LOANS RECEIVABLE AND THE ALLOWANCE FOR LOAN LOSSES | 9 Months Ended |
Sep. 30, 2014 |
Receivables [Abstract] | ' |
LOANS RECEIVABLE AND THE ALLOWANCE FOR LOAN LOSSES | ' |
LOANS RECEIVABLE AND THE ALLOWANCE FOR LOAN LOSSES |
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The Banks originate residential mortgage loans for both portfolio investment and sale in the secondary market. At the time of origination, mortgage loans are designated as held for sale or held for investment. Loans held for sale are stated at the lower of cost or estimated market value determined on an aggregate basis. Net unrealized losses on loans held for sale are recognized through a valuation allowance by charges to income. The Banks also originate construction, land and land development, commercial and multifamily real estate, commercial business, agricultural business and consumer loans for portfolio investment. Loans receivable not designated as held for sale are recorded at the principal amount outstanding, net of deferred fees and origination costs, and discounts and premiums. Premiums, discounts and deferred loan fees and origination costs are amortized to maturity using the level-yield methodology. |
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Interest is accrued as earned unless management doubts the collectability of the loan or the unpaid interest. Interest accruals are generally discontinued when loans become 90 days past due for scheduled interest payments. All previously accrued but uncollected interest is deducted from interest income upon transfer to nonaccrual status. Future collection of interest is included in interest income based upon an assessment of the likelihood that the loans will be repaid or recovered. A loan may be put on nonaccrual status sooner than this policy would dictate if, in management’s judgment, the loan may be uncollectable. Such interest is then recognized as income only if it is ultimately collected. |
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Loans receivable, including loans held for sale, at September 30, 2014 and December 31, 2013 are summarized as follows (dollars in thousands): |
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| September 30, 2014 | | December 31, 2013 | | | | | | | | | | | | | | | | | | | | | | |
| Amount | | Percent of Total | | Amount | | Percent of Total | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | $ | 546,333 | | | 14.4 | % | | $ | 502,601 | | | 14.7 | % | | | | | | | | | | | | | | | | | | | | | | |
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Investment properties | 854,284 | | | 22.4 | | | 692,457 | | | 20.3 | | | | | | | | | | | | | | | | | | | | | | | |
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Multifamily real estate | 183,944 | | | 4.8 | | | 137,153 | | | 4 | | | | | | | | | | | | | | | | | | | | | | | |
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Commercial construction | 18,606 | | | 0.5 | | | 12,168 | | | 0.4 | | | | | | | | | | | | | | | | | | | | | | | |
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Multifamily construction | 48,606 | | | 1.3 | | | 52,081 | | | 1.5 | | | | | | | | | | | | | | | | | | | | | | | |
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One- to four-family construction | 214,141 | | | 5.6 | | | 200,864 | | | 5.8 | | | | | | | | | | | | | | | | | | | | | | | |
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Land and land development: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Residential | 89,649 | | | 2.4 | | | 75,695 | | | 2.2 | | | | | | | | | | | | | | | | | | | | | | | |
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Commercial | 10,505 | | | 0.3 | | | 10,450 | | | 0.3 | | | | | | | | | | | | | | | | | | | | | | | |
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Commercial business | 728,088 | | | 19.1 | | | 682,169 | | | 20 | | | | | | | | | | | | | | | | | | | | | | | |
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Agricultural business, including secured by farmland | 240,048 | | | 6.3 | | | 228,291 | | | 6.7 | | | | | | | | | | | | | | | | | | | | | | | |
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One- to four-family residential | 527,271 | | | 13.8 | | | 529,494 | | | 15.5 | | | | | | | | | | | | | | | | | | | | | | | |
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Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 215,385 | | | 5.7 | | | 173,188 | | | 5.1 | | | | | | | | | | | | | | | | | | | | | | | |
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Consumer-other | 129,835 | | | 3.4 | | | 121,834 | | | 3.5 | | | | | | | | | | | | | | | | | | | | | | | |
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Total loans outstanding | 3,806,695 | | | 100 | % | | 3,418,445 | | | 100 | % | | | | | | | | | | | | | | | | | | | | | | |
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Less allowance for loan losses | (74,331 | ) | | | | | (74,258 | ) | | | | | | | | | | | | | | | | | | | | | | | | | |
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Net loans | $ | 3,732,364 | | | | | | $ | 3,344,187 | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Loan amounts are net of unearned loan fees in excess of unamortized costs of $8.0 million as of September 30, 2014 and $8.3 million as of December 31, 2013. |
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The Company’s total loans by geographic concentration at September 30, 2014 were as follows (dollars in thousands): |
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| Washington | | Oregon | | Idaho | | Other | | Total | | | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | $ | 389,967 | | | $ | 85,032 | | | $ | 53,891 | | | $ | 17,443 | | | $ | 546,333 | | | | | | | | | | | | | | | | | |
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Investment properties | 532,415 | | | 123,874 | | | 59,963 | | | 138,032 | | | 854,284 | | | | | | | | | | | | | | | | | |
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Multifamily real estate | 141,337 | | | 27,685 | | | 14,847 | | | 75 | | | 183,944 | | | | | | | | | | | | | | | | | |
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Commercial construction | 16,953 | | | — | | | 1,653 | | | — | | | 18,606 | | | | | | | | | | | | | | | | | |
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Multifamily construction | 41,462 | | | 7,144 | | | — | | | — | | | 48,606 | | | | | | | | | | | | | | | | | |
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One- to four-family construction | 128,882 | | | 82,656 | | | 2,603 | | | — | | | 214,141 | | | | | | | | | | | | | | | | | |
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Land and land development: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Residential | 50,257 | | | 38,327 | | | 1,065 | | | — | | | 89,649 | | | | | | | | | | | | | | | | | |
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Commercial | 5,055 | | | 2,569 | | | 2,881 | | | — | | | 10,505 | | | | | | | | | | | | | | | | | |
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Commercial business | 392,334 | | | 121,078 | | | 80,262 | | | 134,414 | | | 728,088 | | | | | | | | | | | | | | | | | |
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Agricultural business, including secured by farmland | 123,910 | | | 63,146 | | | 52,992 | | | — | | | 240,048 | | | | | | | | | | | | | | | | | |
