Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 04, 2022 | |
Document And Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2022 | |
Entity File Number | 001-35589 | |
Entity Registrant Name | FS BANCORP, INC. | |
Entity Incorporation, State or Country Code | WA | |
Entity Tax Identification Number | 45-4585178 | |
Entity Address, Address Line One | 6920 220th Street SW | |
Entity Address, City or Town | Mountlake Terrace | |
Entity Address, State or Province | WA | |
Entity Address, Postal Zip Code | 98043 | |
City Area Code | 425 | |
Local Phone Number | 771-5299 | |
Title of 12(b) Security | Common Stock, par value $.01 per share | |
Trading Symbol | FSBW | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 7,704,373 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001530249 | |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
ASSETS | ||
Cash and due from banks | $ 11,541 | $ 12,043 |
Interest-bearing deposits at other financial institutions | 148,256 | 14,448 |
Total cash and cash equivalents | 159,797 | 26,491 |
Certificates of deposit at other financial institutions | 4,960 | 10,542 |
Securities available-for-sale, at fair value | 227,942 | 271,359 |
Securities held-to-maturity, net of allowance for credit losses of $31 and none, respectively (fair value of $7,950 and $8,128, respectively) | 8,469 | 7,500 |
Loans held for sale, at fair value | 23,447 | 125,810 |
Loans receivable, net (includes $14,198 and $16,083, at fair value, respectively) | 2,083,929 | 1,728,540 |
Accrued interest receivable | 10,407 | 7,594 |
Premises and equipment, net | 25,438 | 26,591 |
Operating lease right-of-use ("ROU") assets | 6,607 | 4,557 |
Federal Home Loan Bank ("FHLB") stock, at cost | 13,591 | 4,778 |
Other real estate owned ("OREO") | 145 | |
Deferred tax asset, net | 6,571 | |
Bank owned life insurance ("BOLI"), net | 36,578 | 37,092 |
Servicing rights, held at the lower of cost or fair value | 18,470 | 16,970 |
Goodwill | 2,312 | 2,312 |
Core deposit intangible, net | 3,542 | 4,060 |
Other assets | 19,933 | 12,195 |
TOTAL ASSETS | 2,652,138 | 2,286,391 |
LIABILITIES | ||
Noninterest-bearing accounts | 581,612 | 580,749 |
Interest-bearing accounts | 1,501,726 | 1,334,995 |
Total deposits | 2,083,338 | 1,915,744 |
Borrowings | 260,828 | 42,528 |
Principal amount | 50,000 | 50,000 |
Unamortized debt issuance costs | (556) | (606) |
Total subordinated notes less unamortized debt issuance costs | 49,444 | 49,394 |
Operating lease liabilities | 6,836 | 4,792 |
Deferred tax liability, net | 1,183 | |
Other liabilities | 31,145 | 25,243 |
Total liabilities | 2,431,591 | 2,038,884 |
COMMITMENTS AND CONTINGENCIES (NOTE 9) | ||
STOCKHOLDERS' EQUITY | ||
Preferred stock, $.01 par value; 5,000,000 shares authorized; none issued or outstanding | ||
Common stock, $.01 par value; 45,000,000 shares authorized; 7,704,373 and 8,169,887 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively | 77 | 82 |
Additional paid-in capital | 53,769 | 67,958 |
Retained earnings | 195,986 | 179,215 |
Accumulated other comprehensive (loss) income, net of tax | (29,285) | 252 |
Total stockholders' equity | 220,547 | 247,507 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 2,652,138 | $ 2,286,391 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Items included in Consolidated Balance Sheets | ||
Allowance for credit losses | $ 31 | $ 0 |
Securities held-to-maturity, at fair value | 7,950 | 8,128 |
Loans receivable, at fair value | $ 14,198 | $ 16,083 |
Preferred stock par value, in dollars per share | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock par value, in dollars per share | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 45,000,000 | 45,000,000 |
Common stock, shares issued | 7,704,373 | 8,169,887 |
Common stock, shares outstanding | 7,704,373 | 8,169,887 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
INTEREST INCOME | ||||
Loans receivable, including fees | $ 29,563 | $ 23,520 | $ 77,885 | $ 67,538 |
Interest and dividends on investment securities, cash and cash equivalents, and certificates of deposit at other financial institutions | 1,741 | 1,487 | 4,990 | 4,050 |
Total interest and dividend income | 31,304 | 25,007 | 82,875 | 71,588 |
INTEREST EXPENSE | ||||
Deposits | 2,596 | 1,629 | 5,438 | 5,481 |
Borrowings | 696 | 227 | 1,003 | 895 |
Subordinated notes | 485 | 496 | 1,456 | 1,237 |
Total interest expense | 3,777 | 2,352 | 7,897 | 7,613 |
NET INTEREST INCOME | 27,527 | 22,655 | 74,978 | 63,975 |
PROVISION FOR CREDIT LOSSES | 1,718 | 0 | 4,632 | 1,500 |
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES | 25,809 | 22,655 | 70,346 | 62,475 |
NONINTEREST INCOME | ||||
Service charges and fee income | 1,511 | 1,073 | 4,286 | 3,026 |
Gain on sale of loans | 1,402 | 6,885 | 7,325 | 24,962 |
Earnings on cash surrender value of BOLI | 221 | 218 | 654 | 647 |
Other noninterest income | 1,047 | 222 | 2,147 | 983 |
Total noninterest income | 4,181 | 8,398 | 14,412 | 29,618 |
NONINTEREST EXPENSE | ||||
Salaries and benefits | 11,402 | 12,790 | 35,110 | 36,331 |
Operations | 2,812 | 2,628 | 7,656 | 7,760 |
Occupancy | 1,344 | 1,227 | 3,825 | 3,592 |
Data processing | 1,548 | 1,309 | 4,363 | 3,819 |
Loss on sale of OREO | 0 | 9 | ||
Loan costs | 746 | 842 | 2,020 | 2,013 |
Professional and board fees | 631 | 757 | 2,387 | 2,365 |
Federal Deposit Insurance Corporation ("FDIC") insurance | 462 | 120 | 804 | 491 |
Marketing and advertising | 220 | 177 | 652 | 429 |
Amortization of core deposit intangible | 173 | 177 | 518 | 531 |
Impairment (recovery) of servicing rights | (11) | (1) | (2,057) | |
Total noninterest expense | 19,338 | 20,016 | 57,334 | 55,283 |
INCOME BEFORE PROVISION FOR INCOME TAXES | 10,652 | 11,037 | 27,424 | 36,810 |
PROVISION FOR INCOME TAXES | 2,194 | 2,706 | 5,397 | 8,047 |
NET INCOME | $ 8,458 | $ 8,331 | $ 22,027 | $ 28,763 |
Basic earnings per share | $ 1.09 | $ 1.01 | $ 2.77 | $ 3.43 |
Diluted earnings per share | $ 1.08 | $ 0.98 | $ 2.73 | $ 3.31 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME | ||||
Net income | $ 8,458 | $ 8,331 | $ 22,027 | $ 28,763 |
Securities available-for-sale: | ||||
Unrealized loss during period | (14,567) | (1,653) | (47,046) | (4,162) |
Income tax benefit related to unrealized holding loss | 3,131 | 356 | 10,115 | 896 |
Derivative financial instruments: | ||||
Unrealized derivative gain (loss) during period | 5,107 | (57) | 9,651 | 814 |
Income tax (provision) benefit related to unrealized derivative gain | (1,098) | 12 | (2,075) | (175) |
Reclassification adjustment for realized (gain) loss, net included in net income | (278) | 135 | (232) | 373 |
Income tax provision (benefit) related to reclassification, net | 60 | (29) | 50 | (81) |
Other comprehensive loss, net of tax | (7,645) | (1,236) | (29,537) | (2,335) |
COMPREHENSIVE (LOSS) INCOME | $ 813 | $ 7,095 | $ (7,510) | $ 26,428 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income, Net of Tax | Unearned ESOP Shares | Total |
Balance at Dec. 31, 2020 | $ 85 | $ 81,275 | $ 146,405 | $ 2,533 | $ (291) | $ 230,007 |
Balance (in shares) at Dec. 31, 2020 | 8,475,912 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 28,763 | 28,763 | ||||
Dividends paid | (3,382) | (3,382) | ||||
Share-based compensation | 995 | 995 | ||||
Restricted stock awards (in shares) | 41,350 | |||||
Common stock repurchased - repurchase plan | $ (4) | (12,638) | (12,642) | |||
Common stock repurchased - repurchase plan (in shares) | (480,225) | |||||
Common stock repurchased for employee/director taxes paid on restricted stock awards | (212) | (212) | ||||
Common stock repurchased for employee/director taxes paid on restricted stock awards (in shares) | (5,970) | |||||
Stock options exercised, net | $ 1 | (2,077) | (2,076) | |||
Stock options exercised, net (in shares) | 176,978 | |||||
Other comprehensive loss, net of tax | (2,335) | (2,335) | ||||
ESOP shares allocated | 1,138 | 197 | 1,335 | |||
Balance at Sep. 30, 2021 | $ 82 | 68,481 | 171,786 | 198 | (94) | 240,453 |
Balance (in shares) at Sep. 30, 2021 | 8,208,045 | |||||
Balance at Jun. 30, 2021 | $ 83 | 75,797 | 164,606 | 1,434 | (160) | 241,760 |
Balance (in shares) at Jun. 30, 2021 | 8,333,566 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 8,331 | 8,331 | ||||
Dividends paid | (1,151) | (1,151) | ||||
Share-based compensation | 402 | 402 | ||||
Restricted stock awards | ||||||
Restricted stock awards (in shares) | 41,350 | |||||
Common stock repurchased - repurchase plan | $ (2) | (6,825) | (6,827) | |||
Common stock repurchased - repurchase plan (in shares) | (264,805) | |||||
Common stock repurchased for employee/director taxes paid on restricted stock awards | (212) | (212) | ||||
Common stock repurchased for employee/director taxes paid on restricted stock awards (in shares) | (5,970) | |||||
Stock options exercised, net | $ 1 | (1,054) | (1,053) | |||
Stock options exercised, net (in shares) | 103,904 | |||||
Other comprehensive loss, net of tax | (1,236) | (1,236) | ||||
ESOP shares allocated | 373 | 66 | 439 | |||
Balance at Sep. 30, 2021 | $ 82 | 68,481 | 171,786 | 198 | $ (94) | 240,453 |
Balance (in shares) at Sep. 30, 2021 | 8,208,045 | |||||
Balance at Dec. 31, 2021 | $ 82 | 67,958 | 179,215 | 252 | 247,507 | |
Balance (in shares) at Dec. 31, 2021 | 8,169,887 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 22,027 | 22,027 | ||||
Dividends paid | (5,553) | (5,553) | ||||
Share-based compensation | 1,432 | 1,432 | ||||
Issuance of common stock- employee stock purchase plan | 211 | 211 | ||||
Issuance of common stock- employee stock purchase plan (in shares) | 7,068 | |||||
Restricted stock awards (in shares) | 35,050 | |||||
New credit standard (Topic 326) - impact in year of adoption | 297 | 297 | ||||
Common stock repurchased - repurchase plan | $ (5) | (15,623) | (15,628) | |||
Common stock repurchased - repurchase plan (in shares) | (544,530) | |||||
Common stock repurchased for employee/director taxes paid on restricted stock awards | (190) | (190) | ||||
Common stock repurchased for employee/director taxes paid on restricted stock awards (in shares) | (6,150) | |||||
Stock options exercised, net | (19) | (19) | ||||
Stock options exercised, net (in shares) | 43,048 | |||||
Other comprehensive loss, net of tax | (29,537) | (29,537) | ||||
Balance at Sep. 30, 2022 | $ 77 | 53,769 | 195,986 | (29,285) | 220,547 | |
Balance (in shares) at Sep. 30, 2022 | 7,704,373 | |||||
Balance at Jun. 30, 2022 | $ 77 | 55,129 | 189,075 | (21,640) | 222,641 | |
Balance (in shares) at Jun. 30, 2022 | 7,726,232 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 8,458 | 8,458 | ||||
Dividends paid | (1,547) | (1,547) | ||||
Share-based compensation | 500 | 500 | ||||
Issuance of common stock- employee stock purchase plan | 211 | 211 | ||||
Issuance of common stock- employee stock purchase plan (in shares) | 7,068 | |||||
Restricted stock awards | ||||||
Restricted stock awards (in shares) | 35,050 | |||||
Common stock repurchased - repurchase plan | (1,732) | (1,732) | ||||
Common stock repurchased - repurchase plan (in shares) | (67,923) | |||||
Common stock repurchased for employee/director taxes paid on restricted stock awards | (190) | (190) | ||||
Common stock repurchased for employee/director taxes paid on restricted stock awards (in shares) | (6,150) | |||||
Stock options exercised, net | (149) | (149) | ||||
Stock options exercised, net (in shares) | 10,096 | |||||
Other comprehensive loss, net of tax | (7,645) | (7,645) | ||||
Balance at Sep. 30, 2022 | $ 77 | $ 53,769 | $ 195,986 | $ (29,285) | $ 220,547 | |
Balance (in shares) at Sep. 30, 2022 | 7,704,373 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY | ||||
Dividends paid (in dollars per share) | $ 0.20 | $ 0.14 | $ 0.70 | $ 0.41 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 22,027 | $ 28,763 |
Adjustments to reconcile net income to net cash from operating activities | ||
Provision for credit losses | 4,632 | 1,500 |
Depreciation, amortization and accretion | 10,464 | 11,674 |
Compensation expense related to stock options and restricted stock awards | 1,432 | 995 |
ESOP compensation expense for allocated shares | 0 | 1,335 |
Change in cash surrender value of BOLI | (654) | (647) |
Gain on sale of loans held for sale | (6,729) | (24,856) |
Gain on sale of portfolio loans | (596) | (106) |
Origination of loans held for sale | (498,975) | (1,048,120) |
Proceeds from sale of loans held for sale | 630,396 | 1,133,395 |
Recovery of servicing rights | (1) | (2,057) |
Loss on sale of OREO | 0 | 9 |
Changes in operating assets and liabilities | ||
Accrued interest receivable | (2,813) | (767) |
Other assets | 3,527 | (2,590) |
Other liabilities | 1,236 | 997 |
Net cash from operating activities | 163,946 | 99,525 |
Activity in securities available-for-sale: | ||
Maturities, prepayments, and calls | 17,829 | 20,923 |
Purchases | (22,968) | (117,152) |
Activity in securities held-to-maturity: | ||
Purchases | (1,000) | 0 |
Maturities of certificates of deposit at other financial institutions | 5,582 | 496 |
Portfolio loan originations and principal collections, net | (420,094) | (156,603) |
Proceeds from sale of portfolio loans | 39,034 | 2,699 |
Purchase of portfolio loans | (5,344) | (1,070) |
Proceeds from sale of OREO, net | 0 | 81 |
Purchase of premises and equipment | (695) | (1,921) |
Proceeds from bank owned life insurance death benefits | 1,168 | 0 |
Change in FHLB stock, net | (8,813) | 2,568 |
Net cash used by investing activities | (395,301) | (249,979) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Net increase in deposits | 167,540 | 189,470 |
Proceeds from borrowings | 1,155,007 | 8,000 |
Repayments of borrowings | (936,707) | (131,281) |
Dividends paid on common stock | (5,553) | (3,382) |
Net proceeds from issuance of subordinated notes | 0 | 49,333 |
Repayment of subordinated notes | 0 | (10,000) |
Proceeds (disbursements) from stock options exercised, net | (19) | (2,076) |
Restricted stock awards, net of taxes paid | (190) | (212) |
Issuance of common stock - employee stock purchase plan | 211 | 0 |
Common stock repurchased | (15,628) | (12,642) |
Net cash from financing activities | 364,661 | 87,210 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 133,306 | (63,244) |
CASH AND CASH EQUIVALENTS, beginning of period | 26,491 | 91,576 |
CASH AND CASH EQUIVALENTS, end of period | 159,797 | 28,332 |
SUPPLEMENTARY DISCLOSURES OF CASH FLOW INFORMATION | ||
Interest on deposits and borrowings | 5,538 | 6,540 |
Income taxes | 2,897 | 7,824 |
SUPPLEMENTARY DISCLOSURES OF NONCASH OPERATING, INVESTING AND FINANCING ACTIVITIES | ||
Change in unrealized loss on available - for sale investment securities | (47,046) | (4,162) |
Change in unrealized gain on fair value and cash flow hedges | 9,405 | 1,187 |
Change in unrealized loss on portfolio loans measured under the fair value option | (1,780) | (55) |
Retention in gross mortgage servicing rights from loan sales | 4,935 | 7,567 |
OREO received in settlement of loans | 145 | 0 |
Right-of-use assets in exchange for lease liabilities | $ 3,049 | $ 979 |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2022 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations - a Financial Statement Presentation - The results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022, or any other future period. The preparation of financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect amounts reported in the financial statements. Actual results could differ from these estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for credit losses, fair value of financial instruments, the valuation of servicing rights, deferred income taxes, and if needed, a deferred tax asset valuation allowance. Amounts presented in the consolidated financial statements and footnote tables are rounded and presented to the nearest thousands of dollars except per share amounts. If the amounts are above $1.0 million, they are rounded one decimal point, and if they are above $1.0 billion, they are rounded two decimal points. Principles of Consolidation - Segment Reporting - Subsequent Events - Error Corrections Earnings Per Share Prior presentations of earnings per share were revised due to the improper inclusion of certain unvested shares in the denominator of basic and diluted earnings per share. As a result of the inclusion, earnings per share was understated for the three and nine months ended September 30, 2021. Basic earnings per share for those periods was updated to $1.01 and $3.43, respectively, from $0.99 and $3.38, as previously reported. Diluted earnings per share was updated to $0.98 and $3.31, respectively, from $0.97 and $3.30 as previously reported. Management evaluated the materiality of this error from qualitative and quantitative perspectives and concluded that the error was immaterial to the prior period financial statements taken as a whole. Consequently, the financial statements for the prior periods include the impact of the correction of the error, and prior period financial statements have not been restated. The error correction did not affect total assets, net income, or cash flows for the periods. Deposits Prior presentation of interest-bearing checking balances was revised due to the misclassification of certain checking products in previous periods. As a result of the misclassification, an interest-bearing checking balance of $121.2 million at December 31, 2021 Management evaluated the materiality of this error from qualitative and quantitative perspectives and concluded that the error was immaterial to the prior period financial statements taken as a whole. Consequently, the financial statements for the prior periods include the impact of the correction of the error, and prior period financial statements have not been restated. The error correction did not affect total assets, net income, or cash flows for the periods. RECENT ACCOUNTING PRONOUNCEMENTS In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-04, “Reference Rate Reform” (“Topic 848”) In March 2022, the FASB issued ASU No. 2022-01, Derivatives and Hedging (Topic 815): Fair Value Hedging - Portfolio Layer Method Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities In March 2022, the FASB issued ASU No. 2022-02, Financial Instruments - Credit Losses (Topic 326) Application of New Accounting Guidance Adopted in 2022 On January 1, 2022, the Company adopted ASU 2016-13 Financial Instruments - Credit Losses (Topic 326) The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost and off-balance-sheet credit exposures. Results for reporting periods beginning after January 1, 2022 are presented under ASC 326. The adoption resulted in a decrease of $2.9 million to our allowance for credit losses on loans (“ACLL”), an increase of $2.4 million to our allowance for unfunded commitments and letters of credit, an increase of $72,000 to our allowance for held-to-maturity securities, and a net-of-tax cumulative-effect adjustment of $297,000 to increase the beginning balance of retained earnings. The Company finalized the adoption as of January 1, 2022 as detailed in the following table: January 1, 2022 As Reported January 1, 2022 Pre-Topic 326 Impact of Topic 326 Assets Under Topic 326 Adoption Adoption Allowance for credit losses on debt securities held-to-maturity $ 72 $ — $ 72 Loans Commercial $ 1,728 $ 5,667 $ (3,939) Construction and development 2,328 4,448 (2,120) Home equity 455 279 176 One-to-four-family 3,656 1,424 2,232 Multi-family 1,397 2,980 (1,583) Indirect home improvement 9,394 3,540 5,854 Marine 900 702 198 Other consumer 64 38 26 Commercial and industrial 2,727 5,953 (3,226) Warehouse lending 127 583 (456) Unallocated — 21 (21) Allowance for credit losses on loans $ 22,776 $ 25,635 $ (2,859) Liabilities Allowance for credit losses on unfunded loan commitments $ 2,908 $ 499 $ 2,409 Total $ (378) The adoption of CECL resulted in an increase of retained earnings of $297,000, net of tax. Allowance for Credit Losses on Held-to-Maturity Securities Management measures expected credit losses on held-to-maturity securities by individual security. Accrued interest receivable on held-to-maturity debt securities totaling $119,000 at September 30, 2022, was excluded from the estimate of credit losses used to calculate the allowance for credit losses (“ACL”). The estimate of expected credit losses considers credit ratings and historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. The held-to-maturity portfolio consists entirely of corporate securities. Securities are generally rated BBB- or higher. Securities are analyzed individually to establish a CECL reserve. Allowance for Credit Losses on Available-for-Sale Securities For available-for-sale securities in an unrealized loss position, management first assesses whether it intends to sell, or is more likely than not to be required to sell, the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For debt securities available-for-sale that do not meet the aforementioned criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an ACL is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an ACL is recognized in other comprehensive income (“OCI”). Changes in the ACL are recorded as a provision for (or reversal of) credit loss expense. Losses are charged against the allowance when management believes the uncollectibility of an available-for-sale security is confirmed or when either of the criteria regarding intent or requirement to sell is met. Accrued interest receivable on available-for-sale debt securities totaling $1.8 million at September 30, 2022, was excluded in the estimate of credit losses used to calculate the ACL. Allowance for Credit Losses on Loans The ACLL is a valuation account that is deducted from the loans’ amortized cost basis to present the net amount expected to be collected on the loans. Loans are charged off against the allowance when management believes the uncollectibility of a loan balance is confirmed and recoveries are credited to the allowance when received. The Company may also account for expected recoveries should information of an anticipated recovery become available. In the case of actual or expected recoveries, amounts may not exceed the aggregate of amounts previously charged off. Management utilizes relevant available information, from internal and external sources, relating to past events, current conditions, historical loss experience, and reasonable and supportable forecasts. The lookback period in the analysis includes historical data from 2009 to present. Adjustments to historical loss information are made when management determines historical data is not likely reflective of the current portfolio such as limited data sets or lack of default or loss history. Management may selectively apply external market data to subjectively adjust the Company’s own loss history including index or peer data. Accrued interest receivable totaling $8.3 million at September 30, 2022, was excluded from the estimate of credit losses for loans used to calculate the ACLL. Collective Assessment The ACLL is measured on a collective cohort basis when similar risk characteristics exist. Generally, collectively assessed loans are grouped by call report code and then risk-grade grouping. Risk grade is grouped within each call report code by pass, watch, special mention, substandard, and doubtful. Other loan types are separated into their own cohorts due to specific risk characteristics for that pool of loans. The Company has elected a nondiscounted cash flow methodology with probability of default (“PD”) and loss given default (“LGD”) for all call report code cohorts (“cohorts”), with the exception of the indirect and marine portfolios which are evaluated under a vintage methodology. Guaranteed portions of loans are measured with zero risk due to cash collateral and full guaranty. The PD calculation looks at the historical loan portfolio at particular points in time (each month during the lookback period) to determine the probability that loans in a certain cohort will default over the next 12-month period. A default is defined as a loan that has moved to past due 90 days and greater, nonaccrual status, or experienced a charge-off during the period. In cohorts where the Company’s historical data are insufficient due to a minimal amount of default activity or zero defaults, management uses index PDs comprised of rates derived from the PD experience of other community banks in place of the Company’s historical PDs. Additionally, management reviews all other cohorts to determine if index PDs should be used outside of these criteria. The LGD calculation looks at actual losses (net charge-offs) experienced over the entire lookback period for each cohort of loans. The aggregate loss amount is divided by the exposure at default to determine an LGD rate. All defaults (non-accrual, charge-off, or greater than 90 days past due) occurring during the lookback period are included in the denominator, whether a loss occurred or not and exposure at default is determined by the loan balance immediately preceding the default event (i.e. nonaccrual or charge-off). Due to very limited charge-off history, management uses index LGDs comprised of rates derived from the LGD experience of other community banks in place of the Company’s historical LGDs. The Company utilizes reasonable and supportable forecasts of future economic conditions when estimating the ACLL. The calculation includes a 12-month PD forecast based on the Company’s regression model comparing peer nonperforming loan ratios to the national unemployment rate and other forecast data. After the forecast period, PD rates revert on a straight-line basis back to long-term historical average rates over a 12-month period. The Company recognizes that all significant factors that affect the collectability of the loan portfolio must be considered to determine the estimated credit losses as of the evaluation date. Furthermore, the methodology, in and of itself and even when selectively adjusted by comparison to market and peer data, does not provide a sufficient basis to determine the estimated credit losses. The Company adjusts the modeled historical losses by a Qualitative and Environmental adjustment to incorporate all significant risks to form a sufficient basis to estimate the credit losses. Individual Assessment Loans classified as nonaccrual, TDR, or reasonably expected TDR will be reviewed quarterly for potential individual assessment. Any loan that is being considered for modification and expected to result in a TDR is identified as a reasonably expected TDR. Any loan classified as a nonaccrual or TDR that is not determined to need individual assessment will be evaluated collectively within its respective cohort. All reasonably expected TDR loans will be evaluated individually to account for expected modifications in loan terms. Where the primary and/or expected source of repayment of a specific loan is believed to be the future liquidation of available collateral, impairment will generally be measured based upon expected future collateral proceeds, net of disposition expenses including sales commissions as well as other costs potentially necessary to sell the asset(s) (i.e. past due taxes, liens, etc.). Estimates of future collateral proceeds will be based upon available appraisals, reference to recent valuations of comparable properties, use of consultants or other professionals with relevant market and/or property-specific knowledge, and any other sources of information believed appropriate by management under the specific circumstances. When appraisals are ordered to support the impairment analysis of an impaired loan, the appraisal is reviewed by the Company’s internal appraisal reviewer. Where the primary and/or expected source of repayment of a specific loan is believed to be the receipt of principal and interest payments from the borrower and/or the refinancing of the loan by another creditor, impairment will generally be measured based upon the present value of expected proceeds discounted at the contractual interest rate. Expected refinancing proceeds may be estimated from review of term sheets actually received by the borrower from other creditors and/or from the Company’s knowledge of terms generally available from other banks. Determining the Contractual Term Expected credit losses are estimated over the contractual term of the loans, adjusted for expected prepayments when appropriate. The contractual term excludes expected extensions, renewals and modifications unless either of the following applies: management has a reasonable expectation at the reporting date that a TDR will be executed with an individual borrower or the extension or renewal options are included in the original or modified contract at the reporting date and are not unconditionally cancellable by the Company. Prepayment assumptions will be determined by analysis of historical behavior by loan cohort. Troubled Debt Restructurings A loan for which the terms have been modified resulting in a concession, and for which the borrower is experiencing financial difficulties, is considered to be a TDR. Reasonably expected TDRs are assessed in the CECL calculation utilizing their expected modified terms. The ACL on a TDR is measured using the same method as all other loans held for investment, except that the original interest rate is used to discount the expected cash flows when a rate modification has occurred. Allowance for Credit Losses on Unfunded Commitments The Company estimates expected credit losses over the contractual period in which the Company is exposed to credit risk via a contractual obligation to extend credit unless that obligation is unconditionally cancellable by the Company. The ACL on unfunded commitments is adjusted through a provision for credit loss expense. The estimate includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over its estimated life. The estimate utilizes the same factors and assumptions as the ACLL and is applied at the same collective cohort level. |
INVESTMENTS
INVESTMENTS | 9 Months Ended |
Sep. 30, 2022 | |
INVESTMENTS | |
INVESTMENTS | NOTE 2 - INVESTMENTS The following tables present the amortized costs, unrealized gains, unrealized losses, estimated fair values of securities available-for-sale and held-to-maturity, and ACL at September 30, 2022 and December 31, 2021: September 30, 2022 Estimated Allowance Amortized Unrealized Unrealized Fair for Credit SECURITIES AVAILABLE-FOR-SALE Cost Gains Losses Values Losses U.S. agency securities $ 21,153 $ 80 $ (3,096) $ 18,137 $ — Corporate securities 9,497 28 (909) 8,616 — Municipal bonds 145,918 2 (29,276) 116,644 — Mortgage-backed securities 84,192 — (13,115) 71,077 — U.S. Small Business Administration securities 14,920 6 (1,458) 13,468 — Total securities available-for-sale 275,680 116 (47,854) 227,942 — SECURITIES HELD-TO-MATURITY Corporate securities 8,500 — (550) 7,950 (31) Total securities held-to-maturity 8,500 — (550) 7,950 (31) — Total securities $ 284,180 $ 116 $ (48,404) $ 235,892 $ (31) December 31, 2021 Estimated Amortized Unrealized Unrealized Fair SECURITIES AVAILABLE-FOR-SALE Cost Gains Losses Values U.S. agency securities $ 21,155 $ 133 $ (318) $ 20,970 Corporate securities 9,495 31 (524) 9,002 Municipal bonds 136,377 1,577 (2,521) 135,433 Mortgage-backed securities 88,641 1,457 (696) 89,402 U.S. Small Business Administration securities 16,383 235 (66) 16,552 Total securities available-for-sale 272,051 3,433 (4,125) 271,359 SECURITIES HELD-TO-MATURITY Corporate securities 7,500 628 — 8,128 Total securities held-to-maturity 7,500 628 — 8,128 Total securities $ 279,551 $ 4,061 $ (4,125) $ 279,487 The following table presents the activity in the allowance for credit losses on securities held-to-maturity by major security type for the three and nine months ended September 30, 2022: SECURITIES HELD-TO-MATURITY For the Three Months Ended For the Nine Months Ended Corporate Securities September 30, 2022 September 30, 2022 Beginning allowance balance $ 31 $ — Impact of adopting ASU 2016-13 — 72 Recapture of provision for credit losses — (41) Securities charged-off — — Recoveries — — Total ending allowance balance $ 31 $ 31 Management measures expected credit losses on held-to-maturity debt securities on an individual basis. The estimate of expected credit losses considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. Accrued interest receivable on held-to-maturity debt securities totaled $119,000 and $113,000 as of September 30, 2022 and December 31, 2021, respectively and was $1.8 million and $1.1 million on available-for-sale debt securities as of September 30, 2022 and December 31, 2021, respectively. Accrued interest receivable on securities was excluded from the estimate of credit losses used to calculate the ACL. The Bank monitors the credit quality of debt securities held-to-maturity quarterly through the use of credit rating, material event notices, and changes in market value. The following table summarizes the amortized cost of debt securities held-to-maturity at September 30, 2022 and December 31, 2021, aggregated by credit quality indicator: Corporate securities September 30, 2022 December 31, 2021 BBB/BBB- $ 8,500 $ 7,500 At September 30, 2022, there were no debt securities held-to-maturity that were classified as either nonaccrual or 90 days or more past due and still accruing interest. At September 30, 2022, the Bank pledged seven securities held at the FHLB of Des Moines with a carrying value of $6.0 million to secure Washington State public deposits of $17.6 million with a $7.1 million collateral requirement by the Washington Public Deposit Protection Commission. The deficiency in collateral posted was subsequently corrected with additional securities pledged to exceed requirement. Investment securities that were in an unrealized loss position at September 30, 2022 and December 31, 2021 are presented in the following tables, based on the length of time individual securities have been in an unrealized loss position. September 30, 2022 Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized SECURITIES AVAILABLE-FOR-SALE Value Losses Value Losses Value Losses U.S. agency securities $ 7,071 $ (1,184) $ 8,986 $ (1,912) $ 16,057 $ (3,096) Corporate securities 3,476 (21) 4,112 (888) 7,588 (909) Municipal bonds 66,406 (14,563) 50,133 (14,713) 116,539 (29,276) Mortgage-backed securities 47,724 (7,286) 23,353 (5,829) 71,077 (13,115) U.S. Small Business Administration securities 8,672 (963) 1,577 (495) 10,249 (1,458) Total securities available-for-sale $ 133,349 $ (24,017) $ 88,161 $ (23,837) $ 221,510 $ (47,854) SECURITIES HELD-TO-MATURITY Corporate securities 7,950 (550) — — 7,950 (550) Total securities held-to-maturity 7,950 (550) — — 7,950 (550) Total $ 141,299 $ (24,567) $ 88,161 $ (23,837) $ 229,460 $ (48,404) December 31, 2021 Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized SECURITIES AVAILABLE-FOR-SALE Value Losses Value Losses Value Losses U.S. agency securities $ 13,125 $ (105) $ 3,752 $ (213) $ 16,877 $ (318) Corporate securities — — 5,476 (524) 5,476 (524) Municipal bonds 72,098 (1,961) 14,116 (560) 86,214 (2,521) Mortgage-backed securities 33,291 (620) 3,825 (76) 37,116 (696) U.S. Small Business Administration securities 2,988 (66) — — 2,988 (66) Total securities available-for-sale $ 121,502 $ (2,752) $ 27,169 $ (1,373) $ 148,671 $ (4,125) There were seven held-to-maturity debt securities with unrealized losses less than one year and none with unrealized losses of more than one year at September 30, 2022. There were no held-to-maturity debt securities in an unrealized loss position as of December 31, 2021. There were 130 available-for-sale securities with unrealized losses of less than one year, and 67 available-for-sale securities with an unrealized loss of more than one year at September 30, 2022. There were 75 available-for-sale securities with unrealized losses of less than one year, and 17 available-for-sale securities with an unrealized loss of more than one year at December 31, 2021. The unrealized losses associated with these securities are believed to be caused by changing market conditions that are considered to be temporary and the Company does not intend to sell the securities, and it is not likely to be required to sell these securities prior to maturity. Management monitors the published credit ratings of the issuers of the debt securities for material ratings or outlook changes. Substantially, all of the Company’s municipal bond portfolio is comprised of obligations of states and political subdivisions located within the Company’s geographic footprint that are monitored through quarterly or annual financial review. All of the available-for-sale mortgage-backed securities and U.S. Small Business Administration securities in an unrealized loss position are issued or guaranteed by government-sponsored enterprises, and the available-for-sale corporate securities are all investment grade and monitored for rating or outlook changes. Based on the Company’s evaluation of these securities, no credit impairment was recorded for the nine months ended September 30, 2022, or for the year ended December 31, 2021. The contractual maturities of securities available-for-sale and held-to-maturity at September 30, 2022 and December 31, 2021 are listed below. Expected maturities of mortgage-backed securities may differ from contractual maturities because borrowers may have the right to call or prepay the obligations; therefore, these securities are classified separately with no specific maturity date. September 30, 2022 December 31, 2021 SECURITIES AVAILABLE-FOR-SALE Amortized Fair Amortized Fair U.S. agency securities Cost Value Cost Value Due after one year through five years $ 945 $ 919 $ 959 $ 1,004 Due after five years through ten years 15,898 13,725 6,920 6,850 Due after ten years 4,310 3,493 13,276 13,116 Subtotal 21,153 18,137 21,155 20,970 Corporate securities Due within one year 1,000 997 — — Due after one year through five years 2,497 2,515 3,495 3,526 Due after five years through ten years 4,000 3,809 4,000 3,627 Due after ten years 2,000 1,295 2,000 1,849 Subtotal 9,497 8,616 9,495 9,002 Municipal bonds Due within one year 2,660 2,638 — — Due after one year through five years 1,045 1,023 3,724 3,850 Due after five years through ten years 7,635 6,899 6,857 7,035 Due after ten years 134,578 106,084 125,796 124,548 Subtotal 145,918 116,644 136,377 135,433 Mortgage-backed securities Federal National Mortgage Association (“FNMA”) 70,061 58,404 75,171 75,737 Federal Home Loan Mortgage Corporation (“FHLMC”) 9,346 8,382 9,606 9,768 Government National Mortgage Association (“GNMA”) 4,785 4,291 3,864 3,897 Subtotal 84,192 71,077 88,641 89,402 U.S. Small Business Administration securities Due after one year through five years 2,582 2,409 2,485 2,507 Due after five years through ten years 4,563 4,276 4,420 4,515 Due after ten years 7,775 6,783 9,478 9,530 Subtotal 14,920 13,468 16,383 16,552 Total securities available-for-sale 275,680 227,942 272,051 271,359 SECURITIES HELD-TO-MATURITY Corporate securities Due after five years through ten years 8,500 7,950 7,500 8,128 Total securities held-to-maturity 8,500 7,950 7,500 8,128 Total securities $ 284,180 $ 235,892 $ 279,551 $ 279,487 There were no sales proceeds, gains or losses from the sale of securities available-for-sale for both the three and nine months ended September 30, 2022 and 2021. |
