10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2020

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission file number 001-35522

BANC OF CALIFORNIA, INC.

(Exact name of registrant as specified in its charter)

Maryland

(State or other jurisdiction of

incorporation or organization)

04-3639825

(IRS Employer Identification No.)

3 MacArthur Place, Santa Ana, California

(Address of principal executive offices)

92707

(Zip Code)

(855) 361-2262

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.)  Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	BANC	New York Stock Exchange
Depositary Shares each representing a 1/40th interest in a share of 7.375% Non-Cumulative Perpetual Preferred Stock, Series D	BANC PRD	New York Stock Exchange
Depositary Shares each representing a 1/40th interest in a share of 7.00% Non-Cumulative Perpetual Preferred Stock, Series E	BANC PRE	New York Stock Exchange

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date.

As of August 3, 2020, the registrant had outstanding 49,754,330 shares of voting common stock and 477,321 shares of Class B non-voting common stock.

BANC OF CALIFORNIA, INC.

FORM 10-Q QUARTERLY REPORT

June 30, 2020

Table of Contents

		Page
Part I – Financial Information		5
Item 1 –	Financial Statements	5
	Consolidated Statements of Financial Condition	5
	Consolidated Statements of Operations	6
	Consolidated Statements of Comprehensive Income (Loss)	8
	Consolidated Statements of Stockholders' Equity	9
	Consolidated Statements of Cash Flows	11
	Notes to Consolidated Financial Statements	13
Item 2 –	Management’s Discussion and Analysis of Financial Condition and Results of Operations	50
Item 3 –	Quantitative and Qualitative Disclosures About Market Risk	80
Item 4 –	Controls and Procedures	82
Part II – Other Information		83
Item 1 –	Legal Proceedings	83
Item 1A –	Risk Factors	83
Item 2 –	Unregistered Sales of Equity Securities and Use of Proceeds	83
Item 3 –	Defaults Upon Senior Securities	84
Item 4 –	Mine Safety Disclosures	84
Item 5 –	Other Information	84
Item 6 –	Exhibits	85
Signatures		86

2

Forward-Looking Statements

When used in this report and in public stockholder communications, in other documents of Banc of California, Inc. (the Company, we, us and our) filed with or furnished to the Securities and Exchange Commission (the SEC), or in oral statements made with the approval of an authorized executive officer, the words or phrases “believe,” “will,” “should,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” “guidance” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date made. These statements may relate to our future financial performance, strategic plans or objectives, revenue, expense or earnings projections, or other financial items of Banc of California Inc. and its affiliates (the "Company", "we", "us" or "our"), as well as the continuing effects of the COVID-19 pandemic on the Company’s business, operations, financial performance and prospects. By their nature, these statements are subject to numerous uncertainties that could cause actual results to differ materially from those anticipated in the statements.

Factors that could cause actual results to differ materially from the results anticipated or projected include, but are not limited to, the following:

i.the costs and effects of litigation, including legal fees and other expenses, settlements and judgments;

ii.the effect of the novel coronavirus (COVID-19) pandemic and steps taken by governmental and other authorities to contain, mitigate, and combat the pandemic on our business, operations, loan portfolio, financial performance, and prospects;

iii.the risk that the benefits we realize from exiting the third party mortgage origination and brokered single family residential lending business will be less than anticipated and that the costs we incur from exiting that business will be greater than anticipated;

iv.the risk that we will not be successful in the implementation of our capital utilization strategy and our other strategies for transitioning to a traditional community bank;

v.our ability to obtain regulatory approvals or non-objection to take various capital actions, including the payment of dividends by us or our bank subsidiary or repurchases of our common or preferred stock;

vi.risks that any merger and acquisition transactions of the Company may disrupt current plans and operations and lead to difficulties in customer and employee retention, risks that the costs, fees, expenses and charges related to these transactions could be significantly higher than anticipated and risks that the expected revenues, cost savings, synergies, and other benefits of these transactions might not be realized to the extent anticipated, within the anticipated timetables, or at all;

vii.fluctuations in the demand for loans and fluctuations in commercial and residential real estate values in our market area;

viii.the credit risks of lending activities, which may be affected by deterioration in real estate markets, the financial condition of borrowers, and the operational risk of lending activities, including but not limited to, the effectiveness of our underwriting practices and the risk of fraud; any of which may lead to increased loan delinquencies, losses, and non-performing assets in our loan portfolio which may result in our allowance for credit losses not being adequate and require us to materially increase our credit loss reserves;

ix.the Financial Accounting Standards Board's Current Expected Credit Loss accounting standard, which requires financial institutions to determine periodic estimates of lifetime expected credit losses on loans, and provide for the expected credit losses as allowances for loan losses;

x.the quality and composition of our securities portfolio, particularly the credit risks within our collateralized loan obligation investment portfolio and other asset classes;

xi.errors in estimates of the fair values of certain of our assets and liabilities, which may result in significant changes in valuation;

xii.changes in general economic conditions, either nationally or in our market areas, or changes in financial markets;

