LOANS AND LEASES AND ALLOWANCE FOR LOAN AND LEASE LOSSES | LOANS AND LEASES AND ALLOWANCE FOR LOAN AND LEASE LOSSES The following table presents the balances in the Company’s loans and leases portfolio as of the dates indicated: ($ in thousands) NTM Loans Traditional Loans and Leases Total NTM and Traditional Loans and Leases PCI Loans Total Loans and Leases Receivable December 31, 2017 Commercial: Commercial and industrial $ — $ 1,701,951 $ 1,701,951 $ — $ 1,701,951 Commercial real estate — 717,415 717,415 — 717,415 Multifamily — 1,816,141 1,816,141 — 1,816,141 SBA — 78,699 78,699 — 78,699 Construction — 182,960 182,960 — 182,960 Lease financing — 13 13 — 13 Consumer: Single family residential mortgage 721,158 1,252,294 1,973,452 — 1,973,452 Green Loans (HELOC) - first liens 82,197 — 82,197 — 82,197 Green Loans (HELOC) - second liens 3,578 — 3,578 — 3,578 Other consumer — 103,001 103,001 — 103,001 Total loans and leases $ 806,933 $ 5,852,474 $ 6,659,407 $ — $ 6,659,407 Percentage to total loans and leases 12.1 % 87.9 % 100.0 % — % 100.0 % Allowance for loan and lease losses (49,333 ) Loans and leases receivable, net $ 6,610,074 December 31, 2016 Commercial: Commercial and industrial $ — $ 1,518,200 $ 1,518,200 $ 4,760 $ 1,522,960 Commercial real estate — 728,777 728,777 1,182 729,959 Multifamily — 1,365,262 1,365,262 — 1,365,262 SBA — 71,168 71,168 2,672 73,840 Construction — 125,100 125,100 — 125,100 Lease financing — 379 379 — 379 Consumer: Single family residential mortgage 794,120 1,091,829 1,885,949 133,212 2,019,161 Green Loans (HELOC) - first liens 87,469 — 87,469 — 87,469 Green Loans (HELOC) - second liens 3,559 — 3,559 — 3,559 Other consumer — 107,063 107,063 — 107,063 Total loans and leases $ 885,148 $ 5,007,778 $ 5,892,926 $ 141,826 $ 6,034,752 Percentage to total loans and leases 14.7 % 83.0 % 97.7 % 2.3 % 100.0 % Allowance for loan and lease losses (40,444 ) Loans and leases receivable, net $ 5,994,308 Non-Traditional Mortgage Loans The Company’s NTM portfolio is comprised of three interest only products: Green Loans, Interest Only loans and a small number of additional loans with the potential for negative amortization. As of December 31, 2017 and 2016 , the NTM loans totaled $806.9 million , or 12.1 percent of total loans and leases, and $885.1 million , or 14.7 percent of total loans and leases, respectively. The total NTM portfolio decreased by $78.2 million , or 8.8 percent , during the year ended December 31, 2017 . The following table presents the composition of the NTM portfolio as of the dates indicated: December 31, 2017 2016 ($ in thousands) Count Amount Percent Count Amount Percent Green Loans (HELOC) - first liens 101 $ 82,197 10.2 % 107 $ 87,469 9.9 % Interest only - first liens 468 717,484 88.9 % 522 784,364 88.6 % Negative amortization 11 3,674 0.5 % 22 9,756 1.1 % Total NTM - first liens 580 803,355 99.6 % 651 881,589 99.6 % Green Loans (HELOC) - second liens 12 3,578 0.4 % 12 3,559 0.4 % Total NTM - second liens 12 3,578 0.4 % 12 3,559 0.4 % Total NTM loans 592 806,933 100.0 % 663 885,148 100.0 % Total loans and leases $ 6,659,407 $ 6,034,752 Percentage to total loans and leases 12.1 % 14.7 % Green Loans Green Loans are single family residential first and second mortgage lines of credit with a linked checking account that allows all types of deposits and withdrawals to be performed. The loans are generally interest only for a 15 -year term with a balloon payment due at maturity. At December 31, 2017 and 2016 , Green Loans totaled $85.8 million and $91.0 million , respectively. At December 31, 2017 and 2016 , none of the Company’s Green Loans were non-performing. As a result of their unique payment feature, Green Loans possess higher credit risk due to the potential for negative amortization; however, management believes the risk is mitigated through the Company’s loan terms and underwriting standards, including its policies on LTV ratios