LOANS RECEIVABLE AND ALLOWANCE
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS | 9 Months Ended |
Sep. 30, 2022 | |
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS | |
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS | NOTE 3 - LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS The composition of the loan portfolio was as follows at the dates indicated: September 30, December 31, REAL ESTATE LOANS 2022 2021 Commercial $ 310,923 $ 264,429 Construction and development 335,177 240,553 Home equity 53,681 41,017 One-to-four-family (excludes loans held for sale) 429,196 366,146 Multi-family 223,712 178,158 Total real estate loans 1,352,689 1,090,303 CONSUMER LOANS Indirect home improvement 447,462 336,285 Marine 68,106 82,778 Other consumer 2,987 2,980 Total consumer loans 518,555 422,043 COMMERCIAL BUSINESS LOANS Commercial and industrial (includes Paycheck Protection Program ("PPP") loans) 211,009 208,552 Warehouse lending 28,102 33,277 Total commercial business loans 239,111 241,829 Total loans receivable, gross 2,110,355 1,754,175 Allowance for credit losses on loans (1) (26,426) (25,635) Total loans receivable, net $ 2,083,929 $ 1,728,540 (1) Allowance for credit losses on loans in 2022 is reported using the CECL method and the allowance for loan losses in 2021 is reported using the incurred loss method. Loan amounts are net of unearned loan fees in excess of unamortized costs and premiums of $6.8 million as of September 30, 2022 and $4.9 million as of December 31, 2021. Net loans include unamortized net discounts on acquired loans of $534,000 and $751,000 as of September 30, 2022 and December 31, 2021, respectively. Net loans does not include accrued interest receivable. Accrued interest receivable on loans was $8.3 million and $6.3 million as of September 30, 2022 and December 31, 2021, respectively. Most of the Company’s commercial and multi-family real estate, construction, residential, and/or commercial business lending activities are with customers located in Western Washington, near our newest loan production office in Vancouver, Washington, or near our loan production office located in the Tri-Cities, Washington. The Company originates real estate, consumer, and commercial business loans and has concentrations in these areas, however, indirect home improvement loans, including solar-related home improvement loans, are originated through a network of home improvement contractors and dealers located throughout Washington, Oregon, California, Idaho, Colorado, Arizona, Minnesota, Nevada, and recently, Texas, Utah, Massachusetts, and Montana. Loans are generally secured by collateral and rights to collateral vary and are legally documented to the extent practicable. Local economic conditions may affect borrowers’ ability to meet the stated repayment terms. At September 30, 2022, the Bank held approximately $786.8 million in loans that are pledged as collateral for FHLB advances, compared to approximately $761.6 million at December 31, 2021. The Bank held approximately $524.3 million in loans that are pledged as collateral for the Federal Reserve Bank of San Francisco (“FRB”) line of credit at September 30, 2022, compared to approximately $428.7 million at December 31, 2021. The Company has defined its loan portfolio into three segments that reflect the structure of the lending function, the Company’s strategic plan and the manner in which management monitors performance and credit quality. The three loan portfolio segments are: (a) Real Estate Loans, (b) Consumer Loans, and (c) Commercial Business Loans. Each of these segments is disaggregated into classes based on the risk characteristics of the borrower and/or the collateral type securing the loan. The following is a summary of each of the Company’s loan portfolio segments and classes: Real Estate Loans Commercial Lending Construction and Development Lending Home Equity Lending One-to-Four-Family Real Estate Lending Multi-Family Lending Consumer Loans Indirect Home Improvement Marine Other Consumer. Commercial Business Loans Commercial and Industrial Lending (“C&I”) Warehouse Lending The following tables detail activity in the allowance for credit losses on loans by loan categories at or for the three and nine months ended September 30, 2022 and in the allowance for loan losses under the incurred loss methodology for the three and nine months ended September 30, 2021: At or For the Three Months Ended September 30, 2022 Real Commercial ALLOWANCE FOR CREDIT LOSSES ON LOANS Estate Consumer Business Unallocated Total Beginning balance $ 11,512 $ 10,605 $ 2,850 $ — $ 24,967 (Recapture) provision for credit losses on loans (213) 1,193 1,042 — 2,022 Loans charged-off — (924) — — (924) Recoveries — 361 — — 361 Total ending allowance balance $ 11,299 $ 11,235 $ 3,892 $ — $ 26,426 At or For the Three Months Ended September 30, 2021 Real Commercial ALLOWANCE FOR LOAN LOSSES Estate Consumer Business Unallocated Total Beginning balance $ 14,308 $ 7,023 $ 5,674 $ 229 $ 27,234 Provision (recapture) for loan losses 124 (2,315) 620 1,571 — Loans charged-off — (428) — — (428) Recoveries — 119 — — 119 Total ending allowance balance $ 14,432 $ 4,399 $ 6,294 $ 1,800 $ 26,925 Period end amount allocated to: Loans individually evaluated for impairment $ — $ 243 $ 991 $ — $ 1,234 Loans collectively evaluated for impairment 14,432 4,156 5,303 1,800 25,691 Ending balance $ 14,432 $ 4,399 $ 6,294 $ 1,800 $ 26,925 LOANS RECEIVABLE Loans individually evaluated for impairment $ 755 $ 694 $ 4,487 $ — $ 5,936 Loans collectively evaluated for impairment 1,037,492 410,400 251,140 — 1,699,032 Ending balance $ 1,038,247 $ 411,094 $ 255,627 $ — $ 1,704,968 At or For the Nine Months Ended September 30, 2022 Real Commercial ALLOWANCE FOR CREDIT LOSSES ON LOANS Estate Consumer Business Unallocated Total Beginning balance, prior to adoption of ASC 326 $ 14,798 $ 4,280 $ 6,536 $ 21 $ 25,635 Impact of adopting ASC 326 (5,234) 6,078 (3,682) (21) (2,859) Provision for credit losses on loans 1,735 1,720 1,038 — 4,493 Loans charged-off — (1,744) — — (1,744) Recoveries — 901 — — 901 Total ending allowance balance $ 11,299 $ 11,235 $ 3,892 $ — $ 26,426 At or For the Nine Months Ended September 30, 2021 Real Commercial ALLOWANCE FOR LOAN LOSSES Estate Consumer Business Unallocated Total Beginning balance $ 13,846 $ 6,696 $ 4,939 $ 691 $ 26,172 Provision (recapture) for loan losses 586 (1,588) 1,393 1,109 1,500 Loans charged-off — (1,280) (38) — (1,318) Recoveries — 571 — — 571 Total ending allowance balance $ 14,432 $ 4,399 $ 6,294 $ 1,800 $ 26,925 Period end amount allocated to: Loans individually evaluated for impairment $ — $ 243 $ 991 $ — $ 1,234 Loans collectively evaluated for impairment 14,432 4,156 5,303 1,800 25,691 Ending balance $ 14,432 $ 4,399 $ 6,294 $ 1,800 $ 26,925 LOANS RECEIVABLE Loans individually evaluated for impairment $ 755 $ 694 $ 4,487 $ — $ 5,936 Loans collectively evaluated for impairment 1,037,492 410,400 251,140 — 1,699,032 Ending balance $ 1,038,247 $ 411,094 $ 255,627 $ — $ 1,704,968 Nonaccrual and Past Due Loans Troubled Debt Restructured Loans The Company had two TDR loans on nonaccrual totaling $3.8 million at September 30, 2022, compared to none at December 31, 2021. The two nonaccrual loans at September 30, 2022, consisted of commercial business loans. The Company had no commitments to lend additional funds on these restructured loans. TDRs were the result of interest rate modifications and extended payment terms. The Company has not forgiven any principal on these loans. There were no TDRs which incurred a payment default within twelve months of the restructure date during the three and nine months ended September 30, 2022 and 2021. The following tables provide information pertaining to the aging analysis of contractually past due loans and nonaccrual loans at September 30, 2022 and December 31, 2021: September 30, 2022 30-59 60-89 Days Days 90 Days Total Total Past Past or More Past Loans Non- REAL ESTATE LOANS Due Due Past Due Due Current Receivable Accrual Commercial $ — $ — $ — $ — $ 310,923 $ 310,923 $ — Construction and development — — — — 335,177 335,177 — Home equity — 37 147 184 53,497 53,681 178 One-to-four-family — — 379 379 428,817 429,196 841 Multi-family — — — — 223,712 223,712 — Total real estate loans — 37 526 563 1,352,126 1,352,689 1,019 CONSUMER LOANS Indirect home improvement 1,082 443 262 1,787 445,675 447,462 621 Marine 83 135 — 218 67,888 68,106 181 Other consumer 19 5 — 24 2,963 2,987 — Total consumer loans 1,184 583 262 2,029 516,526 518,555 802 COMMERCIAL BUSINESS LOANS Commercial and industrial — — 2,617 2,617 208,392 211,009 6,420 Warehouse lending — — — — 28,102 28,102 — Total commercial business loans — — 2,617 2,617 236,494 239,111 6,420 Total loans $ 1,184 $ 620 $ 3,405 $ 5,209 $ 2,105,146 $ 2,110,355 $ 8,241 December 31, 2021 30-59 60-89 Days Days 90 Days Total Total Past Past or More Past Loans Non- REAL ESTATE LOANS Due Due Past Due Due Current Receivable Accrual Commercial $ — $ — $ — $ — $ 264,429 $ 264,429 $ — Construction and development — — — — 240,553 240,553 — Home equity — — 179 179 40,838 41,017 301 One-to-four-family 593 264 480 1,337 364,809 366,146 480 Multi-family — — — — 178,158 178,158 — Total real estate loans 593 264 659 1,516 1,088,787 1,090,303 781 CONSUMER LOANS Indirect home improvement 1,047 280 295 1,622 334,663 336,285 554 Marine 119 — — 119 82,659 82,778 57 Other consumer 11 2 18 31 2,949 2,980 18 Total consumer loans 1,177 282 313 1,772 420,271 422,043 629 COMMERCIAL BUSINESS LOANS Commercial and industrial 791 — — 791 207,761 208,552 4,419 Warehouse lending — — — — 33,277 33,277 — Total commercial business loans 791 — — 791 241,038 241,829 4,419 Total loans $ 2,561 $ 546 $ 972 $ 4,079 $ 1,750,096 $ 1,754,175 $ 5,829 There were no loans 90 days or more past due and still accruing interest at both September 30, 2022 and December 31, 2021. Impaired Loans and the Allowance for Loan Losses - Financial Instruments - Credit Losses (Topic 326) the Company determines it was probable that it would be unable to collect all amounts due according to the contractual terms of the loan agreement, including scheduled interest payments. Factors involved in determining impairment included, but were not limited to, the financial condition of the borrower, the value of the underlying collateral and the status of the economy. Impaired loans were comprised of loans on nonaccrual, TDRs that were performing under their restructured terms, and loans that were 90 days or more past due, but were still on accrual. The following table provides additional information on impaired loans with and without allowance reserves at December 31, 2021. Recorded investment includes the unpaid principal balance or the carrying amount of loans less charge-offs and net deferred loan fees: December 31, 2021 Unpaid WITH NO RELATED ALLOWANCE RECORDED Principal Recorded Related Real estate loans: Balance Investment Allowance Home equity $ 259 $ 227 $ — One-to-four-family 497 480 — 756 707 — WITH RELATED ALLOWANCE RECORDED Real estate loans: Home equity 92 74 23 Consumer loans: Indirect 551 554 193 Marine 56 57 20 Other consumer 18 18 6 Commercial business loans: Commercial and industrial 4,417 4,419 921 5,134 5,122 1,163 Total $ 5,890 $ 5,829 $ 1,163 The following tables present the average recorded investment in loans individually evaluated for impairment and the interest income recognized and received for the three and nine months ended September 30, 2021: At or For the Three Months Ended September 30, 2021 WITH NO RELATED ALLOWANCE RECORDED Average Recorded Interest Income Real estate loans: Investment Recognized Home equity $ 455 $ 12 One-to-four-family 488 3 943 15 WITH RELATED ALLOWANCE RECORDED Consumer loans: Indirect 554 12 Marine 85 2 Other consumer 2 — Commercial business loans: Commercial and industrial 4,487 86 5,128 100 Total $ 6,071 $ 115 At or For the Nine Months Ended September 30, 2021 WITH NO RELATED ALLOWANCE RECORDED Average Recorded Interest Income Real estate loans: Investment Recognized Construction and development $ 1,028 $ — Home equity 538 21 One-to-four-family 559 9 2,125 30 WITH RELATED ALLOWANCE RECORDED Real estate loans: One-to-four-family 27 — Consumer loans: Indirect 670 34 Marine 74 5 Other consumer 8 1 Commercial business loans: Commercial and industrial 4,884 191 5,663 231 Total $ 7,788 $ 261 Credit Quality Indicators As part of the Company’s on-going monitoring of credit quality of the loan portfolio, management tracks certain credit quality indicators including trends related to (i) the risk grading of loans, (ii) the level of classified loans, (iii) net charge-offs, (iv) non-performing loans, and (v) the general economic conditions in the Company’s markets. The Company utilizes a risk grading matrix to assign a risk grade to its real estate and commercial business loans. Loans are graded on a scale of 1 to 10, with loans in risk grades 1 to 6 considered “Pass” and loans in risk grades 7 to 10 are reported as classified loans in the Company’s allowance for credit loan loss analysis. A description of the 10 risk grades is as follows: ● Grades 1 and 2 - These grades include loans to very high-quality borrowers with excellent or desirable business credit. ● Grade 3 - This grade includes loans to borrowers of good business credit with moderate risk. ● Grades 4 and 5 - These grades include “Pass” grade loans to borrowers of average credit quality and risk. ● Grade 6 - This grade includes loans on management’s “Watch” list and is intended to be utilized on a temporary basis for “Pass” grade borrowers where frequent and thorough monitoring is required due to credit weaknesses and where significant risk-modifying action is anticipated in the near term. ● Grade 7 - This grade is for “Other Assets Especially Mentioned (“OAEM”)” in accordance with regulatory guidelines and includes borrowers where performance is poor or significantly less than expected. ● Grade 8 - This grade includes “Substandard” loans in accordance with regulatory guidelines which represent an unacceptable business credit where a loss is possible if loan weakness is not corrected. ● Grade 9 - This grade includes “Doubtful” loans in accordance with regulatory guidelines where a loss is highly probable. ● Grade 10 - This grade includes “Loss” loans in accordance with regulatory guidelines for which total loss is expected and when identified are charged off. Homogeneous loans are risk rated based upon the Federal Financial Institutions Examination Council’s Uniform Retail Credit Classification and Account Management Policy. Loans classified under this policy at the Company are consumer loans which include indirect home improvement, solar, marine, other consumer, and one-to-four-family first and second liens. Under the Uniform Retail Credit Classification Policy, loans that are current or less than 90 days past due are graded “Pass” and risk rated “4” or “5” internally. Loans that are past due more than 90 days are classified “Substandard” and risk graded “8” internally until the loan has demonstrated consistent performance, typically six months of contractual payments. Closed-end loans that are 120 days past due and open-end loans that are 180 days past due are charged off based on the value of the collateral less cost to sell. Management may more conservatively risk rate credits even if paying in accordance with the loan’s repayment terms. Commercial real estate, construction and development, multi-family and commercial business loans are evaluated individually for their risk classification and may be classified as “Substandard” even if current on their loan payment obligations. The following tables summarize risk rated loan balances by category as of September 30, 2022. Revolving loans that are converted to term loans are presented by year of origination. Term loans that are renewed or extended for periods longer than 90 days are presented as a new origination in the year of the most recent renewal or extension. September 30, 2022 REAL ESTATE LOANS Term Loans by Year of Origination Commercial 2022 2021 2020 2019 2018 Prior Revolving Loans Total Loans Pass $ 66,350 $ 76,834 $ 44,759 $ 39,148 $ 14,911 $ 60,167 $ — $ 302,169 Watch — — 2,071 — — — 128 2,199 Special mention — — — 2,127 — 898 — 3,025 Substandard — — — — 586 2,944 — 3,530 Total commercial $ 66,350 $ 76,834 $ 46,830 $ 41,275 $ 15,497 $ 64,009 $ 128 $ 310,923 Construction and development Pass 151,853 133,335 29,720 19,823 — 446 — 335,177 Total construction and development $ 151,853 $ 133,335 $ 29,720 $ 19,823 $ — $ 446 $ — $ 335,177 Home equity Pass 5,339 1,707 7,082 11 1,238 1,680 36,446 53,503 Substandard — — — — 13 165 — 178 Total home equity $ 5,339 $ 1,707 $ 7,082 $ 11 $ 1,251 $ 1,845 $ 36,446 $ 53,681 One-to-four-family Pass 121,163 133,680 81,292 32,264 16,307 41,699 — 426,405 Special mention — — — — 1,950 — — 1,950 Substandard — — — — — 841 — 841 Total one-to-four-family $ 121,163 $ 133,680 $ 81,292 $ 32,264 $ 18,257 $ 42,540 $ — $ 429,196 Multi-family Pass 33,930 63,549 48,598 48,080 4,206 25,349 — 223,712 Total multi-family $ 33,930 $ 63,549 $ 48,598 $ 48,080 $ 4,206 $ 25,349 $ — $ 223,712 Total real estate loans $ 378,635 $ 409,105 $ 213,522 $ 141,453 $ 39,211 $ 134,189 $ 36,574 $ 1,352,689 September 30, 2022 CONSUMER LOANS Term Loans by Year of Origination Indirect home improvement 2022 2021 2020 2019 2018 Prior Revolving Loans Total Loans Pass $ 188,174 $ 131,661 $ 50,247 $ 33,222 $ 19,452 $ 24,076 $ 9 $ 446,841 Substandard 82 124 59 119 95 142 — 621 Total indirect home improvement $ 188,256 $ 131,785 $ 50,306 $ 33,341 $ 19,547 $ 24,218 $ 9 $ 447,462 Marine Pass 23,491 12,123 15,693 6,745 5,830 4,043 — 67,925 Substandard 125 — — — — 56 — 181 Total marine $ 23,616 $ 12,123 $ 15,693 $ 6,745 $ 5,830 $ 4,099 $ — $ 68,106 Other consumer Pass 652 779 128 40 34 148 1,206 2,987 Total other consumer $ 652 $ 779 $ 128 $ 40 $ 34 $ 148 $ 1,206 $ 2,987 Total consumer loans $ 212,524 $ 144,687 $ 66,127 $ 40,126 $ 25,411 $ 28,465 $ 1,215 $ 518,555 COMMERCIAL September 30, 2022 BUSINESS LOANS Term Loans by Year of Origination Commercial and industrial 2022 2021 2020 2019 2018 Prior Revolving Loans Total Loans Pass $ 19,348 $ 24,348 $ 15,714 $ 3,940 $ 3,530 $ 8,029 $ 114,581 $ 189,490 Watch — 13 3,073 — — 205 5,460 8,751 Special mention — — — 667 14 44 773 1,498 Substandard — 1,595 1,606 2,295 187 4,379 1,208 11,270 Total commercial and industrial $ 19,348 $ 25,956 $ 20,393 $ 6,902 $ 3,731 $ 12,657 $ 122,022 $ 211,009 Warehouse lending Pass — — — — — — 28,101 28,101 Watch — — — — — — 1 1 Total warehouse lending $ — $ — $ — $ — $ — $ — $ 28,102 $ 28,102 Total commercial business loans $ 19,348 $ 25,956 $ 20,393 $ 6,902 $ 3,731 $ 12,657 $ 150,124 $ 239,111 TOTAL LOANS RECEIVABLE, GROSS Pass $ 610,300 $ 578,016 $ 293,233 $ 183,273 $ 65,508 $ 165,637 $ 180,343 $ 2,076,310 Watch — 13 5,144 — — 205 5,589 10,951 Special mention — — — 2,794 1,964 942 773 6,473 Substandard 207 1,719 1,665 2,414 881 8,527 1,208 16,621 Total loans receivable, gross $ 610,507 $ 579,748 $ 300,042 $ 188,481 $ 68,353 $ 175,311 $ 187,913 $ 2,110,355 The following table summarizes risk rated loan balances by category as of December 31, 2021: December 31, 2021 Special Pass Watch Mention Substandard Doubtful Loss REAL ESTATE LOANS (1 - 5) (6) (7) (8) (9) (10) Total Commercial $ 253,092 $ 4,652 $ 5,769 $ 916 $ — $ — $ 264,429 Construction and development 240,553 — — — — — 240,553 Home equity 40,716 — — 301 — — 41,017 One-to-four-family 363,682 — — 2,464 — — 366,146 Multi-family 178,158 — — — — — 178,158 Total real estate loans 1,076,201 4,652 5,769 3,681 — — 1,090,303 CONSUMER LOANS Indirect home improvement 335,731 — — 554 — — 336,285 Marine 82,721 — — 57 — — 82,778 Other consumer 2,962 — — 18 — — 2,980 Total consumer loans 421,414 — — 629 — — 422,043 COMMERCIAL BUSINESS LOANS Commercial and industrial 188,767 4,182 1,829 13,774 — — 208,552 Warehouse lending 33,277 — — — — — 33,277 Total commercial business loans 222,044 4,182 1,829 13,774 — — 241,829 Total loans receivable, gross $ 1,719,659 $ 8,834 $ 7,598 $ 18,084 $ — $ — $ 1,754,175 The following table presents the amortized cost basis of loans on nonaccrual status and loans 90 days or more past due and still accruing interest as of September 30, 2022: September 30, 2022 Nonaccrual with No Nonaccrual with 90-Days or More Allowance for Credit Allowance for Credit Total Past Due and Still REAL ESTATE LOANS Losses Losses Nonaccrual Accruing Interest Home equity $ 178 $ — $ 178 $ — One-to-four-family 841 — 841 — 1,019 — 1,019 — CONSUMER LOANS Indirect home improvement — 621 621 — Marine — 181 181 — — 802 802 — COMMERCIAL BUSINESS LOANS Commercial and industrial — 6,420 6,420 — Total $ 1,019 $ 7,222 $ 8,241 $ — The Company recognized interest income on nonaccrual loans of $144,000 and $115,000 during the three months ended September 30, 2022 and 2021, respectively and $370,000 and $261,000 during the nine months ended September 30, 2022 and 2021, respectively. The following table presents the amortized cost basis of collateral dependent loans by class of loans as of September 30, 2022: September 30, 2022 REAL ESTATE LOANS Real Estate Equipment Total Home equity $ 178 $ — $ 178 One-to-four-family 841 — 841 1,019 — 1,019 CONSUMER LOANS Indirect home improvement — 621 621 Marine — 181 181 — 802 802 COMMERCIAL BUSINESS LOANS Commercial and industrial — 6,420 6,420 Total $ 1,019 $ 7,222 $ 8,241 |
SERVICING RIGHTS
SERVICING RIGHTS | 9 Months Ended |
Sep. 30, 2022 | |
SERVICING RIGHTS | |
SERVICING RIGHTS | NOTE 4 - SERVICING RIGHTS Loans serviced for others are not included on the Consolidated Balance Sheets. The unpaid principal balances of permanent loans serviced for others were $2.80 billion and $2.61 billion at September 30, 2022 and December 31, 2021, respectively. The following tables summarize servicing rights activity at or for the dates indicated: At or For the Three Months Ended September 30, 2022 2021 Beginning balance, at the lower of cost or fair value $ 18,516 $ 16,356 Additions 925 1,967 Servicing rights amortized (971) (1,837) Recovery of servicing rights — 11 Ending balance, at the lower of cost or fair value $ 18,470 $ 16,497 At or For the Nine Months Ended September 30, 2022 2021 Beginning balance, at the lower of cost or fair value $ 16,970 $ 12,595 Additions 4,935 7,567 Servicing rights amortized (3,436) (5,722) Recovery of servicing rights 1 2,057 Ending balance, at the lower of cost or fair value $ 18,470 $ 16,497 The fair value of the servicing rights’ assets was $36.5 million and $26.1 million at September 30, 2022 and December 31, 2021, respectively. Fair value adjustments to servicing rights are mainly due to market-based assumptions associated with discounted cash flows, loan prepayment speeds, and changes in interest rates. A significant change in prepayments of the loans in the servicing portfolio could result in significant changes in the valuation adjustments, thus creating potential volatility in the carrying amount of servicing rights. The following provides valuation assumptions used in determining the fair value of mortgage servicing rights (“MSR”) at the dates indicated: At September 30, At December 31, Key assumptions: 2022 2021 Weighted average discount rate 9.1 % 9.1 % Conditional prepayment rate (“CPR”) 8.2 % 13.8 % Weighted average life in years 7.9 5.9 Key economic assumptions of the current fair value for single family MSR are presented in the table below. Also presented is the sensitivity to market rate changes for the par rate coupon for a conventional one-to-four-family FNMA, FHLMC, GNMA, or FHLB serviced home loan. The table below references a 50 basis point and 100 basis point adverse rate change and the impact on prepayment speeds and discount rates at September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 Aggregate portfolio principal balance $ 2,797,326 $ 2,609,776 Weighted average rate of note 3.3 % 3.2 % At September 30, 2022 Base 0.5% Adverse Rate Change 1.0% Adverse Rate Change Conditional prepayment rate 8.2 % 8.4 % 8.9 % Fair value MSR $ 36,457 $ 36,085 $ 35,398 Percentage of MSR 1.3 % 1.3 % 1.3 % Discount rate 9.1 % 9.6 % 10.1 % Fair value MSR $ 36,457 $ 35,653 $ 34,881 Percentage of MSR 1.3 % 1.3 % 1.2 % At December 31, 2021 Base 0.5% Adverse Rate Change 1.0% Adverse Rate Change Conditional prepayment rate 13.8 % 20.0 % 31.5 % Fair value MSR $ 26,070 $ 21,188 $ 15,348 Percentage of MSR 1.0 % 0.8 % 0.6 % Discount rate 9.1 % 9.6 % 10.1 % Fair value MSR $ 26,070 $ 25,586 $ 25,119 Percentage of MSR 1.0 % 1.0 % 1.0 % These sensitivities are hypothetical and should be used with caution as the tables above demonstrate the Company’s methodology for estimating the fair value of MSR is highly sensitive to changes in key assumptions. For example, actual prepayment experience may differ and any difference may have a material effect on the fair value of MSR. Changes in fair value resulting from changes in assumptions generally cannot be extrapolated because the relationship of the change in the assumption to the change in fair value may not be linear. Also, in these tables, the effects of a variation in a particular assumption on the fair value of MSR is calculated without changing any other assumption; in reality, changes in one factor may be associated with changes in another (for example, decreases in market interest rates may provide an incentive to refinance, however, this may also indicate a slowing economy and an increase in the unemployment rate, which reduces the number of borrowers who qualify for refinancing), which may magnify or counteract the sensitivities. Thus, any measurement of the fair value of MSR is limited by the conditions existing and assumptions made at a particular point in time. Those assumptions may not be appropriate if they are applied to a different time. The Company recorded $1.8 million and $1.7 million of gross contractually specified servicing fees, late fees, and other ancillary fees resulting from servicing of loans for the three months ended September 30, 2022 and 2021, respectively, and $5.3 million and $4.6 million for the nine months ended September 30, 2022 and 2021, respectively. The income, net of MSR amortization, is reported in noninterest income on the Consolidated Statements of Income. |
DERIVATIVES
DERIVATIVES | 9 Months Ended |
Sep. 30, 2022 | |
DERIVATIVES | |
DERIVATIVES | NOTE 5 - DERIVATIVES The Company is exposed to certain risk arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company’s predominant derivative and hedging activities involve interest rate swaps related to certain borrowings, brokered deposits, investment securities, forward sales contracts, and commitments to extend credit associated with mortgage banking activities. Generally, these instruments help the Company manage exposure to market risk. Market risk represents the possibility that economic value or net interest income will be adversely affected by fluctuations in external factors such as market-driven interest rates and prices or other economic factors. Mortgage Banking Derivatives Not Designated as Hedges The Company regularly enters into commitments to originate and sell loans held for sale. The Company has exposure to movements in interest rates associated with written interest rate lock commitments with potential borrowers to originate one-to four-family loans that are intended to be sold and for closed one-to-four-family mortgage loans held for sale for which fair value accounting has been elected, that are awaiting sale and delivery into the secondary market. The Company economically hedges the risk of changing interest rates associated with these mortgage loan commitments by entering into forward sales contracts to sell one-to-four-family mortgage loans or into contracts to sell forward To-Be-Announced (“TBA”) mortgage-backed securities. These commitments and contracts are considered derivatives but have not been designated as hedging instruments for reporting purposes under U.S. GAAP. Rather, they are accounted for as free-standing derivatives, or economic hedges, with changes in the fair value of the derivatives reported in noninterest income or noninterest expense. The Bank recognizes all derivative instruments as either other assets or other liabilities on the Consolidated Balance Sheets and measures those instruments at fair value. Cash Flow Hedges The Bank has entered into interest rate swaps to reduce the exposure to variability in interest-related cash outflows attributable to changes forecasted London Interbank Offered Rate (“LIBOR”)-based borrowings and brokered deposits. These derivative instruments are designated as cash flow hedges. The hedged item is the LIBOR portion of the series of future adjustable-rate borrowings and deposits over the term of the interest rate swap. Accordingly, changes to the amount of interest payment cash flows for the hedged transactions attributable to a change in credit risk are excluded from management’s assessment of hedge effectiveness. The Bank tests for hedging effectiveness on a quarterly basis. The accumulated other comprehensive income is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. The Bank has not recorded any hedge ineffectiveness since inception. The Bank expects that approximately $3.3 million will be reclassified from accumulated other comprehensive income (“AOCI”) as a decrease to interest expense over the next 12 months related to these cash flow hedges. Fair Value Hedges The Company is exposed to changes in the fair value of certain of its pools of prepayable fixed-rate assets due to changes in benchmark interest rates. The Company uses interest rate swaps to manage its exposure to changes in fair value on these instruments attributable to changes in the designated benchmark interest rate, the Secured Overnight Financing Rate (“SOFR”). Interest rate swaps designated as fair value hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without the exchange of the underlying notional amount. For derivatives designated and that qualify as fair value hedges, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in interest income. At September 30, 2022, the following amounts recorded in investment securities on the Consolidated Balance Sheets related to cumulative-basis adjustment for fair value hedges. The Company had no fair value hedges at December 31, 2021. September 30, 2022 Line item in the statement of financial position in which the hedged Item is included Hedged Assets/(Liabilities) Investment securities (1) $ 55,684 $ 4,316 Total $ 55,684 $ 4,316 (1) These amounts include the amortized cost basis of closed portfolios used in designated hedging relationships in which the hedged item is the last layer expected to be remaining at the end of the hedging relationship. At September 30, 2022, the amortized cost basis of the closed portfolios used in these hedging relationships was $250.2 million; the cumulative basis adjustments associated with these hedging relationships was $4.3 million; and the amounts of the designated hedged items was $60.0 million. The following tables summarize the Bank’s derivative instruments at the dates indicated. The Bank has master netting agreements with derivative dealers with which it does business, but reflects gross assets and liabilities as other assets and other liabilities, respectively, on the Consolidated Balance Sheets, as follows: September 30, 2022 Fair Value Cash flow hedges: Notional Asset Liability Interest rate swaps - brokered deposits and borrowings $ 90,000 $ 6,117 $ — Fair value hedges: Interest rate swaps - securities $ 60,000 $ 4,301 $ — Non-hedging derivatives: Fallout adjusted interest rate lock commitments with customers 23,766 — 172 Mandatory and best effort forward commitments with investors 6,845 294 — Forward TBA mortgage-backed securities 33,000 1,154 — December 31, 2021 Fair Value Cash flow hedges: Notional Asset Liability Interest rate swaps - brokered deposits and borrowings $ 90,000 $ 1,168 $ 155 Non-hedging derivatives: Fallout adjusted interest rate lock commitments with customers 71,890 757 — Mandatory and best effort forward commitments with investors 74,375 808 — Forward TBA mortgage-backed securities 111,000 53 — The following tables summarize the effect of fair value and cash flow hedge accounting recognized in interest income and interest expense on the Consolidated Statements of Income for the three and nine months ended September 30, 2022 and 2021: Three Months Ended Three Months Ended September 30, 2022 September 30, 2021 Interest Expense Deposits Interest Income Securities Interest Expense Deposits Interest Income Securities Total amounts presented on the Consolidated Statements of Income $ 2,596 $ 1,741 $ 1,629 $ 1,487 Net gains (losses) on fair value hedging relationships Interest rate swaps - securities Recognized on hedged items $ — $ (3,383) $ — $ — Recognized on derivatives designated as hedging instruments — 3,313 — — Net income (expense) recognized on fair value hedges $ — $ (70) $ — $ — Net gain (loss) on cash flow hedging relationships Interest rate swaps - brokered deposits and borrowings Realized gains (losses) (pre-tax) reclassified from AOCI into net income $ 278 $ — $ (135) $ — Net income (expense) recognized on cash flow hedges $ 278 $ — $ (135) $ — Nine Months Ended Nine Months Ended September 30, 2022 September 30, 2021 Interest Expense Deposits Interest Income Securities Interest Expense Deposits Interest Income Securities Total amounts presented on the Consolidated Statements of Income $ 5,438 $ 4,990 $ 5,481 $ 4,050 Net gains (losses) on fair value hedging relationships Interest rate swaps - securities Recognized on hedged items $ — $ (4,316) $ — $ — Recognized on derivatives designated as hedging instruments — 4,144 — — Net income (expense) recognized on fair value hedges $ — $ (172) $ — $ — Net gain (loss) on cash flow hedging relationships Interest rate swaps - brokered deposits and borrowings Realized gains (losses) (pre-tax) reclassified from AOCI into net income $ 232 $ — $ (373) $ — Net income (expense) recognized on cash flow hedges $ 232 $ — $ (373) $ — Changes in the fair value of the nonhedging derivatives recognized in noninterest income on the Consolidated Statements of Income and included in gain on sale of loans resulted in net gains of $34,000 and net losses of $402,000 for the three months ended September 30, 2022 and 2021, respectively, and net losses of $1.7 million and $4.3 million for the nine months ended September 30, 2022 and 2021, respectively. The Bank’s derivative instruments with certain counterparties contain legally enforceable netting provisions that allow for net settlement of multiple transactions to a single amount, which may be positive, negative, or zero. Offsetting information in regards to all derivative assets and liabilities, including accrued interest, subject to these master netting agreements at September 30, 2022 and December 31, 2021 is presented in the following tables: Gross Amounts Net Amounts of Assets Gross Amounts Not Offset Gross Amounts Offset in the Presented in the in the Statement of Financial Position Offsetting of derivative assets of Recognized Statement of Statement of Financial Cash Collateral at September 30, 2022 Assets Financial Position Financial Position Instruments Received Net Amount Interest rate swaps $ 10,418 $ — $ 10,418 $ — $ — $ 10,418 at December 31, 2021 Interest rate swaps $ 1,168 $ — $ 1,168 $ — $ — $ 1,168 Gross Amounts Net Amounts of Gross Amounts Not Offset Gross Amounts Offset in the Liabilities in the Statement of Financial Position Offsetting of derivative liabilities of Recognized Statement of Presented in the Statement Financial Cash Collateral at September 30, 2022 Liabilities Financial Position of Financial Position Instruments Posted Net Amount Interest rate swaps $ — $ — $ — $ — $ — $ — at December 31, 2021 Interest rate swaps $ 155 $ — $ 155 $ — $ 155 $ — Credit-risk-related Contingent Features The Company has interest rate swap agreements with certain of its derivative counterparties that contain a provision where if the Company either defaults or fails to maintain its status as a well / adequately capitalized institution, then the Company could be required to terminate the contracts or post additional collateral. At September 30, 2022, the Company had no derivatives in a net liability position related to these agreements. The Company has minimum collateral posting thresholds with certain of its derivative counterparties and has posted collateral of securities with a carrying value of $2.8 million and cash of $680,000 to secure interest rate swap agreements at September 30, 2022. The Company had posted cash of $170,000 as collateral, for TBA trades with counterparties at that date. In certain cases, the Company will have posted excess collateral, compared to total exposure due to initial margin requirements or day-to-day rate volatility. |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2022 | |