xiii.continuation of, or changes in, the short-term interest rate environment, changes in the levels of general interest rates, volatility in the interest rate environment, the relative differences between short- and long-term interest rates, deposit interest rates, our net interest margin, and funding sources;

xiv.our ability to develop and maintain a strong core deposit base or other low cost funding sources necessary to fund our activities;

xv.results of examinations of us by regulatory authorities and the possibility that any such regulatory authority may, among other things, limit our business activities, require us to change our business mix, increase our allowance for credit losses, write-down asset values, increase our capital levels, or affect our ability to borrow funds or maintain or increase deposits, any of which could adversely affect our liquidity and earnings;

xvi.legislative or regulatory changes that adversely affect our business, including, without limitation, changes in tax laws and policies and changes in regulatory capital or other rules, and the availability of resources to address or respond to such changes;

xvii.our ability to control operating costs and expenses;

xviii.staffing fluctuations in response to product demand or the implementation of corporate strategies that affect our work force and potential associated charges;

xix.the risk that our enterprise risk management framework may not be effective in mitigating risk and reducing the potential for losses;

xx.failures or security breaches with respect to the network and computer systems on which we depend;

xxi.our ability to attract and retain key members of our senior management team;

xxii.increased competitive pressures among financial services companies;

xxiii.changes in consumer spending, borrowing and saving habits;

xxiv.the effects of severe weather, natural disasters, pandemics, acts of war or terrorism and other external events on our business;

xxv.the ability of key third-party providers to perform their obligations to us;

xxvi.changes in accounting policies and practices, as may be adopted by the financial institution regulatory agencies or the Financial Accounting Standards Board or their application to our business, including additional guidance and interpretation on accounting issues and details of the implementation of new accounting methods;

xxvii.share price volatility and reputational risks, related to, among other things, speculative trading and certain traders shorting our common shares and attempting to generate negative publicity about us; and

xxviii.other economic, competitive, governmental, regulatory, and technological factors affecting our operations, pricing, products and services and the other risks described in this report and from time to time in other documents that we file with or furnish to the SEC, including, without limitation, the risks described under Part I. Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2019 and under Part II. Item 1A. “Risk Factors” of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2020.

Further, statements about the continuing effects of the COVID-19 pandemic on our business, operations, financial performance, and prospects may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable, and in many cases beyond our control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on our clients, third parties, and us.

We undertake no obligation to update any such statement to reflect circumstances or events that occur after the date, on which the forward-looking statement is made, except as required by law.

3

PART I – FINANCIAL INFORMATION

ITEM 1 – FINANCIAL STATEMENTS

BANC OF CALIFORNIA, INC.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Amounts in thousands, except share and per share data)

(Unaudited)

	June 30, 2020		December 31, 2019
ASSETS
Cash and due from banks	$	23,394	$	28,890
Interest-earning deposits in financial institutions	397,246		344,582
Total cash and cash equivalents	420,640		373,472
Securities available-for-sale, at fair value	1,176,029		912,580
Loans held-for-sale, carried at fair value	19,768		22,642
Loans receivable	5,627,696		5,951,885
Allowance for credit losses - loans	(90,370)		(57,649)
Loans receivable, net	5,537,326		5,894,236
Federal Home Loan Bank and other bank stock, at cost	46,585		59,420
Premises, equipment, net	125,247		128,021
Bank owned life insurance	110,487		109,819
Operating lease right-of-use assets	19,408		22,540
Investments in alternative energy partnerships, net	26,967		29,300
Deferred income taxes, net	48,288		44,906
Income tax receivable	13,094		4,233
Goodwill	37,144		37,144
Other intangible assets, net	3,292		4,151
Other assets	185,863		185,946
Total assets	$	7,770,138	$	7,828,410
LIABILITIES AND STOCKHOLDERS’ EQUITY
Noninterest-bearing deposits	$	1,391,504	$	1,088,516
Interest-bearing deposits	4,645,961		4,338,651
Total deposits	6,037,465		5,427,167
Federal Home Loan Bank advances, net	617,170		1,195,000
Long-term debt, net	173,537		173,421
Reserve for loss on repurchased loans	5,567		6,201
Operating lease liabilities	20,531		23,692
Accrued expenses and other liabilities	68,909		95,684
Total liabilities	6,923,179		6,921,165
Commitments and contingent liabilities
Preferred stock	185,037		189,825
Common stock, $0.01 par value per share, 446,863,844 shares authorized; 52,161,922 shares issued and 49,750,958 shares outstanding at June 30, 2020; 51,997,061 shares issued and 50,413,681 shares outstanding at December 31, 2019	522		520
Class B non-voting non-convertible common stock, $0.01 par value per share, 3,136,156 shares authorized; 477,321 shares issued and outstanding at June 30, 2020 and at December 31, 2019	5		5
Additional paid-in capital	632,117		629,848
Retained earnings	85,670		127,733
Treasury stock, at cost (2,410,964 and 1,583,380 shares at June 30, 2020 and December 31, 2019)	(40,827)		(28,786)
Accumulated other comprehensive loss, net	(15,565)		(11,900)
Total stockholders’ equity	846,959		907,245
Total liabilities and stockholders’ equity	$	7,770,138	$	7,828,410

