hel

Fair Value - Impaired Loans Held-for-investment - Additional Disclosures (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020
Carrying amount
Impaired Loans Held-for-investment
Foreclosed assets	$ 0	$ 0

Fair Value - Carrying Amounts a

Fair Value - Carrying Amounts and Estimated Fair Values of Financial Instruments (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020
Assets
Securities available-for-sale	$ 145,955,000	$ 235,774,000
Securities held-to-maturity	426,755,000	304,927,000
Federal Home Loan Bank, Federal Reserve Bank stock and other investments, at cost	32,495,000	33,522,000
I/O strips receivables	274,000	305,000
Liabilities
Subordinated Debt.	39,832,000	39,740,000
Significant Other Observable Inputs (Level 2)
Assets
I/O strips receivables	274,000	305,000
Carrying amount
Assets
Cash and cash equivalents	1,328,322,000	1,131,073,000
Securities available-for-sale	145,955,000	235,774,000
Securities held-to-maturity	421,286,000	297,389,000
Loans (including loans held-for-sale), net	2,785,184,000	2,576,560,000
Federal Home Loan Bank, Federal Reserve Bank stock and other investments, at cost	32,495,000	33,522,000
Accrued interest receivable	10,397,000	10,546,000
I/O strips receivables	274,000	305,000
Liabilities
Time deposits	158,644,000	153,407,000
Other deposits	4,185,828,000	3,761,079,000
Subordinated Debt.	39,832,000	39,740,000
Accrued interest payable	548,000	545,000
Carried at fair value
Assets
Cash and cash equivalents	1,328,322,000	1,131,073,000
Securities available-for-sale	145,955,000	235,774,000
Securities held-to-maturity	426,755,000	304,927,000
Loans (including loans held-for-sale), net	2,800,683,000	2,574,692,000
Accrued interest receivable	10,397,000	10,546,000
I/O strips receivables	274,000	305,000
Liabilities
Time deposits	158,843,000	153,740,000
Other deposits	4,185,828,000	3,761,079,000
Subordinated Debt.	40,432,000	40,340,000
Accrued interest payable	548,000	545,000
Carried at fair value \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Assets
Cash and cash equivalents	1,328,322,000	1,131,073,000
Securities available-for-sale	15,063,000	60,448,000
Accrued interest receivable	103,000	309,000
Carried at fair value \| Significant Other Observable Inputs (Level 2)
Assets
Securities available-for-sale	130,892,000	175,326,000
Securities held-to-maturity	426,755,000	304,927,000
Loans (including loans held-for-sale), net	4,344,000	1,699,000
Accrued interest receivable	1,510,000	1,512,000
I/O strips receivables	274,000	305,000
Liabilities
Time deposits	158,843,000	153,740,000
Other deposits	4,185,828,000	3,761,079,000
Subordinated Debt.	40,432,000	40,340,000
Accrued interest payable	548,000	545,000
Carried at fair value \| Significant Unobservable Inputs (Level 3)
Assets
Loans (including loans held-for-sale), net	2,796,339,000	2,572,993,000
Accrued interest receivable	$ 8,784,000	$ 8,725,000

Equity Plan - General Disclosur

Equity Plan - General Disclosures (Details) - USD ($)	6 Months Ended
Equity Plan - General Disclosures (Details) - USD ($)	Jun. 30, 2021	May 21, 2020	May 20, 2020
Equity Plan
Number of shares available for future grants	1,940,811
2013 Plan
Equity Plan
Number of shares authorized for equity plan		5,000,000	3,000,000
Options
Equity Plan
Vesting period	4 years
Expiration term	10 years
Restricted stock
Equity Plan
Number of equity awards issued (in shares)	187,325
Fair value of awards vested	$ 1,749,000
Nonqualified stock options
Equity Plan
Number of equity awards issued (in shares)	350,750