LEASES | |
LEASES | NOTE 6 - LEASES The Company has operating leases for retail bank branches, home lending branches, and certain equipment. The Company’s leases have remaining lease terms of two months to seven years and nine months, some of which include options to extend the leases for up to five years. The components of lease cost (included in occupancy expense on the Consolidated Statements of Income) are as follows for the three and nine months ended September 30, 2022 and 2021: Three Months Ended Three Months Ended Lease cost: September 30, 2022 September 30, 2021 Operating lease cost $ 350 $ 353 Short-term lease cost 8 2 Total lease cost $ 358 $ 355 Nine Months Ended Nine Months Ended Lease cost: September 30, 2022 September 30, 2021 Operating lease cost $ 1,041 $ 1,063 Short-term lease cost 16 3 Total lease cost $ 1,057 $ 1,066 The following tables provide supplemental information related to operating leases at or for the three and nine months ended September 30, 2022 and 2021: At or For the At or For the Cash paid for amounts included in the Three Months Ended Three Months Ended measurement of lease liabilities: September 30, 2022 September 30, 2021 Operating cash flows from operating leases $ 360 $ 329 Weighted average remaining lease term- operating leases 4.7 years 4.9 years Weighted average discount rate- operating leases 2.41 % 2.18 % At or For the At or For the Cash paid for amounts included in the Nine Months Ended Nine Months Ended measurement of lease liabilities: September 30, 2022 September 30, 2021 Operating cash flows from operating leases $ 1,063 $ 1,058 Weighted average remaining lease term- operating leases 4.7 years 4.9 years Weighted average discount rate- operating leases 2.41 % 2.18 % The Company’s leases typically do not contain a discount rate implicit in the lease contract. As an alternative, the discount rate used in determining the lease liability for each individual lease was the FHLB of Des Moines’ fixed-advance rate. Maturities of operating lease liabilities at September 30, 2022 for future periods are as follows: 2022 $ 420 2023 1,512 2024 1,462 2025 1,152 2026 1,030 Thereafter 1,996 Total lease payments 7,572 Less imputed interest (736) Total $ 6,836 |
OTHER REAL ESTATE OWNED (OREO)
OTHER REAL ESTATE OWNED (OREO) | 9 Months Ended |
Sep. 30, 2022 | |
OTHER REAL ESTATE OWNED ("OREO") | |
OTHER REAL ESTATE OWNED ("OREO") | NOTE 7 - OTHER REAL ESTATE OWNED (“OREO”) The following table presents the activity related to OREO at or for the three and nine months ended September 30, 2022 and 2021: At or For the Three Months Ended At or For the Nine Months Ended September 30, September 30, 2022 2021 2022 2021 Beginning balance $ 145 $ — $ — $ 90 Additions — — 145 — Gross proceeds from sale of OREO — — — (81) Loss on sale of OREO — — — (9) Ending balance $ 145 $ — $ 145 $ — There was one OREO property at September 30, 2022 and none at September 30, 2021. There were $10,000 in OREO holding costs for the three and nine months ended September 30, 2022 and none for the three and nine months ended September 30, 2021. There was $526,000 in portfolio mortgage loans collateralized by residential real estate property in the process of foreclosure |
DEPOSITS
DEPOSITS | 9 Months Ended |
Sep. 30, 2022 | |
DEPOSITS | |
DEPOSITS | NOTE 8 - DEPOSITS Deposits are summarized as follows at September 30, 2022 and December 31, 2021: September 30, December 31, 2022 2021 Noninterest-bearing checking (4) $ 555,753 $ 564,360 Interest-bearing checking (1)(4) 147,968 228,024 Savings 143,612 193,922 Money market (2) 659,861 552,357 Certificates of deposit less than $100,000 (3) 345,227 186,974 Certificates of deposit of $100,000 through $250,000 133,429 116,206 Certificates of deposit of $250,000 and over 71,629 57,512 Escrow accounts related to mortgages serviced 25,859 16,389 Total $ 2,083,338 $ 1,915,744 (1) Includes $1.2 million and $90.0 million of brokered deposits at September 30, 2022 and December 31, 2021, respectively. (2) Includes $66.8 million and $5.0 million of brokered deposits at September 30, 2022 and December 31, 2021, respectively. (3) Includes $256.6 million and $97.6 million of brokered deposits at September 30, 2022 and December 31, 2021, respectively. (4) Prior presentation of interest-bearing checking balances was revised due to misclassification of certain checking products in previous periods. As a result of the misclassification, interest-bearing checking balances totaling $121.2 million as of December 31, 2021, were reclassified to noninterest-bearing checking for comparative purposes. Balances as of the dates and average values included herein have been updated to reflect the reclassification. Scheduled maturities of time deposits at September 30, 2022 for future periods ending are as follows: At September 30, 2022 Maturing in 2022 $ 137,460 Maturing in 2023 210,943 Maturing in 2024 54,019 Maturing in 2025 111,811 Maturing in 2026 18,439 Thereafter 17,613 Total $ 550,285 Interest expense by deposit category for the three and nine months ended September 30, 2022 and 2021 is as follows: Three Months Ended Nine Months Ended September 30, September 30, 2022 2021 2022 2021 Interest-bearing checking $ 100 $ 56 $ 353 $ 154 Savings and money market 1,303 348 2,397 1,232 Certificates of deposit 1,193 1,225 2,688 4,095 Total $ 2,596 $ 1,629 $ 5,438 $ 5,481 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 9 - COMMITMENTS AND CONTINGENCIES Commitments - The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. The following table provides a summary of the Company’s commitments at September 30, 2022 and December 31, 2021: COMMITMENTS TO EXTEND CREDIT September 30, December 31, REAL ESTATE LOANS 2022 2021 Commercial $ 1,634 $ 787 Construction and development 245,139 182,297 One-to-four-family (includes locks for saleable loans) 43,191 78,264 Home equity 79,283 67,596 Multi-family 2,992 3,434 Total real estate loans 372,239 332,378 CONSUMER LOANS 42,289 35,873 COMMERCIAL BUSINESS LOANS Commercial and industrial 143,881 126,220 Warehouse lending 70,351 64,160 Total commercial business loans 214,232 190,380 Total commitments to extend credit $ 628,760 $ 558,631 Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Since many of the commitments are expected to expire without being drawn upon, the amount of the total commitments do not necessarily represent future cash requirements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon an extension of credit, is based on management’s credit evaluation of the party. Collateral held varies, but may include accounts receivable, inventory, property and equipment, residential real estate, and income-producing commercial properties. Unfunded commitments under commercial lines of credit, revolving credit lines, and overdraft protection agreements are commitments for possible future extensions of credit to existing customers. These lines of credit are uncollateralized and usually do not contain a specified maturity date and ultimately may not be drawn upon to the total extent to which the Company is committed. The Company’s ACL - unfunded loan commitments at September 30, 2022 and reserves for estimated losses from unfunded commitments at December 31, 2021 was $3.1 million and $499,000, respectively. The increase in the ACL - unfunded loan commitments reflects the adoption of CECL, as well as the increased provision for credit losses - unfunded loan commitments recorded during the current quarter. One-to-four-family commitments included in the table above are accounted for as fair value derivatives and do not carry an associated reserve. The Company’s derivative positions are presented with discussion in “Note 5 - Derivatives.” The Company also sells one-to-four-family loans to the FHLB of Des Moines that require a limited level of recourse if the loans default and exceed a certain loss exposure. Specific to that recourse, the FHLB of Des Moines established a first loss account (“FLA”) related to the loans and required a credit enhancement (“CE”) obligation by the Bank to be utilized after the FLA is used. Based on loans sold through September 30, 2022, total loans sold to the FHLB were $10.2 million with the FLA totaling $938,000 and the CE obligation at $811,000 or 7.9% of the loans outstanding. Management has established a holdback of 10% of the outstanding CE, or $81,000, which is a part of the off-balance sheet holdback for loans sold. At both September 30, 2022 and December 31, 2021, there were no loans sold to the FHLB of Des Moines that were greater than 30 days past their contractual payment due date. Contingent liabilities for loans held for sale - The Company has entered into a severance agreement with its Chief Executive Officer (“CEO”). The severance agreement, subject to certain requirements, generally includes a lump sum payment to the CEO equal to 24 months of base compensation in the event his employment is involuntarily terminated, other than for cause or the executive terminates his employment with good reason, as defined in the severance agreement. The Company has entered into change of control agreements with its Chief Financial Officer, Chief Operating Officer, Chief Lending Officer, Chief Credit Officer, Chief Risk Officer, Chief Human Resources Officer, Senior Vice President Compliance Officer, Executive Vice President of Retail Banking and Marketing, and the Executive Vice President of Home Lending. The change of control agreements, subject to certain requirements, generally remain in effect until canceled by either party upon at least 24 months prior written notice. Under the change of control agreements, the executive generally will be entitled to a change of control payment from the Company if the executive is involuntarily terminated within six months preceding or 12 months after a change in control (as defined in the change of control agreements). In such an event, the executives would each be entitled to receive a cash payment in an amount equal to 12 months of their then current salary, subject to certain requirements in the change of control agreements. As a result of the nature of our activities, the Company is subject to various pending and threatened legal actions, which arise in the ordinary course of business. From time to time, subordination liens may create litigation which requires us to defend our lien rights. In the opinion of management, liabilities arising from these claims, if any, will not have a material effect on our financial position. The Company had no material pending legal actions at September 30, 2022. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2022 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | NOTE 10 - FAIR VALUE MEASUREMENTS The Company determines fair value based on the requirements established in Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements, Financial Instruments - Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities, The following definitions describe the levels of inputs that may be used to measure fair value: Level 1 Level 2 Level 3 The following methods were used to estimate the fair value of certain assets and liabilities on a recurring and nonrecurring basis: Securities - Mortgage Loans Held for Sale - Loans Receivable - Fair values are estimated for portfolios of loans with similar financial characteristics. Loans are segregated by type, including commercial, real estate and consumer loans. Each loan category is further segregated by fixed and adjustable-rate loans. The fair value of loans is calculated by discounting expected cash flows at rates at which similar loans are currently being made. These amounts are discounted further by embedded probable losses expected to be realized in the portfolio. Certain residential mortgage loans were initially originated for sale and measured at fair value; after origination, the loans were transferred to loans held for investment. As of September 30, 2022 and December 31, 2021, there were $14.2 million and $16.1 million, respectively, in residential mortgage loans recorded at fair value as they were previously transferred from held for sale to loans held for investment. The aggregate unpaid principal balance of these loans was $16.0 million and $16.1 million as of September 30, 2022 and December 31, 2021, respectively. Gains and losses from changes in fair value for these loans are reported in earnings as a component of service charges and fee income on the Consolidated Statements of Income. For the three and nine months ended September 30, 2022, the Company recorded net decreases in fair value of $816,000 and $1.8 million, as compared to net decreases in fair value of $19,000 and $55,000 for the three and nine months ended September 30, 2021, respectively. For loans originated as held for sale and transferred into loans held for investment, the fair value is determined based on quoted secondary market prices for similar loans (Level 2). Derivative Instruments - rate lock commitments and forward sales commitments are estimated using quoted or published market prices for similar instruments, adjusted for factors such as pull-though rate assumptions based on historical information, where appropriate. TBA mortgage-backed securities are fair valued on similar contracts in active markets (Level 2), while locks and forwards with customers and investors are fair valued using similar contracts in the market and changes in the market interest rates (Level 2 and 3). Derivative instruments not related to mortgage banking activities include interest rate swap agreements. The fair values of interest rate swap agreements are based on valuation models using observable market data as of the measurement date (Level 2). The Company’s derivatives are traded in an over-the-counter market where quoted market prices are not always available. Therefore, the fair values of derivatives are determined using quantitative models that utilize multiple market inputs. The inputs will vary based on the type of derivative, but could include interest rates, prices and indices to generate continuous yield or pricing curves, prepayment rates, and volatility factors to value the position. The majority of market inputs are actively quoted and can be validated through external sources, including market transactions and third-party pricing services. The fair values of all interest rate swaps are determined from third-party pricing services without adjustment. Other Real Estate Owned - Fair value adjustments to OREO are recorded at the lower of carrying amount of the loan or fair value of the collateral less selling costs. Any write-downs based on the asset’s fair value at the date of acquisition are charged to the allowance for credit losses. After foreclosure, management periodically performs valuations such that the real estate is carried at the lower of its new cost basis or fair value, net of estimated costs to sell (Level 3). Loans Individually Evaluated - Expected credit losses for loans evaluated individually are measured based on the present value of expected future cash flows discounted at the loan’s original effective interest rate or when the Bank determines that foreclosure is probable, the expected credit loss is measured based on the fair value of the collateral as of the reporting date, less estimated selling costs, as applicable. As a practical expedient, the Bank measures the expected credit loss for a loan using the fair value of the collateral, if repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty based on the Bank’s assessment as of the reporting date. In both cases, if the fair value of the collateral is less than the amortized cost basis of the loan, the Bank will recognize an allowance as the difference between the fair value of the collateral, less costs to sell (if applicable) at the reporting date and the amortized cost basis of the loan. If the fair value of the collateral exceeds the amortized cost basis of the loan, any expected recovery added to the amortized cost basis will be limited to the amount previously charged-off by the subsequent changes in the expected credit losses for loans evaluated individually are included within the provision for credit losses in the same manner in which the expected credit loss initially was recognized or as a reduction in the provision that would otherwise be reported (Level 3). Servicing Rights - The following tables present securities available-for-sale, mortgage loans held for sale, loans receivable, and derivative assets and liabilities measured at fair value on a recurring basis at the dates indicated: Financial Assets At September 30, 2022 Securities available-for-sale: Level 1 Level 2 Level 3 Total U.S. agency securities $ — $ 18,137 $ — $ 18,137 Corporate securities — 8,616 — 8,616 Municipal bonds — 116,644 — 116,644 Mortgage-backed securities — 71,077 — 71,077 U.S. Small Business Administration securities — 13,468 — 13,468 Mortgage loans held for sale, at fair value — 23,447 — 23,447 Loans receivable, at fair value — 14,198 — 14,198 Derivatives: Mandatory and best effort forward commitments with investors — — 294 294 Forward TBA mortgage-backed securities — 1,154 — 1,154 Interest rate swaps — 10,418 — 10,418 Total assets measured at fair value $ — $ 277,159 $ 294 $ 277,453 Financial Liabilities Derivatives: Interest rate lock commitments with customers — — (172) (172) Total liabilities measured at fair value $ — $ — $ (172) $ (172) Financial Assets At December 31, 2021 Securities available-for-sale: Level 1 Level 2 Level 3 Total U.S. agency securities $ — $ 20,970 $ — $ 20,970 Corporate securities — 7,995 1,007 9,002 Municipal bonds — 135,302 131 135,433 Mortgage-backed securities — 89,402 — 89,402 U.S. Small Business Administration securities — 16,552 — 16,552 Mortgage loans held for sale, at fair value — 125,810 — 125,810 Loans receivable, at fair value — 16,083 — 16,083 Derivatives: Mandatory and best effort forward commitments with investors — — 808 808 Forward TBA mortgage-backed securities — 53 — 53 Interest rate swaps — 1,168 — 1,168 Interest rate lock commitments with customers — — 757 757 Total assets measured at fair value $ — $ 413,335 $ 2,703 $ 416,038 Financial Liabilities Derivatives: Interest rate swaps — (155) — (155) Total liabilities measured at fair value $ — $ (155) $ — $ (155) The following tables present loans individually evaluated, OREO, and servicing rights measured at fair value on a nonrecurring basis for which a nonrecurring change in fair value has been recorded during the reporting periods indicated. The amounts disclosed below represent the fair values at the time the nonrecurring fair value measurements were evaluated. September 30, 2022 Level 1 Level 2 Level 3 Total Loans individually evaluated $ — $ — $ 8,241 $ 8,241 OREO — — 145 145 Servicing rights — — 36,457 36,457 December 31, 2021 Level 1 Level 2 Level 3 Total Loans individually evaluated $ — $ — $ 5,829 $ 5,829 Servicing rights — — 26,070 26,070 Quantitative Information about Level 3 Fair Value Measurements Level 3 Significant Weighted Average Fair Value Valuation Unobservable September 30, December 31, Instruments Techniques Inputs Range 2022 2021 RECURRING Interest rate lock commitments with customers Quoted market prices Pull-through expectations 80% - 99% 97.3 % 93.3 % Individual forward sale commitments with investors Quoted market prices Pull-through expectations 80% - 99% 97.3 % 93.3 % NONRECURRING Loans individually evaluated Fair value of underlying collateral Discount applied to the obtained appraisal 10.0% 10.0 % 10.0 % OREO Fair value of collateral Discount applied to the obtained appraisal 10.0% 10.0 % 10.0 % Servicing rights Industry sources Pre-payment speeds 0% - 50% 8.2 % 13.8 % The pull-through rate is based on historical loan closing rates for similar interest rate lock commitments. An increase or decrease in the pull-through rate would have a corresponding positive or negative fair value adjustment. The following tables provides a reconciliation of assets and liabilities measured at fair value using significant unobservable inputs (Level 3) on a recurring basis during the three and nine months ended September 30, 2022 and 2021: Purchases Net change in Net change in Three Months Ended Beginning and Sales and Ending fair value for fair value for September 30, 2022 Balance Issuances Settlements Balance gains/(losses) (1) gains/(losses) (2) Interest rate lock commitments with customers $ 184 $ 472 $ (828) $ (172) $ (356) $ — Individual forward sale commitments with investors 518 899 (1,123) 294 (224) — September 30, 2021 Interest rate lock commitments with customers $ 2,106 $ 4,920 $ (5,855) $ 1,171 $ (935) $ — Individual forward sale commitments with investors (553) 1,081 30 558 1,111 — Purchases Net change in Net change in Nine Months Ended Beginning and Sales and Ending fair value for fair value for September 30, 2022 Balance Issuances Settlements Balance gains/(losses) (1) gains/(losses) (2) Interest rate lock commitments with customers $ 757 $ 2,589 $ (3,518) $ (172) $ (929) $ — Individual forward sale commitments with investors 808 5,972 (6,486) 294 (514) — September 30, 2021 Interest rate lock commitments with customers $ 4,024 $ 19,780 $ (22,633) $ 1,171 $ (2,853) $ — Individual forward sale commitments with investors (67) 534 91 558 625 — ___________________________ (1) Relating to items held at end of period included in income. (2) Relating to items held at end of period included in other comprehensive income (loss). Gains (losses) on interest rate lock commitments carried at fair value are recorded in other noninterest income. Gains (losses) on forward sale commitments with investors carried at fair value are recorded in noninterest income. The following table provides estimated fair values of the Company’s financial instruments at September 30, 2022 and December 31, 2021, whether or not recognized at fair value on the Consolidated Balance Sheets: September 30, December 31, 2022 2021 Financial Assets Carrying Fair Carrying Fair Level 1 inputs: Amount Value Amount Value Cash and cash equivalents $ 159,797 $ 159,797 $ 26,491 $ 26,491 Certificates of deposit at other financial institutions 4,960 4,960 10,542 10,542 Level 2 inputs: Securities available-for-sale, at fair value 227,942 227,942 271,359 271,359 Securities held-to-maturity 8,500 7,950 7,500 8,128 Loans held for sale, at fair value 23,447 23,447 125,810 125,810 FHLB stock, at cost 13,591 13,591 4,778 4,778 Forward TBA mortgage-backed securities 1,154 1,154 53 53 Loans receivable, at fair value 14,198 14,198 16,083 16,083 Interest rate swaps 10,418 10,418 1,168 1,168 Accrued interest receivable 10,407 10,407 7,594 7,594 Level 3 inputs: Loans receivable, gross 2,096,157 2,030,648 1,738,092 1,725,651 Servicing rights, held at lower of cost or fair value 18,470 36,457 16,970 26,070 Fair value interest rate locks with customers — — 757 757 Mandatory and best effort forward commitments with investors 294 294 808 808 Financial Liabilities Level 2 inputs: Deposits 2,083,338 2,060,539 1,915,744 1,912,498 Borrowings 260,828 260,058 42,528 43,365 Subordinated notes, excluding unamortized debt issuance costs 50,000 44,500 50,000 51,688 Accrued interest payable 1,200 1,200 766 766 Interest rate swaps — — 155 155 Level 3 inputs: Fair value interest rate locks with customers 172 172 — — |
EMPLOYEE BENEFITS
EMPLOYEE BENEFITS | 9 Months Ended |
Sep. 30, 2022 | |
EMPLOYEE BENEFITS | |
EMPLOYEE BENEFITS | NOTE 11 - EMPLOYEE BENEFITS Employee Stock Ownership Plan (“ESOP”) On January 1, 2012, the Company established an ESOP for eligible employees of the Company and the Bank. Employees of the Company and the Bank are eligible to participate in the ESOP if they have been credited with at least 1,000 hours 1,000 The ESOP borrowed $2.6 million from FS Bancorp, Inc. and used those funds to acquire 518,420 shares of FS Bancorp, Inc. common stock in the open market at an average price of $5.09 per share during the second half of 2012. The Bank will make contributions to the ESOP in amounts necessary to amortize the ESOP loan payable to FS Bancorp, Inc. over a period of 10 years, bearing interest at 2.30%. Intercompany expenses associated with the ESOP are eliminated in consolidation. Shares purchased by the ESOP with the loan proceeds are held in a suspense account and allocated to ESOP participants on a pro rata basis as principal and interest payments are made by the ESOP to FS Bancorp, Inc. The loan is secured by shares purchased with the loan proceeds and will be repaid by the ESOP with funds from the Bank’s discretionary contributions to the ESOP and earnings on the ESOP assets. Payments of principal and interest are due annually on December 31, the Company’s fiscal year end. On December 31, 2021, the ESOP paid the tenth annual and final installment of principal in the amount of $288,000, plus accrued interest of $7,000 pursuant to the ESOP loan agreement. All ESOP shares have been allocated as of December 31, 2021. Compensation expense related to the ESOP was $0 for both the three and nine months ended September 30, 2022, and $439,000 and $1.3 million, for the three and nine months ended September 30, 2021, respectively. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2022 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | NOTE 12 - EARNINGS PER SHARE The Company computes earnings per share using the two-class method, which is an earnings allocation method for computing earnings per share that treats a participating security as having rights to earnings that would otherwise have been available to common shareholders. Basic earnings per share are computed by dividing income available to common shareholders by the weighted average number of common shares outstanding for the period. Unvested share-based awards containing non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of earnings per share pursuant to the two-class method. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. For earnings per share calculations, the ESOP shares committed to be released are included as outstanding shares for both basic and diluted earnings per share. The following table presents a reconciliation of the components used to compute basic and diluted earnings per share at or for the three and nine months ended September 30, 2022 and 2021: At or For the Three Months Ended September 30, At or For the Nine Months Ended September 30, Numerator (in thousands): 2022 2021 2022 2021 Net income $ 8,458 $ 8,331 $ 22,027 $ 28,763 Dividends and undistributed earnings allocated to participating securities (153) (138) (414) (463) Net income available to common shareholders $ 8,305 $ 8,193 $ 21,613 $ 28,300 Denominator (shown as actual): Basic weighted average common shares outstanding 7,605,360 8,129,524 7,800,390 8,256,523 Dilutive shares 102,402 240,551 122,456 297,628 Diluted weighted average common shares outstanding 7,707,762 8,370,075 7,922,846 8,554,151 Basic earnings per share $ 1.09 $ 1.01 $ 2.77 $ 3.43 Diluted earnings per share $ 1.08 $ 0.98 $ 2.73 $ 3.31 Potentially dilutive weighted average share options that were not included in the computation of diluted earnings per share because to do so would be anti-dilutive 84,540 23,067 62,544 7,774 |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2022 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | NOTE 13 - STOCK-BASED COMPENSATION Stock Options and Restricted Stock On May 17, 2018, the shareholders of FS Bancorp, Inc. approved the 2018 Equity Incentive Plan (the “2018 Plan”) that authorized 1.3 million shares of the Company’s common stock to be awarded. The 2018 Plan provides for the grant of incentive stock options, nonqualified stock options, and up to 326,000 restricted stock awards (“RSAs”) to directors, emeritus directors, officers, employees or advisory directors of the Company. At September 30, 2022, there were 342,096 stock option awards and 109,410 RSAs available to be granted under the 2018 Plan. Total share-based compensation expense was $499,000 and $1.4 million for the three and nine months ended September 30, 2022, respectively, and $402,000 and $995,000 for the three and nine months ended September 30, 2021, respectively. Stock Options The 2018 Plan consists of stock option awards that may be granted as incentive stock options or nonqualified stock options. Stock option awards generally vest at one year or three years for independent directors or over a five-year period for employees and officers with 20% vesting on the anniversary date of each grant date as long as the award recipient remains in service to the Company. The options are exercisable after vesting for up to the remaining term of the original grant. The maximum term of the options granted is 10 years. Any unexercised stock options will expire 10 years after the grant date or sooner in the event of the award recipient’s termination of service with the Company or the Bank. The fair value of each stock option award is estimated on the grant date using a Black-Scholes Option pricing model that uses the following assumptions. The dividend yield is based on the current quarterly dividend in effect at the time of the grant. Historical employment data is used to estimate the forfeiture rate. The Company elected to use Staff Accounting Bulletin 107, simplified expected term calculation for the “Share-Based Payments” method permitted by the SEC to calculate the expected term. This method uses the vesting term of an option along with the contractual term, setting the expected life at 5.5 years for one-year vesting, 5.75 years for two-year vesting, 6.0 years for three-year vesting, and 6.5 years for five-year vesting. The following table presents a summary of the Company’s stock option awards during the nine months ended September 30, 2022 (shown as actual): Weighted-Average Weighted- Remaining Average Contractual Term In Aggregate Shares Exercise Price Years Intrinsic Value Outstanding at January 1, 2022 613,626 $ 25.24 7.17 $ 5,362,902 Granted 99,200 $ 30.94 — — Less exercised 43,048 $ 16.17 — $ 635,646 Forfeited or expired — — — — Outstanding at September 30, 2022 669,778 $ 26.67 7.00 $ 2,106,211 Expected to vest, assuming a 0.31% annual forfeiture rate (1) 649,479 $ 26.58 6.94 $ 2,077,145 Exercisable at September 30, 2022 334,767 $ 24.21 5.61 $ 1,573,345 (1) Forfeiture rate has been calculated and estimated to assume a forfeiture of 3.1% of the options forfeited over 10 years . At September 30, 2022, there was $2.2 million of total unrecognized compensation cost related to nonvested stock options granted under the 2018 plan. The cost is expected to be recognized over the remaining weighted-average vesting period of 3.4 years. Restricted Stock Awards The RSAs’ fair value is equal to the value of the market price of FS Bancorp’s common stock on the grant date and compensation expense is recognized over the vesting period of the awards based on the fair value of the restricted stock. Shares for the 2018 Plan generally vest at one year or three years for independent directors or over a five-year period for employees and officers beginning on the grant date. Any unvested RSAs will expire after vesting or sooner in the event of the award recipient’s termination of service with the Company or the Bank. The following table presents a summary of the Company’s nonvested awards during the nine months ended September 30, 2022 (shown as actual): Weighted-Average Grant-Date Fair Value Nonvested Shares Shares Per Share Nonvested at January 1, 2022 121,672 $ 28.02 Granted 35,050 — Less vested 38,192 28.12 Forfeited or expired — — Nonvested at September 30, 2022 118,530 $ 28.85 At September 30, 2022, there was $3.3 million of total unrecognized compensation cost related to nonvested shares granted under the 2018 Plan as RSAs. The cost is expected to be recognized over the remaining weighted-average vesting period of 3.4 years. |
REGULATORY CAPITAL
REGULATORY CAPITAL | 9 Months Ended |
Sep. 30, 2022 | |
REGULATORY CAPITAL | |
REGULATORY CAPITAL | NOTE 14 - REGULATORY CAPITAL The Bank is subject to various regulatory capital requirements administered by the Federal Reserve and the FDIC. 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 consolidated financial statements. Under capital adequacy guidelines of the regulatory framework for prompt corrective action, the Bank must meet specific capital adequacy guidelines that involve quantitative measures of the Bank’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Bank’s capital classification is also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. As of September 30, 2022, the Company opted to discontinue the community bank leverage ratio (“CBLR”) framework and return to the former risk-based capital adequacy framework to be well capitalized under prompt corrective action provisions. The CBLR calculated for the Bank at December 31, 2021 was 12.2%. At December 31, 2021, the Bank was considered well capitalized under the CBLR framework with Tier 1 capital of $270.8 million and a minimum Tier 1 capital requirement of $189.3 million. Under the risk-based capital adequacy framework, quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below) of Tier 1 capital (as defined in the regulations) to total average assets (as defined), and minimum ratios of Tier 1 total capital (as defined) and common equity Tier 1 (“CET 1”) capital to risk-weighted assets (as defined). The Bank must maintain minimum total risk-based, Tier 1 risk-based, Tier 1 leverage, and CET 1 capital ratios as set forth in the table below to be categorized as well capitalized. At September 30, 2022, the Bank was categorized as well capitalized under applicable regulatory requirements. There are no conditions or events since that notification that management believes have changed the Bank’s category. Management believes, at September 30, 2022, that the Bank met all capital adequacy requirements. The following table compares the Bank’s actual capital amounts and ratios at September 30, 2022 to their minimum regulatory capital requirements and well capitalized regulatory capital at that date (dollars in thousands): To be Well Capitalized Under Prompt For Capital For Capital Adequacy Corrective Actual Adequacy Purposes with Capital Buffer Action Provisions Bank Only Amount Ratio Amount Ratio Amount Ratio Amount Ratio At September 30, 2022 Total risk-based capital (to risk-weighted assets) $ 316,916 13.73 % $ 184,670 8.00 % $ 242,380 10.50 % $ 230,838 10.00 % Tier 1 risk-based capital (to risk-weighted assets) $ 288,053 12.48 % $ 138,503 6.00 % $ 196,212 8.50 % $ 184,670 8.00 % Tier 1 leverage capital (to average assets) $ 288,053 11.54 % $ 99,810 4.00 % $ N/A N/A $ 124,763 5.00 % CET 1 capital (to risk-weighted assets) $ 288,053 12.48 % $ 103,877 4.50 % $ 161,587 7.00 % $ 150,045 6.50 % In addition to the minimum CET 1, Tier 1, total capital, and leverage ratios, the Bank is required to maintain a capital conservation buffer consisting of additional CET 1 capital greater than 2.5% of risk-weighted assets above the required minimum levels in order to avoid limitations on paying dividends, engaging in share repurchases, and paying discretionary bonuses based on percentages of eligible retained income that could be utilized for such actions. At September 30, 2022, the Bank’s capital conservation buffer was 2.5%. FS Bancorp, Inc. is a bank holding company registered with the Federal Reserve. Bank holding companies are subject to capital adequacy requirements of the Federal Reserve under the Bank Holding Company Act of 1956, as amended, and the regulations of the Federal Reserve. Bank holding companies with less than $3.0 billion in assets are generally not subject to compliance with the Federal Reserve’s capital regulations, which are generally the same as the capital regulations applicable to the Bank. The Federal Reserve has a policy that a bank holding company is required to serve as a source of financial and managerial strength to the holding company’s subsidiary bank and expects the holding company’s subsidiary bank to be well capitalized under the prompt corrective action regulations. If FS Bancorp, Inc. was subject to regulatory guidelines for bank holding companies with $3.0 billion or more in assets at September 30, 2022, FS Bancorp, Inc. would have exceeded all regulatory capital requirements. For informational purposes, the regulatory capital ratios calculated for FS Bancorp, Inc. at September 30, 2022 were 9.8% for Tier 1 leverage-based capital, 10.6% for Tier 1 risk-based capital, 14.0% for total risk-based capital, and 10.6% for CET 1 capital ratio. The Tier 1 leverage-based capital ratio calculated for FS Bancorp, Inc. at December 31, 2021 was 10.8% under the CBLR framework. |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 9 Months Ended |
Sep. 30, 2022 | |
BUSINESS SEGMENTS | |