See accompanying notes to consolidated financial statements (unaudited)

4

BANC OF CALIFORNIA, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except per share data)

(Unaudited)

	Three Months Ended						Six Months Ended June 30,
	June 30, 2020		March 31, 2020		June 30, 2019		2020		2019
Interest and dividend income
Loans, including fees	$	63,642	$	65,534	$	89,159	$	129,176	$	179,717
Securities	7,816		7,820		12,457		15,636		30,298
Other interest-earning assets	1,239		1,360		2,424		2,599		4,737
Total interest and dividend income	72,697		74,714		104,040		147,411		214,752
Interest expense
Deposits	10,205		14,611		28,598		24,816		60,041
Federal Home Loan Bank advances	4,818		5,883		8,289		10,701		17,370
Securities sold under repurchase agreements	2		—		16		2		34
Long-term debt and other interest-bearing liabilities	2,357		2,359		2,357		4,716		4,719
Total interest expense	17,382		22,853		39,260		40,235		82,164
Net interest income	55,315		51,861		64,780		107,176		132,588
Provision for (reversal of) credit losses	11,826		15,761		(1,900)		27,587		198
Net interest income after provision for (reversal of) credit losses	43,489		36,100		66,680		79,589		132,390
Noninterest income
Customer service fees	1,224		1,096		1,434		2,320		2,949
Loan servicing income	95		75		121		170		239
Income from bank owned life insurance	591		578		580		1,169		1,105
Net gain on sale of securities available-for-sale	2,011		—		—		2,011		208
Fair value adjustment for loans held-for-sale	25		(1,586)		59		(1,561)		60
Net (loss) gain on sale of loans	—		(27)		2,767		(27)		4,319
Other income (loss)	1,582		1,925		(7,251)		3,507		(4,875)
Total noninterest income (loss)	5,528		2,061		(2,290)		7,589		4,005
Noninterest expense
Salaries and employee benefits	24,260		23,436		27,506		47,696		55,945
Naming rights termination	26,769		—		—		26,769		—
Occupancy and equipment	7,090		7,243		7,955		14,333		15,641
Professional fees	4,596		5,964		(2,903)		10,560		8,138
Data processing	1,536		1,773		1,672		3,309		3,168
Advertising and promotion	1,157		1,756		2,048		2,913		4,105
Regulatory assessments	725		484		2,136		1,209		4,618
(Gain) loss on investments in alternative energy partnerships	(167)		1,905		(355)		1,738		1,595
Reversal of provision for loan repurchases	(34)		(600)		(61)		(634)		(177)
Amortization of intangible assets	430		429		621		859		1,241
Restructuring (reversal) expense	—		—		(158)		—		2,637
All other expense	6,408		4,529		5,039		10,937		8,838
Total noninterest expense	72,770		46,919		43,500		119,689		105,749
(Loss) income from operations before income taxes	(23,753)		(8,758)		20,890		(32,511)		30,646
Income tax (benefit) expense	(5,304)		(2,165)		4,308		(7,469)		7,027
Net (loss) income	(18,449)		(6,593)		16,582		(25,042)		23,619
Preferred stock dividends	3,442		3,533		4,308		6,975		8,616
Income allocated to participating securities	—		—		271		—		153
Participating securities dividends	94		94		94		188		295
Impact of preferred stock redemption	(49)		(526)		—		(575)		—
Net (loss) income available to common stockholders	$	(21,936)	$	(9,694)	$	11,909	$	(31,630)	$	14,555
(Loss) earnings per common share:
Basic	$	(0.44)	$	(0.19)	$	0.23	$	(0.63)	$	0.29
Diluted	$	(0.44)	$	(0.19)	$	0.23	$	(0.63)	$	0.29
(Loss) earnings per class B common share:
Basic	$	(0.44)	$	(0.19)	$	0.23	$	(0.63)	$	0.29
Diluted	$	(0.44)	$	(0.19)	$	0.23	$	(0.63)	$	0.29

See accompanying notes to consolidated financial statements (unaudited)

5

BANC OF CALIFORNIA, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Amounts in thousands)

(Unaudited)

	Three Months Ended						Six Months Ended June 30,
	June 30, 2020		March 31, 2020		June 30, 2019		2020		2019
Net (loss) income	$	(18,449)	$	(6,593)	$	16,582	$	(25,042)	$	23,619
Other comprehensive income (loss), net of tax:
Unrealized gain (loss) on available-for-sale securities:
Unrealized gain (loss) arising during the period	40,002		(42,248)		5,423		(2,246)		11,596
Reclassification adjustment for (gain) loss included in net (loss) income	(1,419)		—		—		(1,419)		(147)
Total change in unrealized gain (loss) on available-for-sale securities	38,583		(42,248)		5,423		(3,665)		11,449
Total other comprehensive income (loss)	38,583		(42,248)		5,423		(3,665)		11,449
Comprehensive income (loss)	$	20,134	$	(48,841)	$	22,005	$	(28,707)	$	35,068