and the Company’s contractual ability to curtail loans when the value of the underlying collateral declines. The Company discontinued origination of the Green Loan products in 2011. Interest Only Loans Interest Only loans are primarily single family residential first mortgage loans with payment features that allow interest only payments in initial periods before converting to a fully amortizing loan. At December 31, 2017 and 2016 , Interest Only loans totaled $717.5 million and $784.4 million , respectively. At December 31, 2017 and 2016 , $1.2 million and $467 thousand of the Interest Only loans were non-performing, respectively. Loans with the Potential for Negative Amortization Negative amortization loans totaled $3.7 million and $9.8 million at December 31, 2017 and 2016 , respectively. The Company discontinued origination of negative amortization loans in 2007. At December 31, 2017 and 2016 , none of the loans with the potential for negative amortization were non-performing. These loans pose a potentially higher credit risk because of the lack of principal amortization and potential for negative amortization; however, management believes the risk is mitigated through the loan terms and underwriting standards, including the Company’s policies on LTV ratios. Risk Management of Non-Traditional Mortgages The Company has determined that significant performance indicators for NTMs are LTV ratios and FICO scores. Accordingly, the Company manages credit risk in the NTM portfolio through periodic review of the loan portfolio that includes refreshing FICO scores on the Green Loans and HELOCs, as needed in conjunction with portfolio management, and ordering third party AVMs. The loan review is designed to provide a method of identifying borrowers who may be experiencing financial difficulty before they actually fail to make a loan payment. Upon receipt of the updated FICO scores, an exception report is run to identify loans with a decrease in FICO score of 10 percent or more and/or a resulting FICO score of 620 or less. The loans are then further analyzed to determine if the risk rating should be downgraded, which will increase the reserves the Company will establish for potential losses. A report of the periodic loan review is published and regularly monitored. As these loans are revolving lines of credit, the Company, based on the loan agreement and loan covenants of the particular loan, as well as applicable rules and regulations, could suspend the borrowing privileges or reduce the credit limit at any time the Company reasonably believes that the borrower will be unable to fulfill their repayment obligations under the agreement or certain other conditions are met. In many cases, the decrease in FICO score is the first indication that the borrower may have difficulty in making their future payment obligations. The Company proactively manages the NTM portfolio by performing detailed analyses on the portfolio. The Company’s IARC meets at least quarterly to review the loans classified as special mention, substandard, or doubtful and determines whether a suspension or reduction in credit limit is warranted. If a line has been suspended and the borrower would like to have their credit privileges reinstated, they would need to provide updated financials showing their ability to meet their payment obligations. On the interest only loans, the Company projects future payment changes to determine if there will be a material increase in the required payment and then monitors the loans for possible delinquency. Individual loans are monitored for possible downgrading of risk rating. Non-Traditional Mortgage Performance Indicators The following table presents the Company’s Green Loans first lien portfolio at December 31, 2017 by FICO scores that were obtained during the quarter ended December 31, 2017 , comparing to the FICO scores for those same loans that were obtained during the quarter