Loans | Note 3 — Loans Loans Receivable Loans consisted of the following as of the dates indicated: September 30, 2024 December 31, 2023 (in thousands) Real estate loans: Commercial property Retail $ 1,087,433 $ 1,107,360 Hospitality 819,017 740,519 Office 571,580 574,981 Other (1) 1,369,294 1,366,534 Total commercial property loans 3,847,324 3,789,394 Construction 84,764 100,345 Residential (2) 939,285 962,661 Total real estate loans 4,871,373 4,852,400 Commercial and industrial loans (3) 879,092 747,819 Equipment financing agreements 507,279 582,215 Loans receivable 6,257,744 6,182,434 Allowance for credit losses ( 69,163 ) ( 69,462 ) Loans receivable, net $ 6,188,581 $ 6,112,972 (1) Includes mixed-use, multifamily, industrial, gas stations, faith-based facilities, and medical; all other property types represent less than one percent of total loans receivable. (2) Includes $ 1.5 million and $ 1.9 million of home equity loans and lines, and $ 6.8 million and $ 4.5 million of personal loans at September 30, 2024 and December 31, 2023, respectively. (3) At September 30, 2024 and December 31, 2023, Paycheck Protection Program loans were $ 0.1 million and $ 0.2 million, respectively. Accrued interest on loans was $ 18.7 million and $ 19.8 million at September 30, 2024 and December 31, 2023, respectively. At September 30, 2024 and December 31, 2023, loans with carrying values of $ 2.44 billion and $ 2.36 billion, respectively, were pledged to secure advances from the FHLB. Loans Held for Sale The following is the activity for loans held for sale for the following periods: Real Estate Commercial and Industrial Total (in thousands) Three months ended September 30, 2024 Balance at beginning of period $ 7,149 $ 3,318 $ 10,467 Originations and transfers 58,433 8,457 66,890 Sales ( 14,697 ) ( 8,320 ) ( 23,017 ) Principal paydowns and amortization ( 1 ) ( 3 ) ( 4 ) Balance at end of period $ 50,884 $ 3,452 $ 54,336 Three months ended September 30, 2023 Balance at beginning of period $ 5,544 $ 1,749 $ 7,293 Originations and transfers 12,588 13,398 25,986 Sales ( 11,520 ) ( 9,490 ) ( 21,010 ) Principal paydowns and amortization ( 75 ) ( 427 ) ( 502 ) Balance at end of period $ 6,537 $ 5,230 $ 11,767 Real Estate Commercial and Industrial Total (in thousands) Nine months ended September 30, 2024 Balance at beginning of period $ 8,792 $ 3,221 $ 12,013 Originations and transfers 88,619 25,866 114,485 Sales ( 46,473 ) ( 25,621 ) ( 72,094 ) Principal payoffs and amortization ( 54 ) ( 14 ) ( 68 ) Balance at end of period $ 50,884 $ 3,452 $ 54,336 Nine months ended September 30, 2023 Balance at beginning of period $ 3,775 $ 4,268 $ 8,043 Originations and transfers 43,468 31,420 74,888 Sales ( 40,630 ) ( 30,022 ) ( 70,652 ) Principal payoffs and amortization ( 76 ) ( 436 ) ( 512 ) Balance at end of period $ 6,537 $ 5,230 $ 11,767 The following table presents loans purchased by portfolio segment for the following periods: Three Months Ended Nine Months Ended September 30, September 30, 2024 2023 2024 2023 (in thousands) Commercial real estate $ 1,773 $ — $ 8,107 $ — Commercial and industrial 11,935 — 30,257 — Residential real estate 10,744 — 15,922 — Total $ 24,452 $ — $ 54,286 $ — Allowance for Credit Losses The following table details the information on the allowance for credit losses by portfolio segment for the following periods: Real Estate Commercial and Industrial Equipment Financing Agreements Total (in thousands) Three months ended September 30, 2024 Balance at beginning of period $ 42,152 $ 10,563 $ 15,014 $ 67,729 Charge-offs ( 1,133 ) ( 