BUSINESS SEGMENTS | NOTE 15 - BUSINESS SEGMENTS The Company’s business segments are determined based on the products and services provided, as well as the nature of the related business activities, and they reflect the manner in which financial information is currently evaluated by management. This process is dynamic and is based on management’s current view of the Company’s operations and is not necessarily comparable with similar information for other financial institutions. The Company defines its business segments by product type and customer segment which it has organized into two lines of business: commercial and consumer banking and home lending. The Company uses various management accounting methodologies to assign certain income statement items to the responsible operating segment, including: ● ● ● ● ● The FTP methodology is based on management’s estimated cost of originating funds including the cost of overhead for deposit generation. A description of the Company’s business segments and the products and services that they provide is as follows: Commercial and Consumer Banking Segment The commercial and consumer banking segment provides diversified financial products and services to our commercial and consumer customers through Bank branches, automated teller machines (“ATM”), online banking platforms, mobile banking apps, and telephone banking. These products and services include deposit products; residential, consumer, business and commercial real estate lending portfolios and cash management services. The Company originates consumer loans, commercial and multi-family real estate loans, construction loans for residential and multi-family construction, and commercial business loans. At September 30, 2022, the Company’s retail deposit branch network consisted of 21 branches in the Pacific Northwest. This segment is also responsible for the management of the investment portfolio and other assets of the Bank. Home Lending Segment The home lending segment Segment Financial Results The tables below summarize the financial results for each segment based on the factors mentioned above within each segment for the three and nine months ended September 30, 2022 and 2021: At or For the Three Months Ended September 30, 2022 Condensed income statement: Commercial and Consumer Banking Home Lending Total Net interest income (1) $ 24,620 $ 2,907 $ 27,527 (Provision) benefit for credit losses (2) (1,811) 93 (1,718) Noninterest income 3,314 867 4,181 Noninterest expense (14,471) (4,867) (19,338) Income (loss) before (provision) benefit for income taxes 11,652 (1,000) 10,652 (Provision) benefit for income taxes (2,400) 206 (2,194) Net income (loss) $ 9,252 $ (794) $ 8,458 Total average assets for period ended $ 2,072,614 $ 427,368 $ 2,499,982 Full-time employees ("FTEs") 389 140 529 At or For the Three Months Ended September 30, 2021 Condensed income statement: Commercial and Consumer Banking Home Lending Total Net interest income (1) $ 20,377 $ 2,278 $ 22,655 (Provision) benefit for loan losses (2) (1,986) 1,986 — Noninterest income 1,959 6,439 8,398 Noninterest expense (14,404) (5,612) (20,016) Income before provision for income taxes 5,946 5,091 11,037 Provision for income taxes (1,462) (1,244) (2,706) Net income $ 4,484 $ 3,847 $ 8,331 Total average assets for period ended $ 1,799,890 $ 417,763 $ 2,217,653 FTEs 373 154 527 At or For the Nine Months Ended September 30, 2022 Commercial and Consumer Condensed income statement: Banking Home Lending Total Net interest income (1) $ 66,983 $ 7,995 $ 74,978 Provision for loan losses (2) (3,727) (905) (4,632) Noninterest income 7,944 6,468 14,412 Noninterest expense (42,878) (14,456) (57,334) Income (loss) before provision for income taxes 28,322 (898) 27,424 (Provision) benefit for income taxes (5,583) 186 (5,397) Net income (loss) $ 22,739 $ (712) $ 22,027 Total average assets for period ended $ 1,972,376 $ 403,990 $ 2,376,366 FTEs 389 140 529 At or For the Nine Months Ended September 30, 2021 Commercial and Consumer Condensed income statement: Banking Home Lending Total Net interest income (1) $ 57,829 $ 6,146 $ 63,975 (Provision) benefit for loan losses (2) (3,045) 1,545 (1,500) Noninterest income 6,546 23,072 29,618 Noninterest expense (41,151) (14,132) (55,283) Income before provision for income taxes 20,179 16,631 36,810 Provision for income taxes (4,411) (3,636) (8,047) Net income $ 15,768 $ 12,995 $ 28,763 Total average assets for period ended $ 1,771,216 $ 402,693 $ 2,173,909 FTEs 373 154 527 (1) Net interest income is the difference between interest earned on assets and the cost of liabilities to fund those assets. Interest earned includes actual interest earned on segment assets and, if the segment has excess liabilities, interest credits for providing funding to the other segment. The cost of liabilities includes interest expense on segment liabilities and, if the segment does not have enough liabilities to fund its assets, a funding charge based on the cost of assigned liabilities to fund segment assets. (2) Provision for credit losses as calculated using the CECL method in 2022 and provision for loan losses as calculated using the previous incurred loss method in 2021. The change in methodology reflects shifts in allocation between segments due to various changes, to include adjustments to qualitative factors, changes in loan balances, and charge-off and recovery activity. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2022 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 16 - GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill and certain other intangibles generally arise from business combinations accounted for under the acquisition method of accounting. Goodwill totaled $2.3 million at September 30, 2022 and December 31, 2021, and represents the excess of the total acquisition price paid over the fair value of the assets acquired, net of the fair values of liabilities assumed as a result of the purchase of four retail bank branches (“Branch Purchase”) from Bank of America on January 22, 2016. Goodwill is not amortized but is evaluated for impairment on an annual basis at December 31 of each year or whenever events or changes in circumstances indicate the carrying value may not be recoverable. The Company performed an impairment analysis at December 31, 2021, and determined that no impairment of goodwill existed. However, if adverse economic conditions or the decrease in the Company’s stock price and market capitalization as a result of the COVID-19 pandemic were to be deemed sustained rather than temporary, it may significantly affect the fair value of our goodwill. Accordingly, no assurances can be given that the Company will not record an impairment loss on goodwill in the future. Core deposit intangible (“CDI”) is evaluated for impairment whenever events or changes in circumstances indicate that its carrying amount may not be recoverable, with any changes in estimated useful life accounted for prospectively over the revised remaining life. As of September 30, 2022, management believes that there have been no events or changes in the circumstances that would indicate a potential impairment of CDI. The following table summarizes the changes in the Company’s other intangible assets comprised solely of CDI for the year ended December 31, 2021, and the nine months ended September 30, 2022. Other Intangible Assets Accumulated Gross CDI Amortization Net CDI Balance, December 31, 2020 $ 7,490 $ (2,739) $ 4,751 Amortization — (691) (691) Balance, December 31, 2021 7,490 (3,430) 4,060 Amortization — (518) (518) Balance, September 30, 2022 $ 7,490 $ (3,948) $ 3,542 The CDI represents the fair value of the intangible core deposit base acquired in business combinations. The CDI will be amortized on a straight-line basis over 10 years for the CDI related to the Anchor Bank acquisition in November 2018 (“Anchor Acquisition”) and on an accelerated basis over approximately nine years for the CDI related to the Branch Purchase. Total amortization expense was $173,000 and $518,000 for the three and nine months ended September 30, 2022, respectively, and $177,000 and $531,000 for the same periods, respectively, in 2021. Amortization expense for CDI is expected to be as follows at September 30, 2022: Remainder of 2022 $ 173 2023 691 2024 621 2025 525 2026 525 Thereafter 1,007 Total $ 3,542 |
REVENUE FROM CONTRACTS WITH CUS
REVENUE FROM CONTRACTS WITH CUSTOMERS | 9 Months Ended |
Sep. 30, 2022 | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | NOTE 17 - REVENUE FROM CONTRACTS WITH CUSTOMERS Revenue Recognition In accordance with Topic 606, revenues are recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, the Company assesses the goods or services that are promised within each contract and identifies those that contain performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. All the Company’s revenue from contracts with customers in-scope of ASC 606 is recognized in noninterest income and included in our commercial and consumer banking segment. The following table presents noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three and nine months ended September 30, 2022 and 2021. At or For the Three Months Ended September 30, At or For the Nine Months Ended September 30, Noninterest income 2022 2021 2022 2021 In-scope of Topic 606: Debit card interchange fees $ 575 $ 585 $ 1,702 $ 1,685 Deposit service and account maintenance fees 237 192 678 538 Noninterest income (in-scope of Topic 606) 812 777 2,380 2,223 Noninterest income (out-of-scope of Topic 606) 3,369 7,621 12,032 27,395 Total noninterest income $ 4,181 $ 8,398 $ 14,412 $ 29,618 Deposit Fees The Bank earns fees from its deposit customers for account maintenance, transaction-based services, and overdraft charges. Account maintenance fees consist primarily of account fees and analyzed account fees charged on deposit accounts on a monthly basis. The performance obligation is satisfied and the fees are recognized on a monthly basis as the service period is completed. Transaction-based fees on deposit accounts are charged to deposit customers for specific services provided to the customer, such as wire fees, as well as charges against the account, such as fees for non-sufficient funds and overdrafts. The performance obligation is completed as the transaction occurs and the fees are recognized at the time each specific service is provided to the customer. Debit Interchange Income Debit and ATM interchange income represent fees earned when a debit card issued by the Bank is used. The Bank earns interchange fees from debit cardholder transactions through the Visa payment network. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder. The performance obligation is satisfied and the fees are earned when the cost of the transaction is charged to the cardholders’ debit card. |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Financial Statement Presentation | Financial Statement Presentation - The results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022, or any other future period. The preparation of financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect amounts reported in the financial statements. Actual results could differ from these estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for credit losses, fair value of financial instruments, the valuation of servicing rights, deferred income taxes, and if needed, a deferred tax asset valuation allowance. Amounts presented in the consolidated financial statements and footnote tables are rounded and presented to the nearest thousands of dollars except per share amounts. If the amounts are above $1.0 million, they are rounded one decimal point, and if they are above $1.0 billion, they are rounded two decimal points. |
Principles of Consolidation | Principles of Consolidation - |
Segment Reporting | Segment Reporting - |
Subsequent Events | Subsequent Events - |
Error Corrections | Error Corrections Earnings Per Share Prior presentations of earnings per share were revised due to the improper inclusion of certain unvested shares in the denominator of basic and diluted earnings per share. As a result of the inclusion, earnings per share was understated for the three and nine months ended September 30, 2021. Basic earnings per share for those periods was updated to $1.01 and $3.43, respectively, from $0.99 and $3.38, as previously reported. Diluted earnings per share was updated to $0.98 and $3.31, respectively, from $0.97 and $3.30 as previously reported. Management evaluated the materiality of this error from qualitative and quantitative perspectives and concluded that the error was immaterial to the prior period financial statements taken as a whole. Consequently, the financial statements for the prior periods include the impact of the correction of the error, and prior period financial statements have not been restated. The error correction did not affect total assets, net income, or cash flows for the periods. Deposits Prior presentation of interest-bearing checking balances was revised due to the misclassification of certain checking products in previous periods. As a result of the misclassification, an interest-bearing checking balance of $121.2 million at December 31, 2021 Management evaluated the materiality of this error from qualitative and quantitative perspectives and concluded that the error was immaterial to the prior period financial statements taken as a whole. Consequently, the financial statements for the prior periods include the impact of the correction of the error, and prior period financial statements have not been restated. The error correction did not affect total assets, net income, or cash flows for the periods. |
RECENT ACCOUNTING PRONOUNCEMENTS | RECENT ACCOUNTING PRONOUNCEMENTS In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-04, “Reference Rate Reform” (“Topic 848”) In March 2022, the FASB issued ASU No. 2022-01, Derivatives and Hedging (Topic 815): Fair Value Hedging - Portfolio Layer Method Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities In March 2022, the FASB issued ASU No. 2022-02, Financial Instruments - Credit Losses (Topic 326) |
Application of New Accounting Guidance in 2022 | Application of New Accounting Guidance Adopted in 2022 On January 1, 2022, the Company adopted ASU 2016-13 Financial Instruments - Credit Losses (Topic 326) The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost and off-balance-sheet credit exposures. Results for reporting periods beginning after January 1, 2022 are presented under ASC 326. The adoption resulted in a decrease of $2.9 million to our allowance for credit losses on loans (“ACLL”), an increase of $2.4 million to our allowance for unfunded commitments and letters of credit, an increase of $72,000 to our allowance for held-to-maturity securities, and a net-of-tax cumulative-effect adjustment of $297,000 to increase the beginning balance of retained earnings. The Company finalized the adoption as of January 1, 2022 as detailed in the following table: January 1, 2022 As Reported January 1, 2022 Pre-Topic 326 Impact of Topic 326 Assets Under Topic 326 Adoption Adoption Allowance for credit losses on debt securities held-to-maturity $ 72 $ — $ 72 Loans Commercial $ 1,728 $ 5,667 $ (3,939) Construction and development 2,328 4,448 (2,120) Home equity 455 279 176 One-to-four-family 3,656 1,424 2,232 Multi-family 1,397 2,980 (1,583) Indirect home improvement 9,394 3,540 5,854 Marine 900 702 198 Other consumer 64 38 26 Commercial and industrial 2,727 5,953 (3,226) Warehouse lending 127 583 (456) Unallocated — 21 (21) Allowance for credit losses on loans $ 22,776 $ 25,635 $ (2,859) Liabilities Allowance for credit losses on unfunded loan commitments $ 2,908 $ 499 $ 2,409 Total $ (378) The adoption of CECL resulted in an increase of retained earnings of $297,000, net of tax. Allowance for Credit Losses on Held-to-Maturity Securities Management measures expected credit losses on held-to-maturity securities by individual security. Accrued interest receivable on held-to-maturity debt securities totaling $119,000 at September 30, 2022, was excluded from the estimate of credit losses used to calculate the allowance for credit losses (“ACL”). The estimate of expected credit losses considers credit ratings and historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. The held-to-maturity portfolio consists entirely of corporate securities. Securities are generally rated BBB- or higher. Securities are analyzed individually to establish a CECL reserve. Allowance for Credit Losses on Available-for-Sale Securities For available-for-sale securities in an unrealized loss position, management first assesses whether it intends to sell, or is more likely than not to be required to sell, the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For debt securities available-for-sale that do not meet the aforementioned criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an ACL is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an ACL is recognized in other comprehensive income (“OCI”). Changes in the ACL are recorded as a provision for (or reversal of) credit loss expense. Losses are charged against the allowance when management believes the uncollectibility of an available-for-sale security is confirmed or when either of the criteria regarding intent or requirement to sell is met. Accrued interest receivable on available-for-sale debt securities totaling $1.8 million at September 30, 2022, was excluded in the estimate of credit losses used to calculate the ACL. Allowance for Credit Losses on Loans The ACLL is a valuation account that is deducted from the loans’ amortized cost basis to present the net amount expected to be collected on the loans. Loans are charged off against the allowance when management believes the uncollectibility of a loan balance is confirmed and recoveries are credited to the allowance when received. The Company may also account for expected recoveries should information of an anticipated recovery become available. In the case of actual or expected recoveries, amounts may not exceed the aggregate of amounts previously charged off. Management utilizes relevant available information, from internal and external sources, relating to past events, current conditions, historical loss experience, and reasonable and supportable forecasts. The lookback period in the analysis includes historical data from 2009 to present. Adjustments to historical loss information are made when management determines historical data is not likely reflective of the current portfolio such as limited data sets or lack of default or loss history. Management may selectively apply external market data to subjectively adjust the Company’s own loss history including index or peer data. Accrued interest receivable totaling $8.3 million at September 30, 2022, was excluded from the estimate of credit losses for loans used to calculate the ACLL. Collective Assessment The ACLL is measured on a collective cohort basis when similar risk characteristics exist. Generally, collectively assessed loans are grouped by call report code and then risk-grade grouping. Risk grade is grouped within each call report code by pass, watch, special mention, substandard, and doubtful. Other loan types are separated into their own cohorts due to specific risk characteristics for that pool of loans. The Company has elected a nondiscounted cash flow methodology with probability of default (“PD”) and loss given default (“LGD”) for all call report code cohorts (“cohorts”), with the exception of the indirect and marine portfolios which are evaluated under a vintage methodology. Guaranteed portions of loans are measured with zero risk due to cash collateral and full guaranty. The PD calculation looks at the historical loan portfolio at particular points in time (each month during the lookback period) to determine the probability that loans in a certain cohort will default over the next 12-month period. A default is defined as a loan that has moved to past due 90 days and greater, nonaccrual status, or experienced a charge-off during the period. In cohorts where the Company’s historical data are insufficient due to a minimal amount of default activity or zero defaults, management uses index PDs comprised of rates derived from the PD experience of other community banks in place of the Company’s historical PDs. Additionally, management reviews all other cohorts to determine if index PDs should be used outside of these criteria. The LGD calculation looks at actual losses (net charge-offs) experienced over the entire lookback period for each cohort of loans. The aggregate loss amount is divided by the exposure at default to determine an LGD rate. All defaults (non-accrual, charge-off, or greater than 90 days past due) occurring during the lookback period are included in the denominator, whether a loss occurred or not and exposure at default is determined by the loan balance immediately preceding the default event (i.e. nonaccrual or charge-off). Due to very limited charge-off history, management uses index LGDs comprised of rates derived from the LGD experience of other community banks in place of the Company’s historical LGDs. The Company utilizes reasonable and supportable forecasts of future economic conditions when estimating the ACLL. The calculation includes a 12-month PD forecast based on the Company’s regression model comparing peer nonperforming loan ratios to the national unemployment rate and other forecast data. After the forecast period, PD rates revert on a straight-line basis back to long-term historical average rates over a 12-month period. The Company recognizes that all significant factors that affect the collectability of the loan portfolio must be considered to determine the estimated credit losses as of the evaluation date. Furthermore, the methodology, in and of itself and even when selectively adjusted by comparison to market and peer data, does not provide a sufficient basis to determine the estimated credit losses. The Company adjusts the modeled historical losses by a Qualitative and Environmental adjustment to incorporate all significant risks to form a sufficient basis to estimate the credit losses. Individual Assessment Loans classified as nonaccrual, TDR, or reasonably expected TDR will be reviewed quarterly for potential individual assessment. Any loan that is being considered for modification and expected to result in a TDR is identified as a reasonably expected TDR. Any loan classified as a nonaccrual or TDR that is not determined to need individual assessment will be evaluated collectively within its respective cohort. All reasonably expected TDR loans will be evaluated individually to account for expected modifications in loan terms. Where the primary and/or expected source of repayment of a specific loan is believed to be the future liquidation of available collateral, impairment will generally be measured based upon expected future collateral proceeds, net of disposition expenses including sales commissions as well as other costs potentially necessary to sell the asset(s) (i.e. past due taxes, liens, etc.). Estimates of future collateral proceeds will be based upon available appraisals, reference to recent valuations of comparable properties, use of consultants or other professionals with relevant market and/or property-specific knowledge, and any other sources of information believed appropriate by management under the specific circumstances. When appraisals are ordered to support the impairment analysis of an impaired loan, the appraisal is reviewed by the Company’s internal appraisal reviewer. Where the primary and/or expected source of repayment of a specific loan is believed to be the receipt of principal and interest payments from the borrower and/or the refinancing of the loan by another creditor, impairment will generally be measured based upon the present value of expected proceeds discounted at the contractual interest rate. Expected refinancing proceeds may be estimated from review of term sheets actually received by the borrower from other creditors and/or from the Company’s knowledge of terms generally available from other banks. Determining the Contractual Term Expected credit losses are estimated over the contractual term of the loans, adjusted for expected prepayments when appropriate. The contractual term excludes expected extensions, renewals and modifications unless either of the following applies: management has a reasonable expectation at the reporting date that a TDR will be executed with an individual borrower or the extension or renewal options are included in the original or modified contract at the reporting date and are not unconditionally cancellable by the Company. Prepayment assumptions will be determined by analysis of historical behavior by loan cohort. Troubled Debt Restructurings A loan for which the terms have been modified resulting in a concession, and for which the borrower is experiencing financial difficulties, is considered to be a TDR. Reasonably expected TDRs are assessed in the CECL calculation utilizing their expected modified terms. The ACL on a TDR is measured using the same method as all other loans held for investment, except that the original interest rate is used to discount the expected cash flows when a rate modification has occurred. Allowance for Credit Losses on Unfunded Commitments The Company estimates expected credit losses over the contractual period in which the Company is exposed to credit risk via a contractual obligation to extend credit unless that obligation is unconditionally cancellable by the Company. The ACL on unfunded commitments is adjusted through a provision for credit loss expense. The estimate includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over its estimated life. The estimate utilizes the same factors and assumptions as the ACLL and is applied at the same collective cohort level. |
Loan Portfolio Segment | The Company has defined its loan portfolio into three segments that reflect the structure of the lending function, the Company’s strategic plan and the manner in which management monitors performance and credit quality. The three loan portfolio segments are: (a) Real Estate Loans, (b) Consumer Loans, and (c) Commercial Business Loans. Each of these segments is disaggregated into classes based on the risk characteristics of the borrower and/or the collateral type securing the loan. The following is a summary of each of the Company’s loan portfolio segments and classes: Real Estate Loans Commercial Lending Construction and Development Lending Home Equity Lending One-to-Four-Family Real Estate Lending Multi-Family Lending Consumer Loans Indirect Home Improvement Marine Other Consumer. Commercial Business Loans Commercial and Industrial Lending (“C&I”) Warehouse Lending |
Credit Quality Indicators | The Company utilizes a risk grading matrix to assign a risk grade to its real estate and commercial business loans. Loans are graded on a scale of 1 to 10, with loans in risk grades 1 to 6 considered “Pass” and loans in risk grades 7 to 10 are reported as classified loans in the Company’s allowance for credit loan loss analysis. A description of the 10 risk grades is as follows: ● Grades 1 and 2 - These grades include loans to very high-quality borrowers with excellent or desirable business credit. ● Grade 3 - This grade includes loans to borrowers of good business credit with moderate risk. ● Grades 4 and 5 - These grades include “Pass” grade loans to borrowers of average credit quality and risk. ● Grade 6 - This grade includes loans on management’s “Watch” list and is intended to be utilized on a temporary basis for “Pass” grade borrowers where frequent and thorough monitoring is required due to credit weaknesses and where significant risk-modifying action is anticipated in the near term. ● Grade 7 - This grade is for “Other Assets Especially Mentioned (“OAEM”)” in accordance with regulatory guidelines and includes borrowers where performance is poor or significantly less than expected. ● Grade 8 - This grade includes “Substandard” loans in accordance with regulatory guidelines which represent an unacceptable business credit where a loss is possible if loan weakness is not corrected. ● Grade 9 - This grade includes “Doubtful” loans in accordance with regulatory guidelines where a loss is highly probable. ● Grade 10 - This grade includes “Loss” loans in accordance with regulatory guidelines for which total loss is expected and when identified are charged off. Homogeneous loans are risk rated based upon the Federal Financial Institutions Examination Council’s Uniform Retail Credit Classification and Account Management Policy. Loans classified under this policy at the Company are consumer loans which include indirect home improvement, solar, marine, other consumer, and one-to-four-family first and second liens. Under the Uniform Retail Credit Classification Policy, loans that are current or less than 90 days past due are graded “Pass” and risk rated “4” or “5” internally. Loans that are past due more than 90 days are classified “Substandard” and risk graded “8” internally until the loan has demonstrated consistent performance, typically six months of contractual payments. Closed-end loans that are 120 days past due and open-end loans that are 180 days past due are charged off based on the value of the collateral less cost to sell. Management may more conservatively risk rate credits even if paying in accordance with the loan’s repayment terms. Commercial real estate, construction and development, multi-family and commercial business loans are evaluated individually for their risk classification and may be classified as “Substandard” even if current on their loan payment obligations. |
Nonaccrual and Past Due Loans | Nonaccrual and Past Due Loans Troubled Debt Restructured Loans The Company had two TDR loans on nonaccrual totaling $3.8 million at September 30, 2022, compared to none at December 31, 2021. The two nonaccrual loans at September 30, 2022, consisted of commercial business loans. The Company had no commitments to lend additional funds on these restructured loans. TDRs were the result of interest rate modifications and extended payment terms. The Company has not forgiven any principal on these loans. |
Loan Commitments | The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. |
Determination of Fair Market Values | The following methods were used to estimate the fair value of certain assets and liabilities on a recurring and nonrecurring basis: Securities - Mortgage Loans Held for Sale - Loans Receivable - Fair values are estimated for portfolios of loans with similar financial characteristics. Loans are segregated by type, including commercial, real estate and consumer loans. Each loan category is further segregated by fixed and adjustable-rate loans. The fair value of loans is calculated by discounting expected cash flows at rates at which similar loans are currently being made. These amounts are discounted further by embedded probable losses expected to be realized in the portfolio. Certain residential mortgage loans were initially originated for sale and measured at fair value; after origination, the loans were transferred to loans held for investment. As of September 30, 2022 and December 31, 2021, there were $14.2 million and $16.1 million, respectively, in residential mortgage loans recorded at fair value as they were previously transferred from held for sale to loans held for investment. The aggregate unpaid principal balance of these loans was $16.0 million and $16.1 million as of September 30, 2022 and December 31, 2021, respectively. Gains and losses from changes in fair value for these loans are reported in earnings as a component of service charges and fee income on the Consolidated Statements of Income. For the three and nine months ended September 30, 2022, the Company recorded net decreases in fair value of $816,000 and $1.8 million, as compared to net decreases in fair value of $19,000 and $55,000 for the three and nine months ended September 30, 2021, respectively. For loans originated as held for sale and transferred into loans held for investment, the fair value is determined based on quoted secondary market prices for similar loans (Level 2). Derivative Instruments - rate lock commitments and forward sales commitments are estimated using quoted or published market prices for similar instruments, adjusted for factors such as pull-though rate assumptions based on historical information, where appropriate. TBA mortgage-backed securities are fair valued on similar contracts in active markets (Level 2), while locks and forwards with customers and investors are fair valued using similar contracts in the market and changes in the market interest rates (Level 2 and 3). Derivative instruments not related to mortgage banking activities include interest rate swap agreements. The fair values of interest rate swap agreements are based on valuation models using observable market data as of the measurement date (Level 2). The Company’s derivatives are traded in an over-the-counter market where quoted market prices are not always available. Therefore, the fair values of derivatives are determined using quantitative models that utilize multiple market inputs. The inputs will vary based on the type of derivative, but could include interest rates, prices and indices to generate continuous yield or pricing curves, prepayment rates, and volatility factors to value the position. The majority of market inputs are actively quoted and can be validated through external sources, including market transactions and third-party pricing services. The fair values of all interest rate swaps are determined from third-party pricing services without adjustment. Other Real Estate Owned - Fair value adjustments to OREO are recorded at the lower of carrying amount of the loan or fair value of the collateral less selling costs. Any write-downs based on the asset’s fair value at the date of acquisition are charged to the allowance for credit losses. After foreclosure, management periodically performs valuations such that the real estate is carried at the lower of its new cost basis or fair value, net of estimated costs to sell (Level 3). Loans Individually Evaluated - Expected credit losses for loans evaluated individually are measured based on the present value of expected future cash flows discounted at the loan’s original effective interest rate or when the Bank determines that foreclosure is probable, the expected credit loss is measured based on the fair value of the collateral as of the reporting date, less estimated selling costs, as applicable. As a practical expedient, the Bank measures the expected credit loss for a loan using the fair value of the collateral, if repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty based on the Bank’s assessment as of the reporting date. In both cases, if the fair value of the collateral is less than the amortized cost basis of the loan, the Bank will recognize an allowance as the difference between the fair value of the collateral, less costs to sell (if applicable) at the reporting date and the amortized cost basis of the loan. If the fair value of the collateral exceeds the amortized cost basis of the loan, any expected recovery added to the amortized cost basis will be limited to the amount previously charged-off by the subsequent changes in the expected credit losses for loans evaluated individually are included within the provision for credit losses in the same manner in which the expected credit loss initially was recognized or as a reduction in the provision that would otherwise be reported (Level 3). Servicing Rights - |
Earnings Per Share | The Company computes earnings per share using the two-class method, which is an earnings allocation method for computing earnings per share that treats a participating security as having rights to earnings that would otherwise have been available to common shareholders. Basic earnings per share are computed by dividing income available to common shareholders by the weighted average number of common shares outstanding for the period. Unvested share-based awards containing non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of earnings per share pursuant to the two-class method. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. For earnings per share calculations, the ESOP shares committed to be released are included as outstanding shares for both basic and diluted earnings per share. |
BASIS OF PRESENTATION AND SUM_3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of adoption | January 1, 2022 As Reported January 1, 2022 Pre-Topic 326 Impact of Topic 326 Assets Under Topic 326 Adoption Adoption Allowance for credit losses on debt securities held-to-maturity $ 72 $ — $ 72 Loans Commercial $ 1,728 $ 5,667 $ (3,939) Construction and development 2,328 4,448 (2,120) Home equity 455 279 176 One-to-four-family 3,656 1,424 2,232 Multi-family 1,397 2,980 (1,583) Indirect home improvement 9,394 3,540 5,854 Marine 900 702 198 Other consumer 64 38 26 Commercial and industrial 2,727 5,953 (3,226) Warehouse lending 127 583 (456) Unallocated — 21 (21) Allowance for credit losses on loans $ 22,776 $ 25,635 $ (2,859) Liabilities Allowance for credit losses on unfunded loan commitments $ 2,908 $ 499 $ 2,409 Total $ (378) |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
INVESTMENTS | |