See accompanying notes to consolidated financial statements (unaudited)

6

BANC OF CALIFORNIA, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Amounts in thousands)

(Unaudited)

	Preferred Stock		Common Stock				Additional Paid-in Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
			Voting		Class B Non-Voting
Three Months Ended June 30, 2020
Balance at March 31, 2020	$	187,687	$	520	$	5	$	631,125	$	110,640	$	(40,827)	$	(54,148)	$	835,002
Comprehensive loss:
Net loss	—		—		—		—		(18,449)		—		—		(18,449)
Other comprehensive income, net	—		—		—		—		—		—		38,583		38,583
Issuance of common stock	—		2		—		(2)		—		—		—		—
Redemption of preferred stock	(2,650)		—		—		—		49		—		—		(2,601)
Share-based compensation expense	—		—		—		1,470		—		—		—		1,470
Restricted stock surrendered due to employee tax liability	—		—		—		(476)		—		—		—		(476)
Shares purchased under the Dividend Reinvestment Plan	—		—		—		—		(28)		—		—		(28)
Stock appreciation right dividend equivalents	—		—		—		—		(94)		—		—		(94)
Dividends declared ($0.06 per common share)	—		—		—		—		(3,006)		—		—		(3,006)
Preferred stock dividends	—		—		—		—		(3,442)		—		—		(3,442)
Balance at June 30, 2020	$	185,037	$	522	$	5	$	632,117	$	85,670	$	(40,827)	$	(15,565)	$	846,959
Three Months Ended June 30, 2019
Balance at March 31, 2019	$	231,128	$	518	$	5	$	626,608	$	136,943	$	(28,786)	$	(18,091)	$	948,325
Comprehensive income:
Net income	—		—		—		—		16,582		—		—		16,582
Other comprehensive income, net	—		—		—		—		—		—		5,423		5,423
Issuance of common stock	—		2		—		(2)		—		—		—		—
Share-based compensation expense	—		—		—		1,497		—		—		—		1,497
Restricted stock surrendered due to employee tax liability	—		—		—		(797)		—		—		—		(797)
Shares purchased under the Dividend Reinvestment Plan	—		—		—		—		(26)		—		—		(26)
Stock appreciation right dividend equivalents	—		—		—		—		(94)		—		—		(94)
Dividends declared ($0.06 per common share)	—		—		—		—		(3,058)		—		—		(3,058)
Preferred stock dividends	—		—		—		—		(4,308)		—		—		(4,308)
Balance at June 30, 2019	$	231,128	$	520	$	5	$	627,306	$	146,039	$	(28,786)	$	(12,668)	$	963,544
Six Months Ended June 30, 2020
Balance at December 31, 2019	$	189,825	$	520	$	5	$	629,848	$	127,733	$	(28,786)	$	(11,900)	$	907,245
Impact of adoption of ASU No. 2016-13	—		—		—		—		(4,503)		—		—		(4,503)
Comprehensive loss:
Net loss	—		—		—		—		(25,042)		—		—		(25,042)
Other comprehensive loss, net	—		—		—		—		—		—		(3,665)		(3,665)
Issuance of common stock	—		2		—		(2)		—		—		—		—
Redemption of preferred stock	(4,788)		—		—		—		575		—		—		(4,213)
Purchase of 827,584 shares of treasury stock	—		—		—		—		—		(12,041)		—		(12,041)
Share-based compensation expense	—		—		—		3,046		—		—		—		3,046
Restricted stock surrendered due to employee tax liability	—		—		—		(775)		—		—		—		(775)
Shares purchased under the Dividend Reinvestment Plan	—		—		—		—		(47)		—		—		(47)
Stock appreciation right dividend equivalents	—		—		—		—		(188)		—		—		(188)
Dividends declared ($0.12 per common share)	—		—		—		—		(5,883)		—		—		(5,883)
Preferred stock dividends	—		—		—		—		(6,975)		—		—		(6,975)
Balance at June 30, 2020	$	185,037	$	522	$	5	$	632,117	$	85,670	$	(40,827)	$	(15,565)	$	846,959
Six Months Ended June 30, 2019
Balance at December 31, 2018	$	231,128	$	518	$	5	$	625,834	$	140,952	$	(28,786)	$	(24,117)	$	945,534
Comprehensive income:
Net income	—		—		—		—		23,619		—		—		23,619
Other comprehensive income, net	—		—		—		—		—		—		11,449		11,449
Issuance of common stock	—		2		—		(2)		—		—		—		—
Share-based compensation expense	—		—		—		2,350		—		—		—		2,350
Restricted stock surrendered due to employee tax liability	—		—		—		(876)		—		—		—		(876)
Shares purchased under the Dividend Reinvestment Plan	—		—		—		—		(76)		—		—		(76)
Stock appreciation right dividend equivalents	—		—		—		—		(296)		—		—		(296)
Dividends declared ($0.19 per common share)	—		—		—		—		(9,544)		—		—		(9,544)
Preferred stock dividends	—		—		—		—		(8,616)		—		—		(8,616)
Balance at June 30, 2019	$	231,128	$	520	$	5	$	627,306	$	146,039	$	(28,786)	$	(12,668)	$	963,544

