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Covered Loans Receivable (Tables)
 12 Months Ended
Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]  
Schedule of impaired purchased loans accretable yield
Details of certain mortgage banking activities are as follows:
 
 
Years Ended or As of December 31,
 
 
2014
 
2013
 
 
(In thousands)
Loans held for sale at lower of cost or market
 
$
5,582

 
$
—

One-to-four family residential loans sold during the year
 
55,997

 
8,460

Commitments to sell mortgage loans
 
10,625

 
—

Commitments to fund mortgage loans (at interest rates approximating market rates):
 
 
 
 
Fixed rate
 
$
8,467

 
$
—

Variable or adjustable rate
 
2,158

 
—
Covered Loans  
Accounts, Notes, Loans and Financing Receivable [Line Items]  
Schedule of loans receivable
The recorded investment of covered loans receivable at December 31, 2014 and December 31, 2013 consisted of the following portfolio segments and classes:
 
December 31, 2014
 
December 31, 2013
 
(In thousands)
Commercial business:
 
 
 
Commercial and industrial
$
19,110

 
$
14,690

Owner-occupied commercial real estate
59,244

 
24,366

Non-owner occupied commercial real estate
26,879

 
14,625

Total commercial business
105,233

 
53,681

One-to-four family residential
5,990

 
4,777

Real estate construction and land development:
 
 
 
One-to-four family residential
2,446

 
1,556

Five or more family residential and commercial properties
3,560

 
—

Total real estate construction and land development
6,006

 
1,556

Consumer
8,971

 
3,740

Gross covered loans receivable
126,200

 
63,754

Allowance for loan losses
(5,576
)
 
(6,167
)
Covered loans receivable, net
$
120,624

 
$
57,587
Loans receivable by credit quality indicator
The following tables present the recorded invested balance of the covered loans receivable by credit quality indicator as of December 31, 2014 and December 31, 2013.
 
December 31, 2014
 
Pass
 
OAEM
 
Substandard
 
Doubtful
 
Total
 
(In thousands)
Commercial business:
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
11,297

 
$
131

 
$
5,442

 
$
2,240

 
$
19,110

Owner-occupied commercial real estate
40,357

 
4,957

 
13,583

 
347

 
59,244

Non-owner occupied commercial real estate
9,656

 
40

 
17,183

 
—

 
26,879

Total commercial business
61,310

 
5,128

 
36,208

 
2,587

 
105,233

One-to-four family residential
5,414

 
425

 
151

 


 
5,990

Real estate construction and land development:
 
 
 
 
 
 
 
 
 
One-to-four family residential
2,178

 
—

 
268

 
—

 
2,446

Five or more family residential and commercial properties
1,758

 
—

 
1,802

 
—

 
3,560

Total real estate construction and land development
3,936

 
—

 
2,070

 
—

 
6,006

Consumer
7,030

 
—

 
1,941

 
—

 
8,971

Gross covered loans receivable
$
77,690

 
$
5,553

 
$
40,370

 
$
2,587

 
$
126,200

 
December 31, 2013
 
Pass
 
OAEM
 
Substandard
 
Doubtful
 
Total
 
(In thousands)
Commercial business:
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
9,516

 
$
3,887

 
$
702

 
$
585

 
$
14,690

Owner-occupied commercial real estate
21,084

 
2,318

 
708

 
256

 
24,366

Non-owner occupied commercial real estate
6,534

 
55

 
4,631

 
3,405

 
14,625

Total commercial business
37,134

 
6,260

 
6,041

 
4,246

 
53,681

One-to-four family residential
3,739

 
882

 
156

 
—

 
4,777

Real estate construction and land development:
 
 
 
 
 
 
 
 
 
One-to-four family residential
698

 
—

 
858

 
—

 
1,556

Five or more family residential and commercial properties
—

 
—

 
—

 
—

 
—

Total real estate construction and land development
698

 
—

 
858

 
—

 
1,556

Consumer
3,116

 
106

 
518

 
—

 
3,740

Gross covered loans receivable
$
44,687

 
$
7,248

 
$
7,573

 
$
4,246

 
$
63,754
Past due financing receivables
The balances of covered past due loans, segregated by segments and classes of loans, as of December 31, 2014 and December 31, 2013 were as follows:
 
December 31, 2014
 
30-89 Days
 
90 Days or
Greater
 
Total Past 
Due
 
Current
 
Total
 
90 Days or More
and  Still
Accruing (1)
 
(In thousands)
Commercial business:
 
 
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
2,262

 
$
1,163

 
$
3,425

 
$
15,685

 
$
19,110

 
$
—

Owner-occupied commercial real estate
645

 
2,680

 
3,325

 
55,919

 
59,244

 
—

Non-owner occupied commercial real estate
1,713

 
456

 
2,169

 
24,710

 
26,879

 
—

Total commercial business
4,620

 
4,299

 
8,919

 
96,314

 
105,233

 
—

One-to-four family residential
112

 
—

 
112

 
5,878

 
5,990

 
—

Real estate construction and land development:
 
 
 
 
 
 
 
 
 
 
 
One-to-four family residential
178

 
90

 
268

 
2,178

 
2,446

 
—

Five or more family residential and commercial properties
—

 
220

 
220

 
3,340

 
3,560

 
—

Total real estate construction and land development
178

 
310

 
488

 
5,518

 
6,006

 
—

Consumer
263

 
727

 
990

 
7,981

 
8,971

 
—

Gross covered loans receivable
$
5,173

 
$
5,336

 
$
10,509

 
$
115,691

 
$
126,200

 
$
—

(1)
Excludes covered PCI loans.
 