190 ) ( 2,477 ) ( 3,800 ) Recoveries 729 1,679 516 2,924 Credit loss expense (recovery) 1,946 ( 2,269 ) 2,633 2,310 Ending balance $ 43,694 $ 9,783 $ 15,686 $ 69,163 Three months ended September 30, 2023 Balance at beginning of period $ 43,054 $ 16,028 $ 11,942 $ 71,024 Charge-offs ( 216 ) ( 6,323 ) ( 2,831 ) ( 9,370 ) Recoveries 50 141 301 492 Credit loss expense 948 1,396 2,823 5,167 Ending balance $ 43,836 $ 11,242 $ 12,235 $ 67,313 Real Estate Commercial and Industrial Equipment Financing Agreements Total (in thousands) Nine months ended September 30, 2024 Balance at beginning of period $ 45,499 $ 10,257 $ 13,706 $ 69,462 Charge-offs ( 1,226 ) ( 438 ) ( 6,598 ) ( 8,262 ) Recoveries 840 1,903 1,256 3,999 Credit loss expense (recovery) ( 1,419 ) ( 1,939 ) 7,322 3,964 Ending balance $ 43,694 $ 9,783 $ 15,686 $ 69,163 Nine months ended September 30, 2023 Balance at beginning of period $ 44,026 $ 15,267 $ 12,230 $ 71,523 Charge-offs ( 627 ) ( 6,635 ) ( 7,052 ) ( 14,314 ) Recoveries 180 931 1,131 2,242 Credit loss expense 257 1,679 5,926 7,862 Ending balance $ 43,836 $ 11,242 $ 12,235 $ 67,313 The table below presents the allowance for credit losses by portfolio segment as a percentage of the total allowance for credit losses and loans by portfolio segment as a percentage of the aggregate investment of loans receivable as of: September 30, 2024 December 31, 2023 Allowance Amount Percentage of Total Allowance Total Loans Percentage of Total Loans Allowance Amount Percentage of Total Allowance Total Loans Percentage of Total Loans (dollars in thousands) Real estate loans: Commercial property Retail $ 10,226 14.8 % $ 1,087,433 17.4 % $ 10,264 14.8 % $ 1,107,360 17.9 % Hospitality 13,971 20.2 819,017 13.1 15,534 22.4 740,519 12.0 Office 3,879 5.6 571,580 9.1 3,024 4.4 574,981 9.3 Other 8,004 11.6 1,369,294 21.9 8,663 12.4 1,366,534 22.1 Total commercial property loans 36,080 52.2 3,847,324 61.5 37,485 54.0 3,789,394 61.3 Construction 1,698 2.5 84,764 1.4 2,756 4.0 100,345 1.6 Residential 5,916 8.6 939,285 15.0 5,258 7.5 962,661 15.6 Total real estate loans 43,694 63.3 4,871,373 77.9 45,499 65.5 4,852,400 78.5 Commercial and industrial loans 9,783 14.0 879,092 14.0 10,257 14.8 747,819 12.1 Equipment financing agreements 15,686 22.7 507,279 8.1 13,706 19.7 582,215 9.4 Total $ 69,163 100.0 % $ 6,257,744 100.0 % $ 69,462 100.0 % $ 6,182,434 100.0 % The following table represents the amortized cost basis of collateral-dependent loans by class of loans, for which repayment is expected to be obtained through the sale of the underlying collateral, as of: September 30, 2024 December 31, 2023 (in thousands) Real estate loans: Commercial property Retail $ 1,683 $ 1,530 Hospitality 266 338 Other — 305 Total commercial property loans 1,949 2,173 Construction 1,194 — Residential 1,873 1 Total real estate loans 5,016 2,174 Commercial and industrial loans — 5,178 Total $ 5,016 $ 7,352 Loan Quality Indicators As part of the on-going monitoring of the quality of our loans portfolio, we utilize an internal loan grading system to identify credit risk and assign an appropriate grade (from 1 to 8) for each loan in our portfolio. Third-party loan reviews are conducted annually on a sample basis. Additional adjustments are made when determined to be necessary. The loan grade definitions are as follows: Pass and Pass-Watch: Pass and Pass-Watch loans, grades (1-4), are in compliance with the Bank’s credit policy and regulatory requirements, and do not exhibit any potential or defined weaknesses as defined under “Special Mention”, “Substandard” or “Doubtful.” This category is the strongest level of the Bank’s loan grading system. It consists of all performing loans with no identified credit weaknesses. It includes cash and stock/security secured loans or other investment grade loans. Special Mention: A Special Mention loan, grade (5), has potential weaknesses that deserve management’s close attention. If not corrected, these potential weaknesses may result in deterioration of the repayment of the debt and result in a Substandard classification. Loans that have significant actual, not potential, weaknesses are considered more severely classified. Substandard: A Substandard loan, grade (6), has a well-defined weakness that jeopardizes the liquidation of the debt. A loan graded Substandard is not protected by the sound worth and paying capacity of the borrower, or of the value and type of collateral pledged. With a Substandard loan, there is a distinct possibility that the Bank will sustain some loss if the weaknesses or deficiencies are not corrected. Doubtful: A Doubtful loan, grade (7), is one that has critical weaknesses that would make the collection or liquidation of the full amount due improbable. However, there may be pending events which may work to strengthen the loan, and therefore the amount or timing of a possible loss cannot be determined at the current time. Loss: A loan classified as Loss, grade (8), is considered uncollectible and of such little value that their continuance as active bank assets is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this asset even though partial recovery may be possible in the future. Loans classified as Loss will be charged off in a timely manner. Under regulatory guidance, loans graded special mention or worse are considered criticized loans, and loans graded substandard or worse are considered classified loans. Loans by Vintage Year and Risk Rating Term Loans Amortized Cost Basis by Origination Year (1) 2024 2023 2022 2021 2020 Prior Revolving Total (in thousands) September 30, 2024 Real estate loans: Commercial property Risk Rating ` Pass / Pass-Watch $ 433,413 $ 558,091 $ 941,253 $ 821,086 $ 559,560 $ 343,178 $ 62,712 $ 3,719,293 Special Mention — 32,950 — — 1,302 76,970 — 111,222 Classified 523 — 6,999 3,192 71 6,024 — 16,809 Total commercial property 433,936 591,041 948,252 824,278 560,933 426,172 62,712 3,847,324 YTD gross charge-offs — — — — — 93 — 93 YTD net charge-offs (recoveries) — — — — ( 17 ) ( 728 ) — ( 745 ) Construction Risk Rating Pass / Pass-Watch 56,092 27,478 — — — — — 83,570 Special Mention — — — — — — — — Classified 1,194 — — — — — — 1,194 Total construction 57,286 27,478 — — — — — 84,764 YTD gross charge-offs — — — — 1,133 — — 1,133 YTD net charge-offs (recoveries) — — — — 1,133 — — 1,133 Residential Risk Rating Pass / Pass-Watch 82,446 217,473 361,552 148,635 11,851 109,407 7,347 938,711 Special Mention — — — — — — 250 250 Classified — — — — 324 — — 324 Total residential 82,446 217,473 361,552 148,635 12,175 109,407 7,597 939,285 YTD gross charge-offs — — — — — — — — YTD net charge-offs (recoveries) — — — — — ( 2 ) — ( 2 ) Total real estate loans Risk Rating Pass / Pass-Watch 571,951 803,042 1,302,805 969,721 571,411 452,585 70,059 4,741,574 Special Mention — 32,950 — — 1,302 76,970 250 111,472 Classified 1,717 — 6,999 3,192 395 6,024 — 18,327 Total real estate loans 573,668 835,992 1,309,804 972,913 573,108 535,579 70,309 4,871,373 YTD gross charge-offs — — — — 1,133 93 — 1,226 YTD net charge-offs (recoveries) — — — — 1,116 ( 730 ) — 386 Commercial and industrial loans: Risk Rating Pass / Pass-Watch 