See accompanying notes to consolidated financial statements (unaudited)

7

BANC OF CALIFORNIA, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)

	Six Months Ended June 30,
	2020		2019
Cash flows from operating activities:
Net (loss) income	$	(25,042)	$	23,619
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities
Provision for credit losses	27,587		198
Reversal of provision for loan repurchases	(634)		(177)
Depreciation on premises and equipment	8,404		5,290
Amortization of intangible assets	859		1,241
Amortization of debt issuance costs	139		83
Net amortization of premium on securities	258		649
Net amortization of deferred loan costs and fees	(553)		83
Accretion of discounts on purchased loans	(355)		(125)
Write-off of other assets related to naming rights termination, net	6,669		—
Debt extinguishment fee	2,515		—
Deferred income tax (benefit) expense	(71)		1,841
Bank owned life insurance income	(1,169)		(1,105)
Share-based compensation expense	3,046		2,350
Loss on interest rate swaps	288		9,583
Loss on investments in alternative energy partnerships and affordable housing investments	4,033		2,785
Impairment on capitalized software projects	157		835
Fair value adjustment for loans held-for-sale	1,561		(60)
Net loss (gain) on sale of loans	27		(4,319)
Net gain on sale of securities available-for-sale	(2,011)		(208)
Loss on sale or disposal of property and equipment	106		9
Repurchase of mortgage loans	—		(699)
Proceeds from sales of and principal collected on loans held-for-sale	613		3,849
Proceeds from sales of and principal collected on other loans held-for-sale	—		426
Change in accrued interest receivable and other assets	1,119		(14,593)
Change in accrued interest payable and other liabilities	(30,093)		(5,341)
Net cash (used in) provided by operating activities	(2,547)		26,214
Cash flows from investing activities:
Proceeds from sales of securities available-for-sale	22,728		782,019
Proceeds from maturities and calls of securities available-for-sale	30,000		38,029
Proceeds from principal repayments of securities available-for-sale	2,971		20,538
Purchases of securities available-for-sale	(322,590)		—
Cash received from bank-owned life insurance	501		—
Loan originations and principal collections, net	349,818		(149,182)
Purchase of loans and leases	(25,839)		—
Redemption of Federal Home Loan Bank stock	22,171		29,760
Purchase of Federal Home Loan Bank and other bank stock	(9,336)		(38,039)
Proceeds from sale of loans	—		558,021
Proceeds from sale of other real estate owned	—		551
Purchases of premises and equipment	(3,467)		(5,967)
Payments of capital lease obligations	(266)		(259)
Funding of equity investment	(14,201)		(1,501)
(Increase) decrease in investments in alternative energy partnerships	(2,630)		760
Net cash provided by investing activities	49,860		1,234,730
Cash flows provided by (used in) financing activities:
Net increase (decrease) in deposits	610,298		(1,624,354)
Net (decrease) increase in short-term Federal Home Loan Bank advances	(447,000)		305,000
Repayment of long-term Federal Home Loan Bank advances	(235,000)		—
Proceeds from long-term Federal Home Loan Bank advances	111,000		—
Debt extinguishment and financing fees paid	(9,368)		—
Redemption of preferred stock	(4,213)		—
Purchase of treasury stock	(12,041)		—
Purchase of restricted stock surrendered due to employee tax liability	(775)		(876)
Dividend equivalents paid on stock appreciation rights	(188)		(296)
Dividends paid on preferred stock	(6,975)		(8,616)
Dividends paid on common stock	(5,883)		(9,544)
Net cash used in financing activities	(145)		(1,338,686)
Net change in cash and cash equivalents	47,168		(77,742)
Cash and cash equivalents at beginning of period	373,472		391,592
Cash and cash equivalents at end of period	$	420,640	$	313,850
Supplemental cash flow information
Interest paid on deposits and borrowed funds	40,626		85,733
Income taxes paid	62		2,822
Income taxes refunds received	—		7
Supplemental disclosure of non-cash activities
Transfer from loans to other real estate owned, net	—		276
Transfer of loans held-for-investment to loans held-for-sale	—		1,127,339
Equipment acquired under capital leases	30		40
Operating lease right-of-use assets recognized	—		27,421
Operating lease liabilities recognized	—		28,822
Impact of adoption of ASU 2016-13 on retained earnings	(4,503)		—

See accompanying notes to consolidated financial statements (unaudited)

8

BANC OF CALIFORNIA, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

June 30, 2020

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations: Banc of California, Inc. (collectively, with its consolidated subsidiaries, the Company, we, us, and our) is a financial holding company under the Bank Holding Company Act of 1956, as amended, headquartered in Santa Ana, California and incorporated under the laws of Maryland. Banc of California, Inc. is subject to regulation by the Board of Governors of the Federal Reserve System (“FRB”) and its wholly-owned subsidiary, Banc of California, National Association (the Bank), operates under a national bank charter issued by the Office of the Comptroller of the Currency (“OCC”), the Bank's primary regulator. The Bank is a member of the Federal Home Loan Bank (“FHLB”) system, and maintains insurance on deposit accounts with the Federal Deposit Insurance Corporation (“FDIC”).