December 31, 2013
 
30-89 Days
 
90 Days or
Greater
 
Total Past 
Due
 
Current
 
Total
 
90 Days or More
and  Still
Accruing (1)
 
(In thousands)
Commercial business:
 
 
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
726

 
$
1,156

 
$
1,882

 
$
12,808

 
$
14,690

 
$
—

Owner-occupied commercial real estate
28

 
147

 
175

 
24,191

 
24,366

 
—

Non-owner occupied commercial real estate
—

 
3,540

 
3,540

 
11,085

 
14,625

 
—

Total commercial business
754

 
4,843

 
5,597

 
48,084

 
53,681

 
—

One-to-four family residential
113

 
—

 
113

 
4,664

 
4,777

 
—

Real estate construction and land development:
 
 
 
 
 
 
 
 
 
 
 
One-to-four family residential
213

 
644

 
857

 
699

 
1,556

 
—

Five or more family residential and commercial properties
—

 
—

 
—

 
—

 
—

 
—

Total real estate construction and land development
213

 
644

 
857

 
699

 
1,556

 
—

Consumer
67

 
78

 
145

 
3,595

 
3,740

 
—

Gross covered loans receivable
$
1,147

 
$
5,565

 
$
6,712

 
$
57,042

 
$
63,754

 
$
—

(1)
Excludes covered PCI loans.
Recorded investment balance and related allowance for loan losses of accruing and non-accruing TDRs
The recorded investment balance and related allowance for loan losses of covered performing and covered nonaccrual TDRs as of December 31, 2014 and December 31, 2013 were as follows:
 
December 31, 2014
 
December 31, 2013
 
Performing
TDRs
 
Nonaccrual
TDRs
 
Performing
TDRs
 
Nonaccrual
TDRs
 
(In thousands)
Covered TDRs
$
10,289

 
$
2,246

 
$
4,211

 
$
7

Allowance for loan losses on covered TDRs
1

 
2

 
660

 
—
Troubled debt restructurings on financing receivables
Covered loans that were modified as TDRs during the years ended December 31, 2014 and 2013 are set forth in the following table:
 
Years Ended December 31,
 
2014
 
2013
 
Number of
Contracts
(1)
 
Outstanding
Principal Balance
(1)(2)
 
Number of
Contracts
(1)
 
Outstanding
Principal Balance 
(1)(2)
 
(Dollars in thousands)
Commercial business:
 
 
 
 
 
 
 
Commercial and industrial
7

 
$
3,394

 
3

 
$
3,792

Owner-occupied commercial real estate
2

 
1,133

 
—

 
—

Non-owner occupied commercial real estate
2

 
7,561

 
—

 
—

Total commercial business
11

 
12,088

 
3

 
3,792

One-to-four family residential
—

 
—

 
—

 
—

Real estate construction and land development:
 
 
 
 
 
 
 
One-to-four family residential
—

 
—

 
—

 
—

Five or more family residential and commercial properties
1

 
428

 
—

 
—

Total real estate construction and land development
1

 
428

 
—

 
—

Consumer
—

 
—

 
—

 
—

Total covered TDRs
12

 
$
12,516

 
3

 
$
3,792

(1)
Number of contracts and outstanding principal balance represent loans which have balances as of year end as certain loans may have been paid-down or charged-off during the years ended December 31, 2014 and 2013.
(2)
Includes subsequent payments after modifications and reflects the balance as of period end. As the Bank did not forgive any principal or interest balance as part of the loan modification, the Bank’s recorded investment in each loan at the date of modification (pre-modification) did not change as a result of the modification (post-modification).
Purchased impaired loans
The following tables reflect the outstanding principal balance and recorded investment at December 31, 2014 and December 31, 2013 of the covered PCI loans:
 
December 31, 2014
 
December 31, 2013
 
Outstanding Principal
 
Recorded Investment
 
Outstanding Principal
 
Recorded Investment
 
(In thousands)
Commercial business:
 
 
 
 
 
 
 
Commercial and industrial
$
9,635

 
$
7,134

 
$
10,608

 
$
8,680

Owner-occupied commercial real estate
23,071

 
20,666

 
11,538

 
10,923

Non-owner occupied commercial real estate
20,607

 
20,257

 
10,611

 
12,187

Total commercial business
53,313

 
48,057

 
32,757

 
31,790

One-to-four family residential
3,837

 
3,478

 
3,966

 
3,530

Real estate construction and land development:
 
 
 
 
 
 
 
One-to-four family residential
103

 
1,308

 
1,298

 
1,556

Five or more family residential and commercial properties
2,140

 
1,802

 
—

 
—

Total real estate construction and land development
2,243

 
3,110

 
1,298

 
1,556

Consumer
2,945

 
2,717

 
2,022

 
2,000

Gross covered PCI loans
$
62,338

 
$
57,362

 
$
40,043

 
$
38,876
Schedule of impaired purchased loans accretable yield
The following table summarizes the accretable yield on the covered PCI loans resulting from the Cowlitz Acquisition and Washington Banking Merger for the years ended December 31, 2014, 2013 and 2012.
 