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One- to four-family residential | 329,751 | | | 173,384 | | | 23,371 | | | 765 | | | 527,271 | | | | | | | | | | | | | | | | | |
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Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 130,312 | | | 69,121 | | | 15,313 | | | 639 | | | 215,385 | | | | | | | | | | | | | | | | | |
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Consumer—other | 83,379 | | | 39,818 | | | 6,241 | | | 397 | | | 129,835 | | | | | | | | | | | | | | | | | |
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Total loans | $ | 2,366,014 | | | $ | 833,834 | | | $ | 315,082 | | | $ | 291,765 | | | $ | 3,806,695 | | | | | | | | | | | | | | | | | |
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Percent of total loans | 62.1 | % | | 21.9 | % | | 8.3 | % | | 7.7 | % | | 100 | % | | | | | | | | | | | | | | | | |
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The geographic concentrations of the Company’s land and land development loans by state at September 30, 2014 were as follows (dollars in thousands): |
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| Washington | | Oregon | | Idaho | | Total | | | | | | | | | | | | | | | | | | | | |
Residential: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Acquisition and development | $ | 21,759 | | | $ | 17,976 | | | $ | 922 | | | $ | 40,657 | | | | | | | | | | | | | | | | | | | | | |
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Improved land and lots | 25,062 | | | 19,122 | | | 143 | | | 44,327 | | | | | | | | | | | | | | | | | | | | | |
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Unimproved land | 3,436 | | | 1,229 | | | — | | | 4,665 | | | | | | | | | | | | | | | | | | | | | |
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Commercial: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Improved land and lots | 2,863 | | | 489 | | | 1,784 | | | 5,136 | | | | | | | | | | | | | | | | | | | | | |
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Unimproved land | 2,192 | | | 2,080 | | | 1,097 | | | 5,369 | | | | | | | | | | | | | | | | | | | | | |
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Total land and land development loans | $ | 55,312 | | | $ | 40,896 | | | $ | 3,946 | | | $ | 100,154 | | | | | | | | | | | | | | | | | | | | | |
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Percent of land and land development loans | 55.3 | % | | 40.8 | % | | 3.9 | % | | 100 | % | | | | | | | | | | | | | | | | | | | | |
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The Company originates both adjustable- and fixed-rate loans. The maturity and repricing composition of those loans, less undisbursed amounts and deferred fees and origination costs, at September 30, 2014 and December 31, 2013 were as follows (in thousands): |
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| September 30, 2014 | | | December 31, 2013 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Fixed-rate (term to maturity): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Maturing in one year or less | $ | 106,939 | | | $ | 122,313 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Maturing after one year through three years | 165,930 | | | 143,322 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Maturing after three years through five years | 196,794 | | | 187,279 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Maturing after five years through ten years | 235,143 | | | 209,869 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Maturing after ten years | 551,436 | | | 439,004 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Total fixed-rate loans | 1,256,242 | | | 1,101,787 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Adjustable-rate (term to rate adjustment): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Maturing or repricing in one year or less | 1,502,536 | | | 1,390,579 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Maturing or repricing after one year through three years | 408,079 | | | 279,791 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Maturing or repricing after three years through five years | 553,810 | | | 541,529 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Maturing or repricing after five years through ten years | 84,758 | | | 99,503 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Maturing or repricing after ten years | 1,270 | | | 5,256 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Total adjustable-rate loans | 2,550,453 | | | 2,316,658 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Total loans | $ | 3,806,695 | | | $ | 3,418,445 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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The adjustable-rate loans have interest rate adjustment limitations and are generally indexed to various prime or London Inter-bank Offering Rate (LIBOR) rates, One to Five Year Constant Maturity Treasury Indices or FHLB advance rates. Future market factors may affect the correlation of the interest rate adjustment with the rates the Banks pay on the short-term deposits that were primarily utilized to fund these loans. |
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Impaired Loans and the Allowance for Loan Losses. A loan is considered impaired when, based on current information and circumstances, the Company determines it is probable that it will be unable to collect all amounts due according to the contractual terms of the loan agreement, including scheduled interest payments. Impaired loans are comprised of loans on nonaccrual, troubled debt restructurings (TDRs) that are performing under their restructured terms, and loans that are 90 days or more past due, but are still on accrual. |
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Troubled Debt Restructures. Some of the Company’s loans are reported as TDRs. Loans are reported as TDRs when the bank grants one or more concessions to a borrower experiencing financial difficulties that it would not otherwise consider. Examples of such concessions include forgiveness of principal or accrued interest, extending the maturity date(s) or providing a lower interest rate than would be normally available for a transaction of similar risk. Our TDRs have generally not involved forgiveness of amounts due, but almost always include a modification of multiple factors; the most common combination includes interest rate, payment amount and maturity date. As a result of these concessions, restructured loans are impaired as the Company will not collect all amounts due, both principal and interest, in accordance with the terms of the original loan agreement. Loans identified as TDRs are accounted for in accordance with the Company's impaired loan accounting policies. |
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The amount of impaired loans and the related allocated reserve for loan losses as of September 30, 2014 and December 31, 2013 were as follows (in thousands): |
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| September 30, 2014 | | December 31, 2013 | | | | | | | | | | | | | | | | | | | | |