Schedule of Available-for-sale Securities Reconciliation | September 30, 2022 Estimated Allowance Amortized Unrealized Unrealized Fair for Credit SECURITIES AVAILABLE-FOR-SALE Cost Gains Losses Values Losses U.S. agency securities $ 21,153 $ 80 $ (3,096) $ 18,137 $ — Corporate securities 9,497 28 (909) 8,616 — Municipal bonds 145,918 2 (29,276) 116,644 — Mortgage-backed securities 84,192 — (13,115) 71,077 — U.S. Small Business Administration securities 14,920 6 (1,458) 13,468 — Total securities available-for-sale 275,680 116 (47,854) 227,942 — SECURITIES HELD-TO-MATURITY Corporate securities 8,500 — (550) 7,950 (31) Total securities held-to-maturity 8,500 — (550) 7,950 (31) — Total securities $ 284,180 $ 116 $ (48,404) $ 235,892 $ (31) December 31, 2021 Estimated Amortized Unrealized Unrealized Fair SECURITIES AVAILABLE-FOR-SALE Cost Gains Losses Values U.S. agency securities $ 21,155 $ 133 $ (318) $ 20,970 Corporate securities 9,495 31 (524) 9,002 Municipal bonds 136,377 1,577 (2,521) 135,433 Mortgage-backed securities 88,641 1,457 (696) 89,402 U.S. Small Business Administration securities 16,383 235 (66) 16,552 Total securities available-for-sale 272,051 3,433 (4,125) 271,359 SECURITIES HELD-TO-MATURITY Corporate securities 7,500 628 — 8,128 Total securities held-to-maturity 7,500 628 — 8,128 Total securities $ 279,551 $ 4,061 $ (4,125) $ 279,487 |
Schedule of allowance of credit losses | SECURITIES HELD-TO-MATURITY For the Three Months Ended For the Nine Months Ended Corporate Securities September 30, 2022 September 30, 2022 Beginning allowance balance $ 31 $ — Impact of adopting ASU 2016-13 — 72 Recapture of provision for credit losses — (41) Securities charged-off — — Recoveries — — Total ending allowance balance $ 31 $ 31 |
Schedule of Amortized cost of debt securities | Corporate securities September 30, 2022 December 31, 2021 BBB/BBB- $ 8,500 $ 7,500 |
Schedule of Unrealized Loss on Investments | September 30, 2022 Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized SECURITIES AVAILABLE-FOR-SALE Value Losses Value Losses Value Losses U.S. agency securities $ 7,071 $ (1,184) $ 8,986 $ (1,912) $ 16,057 $ (3,096) Corporate securities 3,476 (21) 4,112 (888) 7,588 (909) Municipal bonds 66,406 (14,563) 50,133 (14,713) 116,539 (29,276) Mortgage-backed securities 47,724 (7,286) 23,353 (5,829) 71,077 (13,115) U.S. Small Business Administration securities 8,672 (963) 1,577 (495) 10,249 (1,458) Total securities available-for-sale $ 133,349 $ (24,017) $ 88,161 $ (23,837) $ 221,510 $ (47,854) SECURITIES HELD-TO-MATURITY Corporate securities 7,950 (550) — — 7,950 (550) Total securities held-to-maturity 7,950 (550) — — 7,950 (550) Total $ 141,299 $ (24,567) $ 88,161 $ (23,837) $ 229,460 $ (48,404) December 31, 2021 Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized SECURITIES AVAILABLE-FOR-SALE Value Losses Value Losses Value Losses U.S. agency securities $ 13,125 $ (105) $ 3,752 $ (213) $ 16,877 $ (318) Corporate securities — — 5,476 (524) 5,476 (524) Municipal bonds 72,098 (1,961) 14,116 (560) 86,214 (2,521) Mortgage-backed securities 33,291 (620) 3,825 (76) 37,116 (696) U.S. Small Business Administration securities 2,988 (66) — — 2,988 (66) Total securities available-for-sale $ 121,502 $ (2,752) $ 27,169 $ (1,373) $ 148,671 $ (4,125) |
Schedule of Available-for-Sale and Held-To-Maturity Securities by Contractual Maturity | September 30, 2022 December 31, 2021 SECURITIES AVAILABLE-FOR-SALE Amortized Fair Amortized Fair U.S. agency securities Cost Value Cost Value Due after one year through five years $ 945 $ 919 $ 959 $ 1,004 Due after five years through ten years 15,898 13,725 6,920 6,850 Due after ten years 4,310 3,493 13,276 13,116 Subtotal 21,153 18,137 21,155 20,970 Corporate securities Due within one year 1,000 997 — — Due after one year through five years 2,497 2,515 3,495 3,526 Due after five years through ten years 4,000 3,809 4,000 3,627 Due after ten years 2,000 1,295 2,000 1,849 Subtotal 9,497 8,616 9,495 9,002 Municipal bonds Due within one year 2,660 2,638 — — Due after one year through five years 1,045 1,023 3,724 3,850 Due after five years through ten years 7,635 6,899 6,857 7,035 Due after ten years 134,578 106,084 125,796 124,548 Subtotal 145,918 116,644 136,377 135,433 Mortgage-backed securities Federal National Mortgage Association (“FNMA”) 70,061 58,404 75,171 75,737 Federal Home Loan Mortgage Corporation (“FHLMC”) 9,346 8,382 9,606 9,768 Government National Mortgage Association (“GNMA”) 4,785 4,291 3,864 3,897 Subtotal 84,192 71,077 88,641 89,402 U.S. Small Business Administration securities Due after one year through five years 2,582 2,409 2,485 2,507 Due after five years through ten years 4,563 4,276 4,420 4,515 Due after ten years 7,775 6,783 9,478 9,530 Subtotal 14,920 13,468 16,383 16,552 Total securities available-for-sale 275,680 227,942 272,051 271,359 SECURITIES HELD-TO-MATURITY Corporate securities Due after five years through ten years 8,500 7,950 7,500 8,128 Total securities held-to-maturity 8,500 7,950 7,500 8,128 Total securities $ 284,180 $ 235,892 $ 279,551 $ 279,487 |
LOANS RECEIVABLE AND ALLOWANC_2
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS | |
Schedule of Accounts, Notes, Loans and Financing Receivable | September 30, December 31, REAL ESTATE LOANS 2022 2021 Commercial $ 310,923 $ 264,429 Construction and development 335,177 240,553 Home equity 53,681 41,017 One-to-four-family (excludes loans held for sale) 429,196 366,146 Multi-family 223,712 178,158 Total real estate loans 1,352,689 1,090,303 CONSUMER LOANS Indirect home improvement 447,462 336,285 Marine 68,106 82,778 Other consumer 2,987 2,980 Total consumer loans 518,555 422,043 COMMERCIAL BUSINESS LOANS Commercial and industrial (includes Paycheck Protection Program ("PPP") loans) 211,009 208,552 Warehouse lending 28,102 33,277 Total commercial business loans 239,111 241,829 Total loans receivable, gross 2,110,355 1,754,175 Allowance for credit losses on loans (1) (26,426) (25,635) Total loans receivable, net $ 2,083,929 $ 1,728,540 (1) Allowance for credit losses on loans in 2022 is reported using the CECL method and the allowance for loan losses in 2021 is reported using the incurred loss method. |
Allowance for Credit Losses on Financing Receivables | At or For the Three Months Ended September 30, 2022 Real Commercial ALLOWANCE FOR CREDIT LOSSES ON LOANS Estate Consumer Business Unallocated Total Beginning balance $ 11,512 $ 10,605 $ 2,850 $ — $ 24,967 (Recapture) provision for credit losses on loans (213) 1,193 1,042 — 2,022 Loans charged-off — (924) — — (924) Recoveries — 361 — — 361 Total ending allowance balance $ 11,299 $ 11,235 $ 3,892 $ — $ 26,426 At or For the Three Months Ended September 30, 2021 Real Commercial ALLOWANCE FOR LOAN LOSSES Estate Consumer Business Unallocated Total Beginning balance $ 14,308 $ 7,023 $ 5,674 $ 229 $ 27,234 Provision (recapture) for loan losses 124 (2,315) 620 1,571 — Loans charged-off — (428) — — (428) Recoveries — 119 — — 119 Total ending allowance balance $ 14,432 $ 4,399 $ 6,294 $ 1,800 $ 26,925 Period end amount allocated to: Loans individually evaluated for impairment $ — $ 243 $ 991 $ — $ 1,234 Loans collectively evaluated for impairment 14,432 4,156 5,303 1,800 25,691 Ending balance $ 14,432 $ 4,399 $ 6,294 $ 1,800 $ 26,925 LOANS RECEIVABLE Loans individually evaluated for impairment $ 755 $ 694 $ 4,487 $ — $ 5,936 Loans collectively evaluated for impairment 1,037,492 410,400 251,140 — 1,699,032 Ending balance $ 1,038,247 $ 411,094 $ 255,627 $ — $ 1,704,968 At or For the Nine Months Ended September 30, 2022 Real Commercial ALLOWANCE FOR CREDIT LOSSES ON LOANS Estate Consumer Business Unallocated Total Beginning balance, prior to adoption of ASC 326 $ 14,798 $ 4,280 $ 6,536 $ 21 $ 25,635 Impact of adopting ASC 326 (5,234) 6,078 (3,682) (21) (2,859) Provision for credit losses on loans 1,735 1,720 1,038 — 4,493 Loans charged-off — (1,744) — — (1,744) Recoveries — 901 — — 901 Total ending allowance balance $ 11,299 $ 11,235 $ 3,892 $ — $ 26,426 At or For the Nine Months Ended September 30, 2021 Real Commercial ALLOWANCE FOR LOAN LOSSES Estate Consumer Business Unallocated Total Beginning balance $ 13,846 $ 6,696 $ 4,939 $ 691 $ 26,172 Provision (recapture) for loan losses 586 (1,588) 1,393 1,109 1,500 Loans charged-off — (1,280) (38) — (1,318) Recoveries — 571 — — 571 Total ending allowance balance $ 14,432 $ 4,399 $ 6,294 $ 1,800 $ 26,925 Period end amount allocated to: Loans individually evaluated for impairment $ — $ 243 $ 991 $ — $ 1,234 Loans collectively evaluated for impairment 14,432 4,156 5,303 1,800 25,691 Ending balance $ 14,432 $ 4,399 $ 6,294 $ 1,800 $ 26,925 LOANS RECEIVABLE Loans individually evaluated for impairment $ 755 $ 694 $ 4,487 $ — $ 5,936 Loans collectively evaluated for impairment 1,037,492 410,400 251,140 — 1,699,032 Ending balance $ 1,038,247 $ 411,094 $ 255,627 $ — $ 1,704,968 |
Past Due Financing Receivables | September 30, 2022 30-59 60-89 Days Days 90 Days Total Total Past Past or More Past Loans Non- REAL ESTATE LOANS Due Due Past Due Due Current Receivable Accrual Commercial $ — $ — $ — $ — $ 310,923 $ 310,923 $ — Construction and development — — — — 335,177 335,177 — Home equity — 37 147 184 53,497 53,681 178 One-to-four-family — — 379 379 428,817 429,196 841 Multi-family — — — — 223,712 223,712 — Total real estate loans — 37 526 563 1,352,126 1,352,689 1,019 CONSUMER LOANS Indirect home improvement 1,082 443 262 1,787 445,675 447,462 621 Marine 83 135 — 218 67,888 68,106 181 Other consumer 19 5 — 24 2,963 2,987 — Total consumer loans 1,184 583 262 2,029 516,526 518,555 802 COMMERCIAL BUSINESS LOANS Commercial and industrial — — 2,617 2,617 208,392 211,009 6,420 Warehouse lending — — — — 28,102 28,102 — Total commercial business loans — — 2,617 2,617 236,494 239,111 6,420 Total loans $ 1,184 $ 620 $ 3,405 $ 5,209 $ 2,105,146 $ 2,110,355 $ 8,241 December 31, 2021 30-59 60-89 Days Days 90 Days Total Total Past Past or More Past Loans Non- REAL ESTATE LOANS Due Due Past Due Due Current Receivable Accrual Commercial $ — $ — $ — $ — $ 264,429 $ 264,429 $ — Construction and development — — — — 240,553 240,553 — Home equity — — 179 179 40,838 41,017 301 One-to-four-family 593 264 480 1,337 364,809 366,146 480 Multi-family — — — — 178,158 178,158 — Total real estate loans 593 264 659 1,516 1,088,787 1,090,303 781 CONSUMER LOANS Indirect home improvement 1,047 280 295 1,622 334,663 336,285 554 Marine 119 — — 119 82,659 82,778 57 Other consumer 11 2 18 31 2,949 2,980 18 Total consumer loans 1,177 282 313 1,772 420,271 422,043 629 COMMERCIAL BUSINESS LOANS Commercial and industrial 791 — — 791 207,761 208,552 4,419 Warehouse lending — — — — 33,277 33,277 — Total commercial business loans 791 — — 791 241,038 241,829 4,419 Total loans $ 2,561 $ 546 $ 972 $ 4,079 $ 1,750,096 $ 1,754,175 $ 5,829 |
Impaired Financing Receivables | December 31, 2021 Unpaid WITH NO RELATED ALLOWANCE RECORDED Principal Recorded Related Real estate loans: Balance Investment Allowance Home equity $ 259 $ 227 $ — One-to-four-family 497 480 — 756 707 — WITH RELATED ALLOWANCE RECORDED Real estate loans: Home equity 92 74 23 Consumer loans: Indirect 551 554 193 Marine 56 57 20 Other consumer 18 18 6 Commercial business loans: Commercial and industrial 4,417 4,419 921 5,134 5,122 1,163 Total $ 5,890 $ 5,829 $ 1,163 At or For the Three Months Ended September 30, 2021 WITH NO RELATED ALLOWANCE RECORDED Average Recorded Interest Income Real estate loans: Investment Recognized Home equity $ 455 $ 12 One-to-four-family 488 3 943 15 WITH RELATED ALLOWANCE RECORDED Consumer loans: Indirect 554 12 Marine 85 2 Other consumer 2 — Commercial business loans: Commercial and industrial 4,487 86 5,128 100 Total $ 6,071 $ 115 At or For the Nine Months Ended September 30, 2021 WITH NO RELATED ALLOWANCE RECORDED Average Recorded Interest Income Real estate loans: Investment Recognized Construction and development $ 1,028 $ — Home equity 538 21 One-to-four-family 559 9 2,125 30 WITH RELATED ALLOWANCE RECORDED Real estate loans: One-to-four-family 27 — Consumer loans: Indirect 670 34 Marine 74 5 Other consumer 8 1 Commercial business loans: Commercial and industrial 4,884 191 5,663 231 Total $ 7,788 $ 261 |
Summarize risk rated loan balances | September 30, 2022 REAL ESTATE LOANS Term Loans by Year of Origination Commercial 2022 2021 2020 2019 2018 Prior Revolving Loans Total Loans Pass $ 66,350 $ 76,834 $ 44,759 $ 39,148 $ 14,911 $ 60,167 $ — $ 302,169 Watch — — 2,071 — — — 128 2,199 Special mention — — — 2,127 — 898 — 3,025 Substandard — — — — 586 2,944 — 3,530 Total commercial $ 66,350 $ 76,834 $ 46,830 $ 41,275 $ 15,497 $ 64,009 $ 128 $ 310,923 Construction and development Pass 151,853 133,335 29,720 19,823 — 446 — 335,177 Total construction and development $ 151,853 $ 133,335 $ 29,720 $ 19,823 $ — $ 446 $ — $ 335,177 Home equity Pass 5,339 1,707 7,082 11 1,238 1,680 36,446 53,503 Substandard — — — — 13 165 — 178 Total home equity $ 5,339 $ 1,707 $ 7,082 $ 11 $ 1,251 $ 1,845 $ 36,446 $ 53,681 One-to-four-family Pass 121,163 133,680 81,292 32,264 16,307 41,699 — 426,405 Special mention — — — — 1,950 — — 1,950 Substandard — — — — — 841 — 841 Total one-to-four-family $ 121,163 $ 133,680 $ 81,292 $ 32,264 $ 18,257 $ 42,540 $ — $ 429,196 Multi-family Pass 33,930 63,549 48,598 48,080 4,206 25,349 — 223,712 Total multi-family $ 33,930 $ 63,549 $ 48,598 $ 48,080 $ 4,206 $ 25,349 $ — $ 223,712 Total real estate loans $ 378,635 $ 409,105 $ 213,522 $ 141,453 $ 39,211 $ 134,189 $ 36,574 $ 1,352,689 September 30, 2022 CONSUMER LOANS Term Loans by Year of Origination Indirect home improvement 2022 2021 2020 2019 2018 Prior Revolving Loans Total Loans Pass $ 188,174 $ 131,661 $ 50,247 $ 33,222 $ 19,452 $ 24,076 $ 9 $ 446,841 Substandard 82 124 59 119 95 142 — 621 Total indirect home improvement $ 188,256 $ 131,785 $ 50,306 $ 33,341 $ 19,547 $ 24,218 $ 9 $ 447,462 Marine Pass 23,491 12,123 15,693 6,745 5,830 4,043 — 67,925 Substandard 125 — — — — 56 — 181 Total marine $ 23,616 $ 12,123 $ 15,693 $ 6,745 $ 5,830 $ 4,099 $ — $ 68,106 Other consumer Pass 652 779 128 40 34 148 1,206 2,987 Total other consumer $ 652 $ 779 $ 128 $ 40 $ 34 $ 148 $ 1,206 $ 2,987 Total consumer loans $ 212,524 $ 144,687 $ 66,127 $ 40,126 $ 25,411 $ 28,465 $ 1,215 $ 518,555 COMMERCIAL September 30, 2022 BUSINESS LOANS Term Loans by Year of Origination Commercial and industrial 2022 2021 2020 2019 2018 Prior Revolving Loans Total Loans Pass $ 19,348 $ 24,348 $ 15,714 $ 3,940 $ 3,530 $ 8,029 $ 114,581 $ 189,490 Watch — 13 3,073 — — 205 5,460 8,751 Special mention — — — 667 14 44 773 1,498 Substandard — 1,595 1,606 2,295 187 4,379 1,208 11,270 Total commercial and industrial $ 19,348 $ 25,956 $ 20,393 $ 6,902 $ 3,731 $ 12,657 $ 122,022 $ 211,009 Warehouse lending Pass — — — — — — 28,101 28,101 Watch — — — — — — 1 1 Total warehouse lending $ — $ — $ — $ — $ — $ — $ 28,102 $ 28,102 Total commercial business loans $ 19,348 $ 25,956 $ 20,393 $ 6,902 $ 3,731 $ 12,657 $ 150,124 $ 239,111 TOTAL LOANS RECEIVABLE, GROSS Pass $ 610,300 $ 578,016 $ 293,233 $ 183,273 $ 65,508 $ 165,637 $ 180,343 $ 2,076,310 Watch — 13 5,144 — — 205 5,589 10,951 Special mention — — — 2,794 1,964 942 773 6,473 Substandard 207 1,719 1,665 2,414 881 8,527 1,208 16,621 Total loans receivable, gross $ 610,507 $ 579,748 $ 300,042 $ 188,481 $ 68,353 $ 175,311 $ 187,913 $ 2,110,355 The following table summarizes risk rated loan balances by category as of December 31, 2021: December 31, 2021 Special Pass Watch Mention Substandard Doubtful Loss REAL ESTATE LOANS (1 - 5) (6) (7) (8) (9) (10) Total Commercial $ 253,092 $ 4,652 $ 5,769 $ 916 $ — $ — $ 264,429 Construction and development 240,553 — — — — — 240,553 Home equity 40,716 — — 301 — — 41,017 One-to-four-family 363,682 — — 2,464 — — 366,146 Multi-family 178,158 — — — — — 178,158 Total real estate loans 1,076,201 4,652 5,769 3,681 — — 1,090,303 CONSUMER LOANS Indirect home improvement 335,731 — — 554 — — 336,285 Marine 82,721 — — 57 — — 82,778 Other consumer 2,962 — — 18 — — 2,980 Total consumer loans 421,414 — — 629 — — 422,043 COMMERCIAL BUSINESS LOANS Commercial and industrial 188,767 4,182 1,829 13,774 — — 208,552 Warehouse lending 33,277 — — — — — 33,277 Total commercial business loans 222,044 4,182 1,829 13,774 — — 241,829 Total loans receivable, gross $ 1,719,659 $ 8,834 $ 7,598 $ 18,084 $ — $ — $ 1,754,175 |
Schedule of amortized cost basis of loans | September 30, 2022 Nonaccrual with No Nonaccrual with 90-Days or More Allowance for Credit Allowance for Credit Total Past Due and Still REAL ESTATE LOANS Losses Losses Nonaccrual Accruing Interest Home equity $ 178 $ — $ 178 $ — One-to-four-family 841 — 841 — 1,019 — 1,019 — CONSUMER LOANS Indirect home improvement — 621 621 — Marine — 181 181 — — 802 802 — COMMERCIAL BUSINESS LOANS Commercial and industrial — 6,420 6,420 — Total $ 1,019 $ 7,222 $ 8,241 $ — |
Schedule of amortized cost basis of collateral dependent impaired loans | September 30, 2022 REAL ESTATE LOANS Real Estate Equipment Total Home equity $ 178 $ — $ 178 One-to-four-family 841 — 841 1,019 — 1,019 CONSUMER LOANS Indirect home improvement — 621 621 Marine — 181 181 — 802 802 COMMERCIAL BUSINESS LOANS Commercial and industrial — 6,420 6,420 Total $ 1,019 $ 7,222 $ 8,241 |
SERVICING RIGHTS (Tables)
SERVICING RIGHTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | |
Summary of servicing rights activity | At or For the Three Months Ended September 30, 2022 2021 Beginning balance, at the lower of cost or fair value $ 18,516 $ 16,356 Additions 925 1,967 Servicing rights amortized (971) (1,837) Recovery of servicing rights — 11 Ending balance, at the lower of cost or fair value $ 18,470 $ 16,497 At or For the Nine Months Ended September 30, 2022 2021 Beginning balance, at the lower of cost or fair value $ 16,970 $ 12,595 Additions 4,935 7,567 Servicing rights amortized (3,436) (5,722) Recovery of servicing rights 1 2,057 Ending balance, at the lower of cost or fair value $ 18,470 $ 16,497 |
Key economic assumptions and the sensitivity of the current fair value for single family mortgage servicing rights | September 30, 2022 December 31, 2021 Aggregate portfolio principal balance $ 2,797,326 $ 2,609,776 Weighted average rate of note 3.3 % 3.2 % At September 30, 2022 Base 0.5% Adverse Rate Change 1.0% Adverse Rate Change Conditional prepayment rate 8.2 % 8.4 % 8.9 % Fair value MSR $ 36,457 $ 36,085 $ 35,398 Percentage of MSR 1.3 % 1.3 % 1.3 % Discount rate 9.1 % 9.6 % 10.1 % Fair value MSR $ 36,457 $ 35,653 $ 34,881 Percentage of MSR 1.3 % 1.3 % 1.2 % At December 31, 2021 Base 0.5% Adverse Rate Change 1.0% Adverse Rate Change Conditional prepayment rate 13.8 % 20.0 % 31.5 % Fair value MSR $ 26,070 $ 21,188 $ 15,348 Percentage of MSR 1.0 % 0.8 % 0.6 % Discount rate 9.1 % 9.6 % 10.1 % Fair value MSR $ 26,070 $ 25,586 $ 25,119 Percentage of MSR 1.0 % 1.0 % 1.0 % |
Mortgage servicing rights. | |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | |
Valuation assumptions | At September 30, At December 31, Key assumptions: 2022 2021 Weighted average discount rate 9.1 % 9.1 % Conditional prepayment rate (“CPR”) 8.2 % 13.8 % Weighted average life in years 7.9 5.9 |
DERIVATIVES (Tables)
DERIVATIVES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
DERIVATIVES | |
Schedule of cumulative-basis adjustment for fair value hedges | September 30, 2022 Line item in the statement of financial position in which the hedged Item is included Hedged Assets/(Liabilities) Investment securities (1) $ 55,684 $ 4,316 Total $ 55,684 $ 4,316 (1) These amounts include the amortized cost basis of closed portfolios used in designated hedging relationships in which the hedged item is the last layer expected to be remaining at the end of the hedging relationship. At September 30, 2022, the amortized cost basis of the closed portfolios used in these hedging relationships was $250.2 million; the cumulative basis adjustments associated with these hedging relationships was $4.3 million; and the amounts of the designated hedged items was $60.0 million. |
Schedule of Derivative Instruments | September 30, 2022 Fair Value Cash flow hedges: Notional Asset Liability Interest rate swaps - brokered deposits and borrowings $ 90,000 $ 6,117 $ — Fair value hedges: Interest rate swaps - securities $ 60,000 $ 4,301 $ — Non-hedging derivatives: Fallout adjusted interest rate lock commitments with customers 23,766 — 172 Mandatory and best effort forward commitments with investors 6,845 294 — Forward TBA mortgage-backed securities 33,000 1,154 — December 31, 2021 Fair Value Cash flow hedges: Notional Asset Liability Interest rate swaps - brokered deposits and borrowings $ 90,000 $ 1,168 $ 155 Non-hedging derivatives: Fallout adjusted interest rate lock commitments with customers 71,890 757 — Mandatory and best effort forward commitments with investors 74,375 808 — Forward TBA mortgage-backed securities 111,000 53 — |
Schedule of effect of fair value and cash flow hedge accounting on the income statement | Three Months Ended Three Months Ended September 30, 2022 September 30, 2021 Interest Expense Deposits Interest Income Securities Interest Expense Deposits Interest Income Securities Total amounts presented on the Consolidated Statements of Income $ 2,596 $ 1,741 $ 1,629 $ 1,487 Net gains (losses) on fair value hedging relationships Interest rate swaps - securities Recognized on hedged items $ — $ (3,383) $ — $ — Recognized on derivatives designated as hedging instruments — 3,313 — — Net income (expense) recognized on fair value hedges $ — $ (70) $ — $ — Net gain (loss) on cash flow hedging relationships Interest rate swaps - brokered deposits and borrowings Realized gains (losses) (pre-tax) reclassified from AOCI into net income $ 278 $ — $ (135) $ — Net income (expense) recognized on cash flow hedges $ 278 $ — $ (135) $ — Nine Months Ended Nine Months Ended September 30, 2022 September 30, 2021 Interest Expense Deposits Interest Income Securities Interest Expense Deposits Interest Income Securities Total amounts presented on the Consolidated Statements of Income $ 5,438 $ 4,990 $ 5,481 $ 4,050 Net gains (losses) on fair value hedging relationships Interest rate swaps - securities Recognized on hedged items $ — $ (4,316) $ — $ — Recognized on derivatives designated as hedging instruments — 4,144 — — Net income (expense) recognized on fair value hedges $ — $ (172) $ — $ — Net gain (loss) on cash flow hedging relationships Interest rate swaps - brokered deposits and borrowings Realized gains (losses) (pre-tax) reclassified from AOCI into net income $ 232 $ — $ (373) $ — Net income (expense) recognized on cash flow hedges $ 232 $ — $ (373) $ — |
Schedule of offsetting derivative assets | Gross Amounts Net Amounts of Assets Gross Amounts Not Offset Gross Amounts Offset in the Presented in the in the Statement of Financial Position Offsetting of derivative assets of Recognized Statement of Statement of Financial Cash Collateral at September 30, 2022 Assets Financial Position Financial Position Instruments Received Net Amount Interest rate swaps $ 10,418 $ — $ 10,418 $ — $ — $ 10,418 at December 31, 2021 Interest rate swaps $ 1,168 $ — $ 1,168 $ — $ — $ 1,168 |
Schedule of offsetting derivative liabilities | Gross Amounts Net Amounts of Gross Amounts Not Offset Gross Amounts Offset in the Liabilities in the Statement of Financial Position Offsetting of derivative liabilities of Recognized Statement of Presented in the Statement Financial Cash Collateral at September 30, 2022 Liabilities Financial Position of Financial Position Instruments Posted Net Amount Interest rate swaps $ — $ — $ — $ — $ — $ — at December 31, 2021 Interest rate swaps $ 155 $ — $ 155 $ — $ 155 $ — |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
LEASES | |
Summary of lease cost | Three Months Ended Three Months Ended Lease cost: September 30, 2022 September 30, 2021 Operating lease cost $ 350 $ 353 Short-term lease cost 8 2 Total lease cost $ 358 $ 355 Nine Months Ended Nine Months Ended Lease cost: September 30, 2022 September 30, 2021 Operating lease cost $ 1,041 $ 1,063 Short-term lease cost 16 3 Total lease cost $ 1,057 $ 1,066 |
Supplemental information related to operating leases | At or For the At or For the Cash paid for amounts included in the Three Months Ended Three Months Ended measurement of lease liabilities: September 30, 2022 September 30, 2021 Operating cash flows from operating leases $ 360 $ 329 Weighted average remaining lease term- operating leases 4.7 years 4.9 years Weighted average discount rate- operating leases 2.41 % 2.18 % At or For the At or For the Cash paid for amounts included in the Nine Months Ended Nine Months Ended measurement of lease liabilities: September 30, 2022 September 30, 2021 Operating cash flows from operating leases $ 1,063 $ 1,058 Weighted average remaining lease term- operating leases 4.7 years 4.9 years Weighted average discount rate- operating leases 2.41 % 2.18 % |
Summary of maturities of operating lease liabilities | 2022 $ 420 2023 1,512 2024 1,462 2025 1,152 2026 1,030 Thereafter 1,996 Total lease payments 7,572 Less imputed interest (736) Total $ 6,836 |
OTHER REAL ESTATE OWNED (OREO)
OTHER REAL ESTATE OWNED (OREO) (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
OTHER REAL ESTATE OWNED ("OREO") | |
Schedule of Other Real Estate Owned | At or For the Three Months Ended At or For the Nine Months Ended September 30, September 30, 2022 2021 2022 2021 Beginning balance $ 145 $ — $ — $ 90 Additions — — 145 — Gross proceeds from sale of OREO — — — (81) Loss on sale of OREO — — — (9) Ending balance $ 145 $ — $ 145 $ — |
DEPOSITS (Tables)
DEPOSITS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
DEPOSITS | |
Schedule of Deposit Liabilities | September 30, December 31, 2022 2021 Noninterest-bearing checking (4) $ 555,753 $ 564,360 Interest-bearing checking (1)(4) 147,968 228,024 Savings 143,612 193,922 Money market (2) 659,861 552,357 Certificates of deposit less than $100,000 (3) 345,227 186,974 Certificates of deposit of $100,000 through $250,000 133,429 116,206 Certificates of deposit of $250,000 and over 71,629 57,512 Escrow accounts related to mortgages serviced 25,859 16,389 Total $ 2,083,338 $ 1,915,744 (1) Includes $1.2 million and $90.0 million of brokered deposits at September 30, 2022 and December 31, 2021, respectively. (2) Includes $66.8 million and $5.0 million of brokered deposits at September 30, 2022 and December 31, 2021, respectively. (3) Includes $256.6 million and $97.6 million of brokered deposits at September 30, 2022 and December 31, 2021, respectively. (4) Prior presentation of interest-bearing checking balances was revised due to misclassification of certain checking products in previous periods. As a result of the misclassification, interest-bearing checking balances totaling $121.2 million as of December 31, 2021, were reclassified to noninterest-bearing checking for comparative purposes. Balances as of the dates and average values included herein have been updated to reflect the reclassification. |
Schedule of Maturities of Time Deposits for Future Periods | At September 30, 2022 Maturing in 2022 $ 137,460 Maturing in 2023 210,943 Maturing in 2024 54,019 Maturing in 2025 111,811 Maturing in 2026 18,439 Thereafter 17,613 Total $ 550,285 |
Schedule of Interest Expense by Deposit Category | Three Months Ended Nine Months Ended September 30, September 30, 2022 2021 2022 2021 Interest-bearing checking $ 100 $ 56 $ 353 $ 154 Savings and money market 1,303 348 2,397 1,232 Certificates of deposit 1,193 1,225 2,688 4,095 Total $ 2,596 $ 1,629 $ 5,438 $ 5,481 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of Commitments to Extend Credit | COMMITMENTS TO EXTEND CREDIT September 30, December 31, REAL ESTATE LOANS 2022 2021 Commercial $ 1,634 $ 787 Construction and development 245,139 182,297 One-to-four-family (includes locks for saleable loans) 43,191 78,264 Home equity 79,283 67,596 Multi-family 2,992 3,434 Total real estate loans 372,239 332,378 CONSUMER LOANS 42,289 35,873 COMMERCIAL BUSINESS LOANS Commercial and industrial 143,881 126,220 Warehouse lending 70,351 64,160 Total commercial business loans 214,232 190,380 Total commitments to extend credit $ 628,760 $ 558,631 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Schedule of assets and liabilities measured at fair value on a recurring basis | Financial Assets At September 30, 2022 Securities available-for-sale: Level 1 Level 2 Level 3 Total U.S. agency securities $ — $ 18,137 $ — $ 18,137 Corporate securities — 8,616 — 8,616 Municipal bonds — 116,644 — 116,644 Mortgage-backed securities — 71,077 — 71,077 U.S. Small Business Administration securities — 13,468 — 13,468 Mortgage loans held for sale, at fair value — 23,447 — 23,447 Loans receivable, at fair value — 14,198 — 14,198 Derivatives: Mandatory and best effort forward commitments with investors — — 294 294 Forward TBA mortgage-backed securities — 1,154 — 1,154 Interest rate swaps — 10,418 — 10,418 Total assets measured at fair value $ — $ 277,159 $ 294 $ 277,453 Financial Liabilities Derivatives: Interest rate lock commitments with customers — — (172) (172) Total liabilities measured at fair value $ — $ — $ (172) $ (172) Financial Assets At December 31, 2021 Securities available-for-sale: Level 1 Level 2 Level 3 Total U.S. agency securities $ — $ 20,970 $ — $ 20,970 Corporate securities — 7,995 1,007 9,002 Municipal bonds — 135,302 131 135,433 Mortgage-backed securities — 89,402 — 89,402 U.S. Small Business Administration securities — 16,552 — 16,552 Mortgage loans held for sale, at fair value — 125,810 — 125,810 Loans receivable, at fair value — 16,083 — 16,083 Derivatives: Mandatory and best effort forward commitments with investors — — 808 808 Forward TBA mortgage-backed securities — 53 — 53 Interest rate swaps — 1,168 — 1,168 Interest rate lock commitments with customers — — 757 757 Total assets measured at fair value $ — $ 413,335 $ 2,703 $ 416,038 Financial Liabilities Derivatives: Interest rate swaps — (155) — (155) Total liabilities measured at fair value $ — $ (155) $ — $ (155) |
Schedule of Valuation Allowance for Impairment of Recognized Servicing Assets | September 30, 2022 Level 1 Level 2 Level 3 Total Loans individually evaluated $ — $ — $ 8,241 $ 8,241 OREO — — 145 145 Servicing rights — — 36,457 36,457 December 31, 2021 Level 1 Level 2 Level 3 Total Loans individually evaluated $ — $ — $ 5,829 $ 5,829 Servicing rights — — 26,070 26,070 |
Fair value reconciliation - Level 3 on recurring basis | Purchases Net change in Net change in Three Months Ended Beginning and Sales and Ending fair value for fair value for September 30, 2022 Balance Issuances Settlements Balance gains/(losses) (1) gains/(losses) (2) Interest rate lock commitments with customers $ 184 $ 472 $ (828) $ (172) $ (356) $ — Individual forward sale commitments with investors 518 899 (1,123) 294 (224) — September 30, 2021 Interest rate lock commitments with customers $ 2,106 $ 4,920 $ (5,855) $ 1,171 $ (935) $ — Individual forward sale commitments with investors (553) 1,081 30 558 1,111 — Purchases Net change in Net change in Nine Months Ended Beginning and Sales and Ending fair value for fair value for September 30, 2022 Balance Issuances Settlements Balance gains/(losses) (1) gains/(losses) (2) Interest rate lock commitments with customers $ 757 $ 2,589 $ (3,518) $ (172) $ (929) $ — Individual forward sale commitments with investors 808 5,972 (6,486) 294 (514) — September 30, 2021 Interest rate lock commitments with customers $ 4,024 $ 19,780 $ (22,633) $ 1,171 $ (2,853) $ — Individual forward sale commitments with investors (67) 534 91 558 625 — ___________________________ (1) Relating to items held at end of period included in income. (2) Relating to items held at end of period included in other comprehensive income (loss). |
Fair Value, by Balance Sheet Grouping | September 30, December 31, 2022 2021 Financial Assets Carrying Fair Carrying Fair Level 1 inputs: Amount Value Amount Value Cash and cash equivalents $ 159,797 $ 159,797 $ 26,491 $ 26,491 Certificates of deposit at other financial institutions 4,960 4,960 10,542 10,542 Level 2 inputs: Securities available-for-sale, at fair value 227,942 227,942 271,359 271,359 Securities held-to-maturity 8,500 7,950 7,500 8,128 Loans held for sale, at fair value 23,447 23,447 125,810 125,810 FHLB stock, at cost 13,591 13,591 4,778 4,778 Forward TBA mortgage-backed securities 1,154 1,154 53 53 Loans receivable, at fair value 14,198 14,198 16,083 16,083 Interest rate swaps 10,418 10,418 1,168 1,168 Accrued interest receivable 10,407 10,407 7,594 7,594 Level 3 inputs: Loans receivable, gross 2,096,157 2,030,648 1,738,092 1,725,651 Servicing rights, held at lower of cost or fair value 18,470 36,457 16,970 26,070 Fair value interest rate locks with customers — — 757 757 Mandatory and best effort forward commitments with investors 294 294 808 808 Financial Liabilities Level 2 inputs: Deposits 2,083,338 2,060,539 1,915,744 1,912,498 Borrowings 260,828 260,058 42,528 43,365 Subordinated notes, excluding unamortized debt issuance costs 50,000 44,500 50,000 51,688 Accrued interest payable 1,200 1,200 766 766 Interest rate swaps — — 155 155 Level 3 inputs: Fair value interest rate locks with customers 172 172 — — |
Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Valuation assumptions | Level 3 Significant Weighted Average Fair Value Valuation Unobservable September 30, December 31, Instruments Techniques Inputs Range 2022 2021 RECURRING Interest rate lock commitments with customers Quoted market prices Pull-through expectations 80% - 99% 97.3 % 93.3 % Individual forward sale commitments with investors Quoted market prices Pull-through expectations 80% - 99% 97.3 % 93.3 % NONRECURRING Loans individually evaluated Fair value of underlying collateral Discount applied to the obtained appraisal 10.0% 10.0 % 10.0 % OREO Fair value of collateral Discount applied to the obtained appraisal 10.0% 10.0 % 10.0 % Servicing rights Industry sources Pre-payment speeds 0% - 50% 8.2 % 13.8 % |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
EARNINGS PER SHARE | |
Schedule of Earnings Per Share, Basic and Diluted | At or For the Three Months Ended September 30, At or For the Nine Months Ended September 30, Numerator (in thousands): 2022 2021 2022 2021 Net income $ 8,458 $ 8,331 $ 22,027 $ 28,763 Dividends and undistributed earnings allocated to participating securities (153) (138) (414) (463) Net income available to common shareholders $ 8,305 $ 8,193 $ 21,613 $ 28,300 Denominator (shown as actual): Basic weighted average common shares outstanding 7,605,360 8,129,524 7,800,390 8,256,523 Dilutive shares 102,402 240,551 122,456 297,628 Diluted weighted average common shares outstanding 7,707,762 8,370,075 7,922,846 8,554,151 Basic earnings per share $ 1.09 $ 1.01 $ 2.77 $ 3.43 Diluted earnings per share $ 1.08 $ 0.98 $ 2.73 $ 3.31 Potentially dilutive weighted average share options that were not included in the computation of diluted earnings per share because to do so would be anti-dilutive 84,540 23,067 62,544 7,774 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
STOCK-BASED COMPENSATION | |
Summary of Stock Option Awards | Weighted-Average Weighted- Remaining Average Contractual Term In Aggregate Shares Exercise Price Years Intrinsic Value Outstanding at January 1, 2022 613,626 $ 25.24 7.17 $ 5,362,902 Granted 99,200 $ 30.94 — — Less exercised 43,048 $ 16.17 — $ 635,646 Forfeited or expired — — — — Outstanding at September 30, 2022 669,778 $ 26.67 7.00 $ 2,106,211 Expected to vest, assuming a 0.31% annual forfeiture rate (1) 649,479 $ 26.58 6.94 $ 2,077,145 Exercisable at September 30, 2022 334,767 $ 24.21 5.61 $ 1,573,345 (1) Forfeiture rate has been calculated and estimated to assume a forfeiture of 3.1% of the options forfeited over 10 years . |
Summary of Nonvested Awards | Weighted-Average Grant-Date Fair Value Nonvested Shares Shares Per Share Nonvested at January 1, 2022 121,672 $ 28.02 Granted 35,050 — Less vested 38,192 28.12 Forfeited or expired — — Nonvested at September 30, 2022 118,530 $ 28.85 |
REGULATORY CAPITAL (Tables)
REGULATORY CAPITAL (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
REGULATORY CAPITAL | |
Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations | The following table compares the Bank’s actual capital amounts and ratios at September 30, 2022 to their minimum regulatory capital requirements and well capitalized regulatory capital at that date (dollars in thousands): To be Well Capitalized Under Prompt For Capital For Capital Adequacy Corrective Actual Adequacy Purposes with Capital Buffer Action Provisions Bank Only Amount Ratio Amount Ratio Amount Ratio Amount Ratio At September 30, 2022 Total risk-based capital (to risk-weighted assets) $ 316,916 13.73 % $ 184,670 8.00 % $ 242,380 10.50 % $ 230,838 10.00 % Tier 1 risk-based capital (to risk-weighted assets) $ 288,053 12.48 % $ 138,503 6.00 % $ 196,212 8.50 % $ 184,670 8.00 % Tier 1 leverage capital (to average assets) $ 288,053 11.54 % $ 99,810 4.00 % $ N/A N/A $ 124,763 5.00 % CET 1 capital (to risk-weighted assets) $ 288,053 12.48 % $ 103,877 4.50 % $ 161,587 7.00 % $ 150,045 6.50 % |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
BUSINESS SEGMENTS | |