The Bank offers a variety of financial services to meet the banking and financial needs of the communities it serves, with operations conducted through 31 full-service branches located throughout Southern California as of June 30, 2020.

Basis of Presentation: The accompanying unaudited interim consolidated financial statements have been prepared pursuant to Article 10 of SEC Regulation S-X and other SEC rules and regulations for reporting on the Quarterly Report on Form 10-Q. Accordingly, certain disclosures required by U.S. generally accepted accounting principles (“GAAP”) are not included herein. These interim statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report on Form 10-K for the year ended December 31, 2019 filed by us with the SEC. The December 31, 2019 consolidated statements of financial condition presented herein has been derived from the audited financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC. Certain prior period amounts have been reclassified to conform to current period presentation, including i) reclassification of the provision for losses on unfunded loan commitments from being included in other noninterest expense to being included within provision for credit losses, ii) showing the unrealized fair value adjustment for loans held-for-sale separate from the realized net (loss) gain on sale of loans, and iii) reclassification of outside services expense from "outside services fees" to "all other expense" in the consolidated statements of operations.

In the opinion of management of the Company, the accompanying unaudited interim consolidated financial statements reflect all of the adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the consolidated financial condition and consolidated results of operations as of the dates and for the periods presented. The results of operations for the three and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020.

Principles of Consolidation: The accompanying unaudited consolidated financial statements include the accounts of the Company and its consolidated subsidiaries as of June 30, 2020 and December 31, 2019 and for the three and six months ended June 30, 2020 and 2019. Significant intercompany accounts and transactions have been eliminated in consolidation. Unless the context requires otherwise, all references to the Company include its then wholly-owned subsidiaries.

Adopted Accounting Pronouncements:

On January 1, 2020, we adopted Accounting Standards Update (“ASU”) 2016-13, Financial Instruments-Credit Losses (Topic 326) (“ASU 2016-13”), which replaces the incurred loss impairment methodology with a methodology that reflects current expected credit losses (“CECL”) and requires consideration of a broader range of reasonable and supportable information to estimate expected credit losses. The measurement of expected credit losses under the CECL model is applicable to financial assets measured at amortized cost, including loan receivables, held-to-maturity debt securities and off-balance sheet credit exposures. ASU 2016-13 also requires credit losses relating to available-for-sale debt securities to be recorded through an allowance for credit losses. In addition, ASU 2016-13 modifies the other-than-temporary impairment (“OTTI”) model for available-for-sale (“AFS”) debt securities to require an allowance for credit impairment instead of a direct write-down, which allows for reversal of credit impairments in future periods based on improvements in credit quality.

We adopted ASU 2016-13 using the modified retrospective method for our financial assets measured at cost, including loans receivable and off-balance sheet credit exposures. Results for reporting periods beginning January 1, 2020 are reported under ASU 2016-13 (or Accounting Standards Codification 326), while prior period results continue to be reported under the previously applicable GAAP. The adoption of ASU 2016-13 on January 1, 2020 resulted in an increase of $6.4 million to our allowance for credit losses and an after-tax net decrease in retained earnings of $4.5 million. This transition adjustment reflects the development of our models to estimate lifetime expected credit losses on our loans, unfunded commitments, and other off-balance sheet credit exposure primarily using a lifetime loss methodology.

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The following table presents the impact of adopting ASU 2016-13 on January 1, 2020:

($ in thousands)	As Reported Under ASC 326		Pre- ASC 326 Adoption		Impact of ASC 326 Adoption
Assets:
Allowance for credit losses - loans
Commercial:
Commercial and industrial	$	23,015	$	22,353	$	662
Commercial real estate	10,788		5,941		4,847
Multifamily	13,214		11,405		1,809
SBA	3,508		3,120		388
Construction	4,009		3,906		103
Consumer:
Single family residential mortgage	10,066		10,486		(420)
Other consumer	658		438		220
Total	65,258		57,649		7,609
Liabilities:
Allowance for credit losses - unfunded loan commitments	$	2,838	$	4,064	$	(1,226)

Significant Accounting Policies: The accounting and reporting policies of the Company are based upon GAAP and conform to predominant practices within the banking industry. We have not made any significant changes in our critical accounting policies from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC, except for the accounting for loans and the allowance for credit losses, the allowance for credit losses on unfunded loan commitments, troubled debt restructurings, and available-for-sale debt securities as described below.