Equity Plan - Stock Option Acti

Equity Plan - Stock Option Activity (Details) - Options - USD ($)	6 Months Ended
	Jun. 30, 2021
Number of Shares
Outstanding at the beginning of the period (in shares)	2,546,821
Granted (in shares)	350,750
Exercised (in shares)	(132,342)
Forfeited or expired (in shares)	(36,766)
Outstanding at the end of the period (in shares)	2,728,463
Vested or expected to vest (in shares)	2,564,755
Exercisable at the end of the period (in shares)	1,996,727
Weighted Average Exercise Price
Outstanding at the beginning of the period (in dollars per share)	$ 9.30
Granted (in dollars per share)	12.08
Exercised (in dollars per share)	5.93
Forfeited or expired (in dollars per share)	12.89
Outstanding at the end of the period (in dollars per share)	$ 9.77
Additional Information
Weighted Average Remaining Contractual Life - Outstanding at the end of the period (in years)	5 years 8 months 15 days
Weighted Average Remaining Contractual Life - Vested or expected to vest (in years)	5 years 8 months 15 days
Weighted Average Remaining Contractual Life - Exercisable at the end of the period (in years)	4 years 6 months 3 days
Aggregate Intrinsic Value - Outstanding at the end of the period (in dollars)	$ 6,286,272
Aggregate Intrinsic Value - Vested or expected to vest (in dollars)	5,909,096
Aggregate Intrinsic Value - Exercisable at the end of the period (in dollars)	$ 5,826,621

Equity Plan - Information Relat

Equity Plan - Information Related to the Equity Plans for each of the Last Three Years (Details) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Information Related to the Equity Plans
Cash received from option exercise	$ 784	$ 1,490
Options
Information Related to the Equity Plans
Intrinsic value of options exercised	679,403	2,057,914
Cash received from option exercise	784,264	1,489,991
Tax benefit realized from option exercises	$ 57,215	$ 33,783
Weighted average fair value of options granted (in dollars per share)	$ 2.33	$ 1.15

Equity Plan - Unrecognized Comp

Equity Plan - Unrecognized Compensation Cost - Nonvested Stock Options (Details) - Options $ in Thousands	6 Months Ended
	Jun. 30, 2021USD ($)
Unrecognized Compensation Cost
Total unrecognized compensation cost related to nonvested stock options granted	$ 1,410
Expected weighted-average period for recognition of compensation costs related to nonvested stock options	2 years 11 months 15 days

Equity Plan - Assumptions Used

Equity Plan - Assumptions Used to Estimate Fair Value (Details) - Options	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Assumptions Used to Estimate Fair Value
Expected life in months	72 months	72 months
Volatility (as a percent)	33.00%	29.00%
Weighted average risk-free interest rate (as a percent)	1.10%	0.53%
Expected dividends (as a percent)	4.30%	5.71%

Equity Plan - Restricted Stock

Equity Plan - Restricted Stock Activity (Details) - Restricted stock	6 Months Ended
	Jun. 30, 2021$ / sharesshares
Number of Shares
Nonvested shares at the beginning of the period (in shares) \| shares	298,700
Granted (in shares) \| shares	187,325
Vested (in shares) \| shares	(153,101)
Forfeited or expired (in shares) \| shares	(34,358)
Nonvested shares at the end of the period (in shares) \| shares	298,566
Weighted Average Grant Date Fair Value
Nonvested shares at the beginning of the period (in dollars per share) \| $ / shares	$ 10.83
Granted (in dollars per share) \| $ / shares	12.01
Vested (in dollars per share) \| $ / shares	11.42
Forfeited or expired (in dollars per share) \| $ / shares	10.23
Nonvested shares at the end of the period (in dollars per share) \| $ / shares	$ 11.03

Equity Plan - Unrecognized Co_2

Equity Plan - Unrecognized Compensation Cost - Nonvested Restricted Stock Awards (Details) - Restricted stock $ in Thousands	6 Months Ended
	Jun. 30, 2021USD ($)
Unrecognized Compensation Cost
Total unrecognized compensation cost related to nonvested restricted stock awards	$ 3,201
Expected weighted-average period for recognition of compensation costs related to nonvested restricted stock awards	2 years 10 days

Subordinated Debt (Details)

Subordinated Debt (Details) - USD ($)	May 26, 2017	Jun. 30, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Principal amount	$ 40,000,000
Fixed interest rate (as a percent)	5.25%
Subordinated debt, net of issuance costs		$ 39,832,000	$ 39,740,000
Debt Issuance Costs	$ 168,000
LIBOR
Debt Instrument [Line Items]
Rate of interest added to base rate	336.50%

Capital Requirements - General

Capital Requirements - General Information (Details)	Mar. 27, 2020	Jun. 30, 2021	Dec. 31, 2020
Capital Requirements
Period to delay the estimated impact of the adoption of the CECL Standard to regulatory capital as the company elected the option	2 years
Addition period for transition	3 years
Capital conservation buffer (as a percent)		2.50%	2.50%
HBC (Wholly-owned Subsidiary)
Capital Requirements
Capital conservation buffer (as a percent)		2.50%	2.50%