| Loan Amount | | Allocated Reserves | | Loan Amount | | Allocated Reserves | | | | | | | | | | | | | | | | | | | | |
Impaired loans: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Nonaccrual loans | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | $ | 2,396 | | | $ | 33 | | | $ | 2,466 | | | $ | 31 | | | | | | | | | | | | | | | | | | | | | |
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Investment properties | 305 | | | 57 | | | 3,821 | | | 89 | | | | | | | | | | | | | | | | | | | | | |
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Multifamily real estate | 397 | | | 55 | | | — | | | — | | | | | | | | | | | | | | | | | | | | | |
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One- to four-family construction | — | | | — | | | 269 | | | — | | | | | | | | | | | | | | | | | | | | | |
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Land and land development: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Residential | 1,285 | | | 173 | | | 924 | | | 6 | | | | | | | | | | | | | | | | | | | | | |
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Commercial business | 1,037 | | | 60 | | | 724 | | | 104 | | | | | | | | | | | | | | | | | | | | | |
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Agricultural business, including secured by farmland | 229 | | | 15 | | | — | | | — | | | | | | | | | | | | | | | | | | | | | |
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One- to four-family residential | 8,615 | | | 83 | | | 12,532 | | | 250 | | | | | | | | | | | | | | | | | | | | | |
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Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 724 | | | 34 | | | 903 | | | 13 | | | | | | | | | | | | | | | | | | | | | |
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Consumer—other | 414 | | | 1 | | | 269 | | | 1 | | | | | | | | | | | | | | | | | | | | | |
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Total nonaccrual loans | 15,402 | | | 511 | | | 21,908 | | | 494 | | | | | | | | | | | | | | | | | | | | | |
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Loans 90 days or more past due and still accruing | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | 993 | | | 1 | | | — | | | — | | | | | | | | | | | | | | | | | | | | | |
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Commercial business | 301 | | | 6 | | | — | | | — | | | | | | | | | | | | | | | | | | | | | |
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Agricultural business, including secured by farmland | — | | | — | | | 105 | | | 8 | | | | | | | | | | | | | | | | | | | | | |
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One- to four-family residential | 2,777 | | | 12 | | | 2,611 | | | 16 | | | | | | | | | | | | | | | | | | | | | |
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Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | — | | | — | | | 13 | | | — | | | | | | | | | | | | | | | | | | | | | |
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Consumer—other | 306 | | | — | | | 131 | | | 1 | | | | | | | | | | | | | | | | | | | | | |
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Total loans past due and still accruing | 4,377 | | | 19 | | | 2,860 | | | 25 | | | | | | | | | | | | | | | | | | | | | |
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Troubled debt restructuring on accrual status: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | 184 | | | 4 | | | 186 | | | 4 | | | | | | | | | | | | | | | | | | | | | |
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Investment properties | 6,062 | | | 751 | | | 5,367 | | | 415 | | | | | | | | | | | | | | | | | | | | | |
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Multifamily real estate | 791 | | | 91 | | | 5,744 | | | 1,139 | | | | | | | | | | | | | | | | | | | | | |
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One- to four-family construction | 3,721 | | | 620 | | | 6,864 | | | 1,002 | | | | | | | | | | | | | | | | | | | | | |
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Land and land development: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential | 1,637 | | | 476 | | | 4,061 | | | 754 | | | | | | | | | | | | | | | | | | | | | |
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Commercial business | 880 | | | 103 | | | 1,299 | | | 222 | | | | | | | | | | | | | | | | | | | | | |
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One- to four-family residential | 16,677 | | | 1,074 | | | 23,302 | | | 1,355 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 233 | | | 30 | | | 360 | | | 33 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Consumer—other | 202 | | | 6 | | | 245 | | | 34 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Total troubled debt restructurings on accrual status | 30,387 | | | 3,155 | | | 47,428 | | | 4,958 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Total impaired loans | $ | 50,166 | | | $ | 3,685 | | | $ | 72,196 | | | $ | 5,477 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
|
As of September 30, 2014 and December 31, 2013, the Company had commitments to advance funds related to TDRs up to additional amounts of $788,000 and $225,000, respectively. |
|
The following tables provide additional information on impaired loans with and without specific allowance reserves at or for the nine months ended September 30, 2014 and at or for the year ended December 31, 2013 (in thousands): |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| At or For the Nine Months Ended September 30, 2014 | | | | | | | | | | | | | | | | |
| Recorded Investment | | Unpaid Principal Balance | | Related Allowance | | Average Recorded Investment | | Interest Income Recognized | | | | | | | | | | | | | | | | |
Without a specific allowance reserve (1) | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | $ | 1,565 | | | $ | 1,614 | | | $ | 34 | | | $ | 1,579 | | | $ | 38 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Investment properties | 305 | | | 850 | | | 57 | | | 325 | | | — | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Multifamily real estate | 397 | | | 397 | | | 55 | | | 423 | | | — | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Commercial business | 1,338 | | | 1,705 | | | 66 | | | 1,307 | | | 14 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Agricultural business/farmland | 229 | | | 229 | | | 15 | | | 102 | | | — | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
One- to four-family residential | 9,179 | | | 9,809 | | | 26 | | | 9,439 | | | 89 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 628 | | | 641 | | | 12 | | | 642 | | | — | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer—other | 602 | | | 607 | | | 1 | | | 607 | | | 12 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| 14,243 | | | 15,852 | | | 266 | | | 14,424 | | | 153 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
With a specific allowance reserve (2) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | 2,008 | | | 2,008 | | | 4 | | | 1,555 | | | 8 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Investment properties | 6,062 | | | 6,467 | | | 751 | | | 6,124 | | | 238 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Multifamily real estate | 791 | | | 791 | | | 91 | | | 797 | | | 34 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