222,285 63,975 124,076 45,344 14,705 15,257 372,867 858,509 Special Mention 20,060 — — — — 44 — 20,104 Classified 154 — 78 — — 247 — 479 Total commercial and industrial loans 242,499 63,975 124,154 45,344 14,705 15,548 372,867 879,092 YTD gross charge-offs — 82 168 — 11 175 2 438 YTD net charge-offs (recoveries) — 82 163 ( 13 ) 11 114 ( 1,822 ) ( 1,465 ) Equipment financing agreements: Risk Rating Pass / Pass-Watch 107,615 160,910 148,909 63,155 11,422 5,696 — 497,707 Special Mention — — — — — — — — Classified 258 1,942 4,350 2,488 219 315 — 9,572 Total equipment financing agreements 107,873 162,852 153,259 65,643 11,641 6,011 — 507,279 YTD gross charge-offs — 844 3,803 1,404 318 229 — 6,598 YTD net charge-offs (recoveries) — 795 3,315 1,100 259 ( 127 ) — 5,342 Total loans receivable: Risk Rating Pass / Pass-Watch 901,851 1,027,927 1,575,790 1,078,220 597,538 473,538 442,926 6,097,790 Special Mention 20,060 32,950 — — 1,302 77,014 250 131,576 Classified 2,129 1,942 11,427 5,680 614 6,586 — 28,378 Total loans receivable $ 924,040 $ 1,062,819 $ 1,587,217 $ 1,083,900 $ 599,454 $ 557,138 $ 443,176 $ 6,257,744 YTD gross charge-offs — 926 3,971 1,404 1,462 497 2 8,262 YTD net charge-offs (recoveries) — 877 3,478 1,087 1,386 ( 743 ) ( 1,822 ) 4,263 (1) Includes extensions, renewals, or modifications of credit contracts, which consist of a new credit decision. Term Loans Amortized Cost Basis by Origination Year (1) 2023 2022 2021 2020 2019 Prior Revolving Total December 31, 2023 Real estate loans: Commercial property Risk Rating Pass / Pass-Watch $ 683,819 $ 986,822 $ 858,821 $ 572,950 $ 378,067 $ 238,400 $ 30,236 $ 3,749,115 Special Mention 4,400 3,997 3,271 5,670 711 2,310 1,406 21,765 Classified 3,065 1,080 4,899 — 5,578 3,892 — 18,514 Total commercial property 691,284 991,899 866,991 578,620 384,356 244,602 31,642 3,789,394 YTD gross charge-offs — — — 411 — 216 — 627 YTD net charge-offs (recoveries) — — — 403 — ( 81 ) — 322 Construction Risk Rating Pass / Pass-Watch 72,039 — — — — — — 72,039 Special Mention — — 28,306 — — — — 28,306 Classified — — — — — — — — Total construction 72,039 — 28,306 — — — — 100,345 YTD gross charge-offs — — — — — — — — YTD net charge-offs (recoveries) — — — — — — — — Residential Risk Rating Pass / Pass-Watch 290,196 375,712 158,618 12,656 217 119,736 5,025 962,160 Special Mention — — — — — — 500 500 Classified — — — — — 1 — 1 Total residential 290,196 375,712 158,618 12,656 217 119,737 5,525 962,661 YTD gross charge-offs — — — — — — — — YTD net charge-offs (recoveries) — — — — — ( 7 ) — ( 7 ) Total real estate loans Risk Rating Pass / Pass-Watch 1,046,054 1,362,534 1,017,439 585,606 378,284 358,136 35,261 4,783,314 Special Mention 4,400 3,997 31,577 5,670 711 2,310 1,906 50,571 Classified 3,065 1,080 4,899 — 5,578 3,893 — 18,515 Total real estate loans 1,053,519 1,367,611 1,053,915 591,276 384,573 364,339 37,167 4,852,400 YTD gross charge-offs — — — 411 — 216 — 627 YTD net charge-offs (recoveries) — — — 403 — ( 88 ) — 315 Commercial and industrial loans: Risk Rating Pass / Pass-Watch 177,864 169,209 84,198 31,348 9,971 12,920 242,044 727,554 Special Mention — 14,578 — 102 — 65 ( 1 ) 14,744 Classified 329 — — — 79 174 4,939 5,521 Total commercial and industrial loans 178,193 183,787 84,198 31,450 10,050 13,159 246,982 747,819 YTD gross charge-offs — 17 — — 110 410 6,120 6,657 YTD net charge-offs (recoveries) — 5 ( 7 ) — 101 ( 6,621 ) 6,090 ( 432 ) Equipment financing agreements: Risk Rating Pass / Pass-Watch 215,670 211,228 101,622 24,340 18,832 3,192 — 574,884 Special Mention — — — — — — — — Classified 