Schedule of Segment Reporting Information, by Segment | At or For the Three Months Ended September 30, 2022 Condensed income statement: Commercial and Consumer Banking Home Lending Total Net interest income (1) $ 24,620 $ 2,907 $ 27,527 (Provision) benefit for credit losses (2) (1,811) 93 (1,718) Noninterest income 3,314 867 4,181 Noninterest expense (14,471) (4,867) (19,338) Income (loss) before (provision) benefit for income taxes 11,652 (1,000) 10,652 (Provision) benefit for income taxes (2,400) 206 (2,194) Net income (loss) $ 9,252 $ (794) $ 8,458 Total average assets for period ended $ 2,072,614 $ 427,368 $ 2,499,982 Full-time employees ("FTEs") 389 140 529 At or For the Three Months Ended September 30, 2021 Condensed income statement: Commercial and Consumer Banking Home Lending Total Net interest income (1) $ 20,377 $ 2,278 $ 22,655 (Provision) benefit for loan losses (2) (1,986) 1,986 — Noninterest income 1,959 6,439 8,398 Noninterest expense (14,404) (5,612) (20,016) Income before provision for income taxes 5,946 5,091 11,037 Provision for income taxes (1,462) (1,244) (2,706) Net income $ 4,484 $ 3,847 $ 8,331 Total average assets for period ended $ 1,799,890 $ 417,763 $ 2,217,653 FTEs 373 154 527 At or For the Nine Months Ended September 30, 2022 Commercial and Consumer Condensed income statement: Banking Home Lending Total Net interest income (1) $ 66,983 $ 7,995 $ 74,978 Provision for loan losses (2) (3,727) (905) (4,632) Noninterest income 7,944 6,468 14,412 Noninterest expense (42,878) (14,456) (57,334) Income (loss) before provision for income taxes 28,322 (898) 27,424 (Provision) benefit for income taxes (5,583) 186 (5,397) Net income (loss) $ 22,739 $ (712) $ 22,027 Total average assets for period ended $ 1,972,376 $ 403,990 $ 2,376,366 FTEs 389 140 529 At or For the Nine Months Ended September 30, 2021 Commercial and Consumer Condensed income statement: Banking Home Lending Total Net interest income (1) $ 57,829 $ 6,146 $ 63,975 (Provision) benefit for loan losses (2) (3,045) 1,545 (1,500) Noninterest income 6,546 23,072 29,618 Noninterest expense (41,151) (14,132) (55,283) Income before provision for income taxes 20,179 16,631 36,810 Provision for income taxes (4,411) (3,636) (8,047) Net income $ 15,768 $ 12,995 $ 28,763 Total average assets for period ended $ 1,771,216 $ 402,693 $ 2,173,909 FTEs 373 154 527 (1) Net interest income is the difference between interest earned on assets and the cost of liabilities to fund those assets. Interest earned includes actual interest earned on segment assets and, if the segment has excess liabilities, interest credits for providing funding to the other segment. The cost of liabilities includes interest expense on segment liabilities and, if the segment does not have enough liabilities to fund its assets, a funding charge based on the cost of assigned liabilities to fund segment assets. (2) Provision for credit losses as calculated using the CECL method in 2022 and provision for loan losses as calculated using the previous incurred loss method in 2021. The change in methodology reflects shifts in allocation between segments due to various changes, to include adjustments to qualitative factors, changes in loan balances, and charge-off and recovery activity. |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
Schedule of changes in other intangible assets | Other Intangible Assets Accumulated Gross CDI Amortization Net CDI Balance, December 31, 2020 $ 7,490 $ (2,739) $ 4,751 Amortization — (691) (691) Balance, December 31, 2021 7,490 (3,430) 4,060 Amortization — (518) (518) Balance, September 30, 2022 $ 7,490 $ (3,948) $ 3,542 |
Schedule of amortization expense | Remainder of 2022 $ 173 2023 691 2024 621 2025 525 2026 525 Thereafter 1,007 Total $ 3,542 |
REVENUE FROM CONTRACTS WITH C_2
REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | |
Schedule of noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606 | At or For the Three Months Ended September 30, At or For the Nine Months Ended September 30, Noninterest income 2022 2021 2022 2021 In-scope of Topic 606: Debit card interchange fees $ 575 $ 585 $ 1,702 $ 1,685 Deposit service and account maintenance fees 237 192 678 538 Noninterest income (in-scope of Topic 606) 812 777 2,380 2,223 Noninterest income (out-of-scope of Topic 606) 3,369 7,621 12,032 27,395 Total noninterest income $ 4,181 $ 8,398 $ 14,412 $ 29,618 |
BASIS OF PRESENTATION AND SUM_4
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2022 USD ($) item segment Office | Nov. 05, 2022 USD ($) item | Dec. 31, 2021 USD ($) | |
Schedule of Accounting Policies [Line Items] | |||
Number of operating segments | segment | 2 | ||
Total deposits | $ 2,083,338 | $ 1,915,744 | |
Total loans | $ 2,083,929 | $ 1,728,540 | |
Puget Sound | |||
Schedule of Accounting Policies [Line Items] | |||
Number of bank branches | item | 21 | ||
Number of administrative offices that originates loans and accept deposits | Office | 1 | ||
Columbia State Bank | Subsequent Event | |||
Schedule of Accounting Policies [Line Items] | |||
Number of bank branches | item | 7 | ||
Total deposits | $ 510,000 | ||
Total loans | $ 76,000 |
BASIS OF PRESENTATION AND SUM_5
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Error Corrections (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Schedule of Accounting Policies [Line Items] | |||||
Basic earnings per share | $ 1.09 | $ 1.01 | $ 2.77 | $ 3.43 | |
Diluted earnings per share | $ 1.08 | 0.98 | $ 2.73 | 3.31 | |
Interest-bearing accounts | $ 1,501,726 | $ 1,501,726 | $ 1,334,995 | ||
Noninterest-bearing accounts | $ 581,612 | $ 581,612 | 580,749 | ||
Error correction | |||||
Schedule of Accounting Policies [Line Items] | |||||
Noninterest-bearing accounts | 121,200 | ||||
Previously reported | |||||
Schedule of Accounting Policies [Line Items] | |||||
Basic earnings per share | 0.99 | 3.38 | |||
Diluted earnings per share | $ 0.97 | $ 3.30 | |||
Interest-bearing accounts | $ 121,200 |
BASIS OF PRESENTATION AND SUM_6
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Adoption (Details) - USD ($) | Sep. 30, 2022 | Jan. 01, 2022 | Dec. 31, 2021 |
Schedule of Accounting Policies [Line Items] | |||
Accrued interest receivable on available-for-sale debt securities | $ 1,800,000 | $ 1,100,000 | |
Accrued interest receivable on held to maturity debt securities | 119,000 | 113,000 | |
Accrued interest on loans | 8,300,000 | ||
Increase in retained earnings | $ 195,986,000 | 179,215,000 | |
Excluded accrued interest | true | ||
Assets | |||
Allowance for credit losses on loans | $ 26,426,000 | 25,635,000 | |
Liabilities | |||
Allowance for credit losses on unfunded loan commitments | 3,100,000 | $ 499,000 | |
Securities available-for-sale. | |||
Schedule of Accounting Policies [Line Items] | |||
Accrued interest receivable on available-for-sale debt securities | $ 1,800,000 | ||
Accrued interest from amortized cost | true | ||
ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | $ 25,635,000 | ||
Liabilities | |||
Allowance for credit losses on unfunded loan commitments | 499,000 | ||
ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Schedule of Accounting Policies [Line Items] | |||
Increase in retained earnings | $ 297,000 | ||
Assets | |||
Allowance for credit losses on debt securities held-to-maturity | 72,000 | ||
Allowance for credit losses on loans | 22,776,000 | ||
Liabilities | |||
Allowance for credit losses on unfunded loan commitments | 2,908,000 | ||
ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Schedule of Accounting Policies [Line Items] | |||
Increase in retained earnings | 297,000 | ||
Assets | |||
Allowance for credit losses on debt securities held-to-maturity | 72,000 | ||
Allowance for credit losses on loans | (2,859,000) | ||
Liabilities | |||
Allowance for credit losses on unfunded loan commitments | 2,409,000 | ||
Total | (378,000) | ||
Commercial | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 5,667,000 | ||
Commercial | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Assets | |||
Allowance for credit losses on loans | 1,728,000 | ||
Commercial | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | (3,939,000) | ||
Construction and development | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 4,448,000 | ||
Construction and development | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Assets | |||
Allowance for credit losses on loans | 2,328,000 | ||
Construction and development | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | (2,120,000) | ||
Home equity. | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 279,000 | ||
Home equity. | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Assets | |||
Allowance for credit losses on loans | 455,000 | ||
Home equity. | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | 176,000 | ||
One-to-four-family | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 1,424,000 | ||
One-to-four-family | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Assets | |||
Allowance for credit losses on loans | 3,656,000 | ||
One-to-four-family | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | 2,232,000 | ||
Multi-family | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 2,980,000 | ||
Multi-family | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Assets | |||
Allowance for credit losses on loans | 1,397,000 | ||
Multi-family | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | (1,583,000) | ||
Indirect home improvement | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 3,540,000 | ||
Indirect home improvement | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Assets | |||
Allowance for credit losses on loans | 9,394,000 | ||
Indirect home improvement | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | 5,854,000 | ||
Marine | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 702,000 | ||
Marine | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Assets | |||
Allowance for credit losses on loans | 900,000 | ||
Marine | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | 198,000 | ||
Other consumer loans | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 38,000 | ||
Other consumer loans | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Assets | |||
Allowance for credit losses on loans | 64,000 | ||
Other consumer loans | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | 26,000 | ||
Commercial and industrial | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 5,953,000 | ||
Commercial and industrial | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Assets | |||
Allowance for credit losses on loans | 2,727,000 | ||
Commercial and industrial | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | (3,226,000) | ||
Warehouse lending | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 583,000 | ||
Warehouse lending | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjusted Balance | |||
Assets | |||
Allowance for credit losses on loans | 127,000 | ||
Warehouse lending | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | (456,000) | ||
Unallocated | ASU No 2016-13 | |||
Assets | |||
Allowance for credit losses on loans | 21,000 | ||
Unallocated | ASU No 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||
Assets | |||
Allowance for credit losses on loans | $ (21,000) |
INVESTMENTS - Available-for-sal
INVESTMENTS - Available-for-sale securities reconciliation (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
SECURITIES AVAILABLE-FOR-SALE | |||
Amortized cost | $ 275,680 | $ 272,051 | |
Unrealized Gains | 116 | 3,433 | |
Unrealized Losses | (47,854) | (4,125) | |
Securities available-for-sale, at fair value | 227,942 | 271,359 | |
SECURITIES HELD-TO-MATURITY | |||
Amortized cost | 8,500 | 7,500 | |
Unrealized gains | 628 | ||
Unrealized losses | (550) | ||
Securities held-to-maturity, at fair value | 7,950 | 8,128 | |
Allowance for credit losses | (31) | 0 | |
Total securities | |||
Amortized cost | 284,180 | 279,551 | |
Unrealized gains | 116 | 4,061 | |
Unrealized losses | (48,404) | (4,125) | |
Total securities, at fair value | 235,892 | 279,487 | |
Allowance for credit losses | (31) | ||
U.S. agency securities | |||
SECURITIES AVAILABLE-FOR-SALE | |||
Amortized cost | 21,153 | 21,155 | |
Unrealized Gains | 80 | 133 | |
Unrealized Losses | (3,096) | (318) | |
Securities available-for-sale, at fair value | 18,137 | 20,970 | |
Corporate securities | |||
SECURITIES AVAILABLE-FOR-SALE | |||
Amortized cost | 9,497 | 9,495 | |
Unrealized Gains | 28 | 31 | |
Unrealized Losses | (909) | (524) | |
Securities available-for-sale, at fair value | 8,616 | 9,002 | |
SECURITIES HELD-TO-MATURITY | |||
Amortized cost | 8,500 | 7,500 | |
Unrealized gains | 628 | ||
Unrealized losses | (550) | ||
Securities held-to-maturity, at fair value | 7,950 | 8,128 | |
Allowance for credit losses | (31) | $ (31) | |
Municipal bonds | |||
SECURITIES AVAILABLE-FOR-SALE | |||
Amortized cost | 145,918 | 136,377 | |
Unrealized Gains | 2 | 1,577 | |
Unrealized Losses | (29,276) | (2,521) | |
Securities available-for-sale, at fair value | 116,644 | 135,433 | |
Mortgage-backed securities | |||
SECURITIES AVAILABLE-FOR-SALE | |||
Amortized cost | 84,192 | 88,641 | |
Unrealized Gains | 1,457 | ||
Unrealized Losses | (13,115) | (696) | |
Securities available-for-sale, at fair value | 71,077 | 89,402 | |
U.S. Small Business Administration securities | |||
SECURITIES AVAILABLE-FOR-SALE | |||
Amortized cost | 14,920 | 16,383 | |
Unrealized Gains | 6 | 235 | |
Unrealized Losses | (1,458) | (66) | |
Securities available-for-sale, at fair value | $ 13,468 | $ 16,552 |
INVESTMENTS - Narrative (Detail
INVESTMENTS - Narrative (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 USD ($) security | Dec. 31, 2021 USD ($) security | |
Debt and Equity Securities, FV-NI [Line Items] | ||
Held-to maturity securities with unrealized losses of less than one year | security | 7 | |
Held-to maturity securities with unrealized losses of more than one year | security | 0 | |
Held-to maturity securities with unrealized losses | security | 0 | |
Available-for-sale securities with unrealized losses of less than one year | security | 130 | 75 |
Available-for-sale securities with unrealized losses of more than one year | security | 67 | 17 |
Number of securities pledged and held at FHLB | security | 7 | |
Pledged securities to secure public deposits | $ 6,000,000 | |
Public deposits | 17,600,000 | |
Other than temporary impairment losses, investments | 0 | $ 0 |
Accrued interest receivable on held to maturity debt securities | 119,000 | 113,000 |
Accrued interest receivable on available-for-sale debt securities | 1,800,000 | $ 1,100,000 |
Debt securities classified as nonaccrual or 90 days or more past due and still accruing | 0 | |
Asset pledged as collateral | Washington Public Deposit Protection Commission | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Collateral requirement | $ 7,100,000 |
INVESTMENTS - Allowance for cre
INVESTMENTS - Allowance for credit losses (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Roll Forward] | |
Total ending allowance balance | $ 31 |
Beginning allowance balance | 0 |
Corporate securities | |
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Roll Forward] | |
Total ending allowance balance | 31 |
Recapture of provision for credit losses | (41) |
Corporate securities | Accounting Standards Update 2016-13 | |
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Roll Forward] | |
Beginning allowance balance | $ 72 |
INVESTMENTS - Amortized cost of
INVESTMENTS - Amortized cost of debt (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Financing Receivable, Recorded Investment [Line Items] | |||
Balances of corporate securities | $ 31 | $ 0 | |
Corporate securities | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Balances of corporate securities | 31 | $ 31 | |
BBB/BBB- | Corporate securities | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Balances of corporate securities | $ 8,500 | $ 7,500 |
INVESTMENTS - Investments with
INVESTMENTS - Investments with Unrealized Losses Policy (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value | ||
Securities available-for-sale, Unrealized loss position, Fair Value, Less than 12 Months | $ 133,349 | $ 121,502 |
Securities available-for-sale, Unrealized loss position, Fair Value, 12 Months or Longer | 88,161 | 27,169 |
Securities available-for-sale, Unrealized loss position, Fair Value | 221,510 | 148,671 |
Securities held-to-maturity, Unrealized loss position, Fair Value, Less than 12 Months | 7,950 | |
Securities held-to-maturity, Unrealized loss position, Fair Value | 7,950 | |
Total securities, Unrealized loss position, Fair Value, Less than 12 Months | 141,299 | |
Total securities, Unrealized loss position, Fair Value, 12 Months or Longer | 88,161 | |
Total securities, Unrealized loss position, Fair Value | 229,460 | |
Unrealized Losses | ||
Securities available-for-sale, Unrealized loss position, Unrealized losses, Less than 12 Months | (24,017) | (2,752) |
Securities available-for-sale, Unrealized loss position, Unrealized losses, 12 Months or Longer | (23,837) | (1,373) |
Securities available-for-sale, Unrealized losses | (47,854) | (4,125) |
Securities held-to-maturity, Unrealized loss position, Unrealized losses, Less than 12 Months | (550) | |
Securities held-to-maturity, Unrealized losses | (550) | |
Unrealized loss position, Less than 12 Months, Unrealized Losses | (24,567) | |
Unrealized loss position, 12 Months or Longer, Unrealized Losses | (23,837) | |
Unrealized loss position, Unrealized Losses | (48,404) | |
U.S. agency securities | ||
Fair Value | ||
Securities available-for-sale, Unrealized loss position, Fair Value, Less than 12 Months | 7,071 | 13,125 |
Securities available-for-sale, Unrealized loss position, Fair Value, 12 Months or Longer | 8,986 | 3,752 |
Securities available-for-sale, Unrealized loss position, Fair Value | 16,057 | 16,877 |
Unrealized Losses | ||
Securities available-for-sale, Unrealized loss position, Unrealized losses, Less than 12 Months | (1,184) | (105) |
Securities available-for-sale, Unrealized loss position, Unrealized losses, 12 Months or Longer | (1,912) | (213) |
Securities available-for-sale, Unrealized losses | (3,096) | (318) |
Corporate securities | ||
Fair Value | ||
Securities available-for-sale, Unrealized loss position, Fair Value, Less than 12 Months | 3,476 | |
Securities available-for-sale, Unrealized loss position, Fair Value, 12 Months or Longer | 4,112 | 5,476 |
Securities available-for-sale, Unrealized loss position, Fair Value | 7,588 | 5,476 |
Securities held-to-maturity, Unrealized loss position, Fair Value, Less than 12 Months | 7,950 | |
Securities held-to-maturity, Unrealized loss position, Fair Value | 7,950 | |
Unrealized Losses | ||
Securities available-for-sale, Unrealized loss position, Unrealized losses, Less than 12 Months | (21) | |
Securities available-for-sale, Unrealized loss position, Unrealized losses, 12 Months or Longer | (888) | (524) |
Securities available-for-sale, Unrealized losses | (909) | (524) |
Securities held-to-maturity, Unrealized loss position, Unrealized losses, Less than 12 Months | (550) | |
Securities held-to-maturity, Unrealized losses | (550) | |
Municipal bonds | ||
Fair Value | ||
Securities available-for-sale, Unrealized loss position, Fair Value, Less than 12 Months | 66,406 | 72,098 |
Securities available-for-sale, Unrealized loss position, Fair Value, 12 Months or Longer | 50,133 | 14,116 |
Securities available-for-sale, Unrealized loss position, Fair Value | 116,539 | 86,214 |
Unrealized Losses | ||
Securities available-for-sale, Unrealized loss position, Unrealized losses, Less than 12 Months | (14,563) | (1,961) |
Securities available-for-sale, Unrealized loss position, Unrealized losses, 12 Months or Longer | (14,713) | (560) |
Securities available-for-sale, Unrealized losses | (29,276) | (2,521) |
Mortgage-backed securities | ||
Fair Value | ||
Securities available-for-sale, Unrealized loss position, Fair Value, Less than 12 Months | 47,724 | 33,291 |
Securities available-for-sale, Unrealized loss position, Fair Value, 12 Months or Longer | 23,353 | 3,825 |
Securities available-for-sale, Unrealized loss position, Fair Value | 71,077 | 37,116 |
Unrealized Losses | ||
Securities available-for-sale, Unrealized loss position, Unrealized losses, Less than 12 Months | (7,286) | (620) |
Securities available-for-sale, Unrealized loss position, Unrealized losses, 12 Months or Longer | (5,829) | (76) |
Securities available-for-sale, Unrealized losses | (13,115) | (696) |
U.S. Small Business Administration securities | ||
Fair Value | ||
Securities available-for-sale, Unrealized loss position, Fair Value, Less than 12 Months | 8,672 | 2,988 |
Securities available-for-sale, Unrealized loss position, Fair Value, 12 Months or Longer | 1,577 | |
Securities available-for-sale, Unrealized loss position, Fair Value | 10,249 | 2,988 |
Unrealized Losses | ||
Securities available-for-sale, Unrealized loss position, Unrealized losses, Less than 12 Months | (963) | (66) |
Securities available-for-sale, Unrealized loss position, Unrealized losses, 12 Months or Longer | (495) | |
Securities available-for-sale, Unrealized losses | $ (1,458) | $ (66) |
INVESTMENTS - Available for Sal
INVESTMENTS - Available for Sale Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Debt and Equity Securities, FV-NI [Line Items] | |||||
Proceeds from sale of available-for-sale securities | $ 0 | $ 0 | $ 0 | $ 0 | |
Gains from securities available-for-sale | 0 | 0 | 0 | 0 | |
Losses from securities available-for-sale | 0 | $ 0 | 0 | $ 0 | |
Amortized Cost | |||||
Securities available-for-sale, Total | 275,680 | 275,680 | $ 272,051 | ||
Securities held-to-maturity, Total | 8,500 | 8,500 | 7,500 | ||
Total securities | 284,180 | 284,180 | 279,551 | ||
Fair Value | |||||
Securities available-for-sale, Total | 227,942 | 227,942 | 271,359 | ||
Securities held-to-maturity, Total | 7,950 | 7,950 | 8,128 | ||
Total securities | 235,892 | 235,892 | 279,487 | ||
U.S. agency securities | |||||
Amortized Cost | |||||
Securities available-for-sale, Due after one year through five years | 945 | 945 | 959 | ||
Securities available-for-sale, Due after five years through ten years | 15,898 | 15,898 | 6,920 | ||
Securities available-for-sale, Due after ten years | 4,310 | 4,310 | 13,276 | ||
Securities available-for-sale, Subtotal | 21,153 | 21,153 | 21,155 | ||
Securities available-for-sale, Total | 21,153 | 21,153 | 21,155 | ||
Fair Value | |||||
Securities available-for-sale, Due after one year through five years | 919 | 919 | 1,004 | ||
Securities available-for-sale, Due after five years through ten years | 13,725 | 13,725 | 6,850 | ||
Securities available-for-sale, Due after ten years | 3,493 | 3,493 | 13,116 | ||
Securities available-for-sale, Subtotal | 18,137 | 18,137 | 20,970 | ||
Securities available-for-sale, Total | 18,137 | 18,137 | 20,970 | ||
Corporate securities | |||||
Amortized Cost | |||||
Securities available-for-sale, Due in one year or less | 1,000 | 1,000 | 0 | ||
Securities available-for-sale, Due after one year through five years | 2,497 | 2,497 | 3,495 | ||
Securities available-for-sale, Due after five years through ten years | 4,000 | 4,000 | 4,000 | ||
Securities available-for-sale, Due after ten years | 2,000 | 2,000 | 2,000 | ||
Securities available-for-sale, Subtotal | 9,497 | 9,497 | 9,495 | ||
Securities available-for-sale, Total | 9,497 | 9,497 | 9,495 | ||
Securities held-to-maturity, Due after five years through ten years | 8,500 | 8,500 | 7,500 | ||
Fair Value | |||||
Securities available-for-sale, Due in one year or less | 997 | 997 | 0 | ||
Securities available-for-sale, Due after one year through five years | 2,515 | 2,515 | 3,526 | ||
Securities available-for-sale, Due after five years through ten years | 3,809 | 3,809 | 3,627 | ||
Securities available-for-sale, Due after ten years | 1,295 | 1,295 | 1,849 | ||
Securities available-for-sale, Subtotal | 8,616 | 8,616 | 9,002 | ||
Securities available-for-sale, Total | 8,616 | 8,616 | 9,002 | ||
Securities held-to-maturity, Due after five years through ten years | 7,950 | 7,950 | 8,128 | ||
Municipal bonds | |||||
Amortized Cost | |||||
Securities available-for-sale, Due in one year or less | 2,660 | 2,660 | 0 | ||
Securities available-for-sale, Due after one year through five years | 1,045 | 1,045 | 3,724 | ||
Securities available-for-sale, Due after five years through ten years | 7,635 | 7,635 | 6,857 | ||
Securities available-for-sale, Due after ten years | 134,578 | 134,578 | 125,796 | ||
Securities available-for-sale, Subtotal | 145,918 | 145,918 | 136,377 | ||
Securities available-for-sale, Total | 145,918 | 145,918 | 136,377 | ||
Fair Value | |||||
Securities available-for-sale, Due in one year or less | 2,638 | 2,638 | 0 | ||
Securities available-for-sale, Due after one year through five years | 1,023 | 1,023 | 3,850 | ||
Securities available-for-sale, Due after five years through ten years | 6,899 | 6,899 | 7,035 | ||
Securities available-for-sale, Due after ten years | 106,084 | 106,084 | 124,548 | ||
Securities available-for-sale, Subtotal | 116,644 | 116,644 | 135,433 | ||
Securities available-for-sale, Total | 116,644 | 116,644 | 135,433 | ||
Mortgage-backed securities | |||||
Amortized Cost | |||||
Securities available-for-sale, Mortgage-backed securities | 84,192 | 84,192 | 88,641 | ||
Securities available-for-sale, Total | 84,192 | 84,192 | 88,641 | ||
Fair Value | |||||
Securities available-for-sale, Mortgage-backed securities | 71,077 | 71,077 | 89,402 | ||
Securities available-for-sale, Total | 71,077 | 71,077 | 89,402 | ||
Federal National Mortgage Association ("FNMA") | |||||
Amortized Cost | |||||
Securities available-for-sale, Mortgage-backed securities | 70,061 | 70,061 | 75,171 | ||
Fair Value | |||||
Securities available-for-sale, Mortgage-backed securities | 58,404 | 58,404 | 75,737 | ||
Federal Home Loan Mortgage Corporation ("FHLMC") | |||||
Amortized Cost | |||||
Securities available-for-sale, Mortgage-backed securities | 9,346 | 9,346 | 9,606 | ||
Fair Value | |||||
Securities available-for-sale, Mortgage-backed securities | 8,382 | 8,382 | 9,768 | ||
Government National Mortgage Association ("GNMA") | |||||
Amortized Cost | |||||
Securities available-for-sale, Mortgage-backed securities | 4,785 | 4,785 | 3,864 | ||
Fair Value | |||||
Securities available-for-sale, Mortgage-backed securities | 4,291 | 4,291 | 3,897 | ||
U.S. Small Business Administration securities | |||||
Amortized Cost | |||||
Securities available-for-sale, Due after one year through five years | 2,582 | 2,582 | 2,485 | ||
Securities available-for-sale, Due after five years through ten years | 4,563 | 4,563 | 4,420 | ||
Securities available-for-sale, Due after ten years | 7,775 | 7,775 | 9,478 | ||
Securities available-for-sale, Subtotal | 14,920 | 14,920 | 16,383 | ||
Securities available-for-sale, Total | 14,920 | 14,920 | 16,383 | ||
Fair Value | |||||
Securities available-for-sale, Due after one year through five years | 2,409 | 2,409 | 2,507 | ||
Securities available-for-sale, Due after five years through ten years | 4,276 | 4,276 | 4,515 | ||
Securities available-for-sale, Due after ten years | 6,783 | 6,783 | 9,530 | ||
Securities available-for-sale, Subtotal | 13,468 | 13,468 | 16,552 | ||
Securities available-for-sale, Total | $ 13,468 | $ 13,468 | $ 16,552 |
LOANS RECEIVABLE AND ALLOWANC_3
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS - Composition of Loan Portfolio (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | $ 2,110,355 | $ 1,754,175 | $ 1,704,968 |
Allowance for credit losses on loans | (26,426) | (25,635) | |
Total loans receivable, net | 2,083,929 | 1,728,540 | |
REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 1,352,689 | 1,090,303 | 1,038,247 |
REAL ESTATE LOANS | Commercial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 310,923 | 264,429 | |
REAL ESTATE LOANS | Construction and development | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 335,177 | 240,553 | |
REAL ESTATE LOANS | Home equity. | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 53,681 | 41,017 | |
REAL ESTATE LOANS | One-to-four-family | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 429,196 | 366,146 | |
REAL ESTATE LOANS | Multi-family | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 223,712 | 178,158 | |
CONSUMER LOANS | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 518,555 | 422,043 | 411,094 |
CONSUMER LOANS | Indirect home improvement | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 447,462 | 336,285 | |
CONSUMER LOANS | Marine | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 68,106 | 82,778 | |
CONSUMER LOANS | Other consumer loans | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 2,987 | 2,980 | |
COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 239,111 | 241,829 | $ 255,627 |
COMMERCIAL BUSINESS LOANS | Commercial and industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | 211,009 | 208,552 | |
COMMERCIAL BUSINESS LOANS | Warehouse lending | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable, gross | $ 28,102 | $ 33,277 |
LOANS RECEIVABLE AND ALLOWANC_4
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS - Narrative (Details) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 USD ($) segment item division | Dec. 31, 2021 USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of loan portfolio segments | segment | 3 | |
Number of warehouse lending divisions | division | 2 | |
Loans that qualify as collateral for FHLB advances | $ 786,800 | $ 761,600 |
Loans that qualify as collateral for Federal Reserve Bank lines of credit | $ 524,300 | 428,700 |
Minimum term for accrual of interest on loans to be discontinued | 90 days | |
Unamortized costs and premiums | $ 6,800 | 4,900 |
Net discounts on acquired loans | 534 | 751 |
Accrued interest receivable | $ 8,300 | $ 6,300 |
Multi-family | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of Units in Real Estate Property | item | 5 |
LOANS RECEIVABLE AND ALLOWANC_5
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS - Allowance for Loan Losses by Loan Categories (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
ALLOWANCE FOR LOAN LOSSES | |||||
(Recapture) provision for credit losses on loans | $ 2,022 | $ 4,493 | $ 1,500 | ||
Loans charged-off | (924) | $ (428) | (1,744) | (1,318) | |
Recoveries | 361 | 119 | 901 | 571 | |
Ending balance | 26,426 | 26,925 | 26,426 | 26,925 | |
Period End Amount Allocated to | |||||
Loans individually evaluated for impairment | 1,234 | 1,234 | |||
Loans collectively evaluated for impairment | 25,691 | 25,691 | |||
Ending balance | 26,426 | 26,925 | 26,426 | 26,925 | |
LOANS RECEIVABLE | |||||
Loans individually evaluated for impairment | 5,936 | 5,936 | |||
Loans collectively evaluated for impairment | 1,699,032 | 1,699,032 | |||
Total loans receivable | 2,110,355 | 1,704,968 | 2,110,355 | 1,704,968 | $ 1,754,175 |
Cumulative Effect, Period of Adoption, Adjusted Balance | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
Beginning balance | 24,967 | 27,234 | 25,635 | 26,172 | |
Period End Amount Allocated to | |||||
Ending balance | 25,635 | ||||
Accounting Standards Update 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
Beginning balance | (2,859) | ||||
Period End Amount Allocated to | |||||
Ending balance | (2,859) | ||||
Unallocated Financing Receivables [Member] | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
(Recapture) provision for credit losses on loans | 1,571 | 1,109 | |||
Ending balance | 1,800 | 1,800 | |||
Period End Amount Allocated to | |||||
Loans collectively evaluated for impairment | 1,800 | 1,800 | |||
Ending balance | 1,800 | 1,800 | |||
Unallocated Financing Receivables [Member] | Cumulative Effect, Period of Adoption, Adjusted Balance | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
Beginning balance | 229 | 21 | 691 | ||
Period End Amount Allocated to | |||||
Ending balance | 21 | ||||
Unallocated Financing Receivables [Member] | Accounting Standards Update 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
Beginning balance | (21) | ||||
Period End Amount Allocated to | |||||
Ending balance | (21) | ||||
REAL ESTATE LOANS | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
(Recapture) provision for credit losses on loans | (213) | 124 | 1,735 | 586 | |
Ending balance | 11,299 | 14,432 | 11,299 | 14,432 | |
Period End Amount Allocated to | |||||
Loans collectively evaluated for impairment | 14,432 | 14,432 | |||
Ending balance | 11,299 | 14,432 | 11,299 | 14,432 | |
LOANS RECEIVABLE | |||||
Loans individually evaluated for impairment | 755 | 755 | |||
Loans collectively evaluated for impairment | 1,037,492 | 1,037,492 | |||
Total loans receivable | 1,352,689 | 1,038,247 | 1,352,689 | 1,038,247 | 1,090,303 |
REAL ESTATE LOANS | Cumulative Effect, Period of Adoption, Adjusted Balance | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
Beginning balance | 11,512 | 14,308 | 14,798 | 13,846 | |
Period End Amount Allocated to | |||||
Ending balance | 14,798 | ||||
REAL ESTATE LOANS | Accounting Standards Update 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
Beginning balance | (5,234) | ||||
Period End Amount Allocated to | |||||
Ending balance | (5,234) | ||||
CONSUMER LOANS | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
(Recapture) provision for credit losses on loans | 1,193 | (2,315) | 1,720 | (1,588) | |
Loans charged-off | (924) | (428) | (1,744) | (1,280) | |
Recoveries | 361 | 119 | 901 | 571 | |
Ending balance | 11,235 | 4,399 | 11,235 | 4,399 | |
Period End Amount Allocated to | |||||
Loans individually evaluated for impairment | 243 | 243 | |||
Loans collectively evaluated for impairment | 4,156 | 4,156 | |||
Ending balance | 11,235 | 4,399 | 11,235 | 4,399 | |
LOANS RECEIVABLE | |||||
Loans individually evaluated for impairment | 694 | 694 | |||
Loans collectively evaluated for impairment | 410,400 | 410,400 | |||
Total loans receivable | 518,555 | 411,094 | 518,555 | 411,094 | 422,043 |
CONSUMER LOANS | Cumulative Effect, Period of Adoption, Adjusted Balance | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
Beginning balance | 10,605 | 7,023 | 4,280 | 6,696 | |
Period End Amount Allocated to | |||||
Ending balance | 4,280 | ||||
CONSUMER LOANS | Accounting Standards Update 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
Beginning balance | 6,078 | ||||
Period End Amount Allocated to | |||||
Ending balance | 6,078 | ||||
COMMERCIAL BUSINESS LOANS | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
(Recapture) provision for credit losses on loans | 1,042 | 620 | 1,038 | 1,393 | |
Loans charged-off | (38) | ||||
Ending balance | 3,892 | 6,294 | 3,892 | 6,294 | |
Period End Amount Allocated to | |||||
Loans individually evaluated for impairment | 991 | 991 | |||
Loans collectively evaluated for impairment | 5,303 | 5,303 | |||
Ending balance | 3,892 | 6,294 | 3,892 | 6,294 | |
LOANS RECEIVABLE | |||||
Loans individually evaluated for impairment | 4,487 | 4,487 | |||
Loans collectively evaluated for impairment | 251,140 | 251,140 | |||
Total loans receivable | 239,111 | 255,627 | 239,111 | 255,627 | 241,829 |
COMMERCIAL BUSINESS LOANS | Cumulative Effect, Period of Adoption, Adjusted Balance | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
Beginning balance | $ 2,850 | $ 5,674 | 6,536 | $ 4,939 | |
Period End Amount Allocated to | |||||
Ending balance | 6,536 | ||||
COMMERCIAL BUSINESS LOANS | Accounting Standards Update 2016-13 | Cumulative Effect, Period of Adoption, Adjustment | |||||
ALLOWANCE FOR LOAN LOSSES | |||||
Beginning balance | $ (3,682) | ||||
Period End Amount Allocated to | |||||
Ending balance | $ (3,682) |
LOANS RECEIVABLE AND ALLOWANC_6
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - Schedule of Troubled Debt Restructurings Accrual and Non-accrual (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 USD ($) loan | Dec. 31, 2021 USD ($) | |
Financing Receivable, Modifications [Line Items] | ||
Non-Accrual | $ 8,241 | |
COMMERCIAL BUSINESS LOANS | ||
Financing Receivable, Modifications [Line Items] | ||
Number of TDR loans on non-accrual | loan | 2 | |
Non-Accrual | $ 3,800 | $ 0 |
Number of Non-accrual loans | loan | 2 | |
Commitments to lend additional loans | $ 0 |
LOANS RECEIVABLE AND ALLOWANC_7
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS - Aging Analysis of Past Due Loans (Details) $ in Thousands | Sep. 30, 2022 USD ($) loan | Dec. 31, 2021 USD ($) loan | Sep. 30, 2021 USD ($) loan |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | $ 2,110,355 | $ 1,754,175 | $ 1,704,968 |
Non-Accrual | $ 8,241 | ||
Number of TDRs which incurred payment default | loan | 0 | 0 | |
REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | $ 1,352,689 | 1,090,303 | $ 1,038,247 |
Non-Accrual | 1,019 | ||
CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 518,555 | 422,043 | 411,094 |
Non-Accrual | 802 | ||
COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 239,111 | 241,829 | $ 255,627 |
Non-Accrual | 3,800 | 0 | |
Commercial | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 310,923 | 264,429 | |
Construction and development | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 335,177 | 240,553 | |
Home equity. | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 53,681 | 41,017 | |
Non-Accrual | 178 | ||
One-to-four-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 429,196 | 366,146 | |
Non-Accrual | 841 | ||
Multi-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 223,712 | 178,158 | |
Indirect home improvement | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 447,462 | 336,285 | |
Non-Accrual | 621 | ||
Marine | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 68,106 | 82,778 | |
Non-Accrual | 181 | ||
Other consumer loans | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 2,987 | 2,980 | |
Commercial and industrial | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 211,009 | 208,552 | |
Non-Accrual | 6,420 | ||
Warehouse lending | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 28,102 | 33,277 | |
30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 1,184 | 2,561 | |
30-59 Days Past Due | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 593 | |
30-59 Days Past Due | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 1,184 | 1,177 | |
30-59 Days Past Due | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 791 | |
30-59 Days Past Due | Commercial | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
30-59 Days Past Due | Construction and development | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
30-59 Days Past Due | Home equity. | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
30-59 Days Past Due | One-to-four-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 593 | |