One- to-four family construction | 3,721 | | | 3,721 | | | 620 | | | 3,501 | | | 120 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Land and land development: | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential | 2,922 | | | 4,078 | | | 649 | | | 2,937 | | | 67 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Commercial business | 880 | | | 880 | | | 103 | | | 918 | | | 38 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
One- to four-family residential | 18,890 | | | 19,652 | | | 1,143 | | | 19,457 | | | 659 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 329 | | | 329 | | | 52 | | | 383 | | | 13 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer—other | 320 | | | 336 | | | 6 | | | 331 | | | 15 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| 35,923 | | | 38,262 | | | 3,419 | | | 36,003 | | | 1,192 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Total | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | 3,573 | | | 3,622 | | | 38 | | | 3,134 | | | 46 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Investment properties | 6,367 | | | 7,317 | | | 808 | | | 6,449 | | | 238 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Multifamily real estate | 1,188 | | | 1,188 | | | 146 | | | 1,220 | | | 34 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
One- to four-family construction | 3,721 | | | 3,721 | | | 620 | | | 3,501 | | | 120 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Land and land development: | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential | 2,922 | | | 4,078 | | | 649 | | | 2,937 | | | 67 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Commercial business | 2,218 | | | 2,585 | | | 169 | | | 2,225 | | | 52 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Agricultural business/farmland | 229 | | | 229 | | | 15 | | | 102 | | | — | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
One- to four-family residential | 28,069 | | | 29,461 | | | 1,169 | | | 28,896 | | | 748 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 957 | | | 970 | | | 64 | | | 1,025 | | | 13 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer—other | 922 | | | 943 | | | 7 | | | 938 | | | 27 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| $ | 50,166 | | | $ | 54,114 | | | $ | 3,685 | | | $ | 50,427 | | | $ | 1,345 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| At or For the Year Ended December 31, 2013 | | | | | | | | | | | | | | | | |
| Recorded Investment | | Unpaid Principal Balance | | Related Allowance | | Average Recorded Investment | | Interest Income Recognized | | | | | | | | | | | | | | | | |
Without a specific allowance reserve (1) | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | $ | 534 | | | $ | 584 | | | $ | 31 | | | $ | 569 | | | $ | — | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Investment properties | 429 | | | 974 | | | 89 | | | 624 | | | — | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Commercial business | 724 | | | 1,040 | | | 104 | | | 896 | | | — | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Agricultural business/farmland | 105 | | | 105 | | | 8 | | | 110 | | | 8 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
One- to four-family residential | 8,611 | | | 9,229 | | | 42 | | | 8,889 | | | 31 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 870 | | | 1,013 | | | 13 | | | 900 | | | 1 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer—other | 276 | | | 285 | | | 2 | | | 287 | | | 8 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| 11,549 | | | 13,230 | | | 289 | | | 12,275 | | | 48 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
With a specific allowance reserve (2) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | 2,118 | | | 2,118 | | | 4 | | | 2,192 | | | 12 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Investment properties | 8,759 | | | 10,395 | | | 415 | | | 8,353 | | | 241 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Multifamily real estate | 5,744 | | | 5,744 | | | 1,139 | | | 5,705 | | | 298 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
One- to-four family construction | 7,133 | | | 7,213 | | | 1,002 | | | 5,870 | | | 239 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Land and land development: | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential | 4,985 | | | 6,140 | | | 760 | | | 6,053 | | | 221 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Commercial business | 1,298 | | | 1,298 | | | 222 | | | 1,340 | | | 59 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
One- to four-family residential | 29,834 | | | 31,440 | | | 1,579 | | | 31,668 | | | 1,032 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 406 | | | 407 | | | 33 | | | 503 | | | 24 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer—other | 370 | | | 386 | | | 34 | | | 390 | | | 21 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| 60,647 | | | 65,141 | | | 5,188 | | | 62,074 | | | 2,147 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Total | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Commercial real estate | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | 2,652 | | | 2,702 | | | 35 | | | 2,761 | | | 12 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Investment properties | 9,188 | | | 11,369 | | | 504 | | | 8,977 | | | 241 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Multifamily real estate | 5,744 | | | 5,744 | | | 1,139 | | | 5,705 | | | 298 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
One- to four-family construction | 7,133 | | | 7,213 | | | 1,002 | | | 5,870 | | | 239 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Land and land development | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential | 4,985 | | | 6,140 | | | 760 | | | 6,053 | | | 221 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Commercial business | 2,022 | | | 2,338 | | | 326 | | | 2,236 | | | 59 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Agricultural business/farmland | 105 | | | 105 | | | 8 | | | 110 | | | 8 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
One- to four-family residential | 38,445 | | | 40,669 | | | 1,621 | | | 40,557 | | | 1,063 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 1,276 | | | 1,420 | | | 46 | | | 1,403 | | | 25 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Consumer—other | 646 | | | 671 | | | 36 | | | 677 | | | 29 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| $ | 72,196 | | | $ | 78,371 | | | $ | 5,477 | | | $ | 74,349 | | | $ | 2,195 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(1) | Loans without a specific allowance reserve have not been individually evaluated for impairment, but have been included in pools of homogeneous loans for evaluation of related allowance reserves. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(2) | Loans with a specific allowance reserve have been individually evaluated for impairment using either a discounted cash flow analysis or, for collateral dependent loans, current appraisals less costs to sell to establish realizable value. These analyses may identify a specific impairment amount needed or may conclude that no reserve is needed. Any specific impairment that is identified is included in the category’s Related Allowance column. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