Capital Requirements - Tabular

Capital Requirements - Tabular Disclosure (Details) $ in Thousands	Jun. 30, 2021USD ($)	Dec. 31, 2020USD ($)
Total Capital (to risk-weighted assets)
Actual, Amount	$ 491,475	$ 483,870
Required For Capital Adequacy Purposes, Amount	$ 329,965	$ 307,067
Actual, Ratio (as a percent)	0.156	0.165
Required For Capital Adequacy Purposes, Ratio (as a percent)	0.105	0.105
Tier 1 Capital (to risk-weighted assets)
Actual, Amount	$ 418,134	$ 410,307
Required For Capital Adequacy Purposes, Amount	$ 267,115	$ 248,578
Actual, Ratio (as a percent)	0.133	0.140
Required For Capital Adequacy Purposes, Ratio (as a percent)	0.085	0.085
Common Equity Tier 1 Capital (to risk-weighted assets)
Actual, Amount	$ 418,134	$ 410,307
Required For Capital Adequacy Purposes, Amount	$ 219,977	$ 204,711
Actual, Ratio (as a percent)	0.133%	0.14%
Required For Capital Adequacy Purposes, Ratio (as a percent)	0.07%	0.07%
Tier 1 Capital (to average assets)
Actual, Amount	$ 418,134	$ 410,307
Required For Capital Adequacy Purposes, Amount	$ 194,156	$ 180,281
Actual, Ratio (as a percent)	0.086	0.091
Required For Capital Adequacy Purposes, Ratio (as a percent)	0.040	0.040
HBC (Wholly-owned Subsidiary)
Total Capital (to risk-weighted assets)
Actual, Amount	$ 469,701	$ 461,933
To Be Well Capitalized Under Regulatory Requirements, Amount	314,070	292,258
Required For Capital Adequacy Purposes, Amount	$ 329,773	$ 306,871
Actual, Ratio (as a percent)	0.150	0.158
To Be Well Capitalized Under Regulatory Requirements, Ratio (as a percent)	0.100	0.100
Required For Capital Adequacy Purposes, Ratio (as a percent)	0.105	0.105
Tier 1 Capital (to risk-weighted assets)
Actual, Amount	$ 436,192	$ 428,109
To Be Well Capitalized Under Regulatory Requirements, Amount	251,256	233,806
Required For Capital Adequacy Purposes, Amount	$ 266,959	$ 248,419
Actual, Ratio (as a percent)	0.139	0.146
To Be Well Capitalized Under Regulatory Requirements, Ratio (as a percent)	0.080	0.080
Required For Capital Adequacy Purposes, Ratio (as a percent)	0.085	0.085
Common Equity Tier 1 Capital (to risk-weighted assets)
Actual, Amount	$ 436,192	$ 428,109
To Be Well Capitalized Under Regulatory Requirements, Amount	204,145	189,968
Required For Capital Adequacy Purposes, Amount	$ 219,849	$ 204,580
Actual, Ratio (as a percent)	0.139%	0.146%
To Be Well Capitalized Under Regulatory Requirements, Ratio (as a percent)	0.065%	0.065%
Required For Capital Adequacy Purposes, Ratio (as a percent)	0.07%	0.07%
Tier 1 Capital (to average assets)
Actual, Amount	$ 436,192	$ 428,109
To Be Well Capitalized Under Regulatory Requirements, Amount	242,600	225,263
Required For Capital Adequacy Purposes, Amount	$ 194,080	$ 180,211
Actual, Ratio (as a percent)	0.090	0.095
To Be Well Capitalized Under Regulatory Requirements, Ratio (as a percent)	0.050	0.050
Required For Capital Adequacy Purposes, Ratio (as a percent)	0.040	0.040

Capital Requirements - Dividend

Capital Requirements - Dividends to Parent (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2021	Dec. 31, 2020
Cash dividend
Subordinated Debt.	$ 39,832,000		$ 39,832,000	$ 39,740,000
HBC (Wholly-owned Subsidiary)
Cash dividend
Cash dividend available	35,173,000		35,173,000
Dividends paid to parent company	$ 8,000,000	$ 8,000,000	$ 16,000,000