30-59 Days Past Due | Multi-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
30-59 Days Past Due | Indirect home improvement | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 1,082 | 1,047 | |
30-59 Days Past Due | Marine | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 83 | 119 | |
30-59 Days Past Due | Other consumer loans | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 19 | 11 | |
30-59 Days Past Due | Commercial and industrial | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 791 | |
30-59 Days Past Due | Warehouse lending | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 620 | 546 | |
60-89 Days Past Due | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 37 | 264 | |
60-89 Days Past Due | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 583 | 282 | |
60-89 Days Past Due | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
60-89 Days Past Due | Commercial | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
60-89 Days Past Due | Construction and development | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
60-89 Days Past Due | Home equity. | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 37 | 0 | |
60-89 Days Past Due | One-to-four-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 264 | |
60-89 Days Past Due | Multi-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
60-89 Days Past Due | Indirect home improvement | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 443 | 280 | |
60-89 Days Past Due | Marine | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 135 | 0 | |
60-89 Days Past Due | Other consumer loans | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 5 | 2 | |
60-89 Days Past Due | Commercial and industrial | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
60-89 Days Past Due | Warehouse lending | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
90 Days or More Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | $ 3,405 | $ 972 | |
Number Of Loans Accruing Interest | loan | 0 | 0 | |
90 Days or More Past Due | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | $ 526 | $ 659 | |
90 Days or More Past Due | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 262 | 313 | |
90 Days or More Past Due | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 2,617 | 0 | |
90 Days or More Past Due | Commercial | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
90 Days or More Past Due | Construction and development | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
90 Days or More Past Due | Home equity. | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 147 | 179 | |
90 Days or More Past Due | One-to-four-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 379 | 480 | |
90 Days or More Past Due | Multi-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
90 Days or More Past Due | Indirect home improvement | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 262 | 295 | |
90 Days or More Past Due | Marine | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
90 Days or More Past Due | Other consumer loans | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 18 | |
90 Days or More Past Due | Commercial and industrial | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 2,617 | 0 | |
90 Days or More Past Due | Warehouse lending | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 5,209 | 4,079 | |
Past Due | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 563 | 1,516 | |
Past Due | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 2,029 | 1,772 | |
Past Due | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 2,617 | 791 | |
Past Due | Commercial | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
Past Due | Construction and development | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
Past Due | Home equity. | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 184 | 179 | |
Past Due | One-to-four-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 379 | 1,337 | |
Past Due | Multi-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
Past Due | Indirect home improvement | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 1,787 | 1,622 | |
Past Due | Marine | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 218 | 119 | |
Past Due | Other consumer loans | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 24 | 31 | |
Past Due | Commercial and industrial | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 2,617 | 791 | |
Past Due | Warehouse lending | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 0 | 0 | |
Not Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 2,105,146 | 1,750,096 | |
Not Past Due | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 1,352,126 | 1,088,787 | |
Not Past Due | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 516,526 | 420,271 | |
Not Past Due | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 236,494 | 241,038 | |
Not Past Due | Commercial | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 310,923 | 264,429 | |
Not Past Due | Construction and development | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 335,177 | 240,553 | |
Not Past Due | Home equity. | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 53,497 | 40,838 | |
Not Past Due | One-to-four-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 428,817 | 364,809 | |
Not Past Due | Multi-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 223,712 | 178,158 | |
Not Past Due | Indirect home improvement | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 445,675 | 334,663 | |
Not Past Due | Marine | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 67,888 | 82,659 | |
Not Past Due | Other consumer loans | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 2,963 | 2,949 | |
Not Past Due | Commercial and industrial | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 208,392 | 207,761 | |
Not Past Due | Warehouse lending | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total loans receivable | 28,102 | 33,277 | |
Non-Accrual | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 8,241 | 5,829 | |
Non-Accrual | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 1,019 | 781 | |
Non-Accrual | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 802 | 629 | |
Non-Accrual | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 6,420 | 4,419 | |
Non-Accrual | Commercial | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 0 | 0 | |
Non-Accrual | Construction and development | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 0 | 0 | |
Non-Accrual | Home equity. | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 178 | 301 | |
Non-Accrual | One-to-four-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 841 | 480 | |
Non-Accrual | Multi-family | REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 0 | 0 | |
Non-Accrual | Indirect home improvement | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 621 | 554 | |
Non-Accrual | Marine | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 181 | 57 | |
Non-Accrual | Other consumer loans | CONSUMER LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 0 | 18 | |
Non-Accrual | Commercial and industrial | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | 6,420 | 4,419 | |
Non-Accrual | Warehouse lending | COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Non-Accrual | $ 0 | $ 0 |
LOANS RECEIVABLE AND ALLOWANC_8
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS - Average Recorded Investment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2021 | Sep. 30, 2021 | |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Average Recorded Investment, with no related allowance recorded | $ 943 | $ 2,125 |
Average Recorded Investment, with an allowance recorded | 5,128 | 5,663 |
Average Recorded Investment | 6,071 | 7,788 |
Impaired Financing Receivable, Interest Income [Abstract] | ||
Interest Income Recognized, with no related allowance recorded | 15 | 30 |
Interest Income Recognized, with an allowance recorded | 100 | 231 |
Interest Income Recognized | 115 | 261 |
REAL ESTATE LOANS | Construction and development | ||
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Average Recorded Investment, with an allowance recorded | 1,028 | |
REAL ESTATE LOANS | Home equity. | ||
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Average Recorded Investment, with no related allowance recorded | 455 | 538 |
Impaired Financing Receivable, Interest Income [Abstract] | ||
Interest Income Recognized, with no related allowance recorded | 12 | 21 |
REAL ESTATE LOANS | One-to-four-family | ||
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Average Recorded Investment, with no related allowance recorded | 488 | 559 |
Average Recorded Investment, with an allowance recorded | 27 | |
Impaired Financing Receivable, Interest Income [Abstract] | ||
Interest Income Recognized, with no related allowance recorded | 3 | 9 |
CONSUMER LOANS | Indirect home improvement | ||
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Average Recorded Investment, with an allowance recorded | 554 | 670 |
Impaired Financing Receivable, Interest Income [Abstract] | ||
Interest Income Recognized, with an allowance recorded | 12 | 34 |
CONSUMER LOANS | Marine | ||
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Average Recorded Investment, with an allowance recorded | 85 | 74 |
Impaired Financing Receivable, Interest Income [Abstract] | ||
Interest Income Recognized, with an allowance recorded | 2 | 5 |
CONSUMER LOANS | Other consumer loans | ||
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Average Recorded Investment, with an allowance recorded | 2 | 8 |
Impaired Financing Receivable, Interest Income [Abstract] | ||
Interest Income Recognized, with an allowance recorded | 0 | 1 |
COMMERCIAL BUSINESS LOANS | Commercial and industrial | ||
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Average Recorded Investment, with an allowance recorded | 4,487 | 4,884 |
Impaired Financing Receivable, Interest Income [Abstract] | ||
Interest Income Recognized, with an allowance recorded | $ 86 | $ 191 |
LOANS RECEIVABLE AND ALLOWANC_9
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS - Financing Receivables, Related Allowance Recorded and No Related Allowance Recorded (Details) $ in Thousands | Dec. 31, 2021 USD ($) |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | |
Unpaid Principal Balance, with no related allowance recorded | $ 756 |
Unpaid Principal Balance, with an allowance recorded | 5,134 |
Impaired Financing Receivable, Unpaid Principal Balance, Total | 5,890 |
Impaired Financing Receivable, Recorded Investment [Abstract] | |
Recorded Investment, with no related allowance recorded | 707 |
Recorded Investment, with an allowance recorded | 5,122 |
Recorded Investment | 5,829 |
Impaired Financing Receivable Related Allowance Abstract | |
Related Allowance, with no related allowance recorded | 0 |
Related Allowance, with an allowance recorded | 1,163 |
Related Allowance | 1,163 |
REAL ESTATE LOANS | Home equity. | |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | |
Unpaid Principal Balance, with no related allowance recorded | 259 |
Unpaid Principal Balance, with an allowance recorded | 92 |
Impaired Financing Receivable, Recorded Investment [Abstract] | |
Recorded Investment, with no related allowance recorded | 227 |
Recorded Investment, with an allowance recorded | 74 |
Impaired Financing Receivable Related Allowance Abstract | |
Related Allowance, with no related allowance recorded | 0 |
Related Allowance, with an allowance recorded | 23 |
REAL ESTATE LOANS | One-to-four-family | |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | |
Unpaid Principal Balance, with no related allowance recorded | 497 |
Impaired Financing Receivable, Recorded Investment [Abstract] | |
Recorded Investment, with no related allowance recorded | 480 |
Impaired Financing Receivable Related Allowance Abstract | |
Related Allowance, with no related allowance recorded | 0 |
CONSUMER LOANS | Indirect home improvement | |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | |
Unpaid Principal Balance, with an allowance recorded | 551 |
Impaired Financing Receivable, Recorded Investment [Abstract] | |
Recorded Investment, with an allowance recorded | 554 |
Impaired Financing Receivable Related Allowance Abstract | |
Related Allowance, with an allowance recorded | 193 |
CONSUMER LOANS | Marine | |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | |
Unpaid Principal Balance, with an allowance recorded | 56 |
Impaired Financing Receivable, Recorded Investment [Abstract] | |
Recorded Investment, with an allowance recorded | 57 |
Impaired Financing Receivable Related Allowance Abstract | |
Related Allowance, with an allowance recorded | 20 |
CONSUMER LOANS | Other consumer loans | |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | |
Unpaid Principal Balance, with an allowance recorded | 18 |
Impaired Financing Receivable, Recorded Investment [Abstract] | |
Recorded Investment, with an allowance recorded | 18 |
Impaired Financing Receivable Related Allowance Abstract | |
Related Allowance, with an allowance recorded | 6 |
COMMERCIAL BUSINESS LOANS | Commercial and industrial | |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | |
Unpaid Principal Balance, with an allowance recorded | 4,417 |
Impaired Financing Receivable, Recorded Investment [Abstract] | |
Recorded Investment, with an allowance recorded | 4,419 |
Impaired Financing Receivable Related Allowance Abstract | |
Related Allowance, with an allowance recorded | $ 921 |
LOANS RECEIVABLE AND ALLOWAN_10
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS - Risk Rated Loan Balances (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | $ 610,507 | ||
2021 | 579,748 | ||
2020 | 300,042 | ||
2019 | 188,481 | ||
2018 | 68,353 | ||
Prior | 175,311 | ||
Revolving Loans | 187,913 | ||
Total loans receivable | 2,110,355 | $ 1,754,175 | $ 1,704,968 |
Pass | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 610,300 | ||
2021 | 578,016 | ||
2020 | 293,233 | ||
2019 | 183,273 | ||
2018 | 65,508 | ||
Prior | 165,637 | ||
Revolving Loans | 180,343 | ||
Total loans receivable | 2,076,310 | 1,719,659 | |
Watch | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2021 | 13 | ||
2020 | 5,144 | ||
Prior | 205 | ||
Revolving Loans | 5,589 | ||
Total loans receivable | 10,951 | 8,834 | |
Special Mention | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2019 | 2,794 | ||
2018 | 1,964 | ||
Prior | 942 | ||
Revolving Loans | 773 | ||
Total loans receivable | 6,473 | 7,598 | |
Substandard | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 207 | ||
2021 | 1,719 | ||
2020 | 1,665 | ||
2019 | 2,414 | ||
2018 | 881 | ||
Prior | 8,527 | ||
Revolving Loans | 1,208 | ||
Total loans receivable | 16,621 | 18,084 | |
REAL ESTATE LOANS | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 378,635 | ||
2021 | 409,105 | ||
2020 | 213,522 | ||
2019 | 141,453 | ||
2018 | 39,211 | ||
Prior | 134,189 | ||
Revolving Loans | 36,574 | ||
Total loans receivable | 1,352,689 | 1,090,303 | 1,038,247 |
REAL ESTATE LOANS | Commercial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 66,350 | ||
2021 | 76,834 | ||
2020 | 46,830 | ||
2019 | 41,275 | ||
2018 | 15,497 | ||
Prior | 64,009 | ||
Revolving Loans | 128 | ||
Total loans receivable | 310,923 | 264,429 | |
REAL ESTATE LOANS | Construction and development | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 151,853 | ||
2021 | 133,335 | ||
2020 | 29,720 | ||
2019 | 19,823 | ||
Prior | 446 | ||
Total loans receivable | 335,177 | 240,553 | |
REAL ESTATE LOANS | Home equity. | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 5,339 | ||
2021 | 1,707 | ||
2020 | 7,082 | ||
2019 | 11 | ||
2018 | 1,251 | ||
Prior | 1,845 | ||
Revolving Loans | 36,446 | ||
Total loans receivable | 53,681 | 41,017 | |
REAL ESTATE LOANS | One-to-four-family | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 121,163 | ||
2021 | 133,680 | ||
2020 | 81,292 | ||
2019 | 32,264 | ||
2018 | 18,257 | ||
Prior | 42,540 | ||
Total loans receivable | 429,196 | 366,146 | |
REAL ESTATE LOANS | Multi-family | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 33,930 | ||
2021 | 63,549 | ||
2020 | 48,598 | ||
2019 | 48,080 | ||
2018 | 4,206 | ||
Prior | 25,349 | ||
Total loans receivable | 223,712 | 178,158 | |
REAL ESTATE LOANS | Pass | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 1,076,201 | ||
REAL ESTATE LOANS | Pass | Commercial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 66,350 | ||
2021 | 76,834 | ||
2020 | 44,759 | ||
2019 | 39,148 | ||
2018 | 14,911 | ||
Prior | 60,167 | ||
Total loans receivable | 302,169 | 253,092 | |
REAL ESTATE LOANS | Pass | Construction and development | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 151,853 | ||
2021 | 133,335 | ||
2020 | 29,720 | ||
2019 | 19,823 | ||
Prior | 446 | ||
Total loans receivable | 335,177 | 240,553 | |
REAL ESTATE LOANS | Pass | Home equity. | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 5,339 | ||
2021 | 1,707 | ||
2020 | 7,082 | ||
2019 | 11 | ||
2018 | 1,238 | ||
Prior | 1,680 | ||
Revolving Loans | 36,446 | ||
Total loans receivable | 53,503 | 40,716 | |
REAL ESTATE LOANS | Pass | One-to-four-family | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 121,163 | ||
2021 | 133,680 | ||
2020 | 81,292 | ||
2019 | 32,264 | ||
2018 | 16,307 | ||
Prior | 41,699 | ||
Total loans receivable | 426,405 | 363,682 | |
REAL ESTATE LOANS | Pass | Multi-family | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 33,930 | ||
2021 | 63,549 | ||
2020 | 48,598 | ||
2019 | 48,080 | ||
2018 | 4,206 | ||
Prior | 25,349 | ||
Total loans receivable | 223,712 | 178,158 | |
REAL ESTATE LOANS | Watch | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 4,652 | ||
REAL ESTATE LOANS | Watch | Commercial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2020 | 2,071 | ||
Revolving Loans | 128 | ||
Total loans receivable | 2,199 | 4,652 | |
REAL ESTATE LOANS | Special Mention | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 5,769 | ||
REAL ESTATE LOANS | Special Mention | Commercial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2019 | 2,127 | ||
Prior | 898 | ||
Total loans receivable | 3,025 | 5,769 | |
REAL ESTATE LOANS | Special Mention | One-to-four-family | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2018 | 1,950 | ||
Total loans receivable | 1,950 | ||
REAL ESTATE LOANS | Substandard | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 3,681 | ||
REAL ESTATE LOANS | Substandard | Commercial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2018 | 586 | ||
Prior | 2,944 | ||
Total loans receivable | 3,530 | 916 | |
REAL ESTATE LOANS | Substandard | Home equity. | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2018 | 13 | ||
Prior | 165 | ||
Total loans receivable | 178 | 301 | |
REAL ESTATE LOANS | Substandard | One-to-four-family | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Prior | 841 | ||
Total loans receivable | 841 | 2,464 | |
CONSUMER LOANS | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 212,524 | ||
2021 | 144,687 | ||
2020 | 66,127 | ||
2019 | 40,126 | ||
2018 | 25,411 | ||
Prior | 28,465 | ||
Revolving Loans | 1,215 | ||
Total loans receivable | 518,555 | 422,043 | 411,094 |
CONSUMER LOANS | Indirect home improvement | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 188,256 | ||
2021 | 131,785 | ||
2020 | 50,306 | ||
2019 | 33,341 | ||
2018 | 19,547 | ||
Prior | 24,218 | ||
Revolving Loans | 9 | ||
Total loans receivable | 447,462 | 336,285 | |
CONSUMER LOANS | Marine | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 23,616 | ||
2021 | 12,123 | ||
2020 | 15,693 | ||
2019 | 6,745 | ||
2018 | 5,830 | ||
Prior | 4,099 | ||
Total loans receivable | 68,106 | 82,778 | |
CONSUMER LOANS | Other consumer loans | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 652 | ||
2021 | 779 | ||
2020 | 128 | ||
2019 | 40 | ||
2018 | 34 | ||
Prior | 148 | ||
Revolving Loans | 1,206 | ||
Total loans receivable | 2,987 | 2,980 | |
CONSUMER LOANS | Pass | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 421,414 | ||
CONSUMER LOANS | Pass | Indirect home improvement | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 188,174 | ||
2021 | 131,661 | ||
2020 | 50,247 | ||
2019 | 33,222 | ||
2018 | 19,452 | ||
Prior | 24,076 | ||
Revolving Loans | 9 | ||
Total loans receivable | 446,841 | 335,731 | |
CONSUMER LOANS | Pass | Marine | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 23,491 | ||
2021 | 12,123 | ||
2020 | 15,693 | ||
2019 | 6,745 | ||
2018 | 5,830 | ||
Prior | 4,043 | ||
Total loans receivable | 67,925 | 82,721 | |
CONSUMER LOANS | Pass | Other consumer loans | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 652 | ||
2021 | 779 | ||
2020 | 128 | ||
2019 | 40 | ||
2018 | 34 | ||
Prior | 148 | ||
Revolving Loans | 1,206 | ||
Total loans receivable | 2,987 | 2,962 | |
CONSUMER LOANS | Substandard | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 629 | ||
CONSUMER LOANS | Substandard | Indirect home improvement | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 82 | ||
2021 | 124 | ||
2020 | 59 | ||
2019 | 119 | ||
2018 | 95 | ||
Prior | 142 | ||
Total loans receivable | 621 | 554 | |
CONSUMER LOANS | Substandard | Marine | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 125 | ||
Prior | 56 | ||
Total loans receivable | 181 | 57 | |
CONSUMER LOANS | Substandard | Other consumer loans | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 18 | ||
COMMERCIAL BUSINESS LOANS | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 19,348 | ||
2021 | 25,956 | ||
2020 | 20,393 | ||
2019 | 6,902 | ||
2018 | 3,731 | ||
Prior | 12,657 | ||
Revolving Loans | 150,124 | ||
Total loans receivable | 239,111 | 241,829 | $ 255,627 |
COMMERCIAL BUSINESS LOANS | Commercial and industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 19,348 | ||
2021 | 25,956 | ||
2020 | 20,393 | ||
2019 | 6,902 | ||
2018 | 3,731 | ||
Prior | 12,657 | ||
Revolving Loans | 122,022 | ||
Total loans receivable | 211,009 | 208,552 | |
COMMERCIAL BUSINESS LOANS | Warehouse lending | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Revolving Loans | 28,102 | ||
Total loans receivable | 28,102 | 33,277 | |
COMMERCIAL BUSINESS LOANS | Pass | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 222,044 | ||
COMMERCIAL BUSINESS LOANS | Pass | Commercial and industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2022 | 19,348 | ||
2021 | 24,348 | ||
2020 | 15,714 | ||
2019 | 3,940 | ||
2018 | 3,530 | ||
Prior | 8,029 | ||
Revolving Loans | 114,581 | ||
Total loans receivable | 189,490 | 188,767 | |
COMMERCIAL BUSINESS LOANS | Pass | Warehouse lending | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Revolving Loans | 28,101 | ||
Total loans receivable | 28,101 | 33,277 | |
COMMERCIAL BUSINESS LOANS | Watch | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 4,182 | ||
COMMERCIAL BUSINESS LOANS | Watch | Commercial and industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2021 | 13 | ||
2020 | 3,073 | ||
Prior | 205 | ||
Revolving Loans | 5,460 | ||
Total loans receivable | 8,751 | 4,182 | |
COMMERCIAL BUSINESS LOANS | Watch | Warehouse lending | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Revolving Loans | 1 | ||
Total loans receivable | 1 | ||
COMMERCIAL BUSINESS LOANS | Special Mention | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 1,829 | ||
COMMERCIAL BUSINESS LOANS | Special Mention | Commercial and industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2019 | 667 | ||
2018 | 14 | ||
Prior | 44 | ||
Revolving Loans | 773 | ||
Total loans receivable | 1,498 | 1,829 | |
COMMERCIAL BUSINESS LOANS | Substandard | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Total loans receivable | 13,774 | ||
COMMERCIAL BUSINESS LOANS | Substandard | Commercial and industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
2021 | 1,595 | ||
2020 | 1,606 | ||
2019 | 2,295 | ||
2018 | 187 | ||
Prior | 4,379 | ||
Revolving Loans | 1,208 | ||
Total loans receivable | $ 11,270 | $ 13,774 |
LOANS RECEIVABLE AND ALLOWAN_11
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS - Amortized Cost Basis of Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Financing Receivable, Recorded Investment [Line Items] | |||||
Nonaccrual with no Allowance for Credit Losses | $ 1,019 | $ 1,019 | |||
Nonaccrual with Allowance for Credit Losses | 7,222 | 7,222 | |||
Total Nonaccrual | 8,241 | 8,241 | |||
Recognized interest income on nonaccrual loans | 144 | $ 115 | 370 | $ 261 | |
REAL ESTATE LOANS | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Nonaccrual with no Allowance for Credit Losses | 1,019 | 1,019 | |||
Total Nonaccrual | 1,019 | 1,019 | |||
REAL ESTATE LOANS | Home equity. | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Nonaccrual with no Allowance for Credit Losses | 178 | 178 | |||
Total Nonaccrual | 178 | 178 | |||
REAL ESTATE LOANS | One-to-four-family | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Nonaccrual with no Allowance for Credit Losses | 841 | 841 | |||
Total Nonaccrual | 841 | 841 | |||
CONSUMER LOANS | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Nonaccrual with Allowance for Credit Losses | 802 | 802 | |||
Total Nonaccrual | 802 | 802 | |||
CONSUMER LOANS | Indirect home improvement | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Nonaccrual with Allowance for Credit Losses | 621 | 621 | |||
Total Nonaccrual | 621 | 621 | |||
CONSUMER LOANS | Marine | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Nonaccrual with Allowance for Credit Losses | 181 | 181 | |||
Total Nonaccrual | 181 | 181 | |||
COMMERCIAL BUSINESS LOANS | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total Nonaccrual | 3,800 | 3,800 | $ 0 | ||
COMMERCIAL BUSINESS LOANS | Commercial and industrial | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Nonaccrual with Allowance for Credit Losses | 6,420 | 6,420 | |||
Total Nonaccrual | $ 6,420 | $ 6,420 |
LOANS RECEIVABLE AND ALLOWAN_12
LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES - LOANS - Amortized Cost Basis of Collateral Dependent Impaired Loans (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | $ 8,241 |
Real Estate | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 1,019 |
Equipment | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 7,222 |
REAL ESTATE LOANS | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 1,019 |
REAL ESTATE LOANS | Home equity. | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 178 |
REAL ESTATE LOANS | One-to-four-family | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 841 |
REAL ESTATE LOANS | Real Estate | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 1,019 |
REAL ESTATE LOANS | Real Estate | Home equity. | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 178 |
REAL ESTATE LOANS | Real Estate | One-to-four-family | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 841 |
CONSUMER LOANS | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 802 |
CONSUMER LOANS | Indirect home improvement | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 621 |
CONSUMER LOANS | Marine | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 181 |
CONSUMER LOANS | Equipment | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 802 |
CONSUMER LOANS | Equipment | Indirect home improvement | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 621 |
CONSUMER LOANS | Equipment | Marine | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 181 |
COMMERCIAL BUSINESS LOANS | Commercial and industrial | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | 6,420 |
COMMERCIAL BUSINESS LOANS | Equipment | Commercial and industrial | |
Financing Receivable, Recorded Investment [Line Items] | |
Amortized cost basis of collateral dependent impaired loans | $ 6,420 |
SERVICING RIGHTS - Narrative (D
SERVICING RIGHTS - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Off-balance Sheet Risks, Disclosure Information [Line Items] | |||||
Contractually specified servicing fees, late fees, and other ancillary fees | $ 1.8 | $ 1.7 | $ 5.3 | $ 4.6 | |
Mortgage servicing rights. | |||||
Off-balance Sheet Risks, Disclosure Information [Line Items] | |||||
The unpaid principal balances of mortgage loans serviced | 2,800 | 2,800 | $ 2,610 | ||
Fair market value of servicing rights' assets | $ 36.5 | $ 36.5 | $ 26.1 |
SERVICING RIGHTS - Servicing Ri
SERVICING RIGHTS - Servicing Rights (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Servicing Asset at Fair Value, Amount [Roll Forward] | ||||
Beginning balance, at the lower of cost or fair value | $ 18,516 | $ 16,356 | $ 16,970 | $ 12,595 |
Additions | 925 | 1,967 | 4,935 | 7,567 |
Servicing rights amortized | (971) | (1,837) | (3,436) | (5,722) |
Recovery of servicing rights | 11 | 1 | 2,057 | |
Ending balance, at the lower of cost or fair value | $ 18,470 | $ 16,497 | $ 18,470 | $ 16,497 |
SERVICING RIGHTS - Valuation As
SERVICING RIGHTS - Valuation Assumptions (Details) - Mortgage servicing rights. | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Weighted average discount rate | 9.10% | 9.10% |
Conditional prepayment rate ("CPR") | 8.20% | 13.80% |
Weighted average life in years | 7 years 10 months 24 days | 5 years 10 months 24 days |
SERVICING RIGHTS - Changes in V
SERVICING RIGHTS - Changes in Valuation Assumptions (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Basis Points Drop in Rate, Assumption One | 0.50% | 0.50% |
Basis Points Drop in Rate, Assumption Two | 1% | 1% |
Mortgage servicing rights. | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Aggregate portfolio principal balance | $ 2,797,326 | $ 2,609,776 |
Weighted average rate of note | 3.30% | 3.20% |
Conditional prepayment rate, base | 8.20% | 13.80% |
Conditional prepayment rate, 0.5% Adverse Change | 8.40% | 20% |
Conditional prepayment rate, 1.0% Adverse Change | 8.90% | 31.50% |
Fair value MSR, base | $ 36,457 | $ 26,070 |
Fair value MSR, 0.5% Adverse Change | 36,085 | 21,188 |
Fair value of MSR, 1.0% Adverse Change | $ 35,398 | $ 15,348 |
Percentage of MSR, base | 1.30% | 1% |
Percentage of MSR, 0.5% Adverse Change | 1.30% | 0.80% |
Percentage of MSR, 1.0% Adverse Change | 1.30% | 0.60% |
Discount rate, base | 9.10% | 9.10% |
Discount rate, 0.5% Adverse Change | 9.60% | 9.60% |
Discount rate, 1.0% Adverse Change | 10.10% | 10.10% |
Fair value MSR, 0.5% Adverse Change | $ 35,653 | $ 25,586 |
Fair value MSR, 1.0% Adverse Change | $ 34,881 | $ 25,119 |
Percentage of MSR, 0.5% Adverse Change | 1.30% | 1% |
Percentage of MSR, 1.0% Adverse Change | 1.20% | 1% |
DERIVATIVES (Details)
DERIVATIVES (Details) $ in Millions | Sep. 30, 2022 USD ($) |
Derivative [Line Items] | |
Reclassification to interest expense related to cash flow hedges over next 12 months | $ 3.3 |
DERIVATIVES - Cumulative-basis
DERIVATIVES - Cumulative-basis Adjustment for Fair Value Hedges (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value hedges | $ 0 | |
Fair Value Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Carrying Amount of the Hedged Assets/(Liabilities) | $ 55,684 | |
Cumulative Amount of Fair Value Hedging Adjustment Included in Carrying Amount of the Hedged Assets/(Liabilities) | 4,316 | |
Amortized cost basis of closed portfolios used in hedging relationships | 250,200 | |
Amount of designated hedged item | $ 60,000 |
DERIVATIVES - Derivative instru
DERIVATIVES - Derivative instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Designated as Hedging Instrument | Interest rate swaps | Cash Flow Hedges | ||
Derivative [Line Items] | ||
Notional | $ 90,000 | $ 90,000 |
Fair Value, Asset | 6,117 | 1,168 |
Fair Value, Liability | 0 | 155 |
Designated as Hedging Instrument | Interest rate swaps | Fair Value Hedges | ||
Derivative [Line Items] | ||
Notional | 60,000 | |
Fair Value, Asset | 4,301 | |
Fair Value, Liability | 0 | |
Not Designated as Hedging Instrument | Interest rate lock commitments with customers | ||
Derivative [Line Items] | ||
Notional | 23,766 | 71,890 |
Fair Value, Asset | 0 | 757 |
Fair Value, Liability | 172 | 0 |
Not Designated as Hedging Instrument | Mandatory and best effort forward commitments | ||
Derivative [Line Items] | ||
Notional | 6,845 | 74,375 |
Fair Value, Asset | 294 | 808 |
Fair Value, Liability | 0 | 0 |
Not Designated as Hedging Instrument | Forward TBA mortgage-backed securities | ||
Derivative [Line Items] | ||
Notional | 33,000 | 111,000 |
Fair Value, Asset | 1,154 | 53 |
Fair Value, Liability | $ 0 | $ 0 |
DERIVATIVES - Effect of Fair Va
DERIVATIVES - Effect of Fair Value and Cash Flow Hedge Accounting (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
DERIVATIVES | ||||
Realized gains (losses) (pre-tax) reclassified from AOCI into net income | $ 278 | $ (135) | $ 232 | $ (373) |
Changes in the fair value of the non hedging derivatives | 34 | (402) | (1,700) | (4,300) |
Interest rate swaps | Interest Expense Deposits | ||||
DERIVATIVES | ||||
Total amounts presented on the Consolidated Statements of Income | 2,596 | 1,629 | 5,438 | 5,481 |
Interest rate swaps | Interest Income Securities | ||||
DERIVATIVES | ||||
Total amounts presented on the Consolidated Statements of Income | 1,741 | 1,487 | 4,990 | 4,050 |
Fair Value Hedges | Interest rate swaps | Interest Income Securities | ||||
DERIVATIVES | ||||
Net gains (losses) on fair value hedging relationships - Recognized on hedged items | (3,383) | (4,316) | ||
Net gains (losses) on fair value hedging relationships - Recognized on derivatives designated as hedging instruments | 3,313 | 4,144 | ||
Net income (expense) recognized on fair value hedges | (70) | (172) | ||
Cash Flow Hedges | Interest rate swaps | Interest Expense Deposits | ||||
DERIVATIVES | ||||
Realized gains (losses) (pre-tax) reclassified from AOCI into net income | 278 | (135) | 232 | (373) |
Net income (expense) recognized on cash flow hedges | $ 278 | $ (135) | $ 232 | $ (373) |
DERIVATIVES - Offsetting Deriva
DERIVATIVES - Offsetting Derivative Assets (Details) - Interest rate swaps - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Offsetting Assets [Line Items] | ||
Gross Amounts of Recognized Assets | $ 10,418 | $ 1,168 |
Net Amounts of Assets Presented in the Statement of Financial Position | 10,418 | 1,168 |
Gross Amounts Not Offset in the Statement of Financial Position - Net Amount | $ 10,418 | $ 1,168 |
DERIVATIVES - Offsetting Deri_2
DERIVATIVES - Offsetting Derivative Liabilities (Details) - Interest rate swaps $ in Thousands | Dec. 31, 2021 USD ($) |
Offsetting Liabilities [Line Items] | |
Gross Amounts of Recognized Liabilities | $ 155 |
Net Amounts of Liabilities Presented in the Statement of Financial Position | 155 |
Gross Amounts Not Offset in the Statement of Financial Position - Cash Collateral Posted | $ 155 |
DERIVATIVES - Credit-risk-relat
DERIVATIVES - Credit-risk-related Contingent Features (Details) | Sep. 30, 2022 USD ($) |
Credit-risk-related Contingent Features | |
Derivative, net liability position | $ 0 |
Carrying value of collateral already posted | 2,800,000 |
Interest rate swaps | |
Credit-risk-related Contingent Features | |
Cash collateral for borrowed securities | 680,000 |
Collateral for TBA Trades [Member] | |
Credit-risk-related Contingent Features | |
Cash collateral for borrowed securities | $ 170,000 |
LEASES (Details)
LEASES (Details) | 9 Months Ended |
Sep. 30, 2022 | |
Lessee, Lease, Description [Line Items] | |
Options to extend | true |
Renewal term | 5 years |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Remaining lease terms | 2 months |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Remaining lease terms | 7 years 9 months |
LEASES - Components of lease co
LEASES - Components of lease cost and Supplemental information related to operating leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Lease cost: | ||||
Operating lease cost | $ 350 | $ 353 | $ 1,041 | $ 1,063 |
Short-term lease cost | 8 | 2 | 16 | 3 |
Total lease cost | 358 | 355 | 1,057 | 1,066 |
Operating cash flows from operating leases | $ 360 | $ 329 | $ 1,063 | $ 1,058 |
Weighted average remaining lease term- operating leases | 4 years 8 months 12 days | 4 years 10 months 24 days | 4 years 8 months 12 days | 4 years 10 months 24 days |
Weighted average discount rate- operating leases | 2.41% | 2.18% | 2.41% | 2.18% |
LEASES - Maturities of operatin
LEASES - Maturities of operating lease liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Maturities of operating lease liabilities | ||
2022 | $ 420 | |
2023 | 1,512 | |
2024 | 1,462 | |
2025 | 1,152 | |
2026 | 1,030 | |
Thereafter | 1,996 | |
Total lease payments | 7,572 | |
Less imputed interest | (736) | |
Total | $ 6,836 | $ 4,792 |
OTHER REAL ESTATE OWNED (OREO_2
OTHER REAL ESTATE OWNED (OREO) - Activity related to OREO (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Other Real Estate [Roll Forward] | ||||
Beginning balance | $ 145 | $ 0 | $ 0 | $ 90 |
Additions | 145 | |||
Gross proceeds from sale of OREO | (81) | |||
Loss on sale of OREO | (9) | |||
Ending balance | $ 145 | $ 0 | $ 145 | $ 0 |
OTHER REAL ESTATE OWNED (OREO_3
OTHER REAL ESTATE OWNED (OREO) - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) property | Sep. 30, 2021 USD ($) property | Sep. 30, 2022 USD ($) property | Sep. 30, 2021 USD ($) property | |
OTHER REAL ESTATE OWNED ("OREO") | ||||
Number of OREO Properties | property | 1 | 0 | 1 | 0 |
Holding costs | $ 10 | $ 0 | $ 10 | $ 0 |
Mortgage loans in process of foreclosure | $ 526 | $ 526 |
DEPOSITS - Deposit Liabilities
DEPOSITS - Deposit Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
DEPOSITS | ||
Noninterest-bearing checking | $ 555,753 | $ 564,360 |
Interest-bearing checking | 147,968 | 228,024 |
Savings | 143,612 | 193,922 |
Money market | 659,861 | 552,357 |
Certificates of deposit less than $100,000 | 345,227 | 186,974 |