Allowance for Credit Losses (ACL): The ACL is a reserve established through a provision for credit loss expense and represents management’s best estimate of the net amount expected to be collected from loans receivable as of the date of the consolidated statements of financial condition. Confirmed losses are charged against the ACL. Subsequent recoveries, if any, are credited to the ACL. We perform an analysis of the adequacy of the ACL at least quarterly. Management estimates the required ACL balance using past loan loss experience, the nature and volume of the portfolio, information about specific borrower situations, estimated collateral values, economic conditions, and other factors. The ACL consists of; (i) a specific allowance established for probable losses on individually identified impaired loans, (ii) a quantitative allowance for current expected loan losses based on the portfolio and expected economic conditions over a reasonable and supportable forecast period that reverts back to long-term trends to cover the life of loan; and (iii) a qualitative allowance to capture factors and trends that are not adequately reflected in the quantitative allowance, including an evaluation of our underwriting, other credit-related processes, and other credit risk factors such as concentration risk. Accrued interest is excluded from our expected credit loss estimates.

Expected credit losses are estimated over the contractual term of the loans, adjusted for prepayments, as appropriate. The contractual term excludes expected extensions and renewals unless those extension or renewal options are included in the underlying contract and we do not have the ability to unconditionally cancel. The contractual term also excludes expected modifications unless management has a reasonable expectation, at the reporting period, that a troubled debt restructuring will be executed.

A loan is deemed impaired when, based on current information and events, it is probable that we will be unable to collect all amounts due according to the contractual terms of the loan agreement. We measure expected credit losses on all impaired loans individually under the guidance of ASC 326, Receivables, primarily through the evaluation of collateral values and estimated cash flows expected to be collected. Cash receipts on impaired loans for which the accrual of interest has been discontinued are applied first to principal and then to interest income. Loans for which the terms have been modified by granting a concession that normally would not be provided and where the borrower is experiencing financial difficulties are considered troubled debt restructurings (“TDRs”) and classified as impaired.

Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls, generally, are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the

10

borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. The impairment amount on a collateral dependent loan is generally charged-off to the ACL and the impairment amount on a loan, that is not collateral dependent, is set-up as a specific reserve. TDRs are also measured at the present value of estimated future cash flows using the loan’s effective rate at inception or at the fair value of collateral, less costs to sell, if repayment is expected solely from the collateral. For TDRs that subsequently default, we determine the amount of reserve in accordance with the accounting policy for the ACL.

At June 30, 2020, the following loan portfolio segments have been identified:

•Commercial and industrial (general commercial and industrial, warehouse lending, and indirect/direct leveraged lending)

•Commercial real estate

•Multifamily

•Small Business Administration (“SBA”)

•Construction

•SFR - 1st deeds of trust (generally SFR mortgage and other)

•Other consumer (HELOC and other)

We categorize loans into risk categories based on relevant information about the ability of borrowers to service their obligations such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. We analyze loans individually by classifying the loans as to credit risk.

Loans secured by multifamily and commercial real estate properties generally involve a greater degree of credit risk than SFR mortgage loans. Because payments on loans secured by multifamily and commercial real estate properties are often dependent on the successful operation or management of the properties, repayment of these loans may be subject to adverse conditions in the real estate market or the economy. Commercial and industrial loans are also considered to have a greater degree of credit risk than SFR mortgage loans due to the fact commercial and industrial loans are typically made on the basis of the borrower’s ability to make repayment from the cash flow of the borrower’s business. As a result, the availability of funds for the repayment of commercial and industrial loans may be substantially dependent on the success of the business itself (which, in turn, is often dependent, in part, upon general economic conditions). SBA loans are similar to commercial and industrial loans, however, they have additional credit enhancement in the form of a guaranty provided by the U.S. Small Business Administration, for up to 85% of the loan amount for loans up to $150 thousand and 75% of the loan amount for loans of more than $150 thousand. SBA loans originated as part of the Paycheck Protection Program (“PPP”) established by the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) have additional credit enhancement provided by the U.S. Small Business Administration for up to 100% of the loan amount. As of June 30, 2020, we funded $240.7 million in PPP loans. During the three months ended June 30, 2020, we collected $7.5 million in fees on PPP loans funded during the quarter, which will be recognized over their estimated life of 9 months. The 9 months estimated life of PPP loans is based on our understanding of our clients' cash use, expected forgiveness probability, and loan forgiveness process. The availability of funds for the repayment of financing may be substantially dependent on the success of the business itself which is often dependent, in part, upon general economic conditions. Consumer loans may have greater risk than SFR mortgage loans given that collection of these loans is dependent on the borrower’s continuing financial stability and, thus, are more likely to be adversely affected by job loss, divorce, illness, or personal bankruptcy.

Green Loans are considered to carry a higher degree of credit risk due to their unique cash flows. Credit risk on this asset class is also managed through the completion of regular third party automated valuation models (“AVMs”) of the underlying collateral and monitoring of the borrower’s usage of this account to determine if the borrower is making monthly payments from external sources or “drawdowns” on their line. In cases where the property values have declined to levels less than the original loan to value (“LTV”) ratios, or other levels deemed prudent by us, we may curtail the line and/or require monthly payments or principal reductions to bring the loan in balance.

On interest only loans, we project future payment changes to determine if there will be a material increase in the required payment and then monitor the loans for possible delinquency. Individual loans are monitored for possible downgrading of risk rating.