The following tables present TDRs at September 30, 2014 and December 31, 2013 (in thousands): |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| September 30, 2014 | | | | | | | | | | | | | | | | | | | | | | | | |
| Accrual | | Nonaccrual | | Total | | | | | | | | | | | | | | | | | | | | | | | | |
Status | Status | TDRs | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | $ | 184 | | | $ | 110 | | | $ | 294 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Investment properties | 6,062 | | | 38 | | | 6,100 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Multifamily real estate | 791 | | | — | | | 791 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family construction | 3,721 | | | — | | | 3,721 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Land and land development: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential | 1,637 | | | 535 | | | 2,172 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Commercial business | 880 | | | 103 | | | 983 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | 16,677 | | | 950 | | | 17,627 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 233 | | | 119 | | | 352 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Consumer—other | 202 | | | 117 | | | 319 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| $ | 30,387 | | | $ | 1,972 | | | $ | 32,359 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| December 31, 2013 | | | | | | | | | | | | | | | | | | | | | | | | |
| Accrual | | Nonaccrual | | Total | | | | | | | | | | | | | | | | | | | | | | | | |
Status | Status | TDRs | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | $ | 186 | | | $ | 613 | | | $ | 799 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Investment properties | 5,367 | | | 1,630 | | | 6,997 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Multifamily real estate | 5,744 | | | — | | | 5,744 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family construction | 6,864 | | | 269 | | | 7,133 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Land and land development: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential | 4,061 | | | 174 | | | 4,235 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Commercial business | 1,299 | | | 164 | | | 1,463 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | 23,302 | | | 2,474 | | | 25,776 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Consumer: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 360 | | | 252 | | | 612 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Consumer—other | 245 | | | 123 | | | 368 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| $ | 47,428 | | | $ | 5,699 | | | $ | 53,127 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
|
The following tables present new TDRs that occurred during the three and nine months ended September 30, 2014 and 2013 (dollars in thousands): |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, 2014 | | Nine Months Ended September 30, 2014 | | | | | | | | | | | | | | |
| Number of | | Pre-modification Outstanding | | Post-modification Outstanding | | Number of | | Pre- | | Post- | | | | | | | | | | | | | | |
Contracts | Recorded Investment | Recorded Investment | Contracts | modification Outstanding | modification Outstanding | | | | | | | | | | | | | | |
| | | | Recorded | Recorded | | | | | | | | | | | | | | |
| | | | Investment | Investment | | | | | | | | | | | | | | |
Recorded Investment (1) (2) | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate | | | | | | | | | | | | | | | | | | | | | | | | | |
Owner occupied | — | | | $ | — | | | $ | — | | | 1 | | | $ | 94 | | | $ | 94 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
One- to four-family construction | 1 | | | 388 | | | 388 | | | 5 | | | 1,369 | | | 1,369 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Commercial business | — | | | — | | | — | | | 1 | | | 100 | | | 100 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
One- to four-family residential | 2 | | | 434 | | | 434 | | | 2 | | | 434 | | | 434 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Consumer-other | — | | | — | | | — | | | 1 | | | 9 | | | 9 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| 3 | | | $ | 822 | | | $ | 822 | | | 10 | | | $ | 2,006 | | | $ | 2,006 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, 2013 | | Nine Months Ended September 30, 2013 | | | | | | | | | | | | | | |
| Number of | | Pre-modification Outstanding | | Post-modification Outstanding | | Number of | | Pre- | | Post- | | | | | | | | | | | | | | |
Contracts | Recorded Investment | Recorded Investment | Contracts | modification Outstanding | modification Outstanding | | | | | | | | | | | | | | |
| | | | Recorded | Recorded | | | | | | | | | | | | | | |
| | | | Investment | Investment | | | | | | | | | | | | | | |
Recorded Investment (1) (2) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Multifamily real estate | — | | | $ | — | | | $ | — | | | 1 | | | $ | 376 | | | $ | 376 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
One- to four-family construction | 3 | | | 773 | | | 773 | | | 11 | | | 3,008 | | | 3,008 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Land and land development—residential | 2 | | | 1,029 | | | 1,029 | | | 2 | | | 1,029 | | | 1,029 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
One- to four-family residential | — | | | — | | | — | | | 10 | | | 2,923 | | | 2,923 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| 5 | | | $ | 1,802 | | | $ | 1,802 | | | 24 | | | $ | 7,336 | | | $ | 7,336 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(1) | Since most loans were already considered classified and/or on nonaccrual status prior to restructuring, the modifications did not have a material effect on the Company’s determination of the allowance for loan losses. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(2) | The majority of these modifications do not fit into one separate type, such as rate, term, amount, interest-only or payment, but instead are a combination of multiple types of modifications; therefore, they are disclosed in aggregate. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
The following table presents TDRs which incurred a payment default within twelve months of the restructure date during the three and nine month periods ended September 30, 2014 and 2013 (in thousands). A default on a TDR results in either a transfer to nonaccrual status or a partial charge-off: |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended | | Nine Months Ended | | | | | | | | | | | | | | | | | | | | |
30-Sep | 30-Sep | | | | | | | | | | | | | | | | | | | | |
| 2014 | | | 2013 | | | 2014 | | 2013 | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Commercial business | $ | — | | | $ | 137 | | | $ | — | | | $ | 137 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Total | $ | — | | | $ | 137 | | | $ | — | | | $ | 137 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
|