392 4,171 1,945 365 401 57 — 7,331 Total equipment financing agreements 216,062 215,399 103,567 24,705 19,233 3,249 — 582,215 YTD gross charge-offs 178 3,944 3,267 386 799 232 — 8,806 YTD net charge-offs (recoveries) 178 3,744 2,858 244 250 ( 114 ) — 7,160 Total loans receivable: Risk Rating Pass / Pass-Watch 1,439,588 1,742,971 1,203,259 641,294 407,087 374,248 277,305 6,085,752 Special Mention 4,400 18,575 31,577 5,772 711 2,375 1,905 65,315 Classified 3,786 5,251 6,844 365 6,058 4,124 4,939 31,367 Total loans receivable $ 1,447,774 $ 1,766,797 $ 1,241,680 $ 647,431 $ 413,856 $ 380,747 $ 284,149 $ 6,182,434 YTD gross charge-offs 178 3,961 3,267 797 909 858 6,120 16,090 YTD net charge-offs (recoveries) 178 3,749 2,851 647 351 ( 6,823 ) 6,090 7,043 (1) Includes extensions, renewals, or modifications of credit contracts, which consist of a new credit decision. Loans by Vintage Year and Payment Performance Term Loans Amortized Cost Basis by Origination Year (1) 2024 2023 2022 2021 2020 Prior Revolving Total (in thousands) September 30, 2024 Real estate loans: Commercial property Payment performance Performing $ 433,936 $ 591,041 $ 947,246 $ 824,278 $ 560,933 $ 424,634 $ 62,712 $ 3,844,780 Nonperforming — — 1,006 — — 1,538 — 2,544 Total commercial property 433,936 591,041 948,252 824,278 560,933 426,172 62,712 3,847,324 YTD gross charge-offs — — — — — 93 — 93 YTD net charge-offs (recoveries) — — — — ( 17 ) ( 728 ) — ( 745 ) Construction Payment performance Performing 56,092 27,478 — — — — — 83,570 Nonperforming 1,194 — — — — — — 1,194 Total construction 57,286 27,478 — — — — — 84,764 YTD gross charge-offs — — — — 1,133 — — 1,133 YTD net charge-offs (recoveries) — — — — 1,133 — — 1,133 Residential Payment performance Performing 82,446 217,473 360,970 148,635 11,849 108,444 7,597 937,414 Nonperforming — — 582 — 326 963 — 1,871 Total residential 82,446 217,473 361,552 148,635 12,175 109,407 7,597 939,285 YTD gross charge-offs — — — — — — — — YTD net charge-offs (recoveries) — — — — — ( 2 ) — ( 2 ) Total real estate loans Payment performance Performing 572,474 835,992 1,308,216 972,913 572,782 533,078 70,309 4,865,764 Nonperforming 1,194 — 1,588 — 326 2,501 — 5,609 Total real estate loans 573,668 835,992 1,309,804 972,913 573,108 535,579 70,309 4,871,373 YTD gross charge-offs — — — — 1,133 93 — 1,226 YTD net charge-offs (recoveries) — — — — 1,116 ( 730 ) — 386 Commercial and industrial loans: Payment performance Performing 242,499 63,733 124,154 45,344 14,705 15,548 372,867 878,850 Nonperforming — 242 — — — — — 242 Total commercial and industrial loans 242,499 63,975 124,154 45,344 14,705 15,548 372,867 879,092 YTD gross charge-offs — 82 168 — 11 175 2 438 YTD net charge-offs (recoveries) — 82 163 ( 13 ) 11 114 ( 1,822 ) ( 1,465 ) Equipment financing agreements: Payment performance Performing 107,615 160,910 148,875 63,122 11,422 5,696 — 497,640 Nonperforming 258 1,942 4,384 2,521 219 315 — 9,639 Total equipment financing agreements 107,873 162,852 153,259 65,643 11,641 6,011 — 507,279 YTD gross charge-offs — 844 3,803 1,404 318 229 — 6,598 YTD net charge-offs (recoveries) — 795 3,315 1,100 259 ( 127 ) — 5,342 Total loans receivable: Payment performance Performing 922,588 1,060,635 1,581,245 1,081,379 598,909 554,322 443,176 6,242,254 Nonperforming 1,452 2,184 5,972 2,521 545 2,816 — 15,490 Total loans receivable $ 924,040 $ 1,062,819 $ 1,587,217 $ 1,083,900 $ 599,454 $ 557,138 $ 443,176 $ 6,257,744 YTD gross charge-offs — 926 3,971 1,404 1,462 497 2 8,262 YTD net charge-offs (recoveries) — 877 3,478 1,087 1,386 ( 743 ) ( 1,822 ) 