ended December 31, 2016 : December 31, 2017 By FICO Scores Obtained During the Quarter Ended December 31, 2017 By FICO Scores Obtained During the Quarter Ended December 31, 2016 Change ($ in thousands) Count Amount Percent Count Amount Percent Count Amount Percent FICO score 800+ 12 $ 7,737 9.4 % 15 $ 9,091 11.1 % (3 ) $ (1,354 ) (1.7 )% 700-799 57 42,397 51.6 % 50 38,486 46.8 % 7 3,911 4.8 % 600-699 23 23,467 28.5 % 28 27,420 33.3 % (5 ) (3,953 ) (4.8 )% <600 5 4,691 5.7 % 1 1,800 2.2 % 4 2,891 3.5 % No FICO score 4 3,905 4.8 % 7 5,400 6.6 % (3 ) (1,495 ) (1.8 )% Total 101 $ 82,197 100.0 % 101 $ 82,197 100.0 % — $ — — % Loan to Value Ratio LTV ratio represents estimated current loan to value ratio, determined by dividing current unpaid principal balance by latest estimated property value received per the Company policy. The table below represents the Company’s single family residential NTM first lien portfolio by LTV ratios as of the dates indicated: Green Interest Only Negative Amortization Total ($ in thousands) Count Amount Percent Count Amount Percent Count Amount Percent Count Amount Percent December 31, 2017 < 61 60 $ 51,241 62.3 % 242 $ 407,810 56.8 % 9 $ 2,826 76.9 % 311 $ 461,877 57.5 % 61-80 33 25,072 30.5 % 220 300,500 41.9 % 2 848 23.1 % 255 326,420 40.6 % 81-100 8 5,884 7.2 % 6 9,174 1.3 % — — — % 14 15,058 1.9 % > 100 — — — % — — — % — — — % — — — % Total 101 $ 82,197 100.0 % 468 $ 717,484 100.0 % 11 $ 3,674 100.0 % 580 $ 803,355 100.0 % December 31, 2016 < 61 45 $ 39,105 44.7 % 196 $ 336,744 42.9 % 16 $ 7,043 72.2 % 257 $ 382,892 43.4 % 61-80 52 41,732 47.7 % 306 434,269 55.4 % 6 2,713 27.8 % 364 478,714 54.3 % 81-100 10 6,632 7.6 % 8 8,828 1.1 % — — — % 18 15,460 1.8 % > 100 — — — % 12 4,523 0.6 % — — — % 12 4,523 0.5 % Total 107 $ 87,469 100.0 % 522 $ 784,364 100.0 % 22 $ 9,756 100.0 % 651 $ 881,589 100.0 % Allowance for Loan and Lease Losses The Company has established credit risk management processes that include regular management review of the loan and lease portfolio to identify problem loans and leases. During the ordinary course of business, management becomes aware of borrowers and lessees who may not be able to fulfill the contractual payment requirements of the loan and lease agreements. Such loans and leases are subject to increased monitoring. Consideration is given to placing the loan or lease on non-accrual status, assessing the need for additional ALLL, and partial or full charge-off of the principal balance. The Company maintains the ALLL at a level that is considered adequate to cover the estimated inherent risks in the loan and lease portfolio. The Company also maintains a separate reserve for unfunded loan commitments at a level that is considered adequate to cover the estimated inherent risks. The estimated funding of the loan commitments and credit risk factors determined based on outstanding loans that share similar credit risk exposure are used to determine the adequacy of the reserve. At December 31, 2017 and 2016 , the reserve for unfunded loan commitments was $3.7 million and $2.4 million , respectively. The credit risk monitoring system is designed to identify impaired and potential problem loans, and to perform periodic evaluation of impairment and the adequacy of the allowance for credit losses in a timely manner. In addition, the Board of Directors of the Bank has adopted a credit policy that includes a credit review and control system that it believes should be effective in ensuring that the Company maintains an adequate allowance for loan and lease losses. The Board of Directors also provides oversight and guidance for management’s allowance evaluation process. During the three months ended March 31, 2017, the Company, as part of its continuous evaluation of the ALLL methodology and assumptions, determined that it was appropriate to change from a rolling 28 -quarter look-back period to a cumulative look-back period