Credit Quality Indicators: To appropriately and effectively manage the ongoing credit quality of the Company’s loan portfolio, management has implemented a risk-rating or loan grading system for its loans. The system is a tool to evaluate portfolio asset quality throughout each applicable loan’s life as an asset of the Company. Generally, loans and leases are risk rated on an aggregate borrower/relationship basis with individual loans sharing similar ratings. There are some instances when specific situations relating to individual loans will provide the basis for different risk ratings within the aggregate relationship. Loans are graded on a scale of 1 to 9. A description of the general characteristics of these categories is shown below: |
|
Overall Risk Rating Definitions: Risk-ratings contain both qualitative and quantitative measurements and take into account the financial strength of a borrower and the structure of the loan or lease. Consequently, the definitions are to be applied in the context of each lending transaction and judgment must also be used to determine the appropriate risk rating, as it is not unusual for a loan or lease to exhibit characteristics of more than one risk-rating category. Consideration for the final rating is centered in the borrower’s ability to repay, in a timely fashion, both principal and interest. There were no material changes in the risk-rating or loan grading system in the nine months ended September 30, 2014. |
|
Risk Rating 1: Exceptional |
A credit supported by exceptional financial strength, stability, and liquidity. The risk rating of 1 is reserved for the Company’s top quality loans, generally reserved for investment grade credits underwritten to the standards of institutional credit providers. |
|
Risk Rating 2: Excellent |
A credit supported by excellent financial strength, stability and liquidity. The risk rating of 2 is reserved for very strong and highly stable customers with ready access to alternative financing sources. |
|
Risk Rating 3: Strong |
A credit supported by good overall financial strength and stability. Collateral margins are strong; cash flow is stable although susceptible to cyclical market changes. |
|
Risk Rating 4: Acceptable |
A credit supported by the borrower’s adequate financial strength and stability. Assets and cash flow are reasonably sound and provide for orderly debt reduction. Access to alternative financing sources will be more difficult to obtain. |
|
Risk Rating 5: Watch |
A credit with the characteristics of an acceptable credit which requires, however, more than the normal level of supervision and warrants formal quarterly management reporting. Credits in this category are not yet criticized or classified, but due to adverse events or aspects of underwriting require closer than normal supervision. Generally, credits should be watch credits in most cases for six months or less as the impact of stress factors are analyzed. |
|
Risk Rating 6: Special Mention |
A credit with potential weaknesses that deserves management’s close attention is risk rated a 6. If left uncorrected, these potential weaknesses will result in deterioration in the capacity to repay debt. A key distinction between Special Mention and Substandard is that in a Special Mention credit, there are identified weaknesses that pose potential risk(s) to the repayment sources, versus well defined weaknesses that pose risk(s) to the repayment sources. Assets in this category are expected to be in this category no more than 9-12 months as the potential weaknesses in the credit are resolved. |
|
Risk Rating 7: Substandard |
A credit with well defined weaknesses that jeopardize the ability to repay in full is risk rated a 7. These credits are inadequately protected by either the sound net worth and payment capacity of the borrower or the value of pledged collateral. These are credits with a distinct possibility of loss. Loans headed for foreclosure and/or legal action due to deterioration are rated 7 or worse. |
|
Risk Rating 8: Doubtful |
A credit with an extremely high probability of loss is risk rated 8. These credits have all the same critical weaknesses that are found in a substandard loan; however, the weaknesses are elevated to the point that based upon current information, collection or liquidation in full is improbable. While some loss on doubtful credits is expected, pending events may strengthen a credit making the amount and timing of any loss indeterminable. In these situations taking the loss is inappropriate until it is clear that the pending event has failed to strengthen the credit and improve the capacity to repay debt. |
|
Risk Rating 9: Loss |
A credit that is considered to be currently uncollectible or of such little value that it is no longer a viable Bank asset is risk rated 9. Losses should be taken in the accounting period in which the credit is determined to be uncollectible. Taking a loss does not mean that a credit has absolutely no recovery or salvage value but, rather, it is not practical or desirable to defer writing off the credit, even though partial recovery may occur in the future. |
The following table shows the Company’s portfolio of risk-rated loans and non-risk-rated loans by grade or other characteristics as of September 30, 2014 and December 31, 2013 (in thousands): |
| | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| September 30, 2014 | | | | |
| Commercial | | Multifamily | | Construction and Land | | Commercial Business | | Agricultural Business | | One- to Four-Family Residential | | Consumer | | Total Loans | | | | |
Real Estate | Real Estate | | | | |
Risk-rated loans: | | | | | | | | | | | | | | | | | | | |
Pass (Risk Ratings 1-5) (1) | $ | 1,366,811 | | | $ | 182,727 | | | $ | 364,770 | | | $ | 684,572 | | | $ | 234,787 | | | $ | 514,857 | | | $ | 342,524 | | | $ | 3,691,048 | | | | | |
| | | |
Special mention | 5,147 | | | — | | | — | | | 34,137 | | | 1,183 | | | 64 | | | 144 | | | 40,675 | | | | | |
| | | |
Substandard | 28,394 | | | 1,217 | | | 16,737 | | | 9,372 | | | 4,078 | | | 12,350 | | | 2,541 | | | 74,689 | | | | | |
| | | |
Doubtful | 265 | | | — | | | — | | | 7 | | | — | | | — | | | 11 | | | 283 | | | | | |
| | | |
Loss | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | | | |
| | | |
Total loans | $ | 1,400,617 | | | $ | 183,944 | | | $ | 381,507 | | | $ | 728,088 | | | $ | 240,048 | | | $ | 527,271 | | | $ | 345,220 | | | $ | 3,806,695 | | | | | |
| | | |
| | | | | | | | | | | | | | | | | | | |
Performing loans | $ | 1,396,923 | | | $ | 183,547 | | | $ | 380,222 | | | $ | 726,750 | | | $ | 239,819 | | | $ | 515,879 | | | $ | 343,776 | | | $ | 3,786,916 | | | | | |
| | | |
Non-performing loans (2) | 3,694 | | | 397 | | | 1,285 | | | 1,338 | | | 229 | | | 11,392 | | | 1,444 | | | 19,779 | | | | | |
| | | |
Total loans | $ | 1,400,617 | | | $ | 183,944 | | | $ | 381,507 | | | $ | 728,088 | | | $ | 240,048 | | | $ | 527,271 | | | $ | 345,220 | | | $ | 3,806,695 | | | | | |
| | | |
| | | | | | | | | | | | | | | | | | | |
| December 31, 2013 | | | | |
| Commercial | | Multifamily | | Construction and Land | | Commercial Business | | Agricultural Business | | One- to Four-Family Residential | | Consumer | | Total Loans | | | | |
Real Estate | Real Estate | | | | |
Risk-rated loans: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
Pass (Risk Ratings 1-5) (1) | $ | 1,160,921 | | | $ | 131,523 | | | $ | 332,150 | | | $ | 655,007 | | | $ | 225,329 | | | $ | 511,967 | | | $ | 291,992 | | | $ | 3,308,889 | | | | | |
| | | |