4,263 (1) Includes extensions, renewals, or modifications of credit contracts, which consist of a new credit decision. Term Loans Amortized Cost Basis by Origination Year (1) 2023 2022 2021 2020 2019 Prior Revolving Total December 31, 2023 Real estate loans: Commercial property Payment performance Performing $ 689,449 $ 991,899 $ 866,841 $ 578,620 $ 384,275 $ 243,819 $ 31,642 $ 3,786,545 Nonperforming 1,835 — 150 — 81 783 — 2,849 Total commercial property 691,284 991,899 866,991 578,620 384,356 244,602 31,642 3,789,394 YTD gross charge-offs — — — 411 — 216 — 627 YTD net charge-offs (recoveries) — — — 403 — ( 81 ) — 322 Construction Payment performance Performing 72,039 — 28,306 — — — — 100,345 Nonperforming — — — — — — — — Total construction 72,039 — 28,306 — — — — 100,345 YTD gross charge-offs — — — — — — — — YTD net charge-offs (recoveries) — — — — — — — — Residential Payment performance Performing 290,196 375,712 158,618 12,656 217 119,736 5,525 962,660 Nonperforming — — — — — 1 — 1 Total residential 290,196 375,712 158,618 12,656 217 119,737 5,525 962,661 YTD gross charge-offs — — — — — — — — YTD net charge-offs (recoveries) — — — — — ( 7 ) — ( 7 ) Total real estate loans Payment performance Performing 1,051,684 1,367,611 1,053,765 591,276 384,492 363,555 37,167 4,849,550 Nonperforming 1,835 — 150 — 81 784 — 2,850 Total real estate loans 1,053,519 1,367,611 1,053,915 591,276 384,573 364,339 37,167 4,852,400 YTD gross charge-offs — — — 411 — 216 — 627 YTD net charge-offs (recoveries) — — — 403 — ( 88 ) — 315 Commercial and industrial loans: Payment performance Performing 177,864 183,787 84,198 31,415 10,050 13,066 242,134 742,514 Nonperforming 329 — — 35 — 93 4,848 5,305 Total commercial and industrial loans 178,193 183,787 84,198 31,450 10,050 13,159 246,982 747,819 YTD gross charge-offs — 17 — — 110 410 6,120 6,657 YTD net charge-offs (recoveries) — 5 ( 7 ) — 101 ( 6,621 ) 6,090 ( 432 ) Equipment financing agreements: Payment performance Performing 215,670 211,228 101,622 24,340 18,844 3,192 — 574,896 Nonperforming 392 4,171 1,945 365 389 57 — 7,319 Total equipment financing agreements 216,062 215,399 103,567 24,705 19,233 3,249 — 582,215 YTD gross charge-offs 178 3,944 3,267 386 799 232 — 8,806 YTD net charge-offs (recoveries) 178 3,744 2,858 244 250 ( 114 ) — 7,160 Total loans receivable: Payment performance Performing 1,445,218 1,762,626 1,239,585 647,031 413,386 379,813 279,301 6,166,960 Nonperforming 2,556 4,171 2,095 400 470 934 4,848 15,474 Total loans receivable $ 1,447,774 $ 1,766,797 $ 1,241,680 $ 647,431 $ 413,856 $ 380,747 $ 284,149 $ 6,182,434 YTD gross charge-offs 178 3,961 3,267 797 909 858 6,120 16,090 YTD net charge-offs (recoveries) 178 3,749 2,851 647 351 ( 6,823 ) 6,090 7,043 (1) Includes extensions, renewals, or modifications of credit contracts, which consist of a new credit decision. The following is an aging analysis of loans, including loans on nonaccrual status, disaggregated by loan class, as of: 30-59 60-89 90 Days Total Current Total (in thousands) September 30, 2024 Real estate loans: Commercial property Retail $ 870 $ 262 $ — $ 1,132 $ 1,086,301 $ 1,087,433 Hospitality 775 — — 775 818,242 819,017 Office 812 — — 812 570,768 571,580 Other 253 350 — 603 1,368,691 1,369,294 Total commercial property loans 2,710 612 — 3,322 3,844,002 3,847,324 Construction 1,194 — — 1,194 83,570 84,764 Residential 3,642 2,856 6,498 932,787 939,285 Total real estate loans 7,546 3,468 — 11,014 4,860,359 4,871,373 Commercial and industrial loans 627 206 242 1,075 878,017 879,092 Equipment financing agreements 6,287 