with a pegged (fixed) starting point (the quarter ended March 31, 2008). The Company believes that an extended period of observed credit loss stability warranted the review of a longer historical period that captured a full credit cycle. Accordingly, as of December 31, 2017 , the Company's look-back period was extended to 39 -quarters. The Company further enhanced the methodology in the areas of qualitative adjustments and loan segmentation during the second quarter of 2017, and performed an annual update of the loss emergence period during the third quarter of 2017. These updates were designed to be systematic, transparent, and repeatable. The annual update of the loss emergence period resulted in an increase of $1.9 million in the ALLL at September 30, 2017. The updates on qualitative adjustments and loan segmentation did not have a material impact. The following table presents a summary of activity in the ALLL for the periods indicated: Year Ended December 31, ($ in thousands) 2017 2016 2015 Balance at beginning of year $ 40,444 $ 35,533 $ 29,480 Loans and leases charged-off (5,581 ) (2,618 ) (1,942 ) Recoveries of loans and leases previously charged off 771 2,258 526 Provision for loan and lease losses 13,699 5,271 7,469 Balance at end of year $ 49,333 $ 40,444 $ 35,533 The following table presents the activity and balance in the ALLL and the recorded investment, excluding accrued interest, in loans and leases by portfolio segment and is based on the impairment method as of or for the year ended December 31, 2017 : ($ in thousands) Commercial and Industrial Commercial Real Estate Multifamily SBA Construction Lease Financing Single Family Residential Mortgage Other Consumer Total ALLL: Balance at December 31, 2016 $ 7,584 $ 5,467 $ 11,376 $ 939 $ 2,015 $ 6 $ 12,075 $ 982 $ 40,444 Charge-offs (1,730 ) (113 ) — (625 ) (29 ) — (2,806 ) (278 ) (5,581 ) Recoveries 54 — — 422 — 32 1 262 771 Provision 8,372 (383 ) 1,889 965 1,332 (38 ) 1,726 (164 ) 13,699 Balance at December 31, 2017 $ 14,280 $ 4,971 $ 13,265 $ 1,701 $ 3,318 $ — $ 10,996 $ 802 $ 49,333 Individually evaluated for impairment $ 498 $ — $ — $ 435 $ — $ — $ 277 $ 7 $ 1,217 Collectively evaluated for impairment 13,782 4,971 13,265 1,266 3,318 — 10,719 795 48,116 Acquired with deteriorated credit quality — — — — — — — — — Total ending ALLL $ 14,280 $ 4,971 $ 13,265 $ 1,701 $ 3,318 $ — $ 10,996 $ 802 $ 49,333 Loans and leases: Individually evaluated for impairment $ 3,582 $ — $ — $ 944 $ — $ — $ 14,699 $ 4,825 $ 24,050 Collectively evaluated for impairment 1,698,369 717,415 1,816,141 77,755 182,960 13 2,040,950 101,754 6,635,357 Acquired with deteriorated credit quality — — — — — — — — — Total loans and leases $ 1,701,951 $ 717,415 $ 1,816,141 $ 78,699 $ 182,960 $ 13 $ 2,055,649 $ 106,579 $ 6,659,407 The following table presents the activity and balance in the ALLL and the recorded investment, excluding accrued interest, in loans and leases by portfolio segment and is based on the impairment method as of or for the year ended December 31, 2016 : ($ in thousands) Commercial and Industrial Commercial Real Estate Multifamily SBA Construction Lease Financing Single Family Residential Mortgage Other Consumer Total ALLL: Balance at December 31, 2015 $ 5,850 $ 4,252 $ 6,012 $ 683 $ 1,530 $ 2,195 $ 13,854 $ 1,157 $ 35,533 Charge-offs (166 ) (414 ) — — — (974 ) (1,057 ) (7 ) (2,618 ) Recoveries 225 807 169 500 — 283 248 26 2,258 Provision 1,675 822 5,195 (244 ) 485 (1,498 ) (970 ) (194 ) 5,271 Balance at December 31, 2016 $ 7,584 $ 5,467 $ 11,376 $ 939 $ 2,015 $ 6 $ 12,075 $ 982 $ 40,444 Individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ 243 $ — $ 243 Collectively evaluated for impairment 7,584 5,462 11,376 920 2,015 6 11,752 982 40,097 Acquired with deteriorated credit quality — 5 — 19 — — 80 — 104 Total ending ALLL $ 7,584 $ 5,467 $ 11,376 $ 939 $ 2,015 $ 6 $ 12,075 $ 982 $ 40,444 Loans and leases: Individually