Commitments and Loss Continge_3

Commitments and Loss Contingencies - Financial Instruments with Off-Balance Sheet Risk (Details) - USD ($)	3 Months Ended	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Commitments and Contingencies
Reserve for legal settlement	$ 4,000,000	$ 4,000,000
Commitments to extend credit, fixed rate	134,755,000	134,755,000		$ 124,609,000
Commitments to extend credit, variable rate	1,033,740,000	1,033,740,000		989,584,000
Commitment to extend credit, total	1,168,495,000	$ 1,168,495,000		$ 1,114,193,000
Percentage of unused commitments to outstanding gross loans		41.00%	43.00%	42.00%
Off-Balance Sheet, Credit Loss, Liability, Credit Loss Expenses (Reduction)		$ 23,000
Off-balance sheet, credit loss liability increase due to offsetting increase in loss factors in CECL model		1,101,000		$ 1,078,000
Unused lines of credit and commitments to make loans
Commitments and Contingencies
Commitments to extend credit, fixed rate	131,878,000	131,878,000		121,560,000
Commitments to extend credit, variable rate	1,018,383,000	1,018,383,000		970,614,000
Commitment to extend credit, total	1,150,261,000	1,150,261,000		1,092,174,000
Standby letters of credit
Commitments and Contingencies
Commitments to extend credit, fixed rate	2,877,000	2,877,000		3,049,000
Commitments to extend credit, variable rate	15,357,000	15,357,000		18,970,000
Commitment to extend credit, total	$ 18,234,000	$ 18,234,000		$ 22,019,000

Revenue Recognition (Details)

Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Revenue Recognition (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Disaggregation of Revenue [Line Items]
Non-interest Income In-scope of Topic 606	$ 659	$ 650	$ 1,260	$ 2,410
Non-interest Income Out-of-scope of Topic 606	1,510	1,428	3,210	2,861
Total noninterest income	2,169	2,078	4,470	5,271
Service charges and fees on deposit accounts
Disaggregation of Revenue [Line Items]
Non-interest Income In-scope of Topic 606	$ 659	$ 650	$ 1,260	$ 1,619
Revenue, Product and Service [Extensible List]	Service charges and fees on deposit accounts	Service charges and fees on deposit accounts	Service charges and fees on deposit accounts	Service charges and fees on deposit accounts
Gain on the disposition of foreclosed assets
Disaggregation of Revenue [Line Items]
Non-interest Income In-scope of Topic 606				$ 791
Revenue, Product and Service [Extensible List]	Gain on the disposition of foreclosed assets	Gain on the disposition of foreclosed assets	Gain on the disposition of foreclosed assets	Gain on the disposition of foreclosed assets

Noninterest Expense (Details)

Noninterest Expense (Details) - USD ($)	3 Months Ended		6 Months Ended
Noninterest Expense (Details) - USD ($)	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Noninterest Expense
Salaries and employee benefits	$ 12,572,000	$ 12,300,000	$ 26,530,000	$ 26,503,000
Reserve for legal settlement	4,000,000		4,000,000
Occupancy and equipment	2,247,000	1,766,000	4,521,000	3,538,000
Professional fees	1,771,000	1,155,000	3,490,000	2,590,000
Amortization of intangible assets	754,000	964,000	1,487,000	1,822,000
Insurance expense	661,000	516,000	1,324,000	1,034,000
Data processing	583,000	779,000	1,117,000	1,755,000
Software subscriptions	501,000	746,000	977,000	1,635,000
Other	2,686,000	2,786,000	5,573,000	7,909,000
Total noninterest expense, excluding merger-related costs	25,775,000	21,012,000	49,019,000	46,786,000
Salaries and employee benefits merger-related costs				356,000
Other	(24,000)	59,000	34,000	2,127,000
Total merger-related costs	$ (24,000)	$ 59,000	$ 34,000	$ 2,483,000

Leases (Details)

Leases (Details) - USD ($)	3 Months Ended		6 Months Ended
Leases (Details) - USD ($)	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Leases
Lessee, Operating Lease, Option to renew			true
Operating Lease Cost (Cost resulting from lease payments)	$ 1,621,000	$ 1,733,000	$ 3,292,000	$ 3,502,000
Operating Lease - Operating Cash Flows (Fixed Payments)	1,220,000	1,379,000	2,406,000	2,570,000
Operating Lease - ROU assets	36,601,000	37,137,000	36,601,000	37,137,000
Operating Lease - Liabilities	$ 36,601,000	$ 37,137,000	$ 36,601,000	$ 37,137,000
Operating Lease, Liability, Statement of Financial Position [Extensible List]	Operating Lease - Liabilities	Operating Lease - Liabilities	Operating Lease - Liabilities	Operating Lease - Liabilities
Weighted Average Lease Term - Operating Leases	7 years 9 months 14 days	8 years 6 months	7 years 9 months 14 days	8 years 6 months
Weighted Average Discount Rate - Operating Leases	4.48%	4.53%	4.48%	4.53%