2,751 5,734 14,772 492,507 507,279 Total loans receivable $ 14,460 $ 6,425 $ 5,976 $ 26,861 $ 6,230,883 $ 6,257,744 December 31, 2023 Real estate loans: Commercial property Retail $ 632 $ — $ — $ 632 $ 1,106,728 $ 1,107,360 Hospitality — 150 22 172 740,347 740,519 Office — — — — 574,981 574,981 Other 592 — — 592 1,365,942 1,366,534 Total commercial property loans 1,224 150 22 1,396 3,787,998 3,789,394 Construction — — — — 100,345 100,345 Residential 521 336 1 858 961,803 962,661 Total real estate loans 1,745 486 23 2,254 4,850,146 4,852,400 Commercial and industrial loans 76 120 5,178 5,374 742,445 747,819 Equipment financing agreements 7,138 2,134 4,551 13,823 568,392 582,215 Total loans receivable $ 8,959 $ 2,740 $ 9,752 $ 21,451 $ 6,160,983 $ 6,182,434 Nonaccrual Loans and Nonperforming Assets The following tables represent the amortized cost basis of loans on nonaccrual status and loans past due 90 days and still accruing as of: September 30, 2024 Nonaccrual Loans Nonaccrual Loans Loans Total (in thousands) Real estate loans: Commercial property Retail $ 1,803 $ 509 $ — $ 2,312 Hospitality 224 — — 224 Office — — — — Other — 9 — 9 Total commercial property loans 2,027 518 — 2,545 Construction 1,194 — — 1,194 Residential 1,871 — — 1,871 Total real estate loans 5,092 518 — 5,610 Commercial and industrial loans — — 241 241 Equipment financing agreements 566 9,073 — 9,639 Total $ 5,658 $ 9,591 $ 241 $ 15,490 December 31, 2023 Nonaccrual Loans Nonaccrual Loans Loans Total (in thousands) Real estate loans: Commercial property Retail $ 1,717 $ 321 $ — $ 2,038 Hospitality 338 150 — 488 Other 305 18 — 323 Total commercial property loans 2,360 489 — 2,849 Residential 1 — — 1 Total real estate loans 2,361 489 — 2,850 Commercial and industrial loans 5,213 92 — 5,305 Equipment financing agreements 570 6,749 — 7,319 Total $ 8,144 $ 7,330 $ — $ 15,474 The Company recognized $ 11,000 and $ 26,000 of interest income on nonaccrual loans for the three months ended September 30, 2024 and 2023, respectively. Interest income recognized on nonaccrual loans for the nine months ended September 30, 2024 and 2023 was $ 49,000 and $ 160,000 , respectively. The following table details nonperforming assets as of the dates indicated: September 30, 2024 December 31, 2023 (in thousands) Nonaccrual loans $ 15,249 $ 15,474 Loans receivable 90 days or more past due and still accruing 241 — Total nonperforming loans receivable* 15,490 15,474 Other real estate owned (“OREO”) 772 117 Total nonperforming assets** $ 16,262 $ 15,591 * Excludes a $ 27.2 million nonperforming loan held-for-sale. ** Excludes repossessed personal property of $ 1.2 million and $ 1.3 million as of September 30, 2024 and December 31, 2023, respectively. OREO of $ 0.8 million and $ 0.1 million is included in prepaid expenses and other assets in the accompanying Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, respectively. Loan Modifications The following table presents loan modifications made to borrowers experiencing financial difficulty, by type of modification, with related amortized cost balances, respective percentage shares of the total class of loans, and the related financial effect, for the periods indicated: Term Extension Amortized Cost Basis % of Total Class of Loans Financial Effect (in thousands) Three and nine months ended September 30, 2024 Commercial and industrial loans $ 20,060 2.0 % 1 loan with term extension of 6 years The modified loan above is current at September 30, 2024. No loans were modified to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2023. |