evaluated for impairment $ 2,429 $ — $ — $ — $ — $ — $ 10,629 $ 294 $ 13,352 Collectively evaluated for impairment 1,515,771 728,777 1,365,262 71,168 125,100 379 1,962,789 110,328 5,879,574 Acquired with deteriorated credit quality 4,760 1,182 — 2,672 — — 133,212 — 141,826 Total loans and leases $ 1,522,960 $ 729,959 $ 1,365,262 $ 73,840 $ 125,100 $ 379 $ 2,106,630 $ 110,622 $ 6,034,752 The following table presents loans and leases individually evaluated for impairment by class of loans and leases as of the dates indicated. The recorded investment, excluding accrued interest, presents customer balances net of any partial charge-offs recognized on the loans and leases and net of any deferred fees and costs. December 31, 2017 2016 ($ in thousands) Unpaid Principal Balance Recorded Investment Allowance for Loan and Lease Losses Unpaid Principal Balance Recorded Investment Allowance for Loan and Lease Losses With no related allowance recorded: Commercial: Commercial and industrial $ 471 $ 453 $ — $ 2,478 $ 2,429 $ — SBA 342 335 — — — — Consumer: Single family residential mortgage 7,521 7,553 — 8,865 8,887 — Other consumer 4,664 4,663 — 294 294 — With an allowance recorded: Commercial: Commercial and industrial 3,146 3,129 498 — — — SBA 635 609 435 — — — Consumer: Single family residential mortgage 7,090 7,146 277 1,772 1,742 243 Other consumer 157 162 7 — — — Total $ 24,026 $ 24,050 $ 1,217 $ 13,409 $ 13,352 $ 243 The following table presents information on impaired loans and leases, disaggregated by class, for the periods indicated: Year Ended December 31, 2017 2016 2015 ($ in thousands) Average Recorded Investment Interest Income Recognized Cash Basis Interest Recognized Average Recorded Investment Interest Income Recognized Cash Basis Interest Recognized Average Recorded Investment Interest Income Recognized Cash Basis Interest Recognized Commercial: Commercial and industrial $ 1,034 $ — $ — $ 3,490 $ 183 $ 208 $ 6,750 $ 305 $ 302 Commercial real estate — — — 148 24 24 353 37 37 Multifamily — — — — — — 395 13 15 SBA 357 — — — — — 7 2 — Construction 382 — — — — — — — — Lease Financing 19 — — — — — — — — Consumer: Single family residential mortgage 12,611 199 182 27,150 862 835 25,093 869 885 Other consumer 1,757 8 8 294 8 9 424 12 13 Total $ 16,158 $ 207 $ 190 $ 31,081 $ 1,077 $ 1,076 $ 33,022 $ 1,238 $ 1,252 Past Due Loans and Leases The following table presents the aging of the recorded investment in past due loans and leases as of December 31, 2017 , excluding accrued interest receivable (which is not considered to be material), by class of loans and leases: December 31, 2017 ($ in thousands) 30 - 59 Days Past Due 60 - 89 Days Past Due Greater than 89 Days Past due Total Past Due Current Total NTM loans: Single family residential mortgage $ 3,353 $ 1,587 $ 1,171 $ 6,111 $ 715,047 $ 721,158 Green Loans (HELOC) - first liens 5,707 292 — 5,999 76,198 82,197 Green Loans (HELOC) - second liens — — — — 3,578 3,578 Other consumer — — — — — — Total NTM loans 9,060 1,879 1,171 12,110 794,823 806,933 Traditional loans and leases: Commercial: Commercial and industrial 136 3,595 948 4,679 1,697,272 1,701,951 Commercial real estate — — — — 717,415 717,415 Multifamily — — — — 1,816,141 1,816,141 SBA 3,578 — 1,319 4,897 73,802 78,699 Construction — — — — 182,960 182,960 Lease financing — — — — 13 13 Consumer: Single family residential mortgage 6,862 3,370 6,012 16,244 1,236,050 1,252,294 Other consumer 3,194 413 92 3,699 99,302 103,001 Total traditional loans and leases 13,770 7,378 8,371 29,519 5,822,955 5,852,474 PCI loans: Commercial: Commercial and industrial — — — — — — Commercial real estate — — — — — — SBA — — — — — — Consumer: Single family residential mortgage — — — — — — Total PCI loans — — — — — — Total loans and leases $ 22,830 $ 9,257 $ 9,542 $ 41,629 $ 6,617,778 $ 6,659,407 The following table presents the aging of the recorded investment in past due loans and leases as of