Special mention | 6,614 | | | — | | | 350 | | | 10,484 | | | 561 | | | — | | | 106 | | | 18,115 | | | | | |
| | | |
Substandard | 26,979 | | | 5,630 | | | 18,758 | | | 16,669 | | | 2,401 | | | 17,527 | | | 2,924 | | | 90,888 | | | | | |
| | | |
Doubtful | 544 | | | — | | | — | | | 9 | | | — | | | — | | | — | | | 553 | | | | | |
| | | |
Loss | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | | | |
| | | |
Total loans | $ | 1,195,058 | | | $ | 137,153 | | | $ | 351,258 | | | $ | 682,169 | | | $ | 228,291 | | | $ | 529,494 | | | $ | 295,022 | | | $ | 3,418,445 | | | | | |
| | | |
| | | | | | | | | | | | | | | | | | | |
Performing loans | $ | 1,188,771 | | | $ | 137,153 | | | $ | 350,065 | | | $ | 681,445 | | | $ | 228,187 | | | $ | 514,351 | | | $ | 293,705 | | | $ | 3,393,677 | | | | | |
| | | |
Non-performing loans (2) | 6,287 | | | — | | | 1,193 | | | 724 | | | 104 | | | 15,143 | | | 1,317 | | | 24,768 | | | | | |
| | | |
Total loans | $ | 1,195,058 | | | $ | 137,153 | | | $ | 351,258 | | | $ | 682,169 | | | $ | 228,291 | | | $ | 529,494 | | | $ | 295,022 | | | $ | 3,418,445 | | | | | |
| | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(1) | The Pass category includes some performing loans that are part of homogenous pools which are not individually risk-rated. This includes all consumer loans, all one- to four-family residential loans and, as of September 30, 2014 and December 31, 2013, in the commercial business category, $109 million and $94 million, respectively, of credit-scored small business loans. As loans in these pools become non-performing, they are individually risk-rated. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(2) | Non-performing loans include non-accrual loans and loans past due greater than 90 days and on accrual status. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
The following tables provide additional detail on the age analysis of the Company’s past due loans as of September 30, 2014 and December 31, 2013 (in thousands): |
| | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| September 30, 2014 | | | | | | | | |
| 30-59 Days | | 60-89 Days | | 90 Days or More | | Total | | Current | | Total Loans | | Loans 90 Days or More Past Due and Accruing | | | | | | | | |
Past Due | Past Due | Past Due | Past Due | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | $ | 187 | | | $ | 1,620 | | | $ | 1,258 | | | $ | 3,065 | | | $ | 543,268 | | | $ | 546,333 | | | $ | 993 | | | | | | | | | |
| | | | | | | |
Investment properties | — | | | — | | | 267 | | | 267 | | | 854,017 | | | 854,284 | | | — | | | | | | | | | |
| | | | | | | |
Multifamily real estate | — | | | — | | | — | | | — | | | 183,944 | | | 183,944 | | | — | | | | | | | | | |
| | | | | | | |
Commercial construction | — | | | — | | | — | | | — | | | 18,606 | | | 18,606 | | | — | | | | | | | | | |
| | | | | | | |
Multifamily construction | — | | | — | | | — | | | — | | | 48,606 | | | 48,606 | | | — | | | | | | | | | |
| | | | | | | |
One-to-four-family construction | — | | | — | | | — | | | — | | | 214,141 | | | 214,141 | | | — | | | | | | | | | |
| | | | | | | |
Land and land development: | | | | | | | | | | | | | | | | | | | | | |
Residential | — | | | — | | | 750 | | | 750 | | | 88,899 | | | 89,649 | | | — | | | | | | | | | |
| | | | | | | |
Commercial | — | | | — | | | — | | | — | | | 10,505 | | | 10,505 | | | — | | | | | | | | | |
| | | | | | | |
Commercial business | 188 | | | 145 | | | 899 | | | 1,232 | | | 726,856 | | | 728,088 | | | 301 | | | | | | | | | |
| | | | | | | |
Agricultural business, including secured by farmland | 14 | | | 552 | | | 229 | | | 795 | | | 239,253 | | | 240,048 | | | — | | | | | | | | | |
| | | | | | | |
One- to four-family residential | 240 | | | 3,401 | | | 7,274 | | | 10,915 | | | 516,356 | | | 527,271 | | | 2,777 | | | | | | | | | |
| | | | | | | |
Consumer: | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 368 | | | 572 | | | 176 | | | 1,116 | | | 214,269 | | | 215,385 | | | — | | | | | | | | | |
| | | | | | | |
Consumer—other | 346 | | | 67 | | | 521 | | | 934 | | | 128,901 | | | 129,835 | | | 306 | | | | | | | | | |
| | | | | | | |
Total | $ | 1,343 | | | $ | 6,357 | | | $ | 11,374 | | | $ | 19,074 | | | $ | 3,787,621 | | | $ | 3,806,695 | | | $ | 4,377 | | | | | | | | | |
| | | | | | | |
|
| | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 31-Dec-13 | | | | | | | | |
| 30-59 Days | | 60-89 Days | | 90 Days or More | | Total | | Current | | Total Loans | | Loans 90 Days or More Past Due and Accruing | | | | | | | | |
Past Due | Past Due | Past Due | Past Due | | | | | | | | |
Commercial real estate: | | | | | | | | | | | | | | | | | | | | | |
Owner-occupied | $ | 883 | | | $ | 550 | | | $ | 813 | | | $ | 2,246 | | | $ | 500,355 | | | $ | 502,601 | | | $ | — | | | | | | | | | |
| | | | | | | |
Investment properties | — | | | — | | | — | | | — | | | 692,457 | | | 692,457 | | | — | | | | | | | | | |
| | | | | | | |
Multifamily real estate | 1,845 | | | 785 | | | — | | | 2,630 | | | 134,523 | | | 137,153 | | | — | | | | | | | | | |
| | | | | | | |
Commercial construction | — | | | — | | | — | | | — | | | 12,168 | | | 12,168 | | | — | | | | | | | | | |
| | | | | | | |
Multifamily construction | — | | | — | | | — | | | — | | | 52,081 | | | 52,081 | | | — | | | | | | | | | |
| | | | | | | |
One-to-four-family construction | 9 | | | 7 | | | 4 | | | 20 | | | 200,844 | | | 200,864 | | | — | | | | | | | | | |
| | | | | | | |
Land and land development: | | | | | | | | | | | | | | | | | | | | | |
Residential | — | | | — | | | 251 | | | 251 | | | 75,444 | | | 75,695 | | | — | | | | | | | | | |
| | | | | | | |
Commercial | — | | | — | | | — | | | — | | | 10,450 | | | 10,450 | | | — | | | | | | | | | |
| | | | | | | |
Commercial business | 2,001 | | | 2 | | | 299 | | | 2,302 | | | 679,867 | | | 682,169 | | | — | | | | | | | | | |
| | | | | | | |
Agricultural business, including secured by farmland | — | | | — | | | — | | | — | | | 228,291 | | | 228,291 | | | 105 | | | | | | | | | |
| | | | | | | |
One-to four-family residential | 521 | | | 2,550 | | | 9,142 | | | 12,213 | | | 517,281 | | | 529,494 | | | 2,611 | | | | | | | | | |
| | | | | | | |
Consumer: | | | | | | | | | | | | | | | | | | | | | |
Consumer secured by one- to four-family | 723 | | | 93 | | | 918 | | | 1,734 | | | 171,454 | | | 173,188 | | | 13 | | | | | | | | | |
| | | | | | | |
Consumer—other | 384 | | | 99 | | | 131 | | | 614 | | | 121,220 | | | 121,834 | | | 131 | | | | | | | | | |
| | | | | | | |
Total | $ | 6,366 | | | $ | 4,086 | | | $ | 11,558 | | | $ | 22,010 | | | $ | 3,396,435 | | | $ | 3,418,445 | | | $ | 2,860 | | | | | | | | | |
| | | | | | | |
|
The following tables provide additional information on the allowance for loan losses and loan balances individually and collectively evaluated for impairment at or for the three and nine months ended September 30, 2014 and 2013 (in thousands): |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| For the Three Months Ended September 30, 2014 |
| Commercial | | Multifamily | | Construction and Land | | Commercial Business | | Agricultural Business | | One- to Four-Family Residential | | Consumer | | Unallocated | | Total |
Real Estate | Real Estate |
Allowance for loan losses: | | | | | | | | | | | | | | | | | |