Certificates of deposit of $100,000 through $250,000 | 133,429 | 116,206 |
Certificates of deposit of $250,000 and over | 71,629 | 57,512 |
Escrow accounts related to mortgages serviced | 25,859 | 16,389 |
Total deposits | 2,083,338 | 1,915,744 |
Interest-bearing domestic deposit, brokered deposits | 1,200 | 90,000 |
Deposits, money market deposits, brokered deposits | 66,800 | 5,000 |
Certificates of deposits less than 100000 brokered deposits | $ 256,600 | 97,600 |
Interest-bearing to noninterest-bearing due to reclass | $ 121,200 |
DEPOSITS - Maturities of Time D
DEPOSITS - Maturities of Time Deposits for Future Periods (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
DEPOSITS | |
Maturing in 2022 | $ 137,460 |
Maturing in 2023 | 210,943 |
Maturing in 2024 | 54,019 |
Maturing in 2025 | 111,811 |
Maturing in 2026 | 18,439 |
Thereafter | 17,613 |
Total | $ 550,285 |
DEPOSITS - Interest Expense by
DEPOSITS - Interest Expense by Deposit Category (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
DEPOSITS | ||||
Interest-bearing checking | $ 100 | $ 56 | $ 353 | $ 154 |
Savings and money market | 1,303 | 348 | 2,397 | 1,232 |
Certificates of deposit | 1,193 | 1,225 | 2,688 | 4,095 |
Total | $ 2,596 | $ 1,629 | $ 5,438 | $ 5,481 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Commitment (Details) - Commitments to Extend Credit - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | $ 628,760 | $ 558,631 |
REAL ESTATE LOANS. | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | 372,239 | 332,378 |
Commercial | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | 1,634 | 787 |
Construction and development | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | 245,139 | 182,297 |
One-to-four-family | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | 43,191 | 78,264 |
Home equity. | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | 79,283 | 67,596 |
Multi-family | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | 2,992 | 3,434 |
CONSUMER LOANS. | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | 42,289 | 35,873 |
COMMERCIAL BUSINESS LOANS. | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | 214,232 | 190,380 |
Commercial and industrial | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | 143,881 | 126,220 |
Warehouse lending | ||
Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments | $ 70,351 | $ 64,160 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Narrative (Details) | 9 Months Ended | |
Sep. 30, 2022 USD ($) action | Dec. 31, 2021 USD ($) | |
Loss Contingencies [Line Items] | ||
Allowance for unfunded loan commitments | $ 3,100,000 | $ 499,000 |
Amount of loans sold to FHLB | 10,200,000 | |
Federal Home Loan Bank, First Loss Account Established | 938,000 | |
Bank recourse obligation | $ 811,000 | |
Bank recourse obligation, percentage of loans outstanding | 7.90% | |
Holdback as a percentage of outstanding CE | 10% | |
Holdback for loans sold to FHLB | $ 81,000 | |
Outstanding delinquencies on loans sold to Federal Home Loan Bank | $ 0 | 0 |
Change of control agreement, executive payment, period following change in control (in months) | 12 months | |
Pending material legal actions | action | 0 | |
CEO | ||
Loss Contingencies [Line Items] | ||
Severance agreement, period of base compensation disbursed as lump sum payment (in months) | 24 months | |
Maximum | ||
Loss Contingencies [Line Items] | ||
Change of control agreement, executive payment, period prior to change in control (in months) | 6 months | |
Change of control agreement, period of base compensation disbursed as lump sum payment (in months) | 12 months | |
Minimum | ||
Loss Contingencies [Line Items] | ||
Change of control agreement, notice required to cancel agreement (in months) | 24 months | |
One-to-four-family | Guarantee on loans sold | ||
Loss Contingencies [Line Items] | ||
Reserve for estimated losses | $ 2,300,000 | $ 2,700,000 |
FAIR VALUE MEASUREMENTS - Avail
FAIR VALUE MEASUREMENTS - Available for Sale Securities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans receivable, at fair value | $ 14,198 | $ 16,083 |
Level 2 | Residential Mortgage | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans receivable, at fair value | 14,200 | 16,100 |
The unpaid principal balances of mortgage loans serviced | 16,000 | 16,100 |
Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 277,453 | 416,038 |
Total liabilities measured at fair value | (172) | (155) |
Fair Value, Measurements, Recurring | Mortgage loans held for sale | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 23,447 | 125,810 |
Fair Value, Measurements, Recurring | Residential Mortgage | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans receivable, at fair value | 14,198 | 16,083 |
Fair Value, Measurements, Recurring | Securities available-for-sale. | U.S. agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 18,137 | 20,970 |
Fair Value, Measurements, Recurring | Securities available-for-sale. | Corporate securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 8,616 | 9,002 |
Fair Value, Measurements, Recurring | Securities available-for-sale. | Municipal bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 116,644 | 135,433 |
Fair Value, Measurements, Recurring | Securities available-for-sale. | Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 71,077 | 89,402 |
Fair Value, Measurements, Recurring | Securities available-for-sale. | U.S. Small Business Administration securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 13,468 | 16,552 |
Fair Value, Measurements, Recurring | Derivative | Mandatory and best effort forward commitments with investors | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 294 | 808 |
Fair Value, Measurements, Recurring | Derivative | Forward TBA mortgage backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 1,154 | 53 |
Fair Value, Measurements, Recurring | Derivative | Interest rate swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 10,418 | 1,168 |
Total liabilities measured at fair value | (155) | |
Fair Value, Measurements, Recurring | Derivative | Interest rate lock commitments with customers | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 757 | |
Total liabilities measured at fair value | (172) | |
Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Total liabilities measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Mortgage loans held for sale | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Residential Mortgage | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans receivable, at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Securities available-for-sale. | U.S. agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Securities available-for-sale. | Corporate securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Securities available-for-sale. | Municipal bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Securities available-for-sale. | Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Securities available-for-sale. | U.S. Small Business Administration securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Derivative | Mandatory and best effort forward commitments with investors | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Derivative | Forward TBA mortgage backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Derivative | Interest rate swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Total liabilities measured at fair value | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Derivative | Interest rate lock commitments with customers | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | |
Total liabilities measured at fair value | 0 | |
Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 277,159 | 413,335 |
Total liabilities measured at fair value | 0 | (155) |
Fair Value, Measurements, Recurring | Level 2 | Mortgage loans held for sale | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 23,447 | 125,810 |
Fair Value, Measurements, Recurring | Level 2 | Residential Mortgage | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans receivable, at fair value | 14,198 | 16,083 |
Fair Value, Measurements, Recurring | Level 2 | Securities available-for-sale. | U.S. agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 18,137 | 20,970 |
Fair Value, Measurements, Recurring | Level 2 | Securities available-for-sale. | Corporate securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 8,616 | 7,995 |
Fair Value, Measurements, Recurring | Level 2 | Securities available-for-sale. | Municipal bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 116,644 | 135,302 |
Fair Value, Measurements, Recurring | Level 2 | Securities available-for-sale. | Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 71,077 | 89,402 |
Fair Value, Measurements, Recurring | Level 2 | Securities available-for-sale. | U.S. Small Business Administration securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 13,468 | 16,552 |
Fair Value, Measurements, Recurring | Level 2 | Derivative | Mandatory and best effort forward commitments with investors | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 2 | Derivative | Forward TBA mortgage backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 1,154 | 53 |
Fair Value, Measurements, Recurring | Level 2 | Derivative | Interest rate swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 10,418 | 1,168 |
Total liabilities measured at fair value | (155) | |
Fair Value, Measurements, Recurring | Level 2 | Derivative | Interest rate lock commitments with customers | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | |
Total liabilities measured at fair value | 0 | |
Fair Value, Measurements, Recurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 294 | 2,703 |
Total liabilities measured at fair value | (172) | 0 |
Fair Value, Measurements, Recurring | Level 3 | Mortgage loans held for sale | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Residential Mortgage | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans receivable, at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Securities available-for-sale. | U.S. agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Securities available-for-sale. | Corporate securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 1,007 |
Fair Value, Measurements, Recurring | Level 3 | Securities available-for-sale. | Municipal bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 131 |
Fair Value, Measurements, Recurring | Level 3 | Securities available-for-sale. | Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Securities available-for-sale. | U.S. Small Business Administration securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Derivative | Mandatory and best effort forward commitments with investors | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 294 | 808 |
Fair Value, Measurements, Recurring | Level 3 | Derivative | Forward TBA mortgage backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Derivative | Interest rate swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 0 | 0 |
Total liabilities measured at fair value | 0 | |
Fair Value, Measurements, Recurring | Level 3 | Derivative | Interest rate lock commitments with customers | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | $ 757 | |
Total liabilities measured at fair value | $ (172) |
FAIR VALUE MEASUREMENTS - Loans
FAIR VALUE MEASUREMENTS - Loans Individually Evaluated, OREO and Servicing Rights on Non-recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other real estate owned | $ 145 | |
Fair Value, Measurements, Nonrecurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans individually evaluated | 8,241 | $ 5,829 |
Other real estate owned | 145 | |
Servicing rights. | 36,457 | 26,070 |
Fair Value, Measurements, Nonrecurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans individually evaluated | 0 | 0 |
Other real estate owned | 0 | |
Servicing rights. | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans individually evaluated | 0 | 0 |
Other real estate owned | 0 | |
Servicing rights. | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans individually evaluated | 8,241 | 5,829 |
Other real estate owned | 145 | |
Servicing rights. | $ 36,457 | $ 26,070 |
FAIR VALUE MEASUREMENTS - Disco
FAIR VALUE MEASUREMENTS - Discount Rate (Details) | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Measurements, Recurring | Interest rate lock commitments with customers | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale, Valuation Technique [Extensible List] | fsbw:QuotedMarketPricesMember | fsbw:QuotedMarketPricesMember |
Debt Securities, Available-for-sale, Measurement Input [Extensible List] | fsbw:MeasurementInputPullThroughExpectationsMember | fsbw:MeasurementInputPullThroughExpectationsMember |
Fair Value, Measurements, Recurring | Individual forward sale commitments with investors | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale, Valuation Technique [Extensible List] | fsbw:QuotedMarketPricesMember | fsbw:QuotedMarketPricesMember |
Debt Securities, Available-for-sale, Measurement Input [Extensible List] | fsbw:MeasurementInputPullThroughExpectationsMember | fsbw:MeasurementInputPullThroughExpectationsMember |
Fair Value, Measurements, Nonrecurring | Impaired Loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale, Valuation Technique [Extensible List] | fsbw:FairValueOfUnderlyingCollateralMember | fsbw:FairValueOfUnderlyingCollateralMember |
Debt Securities, Available-for-sale, Measurement Input [Extensible List] | fsbw:MeasurementInputDiscountAppliedToObtainedAppraisalMember | fsbw:MeasurementInputDiscountAppliedToObtainedAppraisalMember |
Fair Value, Measurements, Nonrecurring | OREO | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale, Valuation Technique [Extensible List] | fsbw:FairValueOfCollateralMember | fsbw:FairValueOfCollateralMember |
Debt Securities, Available-for-sale, Measurement Input [Extensible List] | fsbw:MeasurementInputDiscountAppliedToObtainedAppraisalMember | fsbw:MeasurementInputDiscountAppliedToObtainedAppraisalMember |
Fair Value, Measurements, Nonrecurring | Servicing rights | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale, Valuation Technique [Extensible List] | fsbw:IndustrySourcesMember | fsbw:IndustrySourcesMember |
Debt Securities, Available-for-sale, Measurement Input [Extensible List] | fsbw:PrepaymentSpeedsMember | fsbw:PrepaymentSpeedsMember |
Level 3 | Fair Value, Measurements, Recurring | Interest rate lock commitments with customers | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.80 | 0.80 |
Level 3 | Fair Value, Measurements, Recurring | Interest rate lock commitments with customers | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.99 | 0.99 |
Level 3 | Fair Value, Measurements, Recurring | Interest rate lock commitments with customers | Weighted Average | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.973 | 0.933 |
Level 3 | Fair Value, Measurements, Recurring | Individual forward sale commitments with investors | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.80 | 0.80 |
Level 3 | Fair Value, Measurements, Recurring | Individual forward sale commitments with investors | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.99 | 0.99 |
Level 3 | Fair Value, Measurements, Recurring | Individual forward sale commitments with investors | Weighted Average | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.973 | 0.933 |
Level 3 | Fair Value, Measurements, Nonrecurring | Impaired Loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.100 | 0.100 |
Level 3 | Fair Value, Measurements, Nonrecurring | Impaired Loans | Weighted Average | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.100 | 0.100 |
Level 3 | Fair Value, Measurements, Nonrecurring | OREO | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.100 | 0.100 |
Level 3 | Fair Value, Measurements, Nonrecurring | OREO | Weighted Average | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.100 | 0.100 |
Level 3 | Fair Value, Measurements, Nonrecurring | Servicing rights | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0 | 0 |
Level 3 | Fair Value, Measurements, Nonrecurring | Servicing rights | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.50 | 0.50 |
Level 3 | Fair Value, Measurements, Nonrecurring | Servicing rights | Weighted Average | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement inputs (as a percent) | 0.082 | 0.138 |
FAIR VALUE MEASUREMENTS - Fair
FAIR VALUE MEASUREMENTS - Fair Value Level 3 on recurring basis (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Interest rate lock commitments with customers | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning Balance | $ 184 | $ 2,106 | $ 757 | $ 4,024 |
Purchases and Issuances | 472 | 4,920 | 2,589 | 19,780 |
Sales and Settlements | (828) | (5,855) | (3,518) | (22,633) |
Ending Balance | (172) | 1,171 | (172) | 1,171 |
Net change in fair value for gains/(losses) relating to items held at end of period included in income | (356) | (935) | (929) | (2,853) |
Individual forward sale commitments with investors | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning Balance | 518 | (553) | 808 | (67) |
Purchases and Issuances | 899 | 1,081 | 5,972 | 534 |
Sales and Settlements | (1,123) | 30 | (6,486) | 91 |
Ending Balance | 294 | 558 | 294 | 558 |
Net change in fair value for gains/(losses) relating to items held at end of period included in income | $ (224) | $ 1,111 | $ (514) | $ 625 |
FAIR VALUE MEASUREMENTS - Fai_2
FAIR VALUE MEASUREMENTS - Fair Value By Balance Sheet Grouping (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
Financial Assets | |||
Certificates of deposit at other financial institutions | $ 4,960 | $ 10,542 | |
Securities available-for-sale, at fair value | 227,942 | 271,359 | |
Securities held-to-maturity | 8,500 | 7,500 | |
Loans held for sale, at fair value | 23,447 | 125,810 | |
Loans receivable, at fair value | 14,198 | 16,083 | |
Loans receivable, gross | 2,110,355 | 1,754,175 | $ 1,704,968 |
Carrying Amount | Level 1 | |||
Financial Assets | |||
Cash and cash equivalents | 159,797 | 26,491 | |
Certificates of deposit at other financial institutions | 4,960 | 10,542 | |
Carrying Amount | Level 2 | |||
Financial Assets | |||
Securities available-for-sale, at fair value | 227,942 | 271,359 | |
Securities held-to-maturity | 8,500 | 7,500 | |
Loans held for sale, at fair value | 23,447 | 125,810 | |
FHLB stock, at cost | 13,591 | 4,778 | |
Forward TBA mortgage-backed securities | 1,154 | 53 | |
Loans receivable, at fair value | 14,198 | 16,083 | |
Interest rate swaps | 10,418 | 1,168 | |
Accrued interest receivable | 10,407 | 7,594 | |
Financial Liabilities | |||
Deposits | 2,083,338 | 1,915,744 | |
Borrowings | 260,828 | 42,528 | |
Subordinated notes, excluding unamortized debt issuance costs | 50,000 | 50,000 | |
Accrued interest payable | 1,200 | 766 | |
Interest rate swaps | 155 | ||
Carrying Amount | Level 3 | |||
Financial Assets | |||
Loans receivable, gross | 2,096,157 | 1,738,092 | |
Servicing rights, held at lower of cost or fair value | 18,470 | 16,970 | |
Fair value interest rate locks with customers | 757 | ||
Mandatory and best effort forward commitments with investors | 294 | 808 | |
Financial Liabilities | |||
Fair value interest rate locks with customers | 172 | ||
Fair Value | Level 1 | |||
Financial Assets | |||
Cash and cash equivalents | 159,797 | 26,491 | |
Certificates of deposit at other financial institutions | 4,960 | 10,542 | |
Fair Value | Level 2 | |||
Financial Assets | |||
Securities available-for-sale, at fair value | 227,942 | 271,359 | |
Securities held-to-maturity | 7,950 | 8,128 | |
Loans held for sale, at fair value | 23,447 | 125,810 | |
FHLB stock, at cost | 13,591 | 4,778 | |
Forward TBA mortgage-backed securities | 1,154 | 53 | |
Loans receivable, at fair value | 14,198 | 16,083 | |
Interest rate swaps | 10,418 | 1,168 | |
Accrued interest receivable | 10,407 | 7,594 | |
Financial Liabilities | |||
Deposits | 2,060,539 | 1,912,498 | |
Borrowings | 260,058 | 43,365 | |
Subordinated notes, excluding unamortized debt issuance costs | 44,500 | 51,688 | |
Accrued interest payable | 1,200 | 766 | |
Interest rate swaps | 155 | ||
Fair Value | Level 3 | |||
Financial Assets | |||
Loans receivable, gross | 2,030,648 | 1,725,651 | |
Servicing rights, held at lower of cost or fair value | 36,457 | 26,070 | |
Fair value interest rate locks with customers | 757 | ||
Mandatory and best effort forward commitments with investors | 294 | $ 808 | |
Financial Liabilities | |||
Fair value interest rate locks with customers | $ 172 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Financing Receivable, Allowance for Credit Losses [Line Items] | |||||
Increase (decrease) in fair value of loans receivable | $ (816,000) | $ (19,000) | $ (1,800,000) | $ (55,000) | |
Loans receivable, at fair value | 14,198,000 | 14,198,000 | $ 16,083,000 | ||
Level 2 | Residential Mortgage | |||||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||||
Loans receivable, at fair value | $ 14,200,000 | $ 14,200,000 | $ 16,100,000 |
EMPLOYEE BENEFITS - Narrative (
EMPLOYEE BENEFITS - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||
Jan. 01, 2012 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2012 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
EMPLOYEE BENEFITS | |||||||
Number of hours of service required for participation in ESOP, per first 12 month period (in hours) | 1000 hours | ||||||
Vesting percentage after requisite service period is met (as a percent) | 100% | ||||||
Requisite service period (in years) | 2 years | ||||||
Employee stock ownership plan (ESOP), requisite service period (in hours) | 1000 hours | ||||||
Employee Stock Ownership Plan (ESOP), Debt Structure, Employer Loan, Amount | $ 2,600 | ||||||
Employee stock ownership plan shares purchased | 518,420 | ||||||
Employee stock ownership plan (ESOP), weighted average purchase price of shares purchased (in dollars per share) | $ 5.09 | ||||||
Amortization period of ESOP loan | 10 years | ||||||
Employee stock ownership plan (ESOP), debt structure, employer loan, interest rate | 2.30% | ||||||
Employee stock ownership plan (ESOP), periodic installment payments from esop, amount paid | $ 288 | ||||||
Employee stock ownership plan (ESOP), interest payments from esop | $ 7 | ||||||
ESOP compensation expense for allocated shares | $ 0 | $ 439 | $ 0 | $ 1,335 |
EARNINGS PER SHARE - Schedule o
EARNINGS PER SHARE - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Numerator (in thousands): | ||||
Net Income | $ 8,458 | $ 8,331 | $ 22,027 | $ 28,763 |
Dividends and undistributed earnings allocated to participating securities | (153) | (138) | (414) | (463) |
Net income available to common shareholders | $ 8,305 | $ 8,193 | $ 21,613 | $ 28,300 |
Denominator (shown as actual): | ||||
Basic weighted average common shares outstanding (in shares) | 7,605,360 | 8,129,524 | 7,800,390 | 8,256,523 |
Dilutive shares (in shares) | 102,402 | 240,551 | 122,456 | 297,628 |
Diluted weighted average common shares outstanding (in shares) | 7,707,762 | 8,370,075 | 7,922,846 | 8,554,151 |
Basic earnings per share | $ 1.09 | $ 1.01 | $ 2.77 | $ 3.43 |
Diluted earnings per share | $ 1.08 | $ 0.98 | $ 2.73 | $ 3.31 |
Potentially dilutive weighted average share options that were not included in the computation of diluted earnings per share because to do so would be anti-dilutive | 84,540 | 23,067 | 62,544 | 7,774 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | May 17, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award contractual life | 10 years | |||||
2018 Equity Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation expense | $ 499,000 | $ 402,000 | $ 1,400,000 | $ 995,000 | ||
Expected term in years | 7 years 2 months 1 day | |||||
Remaining weighted-average vesting period | 7 years | |||||
2018 Equity Incentive Plan | Equity option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award contractual life | 10 years | |||||
Shares available for grant | 342,096 | 342,096 | ||||
Unrecognized compensation cost, nonvested awards | $ 2,200,000 | $ 2,200,000 | ||||
Remaining weighted-average vesting period | 3 years 4 months 24 days | |||||
2018 Equity Incentive Plan | Restricted stock awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares authorized (in shares) | 326,000 | |||||
Shares available for grant | 109,410 | 109,410 | ||||
Unrecognized compensation cost, nonvested awards | $ 3,300,000 | $ 3,300,000 | ||||
Weighted-average vesting period | 3 years 4 months 24 days | |||||
2018 Equity Incentive Plan | Restricted stock awards | Officers And Employees | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 5 years | |||||
2018 Equity Incentive Plan | Equity option and restricted stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares authorized (in shares) | 1,300,000 | |||||
Maximum | 2018 Equity Incentive Plan | Restricted stock awards | Independent Director | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 3 years | |||||
Minimum | 2018 Equity Incentive Plan | Restricted stock awards | Independent Director | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 1 year | |||||
One year vesting | 2018 Equity Incentive Plan | Equity option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Expected term in years | 5 years 6 months | |||||
One year vesting | 2018 Equity Incentive Plan | Equity option | Directors Excluding CEO | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 1 year | |||||
One year vesting | Minimum | 2018 Equity Incentive Plan | Equity option | Directors Excluding CEO | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 1 year | |||||
Two year vesting | 2018 Equity Incentive Plan | Equity option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Annual award vesting percentage | 20% | |||||
Expected term in years | 5 years 9 months | |||||
Two year vesting | 2018 Equity Incentive Plan | Equity option | Directors Excluding CEO | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 2 years | |||||
Two year vesting | 2018 Equity Incentive Plan | Equity option | Officers And Employees | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 5 years | |||||
Three year vesting | 2018 Equity Incentive Plan | Equity option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Expected term in years | 6 years | |||||
Three year vesting | 2018 Equity Incentive Plan | Equity option | Directors Excluding CEO | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 3 years | |||||
Three year vesting | Maximum | 2018 Equity Incentive Plan | Equity option | Directors Excluding CEO | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 3 years | |||||
Five year vesting | 2018 Equity Incentive Plan | Equity option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Expected term in years | 6 years 6 months | |||||
Five year vesting | 2018 Equity Incentive Plan | Equity option | Directors Excluding CEO | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 5 years |
STOCK-BASED COMPENSATION - Stoc
STOCK-BASED COMPENSATION - Stock Option Activity (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | |
Shares | ||
Award contractual life | 10 years | |
Equity option | ||
Shares | ||
Expected forfeiture rate over contractual term | 3.10% | |
2018 Equity Incentive Plan | ||
Shares | ||
Outstanding, beginning balance (in shares) | shares | 613,626 | |
Granted, Shares | shares | 99,200 | |
Less exercised (in shares) | shares | 43,048 | |
Outstanding, ending balance (in shares) | shares | 669,778 | 613,626 |
Expected to vest, assuming a 0.31% annual forfeiture rate (in shares) | shares | 649,479 | |
Exercisable (in shares) | shares | 334,767 | |
Annual forfeiture rate | 0.31% | |
Weighted-Average Exercise Price | ||
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 25.24 | |
Granted (in dollars per share) | $ / shares | 30.94 | |
Less exercised (in dollars per share) | $ / shares | 16.17 | |
Outstanding, ending balance (in dollars per share) | $ / shares | 26.67 | $ 25.24 |
Expected to vest, assuming a 0.31% annual forfeiture rate (in dollars per share) | $ / shares | 26.58 | |
Exercisable (in dollars per share) | $ / shares | $ 24.21 | |
Weighted-Average Remaining Contractual Term In Years | ||
Outstanding, beginning balance | 7 years 2 months 1 day | |
Outstanding, ending balance | 7 years | |
Expected to vest, assuming a 0.31% annual forfeiture rate, Weighted Average Remaining Contractual Term | 6 years 11 months 8 days | |
Exercisable | 5 years 7 months 9 days | |
Aggregate Intrinsic Value | ||
Beginning balance | $ | $ 5,362,902 | |
Less exercised | $ | 635,646 | |
Ending balance | $ | 2,106,211 | $ 5,362,902 |
Expected to vest, assuming a 0.31% annual forfeiture rate | $ | 2,077,145 | |
Exercisable | $ | $ 1,573,345 | |
2018 Equity Incentive Plan | Equity option | ||
Shares | ||
Award contractual life | 10 years | |
Weighted-Average Remaining Contractual Term In Years | ||
Outstanding, ending balance | 3 years 4 months 24 days |
STOCK-BASED COMPENSATION - Rest
STOCK-BASED COMPENSATION - Restricted Stock Awards (Details) - Restricted stock awards | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Shares | |
Nonvested, Beginning balance (in shares) | shares | 121,672 |
Granted (shares) | shares | 35,050 |
Less vested (in shares) | shares | 38,192 |
Forfeited or expired ( in shares) | shares | 0 |
Nonvested, Ending balance (in shares) | shares | 118,530 |
Weighted-Average Grant-Date Fair Value Per Share | |
Nonvested, Beginning balance (in dollars per share) | $ / shares | $ 28.02 |
Granted (in dollars per share) | $ / shares | 0 |
Less vested (in dollars per share) | $ / shares | 28.12 |
Forfeited or expired (in dollars per share) | $ / shares | 0 |
Nonvested, Ending balance (in dollars per share) | $ / shares | $ 28.85 |
REGULATORY CAPITAL - Regulatory
REGULATORY CAPITAL - Regulatory Capital Ratios Policy (Details) $ in Thousands | Sep. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Tier 1 leverage capital, Ratio | 0.098 | |
CET 1 capital, Ratio | 0.106 | |
Total risk-based capital, Ratio | 0.140 | |
Tier 1 risk-based capital, Ratio | 0.106 | 0.108 |
Bank | ||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Tier 1 leverage capital, Ratio | 0.1154 | 0.122 |
CET 1 capital, Ratio | 0.1248 | |
Tier 1 leverage capital, To be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 124,763 | $ 189,300 |
Total risk-based capital, Ratio | 0.1373 | |
Tier 1 risk-based capital, Ratio | 0.1248 | |
CET 1 capital, Amount | $ 288,053 | $ 270,800 |
REGULATORY CAPITAL - Compliance
REGULATORY CAPITAL - Compliance with Regulatory Capital Requirements under Banking Regulations (Details) $ in Thousands | Sep. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Total risk-based capital, Ratio | 0.140 | |
Tier 1 risk-based capital, Ratio | 0.106 | 0.108 |
Tier 1 leverage capital, Ratio | 0.098 | |
CET 1 capital, Ratio | 0.106 | |
Bank | ||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Common Equity Tier 1 to Risk Weighted Assets, Capital Conservation Buffer | 0.025 | |
Total risk-based capital, Amount | $ 316,916 | |
Total risk-based capital, Ratio | 0.1373 | |
Total risk-based capital, For Capital Adequacy Purposes, Amount | $ 184,670 | |
Total risk-based capital, For Capital Adequacy Purposes, Ratio | 0.0800 | |
Total risk-based capital, For Capital Adequacy with Capital Buffer, Amount | $ 242,380 | |
Total risk-based capital, For Capital Adequacy with Capital Buffer, Ratio | 0.1050 | |
Total risk-based capital, To be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 230,838 | |
Total risk-based capital, To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 0.1000 | |
Tier 1 risk-based capital, Amount | $ 288,053 | |
Tier 1 risk-based capital, Ratio | 0.1248 | |
Tier 1 risk-based capital, For Capital Adequacy Purposes, Amount | $ 138,503 | |
Tier 1 risk-based capital, For Capital Adequacy Purposes, Ratio | 0.0600 | |
Tier 1 risk-based capital, For Capital Adequacy with Capital Buffer, Amount | $ 196,212 | |
Tier 1 risk-based capital, For Capital Adequacy with Capital Buffer, Ratio | 0.0850 | |
Tier 1 risk-based capital, To be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 184,670 | |
Tier 1 risk-based capital, To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 0.0800 | |
Tier 1 leverage capital | $ 288,053 | |
Tier 1 leverage capital, Ratio | 0.1154 | 0.122 |
Tier 1 leverage capital, For Capital Adequacy Purposes, Amount | $ 99,810 | |
Tier 1 leverage capital, For Capital Adequacy Purposes, Ratio | 0.0400 | |
Tier 1 leverage capital, To be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 124,763 | $ 189,300 |
Tier 1 leverage capital, To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 0.0500 | |
CET 1 capital, Amount | $ 288,053 | $ 270,800 |
CET 1 capital, Ratio | 0.1248 | |
CET 1 capital, For Capital Adequacy Purposes, Amount | $ 103,877 | |
CET 1 capital, For Capital Adequacy Purposes, Ratio | 0.0450 | |
CET 1 capital, For Capital Adequacy with Capital Buffer, Amount | $ 161,587 | |
CET 1 capital, For Capital Adequacy with Capital Buffer, Ratio | 0.0700 | |
CET 1 capital, To be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 150,045 | |
CET 1 capital, To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 0.0650 |
BUSINESS SEGMENTS - Narrative (
BUSINESS SEGMENTS - Narrative (Details) | 9 Months Ended |
Sep. 30, 2022 item segment | |
Segment Reporting Information [Line Items] | |
Number of operating segments | segment | 2 |
Retail Deposit | Pacific Northwest | |
Segment Reporting Information [Line Items] | |
Number of bank branches | item | 21 |
BUSINESS SEGMENTS - Segment Fin
BUSINESS SEGMENTS - Segment Financial Results (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) employee | Sep. 30, 2021 USD ($) employee | Sep. 30, 2022 USD ($) employee | Sep. 30, 2021 USD ($) employee | |
Segment Reporting Information [Line Items] | ||||
Net interest income | $ 27,527 | $ 22,655 | $ 74,978 | $ 63,975 |
(Provision) benefit for loan losses | (1,718) | 0 | (4,632) | (1,500) |
Noninterest income | 4,181 | 8,398 | 14,412 | 29,618 |
Noninterest expense | (19,338) | (20,016) | (57,334) | (55,283) |
INCOME BEFORE PROVISION FOR INCOME TAXES | 10,652 | 11,037 | 27,424 | 36,810 |
(Provision) benefit for income taxes | (2,194) | (2,706) | (5,397) | (8,047) |
NET INCOME | 8,458 | 8,331 | 22,027 | 28,763 |
Total average assets for period ended | $ 2,499,982 | $ 2,217,653 | $ 2,376,366 | $ 2,173,909 |
Full-time employees ("FTEs") | employee | 529 | 527 | 529 | 527 |
Home Lending | ||||
Segment Reporting Information [Line Items] | ||||
Net interest income | $ 2,907 | $ 2,278 | $ 7,995 | $ 6,146 |
(Provision) benefit for loan losses | 93 | 1,986 | (905) | 1,545 |
Noninterest income | 867 | 6,439 | 6,468 | 23,072 |
Noninterest expense | (4,867) | (5,612) | (14,456) | (14,132) |
INCOME BEFORE PROVISION FOR INCOME TAXES | (1,000) | 5,091 | (898) | 16,631 |
(Provision) benefit for income taxes | 206 | (1,244) | 186 | (3,636) |
NET INCOME | (794) | 3,847 | (712) | 12,995 |
Total average assets for period ended | $ 427,368 | $ 417,763 | $ 403,990 | $ 402,693 |
Full-time employees ("FTEs") | employee | 140 | 154 | 140 | 154 |
Commercial and Consumer Banking | ||||
Segment Reporting Information [Line Items] | ||||
Net interest income | $ 24,620 | $ 20,377 | $ 66,983 | $ 57,829 |
(Provision) benefit for loan losses | (1,811) | (1,986) | (3,727) | (3,045) |
Noninterest income | 3,314 | 1,959 | 7,944 | 6,546 |
Noninterest expense | (14,471) | (14,404) | (42,878) | (41,151) |
INCOME BEFORE PROVISION FOR INCOME TAXES | 11,652 | 5,946 | 28,322 | 20,179 |
(Provision) benefit for income taxes | (2,400) | (1,462) | (5,583) | (4,411) |
NET INCOME | 9,252 | 4,484 | 22,739 | 15,768 |
Total average assets for period ended | $ 2,072,614 | $ 1,799,890 | $ 1,972,376 | $ 1,771,216 |
Full-time employees ("FTEs") | employee | 389 | 373 | 389 | 373 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill | $ 2,312 | $ 2,312 | $ 2,312 | ||
Goodwill, Impairment Loss | 0 | ||||
Finite-Lived Intangible Assets, Net [Abstract] | |||||
Finite-Lived Intangible Assets, Gross, Total | 7,490 | $ 7,490 | 7,490 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | (3,430) | (2,739) | (2,739) | ||
Finite-Lived Intangible Assets, Net, Beginning Balance | 4,060 | 4,751 | 4,751 | ||
Amortization | (173) | $ (177) | (518) | $ (531) | (691) |
Finite-Lived Intangible Assets, Gross, Total | 7,490 | 7,490 | 7,490 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | (3,948) | (3,948) | (3,430) | ||
Finite-Lived Intangible Assets, Net, Ending Balance | 3,542 | 3,542 | 4,060 | ||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |||||
Remainder of 2022 | 173 | 173 | |||
2023 | 691 | 691 | |||
2024 | 621 | 621 | |||
2025 | 525 | 525 | |||
2026 | 525 | 525 | |||
Thereafter | 1,007 | 1,007 | |||
Total | 3,542 | $ 3,542 | 4,060 | ||
Anchor Bancorp | |||||
Finite-Lived Intangible Assets, Net [Abstract] | |||||
Amortization period - CDI | 10 years | ||||
Bank of America | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill | $ 2,300 | $ 2,300 | $ 2,300 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||||
Amortization period - CDI | 9 years |
REVENUE FROM CONTRACTS WITH C_3
REVENUE FROM CONTRACTS WITH CUSTOMERS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Noninterest Income | ||||
Noninterest income (in-scope of Topic 606) | $ 812 | $ 777 | $ 2,380 | $ 2,223 |
Noninterest income (out-of-scope of Topic 606) | 3,369 | 7,621 | 12,032 | 27,395 |
Total noninterest income | 4,181 | 8,398 | 14,412 | 29,618 |
Debit Card Interchange Fees | ||||
Noninterest Income | ||||
Noninterest income (in-scope of Topic 606) | 575 | 585 | 1,702 | 1,685 |
Deposit service and account maintenance fees | ||||
Noninterest Income | ||||
Noninterest income (in-scope of Topic 606) | $ 237 | $ 192 | $ 678 | $ 538 |