December 31, 2016 , excluding accrued interest receivable (which is not considered to be material), by class of loans and leases: December 31, 2016 ($ in thousands) 30 - 59 Days Past Due 60 - 89 Days Past Due Greater than 89 Days Past due Total Past Due Current Total NTM loans: Single family residential mortgage $ 4,193 $ — $ 467 $ 4,660 $ 789,460 $ 794,120 Green Loans (HELOC) - first liens — — — — 87,469 87,469 Green Loans (HELOC) - second liens — — — — 3,559 3,559 Other consumer — — — — — — Total NTM loans 4,193 — 467 4,660 880,488 885,148 Traditional loans and leases: Commercial: Commercial and industrial 412 463 3,385 4,260 1,513,940 1,518,200 Commercial real estate — — — — 728,777 728,777 Multifamily — — — — 1,365,262 1,365,262 SBA 15 2 482 499 70,669 71,168 Construction 1,529 — — 1,529 123,571 125,100 Lease financing — — 109 109 270 379 Consumer: Single family residential mortgage 11,225 1,345 9,393 21,963 1,069,866 1,091,829 Other consumer 10,023 933 382 11,338 95,725 107,063 Total traditional loans and leases 23,204 2,743 13,751 39,698 4,968,080 5,007,778 PCI loans: Commercial: Commercial and industrial — — 156 156 4,604 4,760 Commercial real estate — — — — 1,182 1,182 SBA 300 232 328 860 1,812 2,672 Consumer: Single family residential mortgage 10,483 4,063 2,093 16,639 116,573 133,212 Total PCI loans 10,783 4,295 2,577 17,655 124,171 141,826 Total loans and leases $ 38,180 $ 7,038 $ 16,795 $ 62,013 $ 5,972,739 $ 6,034,752 Non-accrual Loans and Leases The following table presents the composition of non-accrual loans and leases, excluding PCI loans, as of the dates indicated: December 31, 2017 2016 ($ in thousands) NTM Loans Traditional Loans and Leases Total NTM Loans Traditional Loans and Leases Total Commercial: Commercial and industrial $ — $ 3,723 $ 3,723 $ — $ 3,544 $ 3,544 SBA — 1,781 1,781 — 619 619 Lease financing — — — — 109 109 Consumer: Single family residential mortgage 1,171 8,176 9,347 467 9,820 10,287 Other consumer — 4,531 4,531 — 383 383 Total $ 1,171 $ 18,211 $ 19,382 $ 467 $ 14,475 $ 14,942 At December 31, 2017 and 2016 , none of loans were past due 90 days or more and still accruing. Loans in Process of Foreclosure At December 31, 2017 and 2016 , the Company's SFR mortgage loans of $4.3 million and $2.2 million , respectively, were in the process of foreclosure. Troubled Debt Restructurings A modification of a loan constitutes a TDR when the Company, for economic or legal reasons related to a borrower’s financial difficulties, grants a concession to the borrower that it would not otherwise consider. The concessions may be granted in various forms, including reduction in the stated interest rate, reduction in the amount of principal amortization, forgiveness of a portion of the loan balance or accrued interest, or extension of the maturity date. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under the Company’s internal underwriting policy. Troubled debt restructured loans and leases consist of the following as of the dates indicated: December 31, 2017 2016 ($ in thousands) NTM Loans Traditional Loans Total NTM Loans Traditional Loans Total Commercial: Commercial and industrial $ — $ 2,675 $ 2,675 $ — $ — $ — Consumer: Single family residential mortgage 471 2,653 3,124 853 1,440 2,293 Green Loans (HELOC) - first liens 2,228 — 2,228 2,240 — 2,240 Green Loans (HELOC) - second liens 294 — 294 294 — 294 Total $ 2,993 $ 5,328 $ 8,321 $ 3,387 $ 1,440 $ 4,827 The Company did not have any commitments to lend to customers with outstanding loans that were classified as troubled debt restructurings as of December 31, 2017 and 2016 . The following table summarizes the pre-modification and post-modification balances of the new TDRs for the periods indicated: Year Ended December 31, 2017 2016 2015 ($ in thousands) Number of Loans Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment Number of Loans Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment Number of Loans Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment Commercial: Commercial and industrial 1 $ 2,706 $ 2,706 — — $ — $ — $ — $ — Consumer: Single family residential mortgage 3 $ 2,416 $ 2,433 42 $ 10,278 $ 10,273 13 $ 4,571 $ 4,493 Other consumer — — — — — — 1 261 259 Total 4 $ 5,122 $ 5,139 42 10,278 $ 10,273 $ 14 $ 4,832 $ 4,752 For the years ended December 31, 2017 , 2016 , and 2015 , there were no loans and leases that were modified as TDRs during the past 12 months that had subsequent payment defaults during the periods. The following table summarizes the TDRs by modification type for the periods indicated: Modification Type Change in Principal Payments and Interest Rates Change in Principal Payments Change in Interest Rates Chapter 7 Bankruptcy Other Total ($ in thousands) Count Amount Count Amount Count Amount Count Amount Count Amount Count Amount Year ended December 31, 2017 Commercial: Commercial and industrial — $ — 1 $ 2,706 — $ — — $ — — $ — 1 $ 2,706 Consumer: Single family residential mortgage 2 1,290 1 1,143 — — — — — — 3 2,433 Total 2 $ 1,290 2 $ 3,849 — $ — — $ — — $ — 4 $ 5,139 Year ended December 31, 2016 Consumer: Single family residential mortgage 34 $ 8,622 4 $ 780 2 $ 146 1 $ 519 1 $ 206 42 $ 10,273 Total 34 $ 8,622 4 $ 780 2 $ 146 1 $ 519 1 $ 206 42 $ 10,273 Year ended December 31, 2015 Consumer: Single family residential mortgage — $ — — $ — — $ — 13 $ 4,493 — $ — 13 $ 4,493 Other consumer — — — — — — 1 259 — — 1 259 Total — $ — — $ — — $ — 14 $ 4,752 — $ — 14 $ 4,752 Credit Quality Indicators The Company categorizes loans and leases 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, among other factors. The Company performs historical loss analysis that is combined with a comprehensive loan or lease to value analysis to analyze the associated risks in the current loan and lease portfolio. The Company analyzes loans and leases individually by classifying the loans and leases as to credit risk. This analysis includes all loans and leases delinquent over 60 days and non-homogeneous loans and leases such as commercial and commercial real estate loans and leases. The Company uses the following definitions for risk ratings: Pass : Loans and leases classified as pass are in compliance in all respects with the Bank’s credit policy and regulatory requirements, and do not exhibit any potential or defined weakness as defined under “Special Mention”, “Substandard” or “Doubtful”. Special Mention : Loans and leases classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or lease or of the Company’s credit position at some future date. Substandard : Loans and leases 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 and leases so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Doubtful : Loans and leases 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. Not-Rated : When accrual of income on a pool of PCI loans with common risk characteristics is appropriate in accordance with ASC 310-30, individual loans in those pools are not risk-rated. The credit criteria evaluated are FICO scores, LTV ratios, delinquency, and actual cash flows versus expected cash flows of the loan pools. Loans and leases not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans and leases. The following table presents the risk categories for total loans and leases as of December 31, 2017 : December 31, 2017 ($ in thousands) Pass Special Mention Substandard Doubtful Not-Rated Total NTM loans: Single family residential mortgage $ 719,182 $ 805 $ 1,171 $ — $ — $ 721,158 Green Loans (HELOC) - first liens 81,407 790 — — — 82,197 Green Loans (HELOC) - second liens 3,578 — — — — 3,578 Other consumer — — — — — — Total NTM loans 804,167 1,595 1,171 — — 806,933 Traditional loans and leases: Commercial: Commercial and industrial 1,651,628 33,376 16,947 — — 1,701,951 Commercial real estate 713,131 — 4,284 — — 717,415 Multifamily 1,815,601 540 — — — 