Years Ended December 31,
 
2014
 
2013
 
2012
 
(In thousands)
Balance at the beginning of the year
$
9,535

 
$
14,286

 
$
19,912

Accretion
(3,749
)
 
(4,210
)
 
(6,679
)
Disposal and other
(1,718
)
 
(4,902
)
 
(1,140
)
Change in accretable yield (1)
4,452

 
4,361

 
2,193

Balance at the end of the year
$
8,520

 
$
9,535

 
$
14,286

(1)
Includes accretable difference at acquisition.
Covered Nonaccrual Loans  
Accounts, Notes, Loans and Financing Receivable [Line Items]  
Schedule of average recorded investment impaired loans including restructuring loans
The recorded investment balance of covered nonaccrual loans, segregated by segments and classes of loans, were as follows as of December 31, 2014 and December 31, 2013:
 
December 31, 2014
 
December 31, 2013
 
(In thousands)
Commercial business:
 
 
 
Commercial and industrial
$
2,321

 
$
—

Owner-occupied commercial real estate
1,132

 
—

Non-owner-occupied commercial real estate
424

 
—

Total commercial business
3,877

 
—

Real estate construction and land development:
 
 
 
One-to-four family residential
179

 
—

Consumer
6

 
7

Gross covered nonaccrual loans
$
4,062

 
$
7
Covered Impaired Loans  
Accounts, Notes, Loans and Financing Receivable [Line Items]  
Schedule of average recorded investment impaired loans including restructuring loans
The average recorded investment of covered impaired loans for the years ended December 31, 2014 and 2013 are set forth in the following table.
 
 
Years Ended December 31,
 
 
2014
 
2013
 
2012
 
 
(In thousands)
Commercial business:
 
 
 
 
 
 
Commercial and industrial
 
$
3,421

 
$
1,484

 
$
21

Owner-occupied commercial real estate
 
367

 
—

 
—

Non-owner occupied commercial real estate
 
171

 
—

 
—

Total commercial business
 
3,959

 
1,484

 
21

One-to-four family residential
 
90

 
459

 
187

Real estate construction and land development:
 
 
 
 
 
 
One-to-four family residential
 
36

 
—

 
—

Total real estate construction and land development
 
36

 
—

 
—

Consumer
 
7

 
20

 
26

Gross covered impaired loans
 
$
4,092

 
$
1,963

 
$
234
Schedule of impaired loans, including restructured
Covered impaired loans as of December 31, 2014 and December 31, 2013 are set forth in the following tables.
 
December 31, 2014
 
Recorded
Investment With
No Specific
Valuation
Allowance
 
Recorded
Investment With
Specific
Valuation
Allowance
 
Total
Recorded
Investment
 
Unpaid
Contractual
Principal
Balance
 
Related
Specific
Valuation
Allowance
 
(In thousands)
Commercial business:
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
2,240

 
$
94

 
$
2,334

 
$
3,696

 
$
9

Owner-occupied commercial real estate
—

 
1,132

 
1,132

 
1,156

 
295

Non-owner occupied commercial real estate
—

 
424

 
424

 
440

 
66

Total commercial business
2,240

 
1,650

 
3,890

 
5,292

 
370

Real estate construction and land development:
 
 
 
 
 
 
 
 
 
One-to-four family residential
—

 
179

 
179

 
182

 
51

Total real estate construction and land development
—

 
179

 
179

 
182

 
51

Consumer
—

 
6

 
6

 
8

 
2

Gross covered impaired loans
$
2,240

 
$
1,835

 
$
4,075

 
$
5,482

 
$
423


 
December 31, 2013
 
Recorded
Investment With
No Specific
Valuation
Allowance
 
Recorded
Investment With
Specific
Valuation
Allowance
 
Total
Recorded
Investment
 
Unpaid
Contractual
Principal
Balance
 
Related
Specific
Valuation
Allowance
 
(In thousands)
Commercial business:
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
10

 
$
3,751

 
$
3,761

 
$
3,761

 
$
629

Total commercial business
10

 
3,751

 
3,761

 
3,761

 
629

One-to-four family residential
—

 
450

 
450

 
423

 
31

Consumer
7

 
—

 
7

 
8

 
—

Gross covered impaired loans
$
17

 
$
4,201

 
$
4,218

 
$
4,192

 
$
660