Beginning balance | $ | 18,884 | | | $ | 5,765 | | | $ | 17,837 | | | $ | 12,014 | | | $ | 2,824 | | | $ | 9,270 | | | $ | 748 | | | $ | 6,968 | | | $ | 74,310 | |
|
Provision for loan losses | 527 | | | (853 | ) | | 2,858 | | | 490 | | | (339 | ) | | (38 | ) | | 603 | | | (3,248 | ) | | — | |
|
Recoveries | 94 | | | — | | | 84 | | | 256 | | | 587 | | | 143 | | | 53 | | | — | | | 1,217 | |
|
Charge-offs | — | | | (20 | ) | | — | | | (83 | ) | | (125 | ) | | (239 | ) | | (729 | ) | | — | | | (1,196 | ) |
|
Ending balance | $ | 19,505 | | | $ | 4,892 | | | $ | 20,779 | | | $ | 12,677 | | | $ | 2,947 | | | $ | 9,136 | | | $ | 675 | | | $ | 3,720 | | | $ | 74,331 | |
|
| | | | | | | | | | | | | | | | | |
| For the Nine Months Ended September 30, 2014 |
| Commercial | | Multifamily | | Construction and Land | | Commercial | | Agricultural | | One- to Four-Family Residential | | Consumer | | Unallocated | | Total |
Real Estate | Real Estate | Business | business |
Allowance for loan losses: | | | | | | | | | | | | | | | | | |
Beginning balance | $ | 16,759 | | | $ | 5,306 | | | $ | 17,640 | | | $ | 11,773 | | | $ | 2,841 | | | $ | 11,486 | | | $ | 1,335 | | | $ | 7,118 | | | $ | 74,258 | |
|
Provision for loan losses | 3,321 | | | (394 | ) | | 2,558 | | | 1,150 | | | (1,017 | ) | | (2,253 | ) | | 33 | | | (3,398 | ) | | — | |
|
Recoveries | 664 | | | — | | | 788 | | | 835 | | | 1,248 | | | 535 | | | 393 | | | — | | | 4,463 | |
|
Charge-offs | (1,239 | ) | | (20 | ) | | (207 | ) | | (1,081 | ) | | (125 | ) | | (632 | ) | | (1,086 | ) | | — | | | (4,390 | ) |
|
Ending balance | $ | 19,505 | | | $ | 4,892 | | | $ | 20,779 | | | $ | 12,677 | | | $ | 2,947 | | | $ | 9,136 | | | $ | 675 | | | $ | 3,720 | | | $ | 74,331 | |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| September 30, 2014 |
| Commercial | | Multifamily | | Construction and Land | | Commercial Business | | Agricultural Business | | One- to Four-Family Residential | | Consumer | | Unallocated | | Total |
Real Estate | Real Estate |
Allowance individually evaluated for impairment | $ | 755 | | | $ | 91 | | | $ | 1,269 | | | $ | 103 | | | $ | — | | | $ | 1,143 | | | $ | 58 | | | $ | — | | | $ | 3,419 | |
|
Allowance collectively evaluated for impairment | 18,750 | | | 4,801 | | | 19,510 | | | 12,574 | | | 2,947 | | | 7,993 | | | 617 | | | 3,720 | | | 70,912 | |
|
Total allowance for loan losses | $ | 19,505 | | | $ | 4,892 | | | $ | 20,779 | | | $ | 12,677 | | | $ | 2,947 | | | $ | 9,136 | | | $ | 675 | | | $ | 3,720 | | | $ | 74,331 | |
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loan balances: | | | | | | | | | | | | | | | | | |
Loans individually evaluated for impairment | $ | 8,070 | | | $ | 791 | | | $ | 6,643 | | | $ | 880 | | | $ | — | | | $ | 18,890 | | | $ | 649 | | | $ | — | | | $ | 35,923 | |
|
Loans collectively evaluated for impairment | 1,392,547 | | | 183,153 | | | 374,864 | | | 727,208 | | | 240,048 | | | 508,381 | | | 344,571 | | | — | | | 3,770,772 | |
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Total loans | $ | 1,400,617 | | | $ | 183,944 | | | $ | 381,507 | | | $ | 728,088 | | | $ | 240,048 | | | $ | 527,271 | | | $ | 345,220 | | | $ | — | | | $ | 3,806,695 | |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| For the Three Months Ended September 30, 2013 |
| Commercial | | Multifamily | | Construction and Land | | Commercial Business | | Agricultural Business | | One- to Four-Family Residential | | Consumer | | Unallocated | | Total |
Real Estate | Real Estate |
Allowance for loan losses: | | | | | | | | | | | | | | | | | |
Beginning balance | $ | 14,898 | | | $ | 4,973 | | | $ | 16,625 | | | $ | 10,806 | | | $ | 3,805 | | | $ | 14,974 | | | $ | 1,011 | | | $ | 9,029 | | | $ | 76,121 | |
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Provision for loan losses | 1,239 | | | 310 | | | (464 | ) | | (223 | ) | | (411 | ) | | (1,599 | ) | | 43 | | | 1,105 | | | — | |
|
Recoveries | 331 | | | — | | | 507 | | | 339 | | | 265 | | | 19 | | | 68 | | | — | | | 1,529 | |
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Charge-offs | (850 | ) | | — | | | — | | | (246 | ) | | (248 | ) | | (207 | ) | | (174 | ) | | — | | | (1,725 | ) |
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Ending balance | $ | 15,618 | | | $ | 5,283 | | | $ | 16,668 | | | $ | 10,676 | | | $ | 3,411 | | | $ | 13,187 | | | $ | 948 | | | $ | 10,134 | | | $ | 75,925 | |
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| | | | | | | | | | | | | | | | | |
| For the Nine Months Ended September 30, 2013 |
| Commercial | | Multifamily | | Construction and Land | | Commercial | | Agricultural | | One- to Four-Family Residential | | Consumer | | Unallocated | | Total |
Real Estate | Real Estate | Business | business |
Allowance for loan losses: | | | | | | | | | | | | | | | | | |
Beginning balance | $ | 15,322 | | | $ | 4,506 | | | $ | 14,991 | | | $ | 9,957 | | | $ | 2,295 | | | $ | 16,475 | | | $ | 1,348 | | | $ | 11,865 | | | $ | 76,759 | |
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Provision for loan losses | (383 | ) | | 777 | | | 1,586 | | | 901 | | | 752 | | | (2,166 | ) | | 264 | | | (1,731 | ) | | — | |
|
Recoveries | 2,295 | | | — | | | 945 | | | 1,391 | | | 612 | | | 138 | | | 287 | | | — | | | 5,668 | |
|
Charge-offs | (1,616 | ) | | — | | | (854 | ) | | (1,573 | ) | | (248 | ) | | (1,260 | ) | | (951 | ) | | — | | | (6,502 | ) |
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Ending balance | $ | 15,618 | | | $ | 5,283 | | | $ | 16,668 | | | $ | 10,676 | | | $ | 3,411 | | | $ | 13,187 | | | $ | 948 | | | $ | 10,134 | | | $ | 75,925 | |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| September 30, 2013 |
| Commercial | | Multifamily | | Construction and Land | | Commercial Business | | Agricultural Business | | One- to Four-Family Residential | | Consumer | | Unallocated | | Total |
Real Estate | Real Estate |
Allowance individually evaluated for impairment | $ | 459 | | | $ | 1,256 | | | $ | 2,182 | | | $ | 202 | | | $ | — | | | $ | 1,639 | | | $ | 85 | | | $ | — | | | $ | 5,823 | |
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Allowance collectively evaluated for impairment | 15,159 | | | 4,027 | | | 14,486 | | | 10,474 | | | 3,411 | | | 11,548 | | | 863 | | | 10,134 | | | 70,102 | |
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Total allowance for loan losses | $ | 15,618 | | | $ | 5,283 | | | $ | 16,668 | | | $ | 10,676 | | | $ | 3,411 | | | $ | 13,187 | | | $ | 948 | | | $ | 10,134 | | | $ | 75,925 | |
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Loan balances: | | | | | | | | | | | | | | | | | |
Loans individually evaluated for impairment | $ | 9,137 | | | $ | 5,810 | | | $ | 13,613 | | | $ | 1,115 | | | $ | — | | | $ | 28,711 | | | $ | 1,139 | | | $ | — | | | $ | 59,525 | |
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Loans collectively evaluated for impairment | 1,112,961 | | | 127,960 | | | 319,999 | | | 634,543 | | | 223,187 | | | 514,552 | | | 282,709 | | | — | | | 3,215,911 | |
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Total loans | $ | 1,122,098 | | | $ | 133,770 | | | $ | 333,612 | | | $ | 635,658 | | | $ | 223,187 | | | $ | 543,263 | | | $ | 283,848 | | | $ | — | | | $ | 3,275,436 | |
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