1,816,141 SBA 72,417 1,555 4,621 106 — 78,699 Construction 182,960 — — — — 182,960 Lease financing 13 — — — — 13 Consumer: Single family residential mortgage 1,240,866 2,282 9,146 — — 1,252,294 Other consumer 98,030 422 4,549 — — 103,001 Total traditional loans and leases 5,774,646 38,175 39,547 106 — 5,852,474 PCI loans: Commercial: Commercial and industrial — — — — — — Commercial real estate — — — — — — SBA — — — — — — Consumer: Single family residential mortgage — — — — — — Total PCI loans — — — — — — Total loans and leases $ 6,578,813 $ 39,770 $ 40,718 $ 106 $ — $ 6,659,407 The following table presents the risk categories for total loans and leases as of December 31, 2016 : December 31, 2016 ($ in thousands) Pass Special Mention Substandard Doubtful Not-Rated Total NTM loans: Single family residential mortgage $ 792,179 $ 1,474 $ 467 $ — $ — $ 794,120 Green Loans (HELOC) - first liens 85,460 2,009 — — — 87,469 Green Loans (HELOC) - second liens 3,559 — — — — 3,559 Other consumer — — — — — — Total NTM loans 881,198 3,483 467 — — 885,148 Traditional loans and leases: Commercial: Commercial and industrial 1,508,636 844 8,642 78 — 1,518,200 Commercial real estate 725,861 1,350 1,566 — — 728,777 Multifamily 1,365,262 — — — — 1,365,262 SBA 70,508 — 660 — — 71,168 Construction 123,571 1,529 — — — 125,100 Lease financing 270 — 109 — — 379 Consumer: Single family residential mortgage 1,080,664 950 10,215 — — 1,091,829 Other consumer 106,632 48 383 — — 107,063 Total traditional loans and leases 4,981,404 4,721 21,575 78 — 5,007,778 PCI loans: Commercial: Commercial and industrial — 4,056 704 — — 4,760 Commercial real estate 1,182 — — — — 1,182 SBA 1,268 — 1,404 — — 2,672 Consumer: Single family residential mortgage — — — — 133,212 133,212 Total PCI loans 2,450 4,056 2,108 — 133,212 141,826 Total loans and leases $ 5,865,052 $ 12,260 $ 24,150 $ 78 $ 133,212 $ 6,034,752 Purchases, Sales, and Transfers The following table presents loans and leases purchased and/or sold by portfolio segment, excluding loans held-for-sale, loans and leases acquired in business combinations or sold in sales of branches and business units, and PCI loans for the periods indicated: Year Ended December 31, 2017 2016 2015 ($ in thousands) Purchases Sales Purchases Sales Purchases Sales Commercial: Multifamily $ — $ — $ — $ — $ — $ (242,580 ) SBA — — — — — (3,599 ) Lease financing — — 91,247 (19,741 ) 127,043 — Consumer: Single family residential mortgage — — — (149,413 ) 49,488 (165,915 ) Total $ — $ — $ 91,247 $ (169,154 ) $ 176,531 $ (412,094 ) The Company purchased the above loans and leases at a net discount of $0 , $0 , and $1.4 million for the years ended December 31, 2017 , 2016 , and 2015 , respectively. For the purchased loans and leases disclosed above, the Company did not incur any specific allowances for loan and lease losses during the years ended December 31, 2017 , 2016 , and 2015 . The Company determined that it was probable at acquisition that all contractually required payments would be collected. The sales of loans and leases above exclude the transfer of lease financing totaling $242.7 million in the sale of the Commercial Equipment Finance business unit to Hanmi during the year ended December 31, 2016 and certain loans of $40.2 million sold to AUB as part of the branch sale transaction during the year ended December 31, 2015. See Note 2 for additional information. The following table presents loans and leases transferred from (to) loans held-for-sale by portfolio segment, excluding loans and leases transferred in connection with sales of branch and business unit, and PCI loans for the periods indicated: Year Ended December 31, 2017 2016 2015 ($ in thousands) Transfers from Held-For-Sale Transfers to Held-For-Sale Transfers from Held-For-Sale Transfers to Held-For-Sale Transfers from Held-For-Sale Transfers to Held-For-Sale Commercial: Commercial and industrial $ — $ (3,924 ) $ — $ (1,7 |