Leases - Maturity Analysis (Det

Leases - Maturity Analysis (Details) - USD ($)	Jun. 30, 2021	Jun. 30, 2020
Operating Lease Payments Due
2021 remaining	$ 2,998,000
2022	6,353,000
2023	5,724,000
2024	5,341,000
2025	4,929,000
Thereafter	19,011,000
Total undiscounted cash flows	44,356,000
Discount on cash flows	(7,755,000)
Total lease liability	$ 36,601,000	$ 37,137,000

Business Segment Information -

Business Segment Information - Business Segments (Details)	6 Months Ended
Business Segment Information - Business Segments (Details)	Jun. 30, 2021segment
Business Segment Information
Number of business segments	2
Focus
Business Segment Information
Number of business segments	2

Business Segment Information _2

Business Segment Information - Operating Statements (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Operating Income
Interest income	$ 36,632		$ 37,132		$ 73,393	$ 78,074
Total interest expense	1,756		2,192		3,559	4,554
Net interest income	34,876		34,940		69,834	73,520
Provision for (recapture of) credit losses on loans	(493)		1,114		(2,005)	14,384
Net interest income after provision	35,369		33,826		71,839	59,136
Noninterest income	2,169		2,078		4,470	5,271
Noninterest expense	25,775		21,012		49,019	46,786
Income before income taxes	11,763		14,892		27,290	17,621
Income tax expense	2,950		4,274		7,273	5,142
Net income	8,813	$ 11,204	10,618	$ 1,861	20,017	12,479
Total assets	5,072,875		4,614,401		5,072,875	4,614,401	$ 4,634,114
Loans, net of deferred fees	2,824,796		2,686,389		2,824,796	2,686,389	2,619,261
Goodwill	167,631		167,631		167,631	167,631	167,631
Banking
Operating Income
Interest income	33,860		34,570		67,971	72,635
Intersegment interest allocations	202		218		413	502
Total interest expense	1,756		2,192		3,559	4,554
Net interest income	32,306		32,596		64,825	68,583
Provision for (recapture of) credit losses on loans	(486)		1,107		(1,949)	13,981
Net interest income after provision	32,792		31,489		66,774	54,602
Noninterest income	2,049		1,883		4,209	4,906
Noninterest expense	24,331		19,336		46,228	43,519
Intersegment expense allocations	127		106		233	235
Income before income taxes	10,637		14,142		24,988	16,224
Income tax expense	2,617		4,052		6,593	4,729
Net income	8,020		10,090		18,395	11,495
Total assets	5,003,894		4,546,199		5,003,894	4,546,199
Loans, net of deferred fees	2,777,685		2,644,480		2,777,685	2,644,480
Goodwill	154,587		154,587		154,587	154,587	154,587
Factoring
Operating Income
Interest income	2,772		2,562		5,422	5,439
Intersegment interest allocations	(202)		(218)		(413)	(502)
Net interest income	2,570		2,344		5,009	4,937
Provision for (recapture of) credit losses on loans	(7)		7		(56)	403
Net interest income after provision	2,577		2,337		5,065	4,534
Noninterest income	120		195		261	365
Noninterest expense	1,444		1,676		2,791	3,267
Intersegment expense allocations	(127)		(106)		(233)	(235)
Income before income taxes	1,126		750		2,302	1,397
Income tax expense	333		222		680	413
Net income	793		528		1,622	984
Total assets	68,981		68,202		68,981	68,202
Loans, net of deferred fees	47,111		41,909		47,111	41,909
Goodwill	$ 13,044		$ 13,044		$ 13,044	$ 13,044	$ 13,044

Subsequent Events (Details)

Subsequent Events (Details) - $ / shares	Jul. 22, 2021	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2020	Mar. 31, 2020
Subsequent Event [Line Items]
Quarterly cash dividends declared to holders of common stock		$ 0.13	$ 0.13	$ 0.13	$ 0.13
Subsequent Event
Subsequent Event [Line Items]
Quarterly cash dividends declared to holders of common stock	$ 0.13