Troubled Debt Restructurings: A loan is identified as a TDR when a borrower is experiencing financial difficulties and, for economic or legal reasons related to these difficulties, we grant a concession to the borrower in the restructuring that we would not otherwise consider. We have granted a concession when, as a result of the restructuring to a troubled borrower, we do not expect to collect all amounts due, including principal and/or interest accrued at the original terms of the loan. The concessions may be granted in various forms, including a below-market change in the stated interest rate, a reduction in the loan balance or accrued interest, an extension of the maturity date, or a note split with principal forgiveness. Loans for which the borrower has been discharged under Chapter 7 bankruptcy are considered collateral dependent TDRs, impaired at the date of discharge, and

11

charged down to the fair value of collateral less cost to sell. A restructuring executed at an interest rate that is at market interest rates based on the current credit characteristics of the borrower is not a TDR.

Our policy is to place consumer loan TDRs, except those that were performing prior to TDR status, on non-accrual status for a minimum period of 6 months. Commercial TDRs are evaluated on a case-by-case basis for determination whether or not to place them on non-accrual status. Loans qualify for return to accrual status once they have demonstrated performance under the restructured terms of the loan for a minimum of 6 months. Initially, all TDRs are reported as impaired. Generally, TDRs are classified as impaired loans and reported as TDRs for the remaining life of the loan. Impaired and TDR classification may be removed if the borrower demonstrates compliance with the modified terms for a minimum of 6 months, through one fiscal year-end and the restructuring agreement specifies a market rate of interest equal to that which would be provided to a borrower with similar credit at the time of restructuring. In the limited circumstance that a loan is removed from TDR classification, it is our policy to continue to base our measure of loan impairment on the contractual terms specified by the loan agreement.

Troubled Debt Restructuring (TDR) Relief: Under U.S. GAAP, banks are required to assess modifications to a loan’s terms for potential classification as a TDR. A loan to a borrower experiencing financial difficulty is classified as a TDR when a lender grants a concession that it would otherwise not consider, such as a payment deferral or interest concession. In order to encourage banks to work with impacted borrowers, the CARES Act and U.S. banking regulatory agencies have provided relief from TDR accounting. The main benefits of TDR relief include 1) a capital benefit in the form of reduced risk-weighted assets, as TDRs are more heavily risk-weighted for capital purposes; 2) a delinquency status benefit, as the aging of loans are frozen, i.e., they will continue to be reported in the same delinquency bucket they were in at the time of modification; and 3) a non-accrual status benefit as the loans are generally not reported as non-accrual during the modification period.

Reserve for Unfunded Loan Commitments: The reserve for unfunded loan commitments provides for estimated credit losses for the unused portion of lending commitments expected to be funded, except for unconditionally cancellable commitments for which no reserve is required under ASC 326. The reserve for unfunded loan commitments includes factors that are consistent with ACL methodology for loans using the expected loss factors and a draw down factor applied to the underlying borrower risk and facility grades. Changes in the reserve for unfunded loan commitments are reported as a component of provision for credit losses in the consolidated statements of operations and the reserve for unfunded loan commitments is included in other liabilities in the consolidated statements of financial condition.

Available-for-Sale Debt Securities: Available-for-sale debt securities are analyzed for credit losses under ASC 326, which requires the Company to determine whether impairment exists as of the reporting date and whether that impairment is due to credit losses. An allowance for credit losses is established for losses on available-for-sale debt securities due to credit losses and is reported as a component of provision for credit losses. Accrued interest is excluded from our expected credit loss estimates. Available-for-sale debt securities are typically classified as non-accrual when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about the further collectability of principal or interest. When available-for-sale debt securities are placed on non-accrual status, unpaid interest recognized as interest income is reversed.

Use of Estimates in the Preparation of Financial Statements: The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the consolidated financial statements and disclosures provided, and actual results could differ. The ACL, reserve for loss on repurchased loans, reserve for unfunded loan commitments, realization of deferred tax assets, the valuation of goodwill and other intangible assets, mortgage banking, other derivatives, Hypothetical Liquidation at Book Value (“HLBV”) of investments in alternative energy partnerships, and the fair value measurement of financial instruments are particularly subject to change and such change could have a material effect on the consolidated financial statements.

Recent Accounting Guidance, Not Yet Effective: In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). The amendments in this Update simplify the accounting for income taxes by removing certain exceptions for investments, intra-period allocations, and interim calculations, and add guidance to reduce the complexity of applying Topic 740. This ASU will be effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2020. We will adopt this guidance on January 1, 2021. We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.

In March 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-04, Reference Rate Reform (Topic 848), which provides optional guidance, for a limited period of time, to ease the potential burden in accounting for (or recognizing the benefits of) reference rate reform on financial reporting. The amendments in ASU 2020-04 are elective and apply to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria. When elected, the optional expedients for contract modifications must be applied consistently for all eligible contracts or eligible transactions within the relevant topic or industry subtopic within the

12

codification that contains the guidance that otherwise would be required to be applied. The amendments in ASU 2020-04 are effective for all entities as of March 12, 2020 through December 31, 2022. We are in the process of evaluating the potential impact the discontinuation of LIBOR will have on our contracts and expect to elect the optional expedients and exceptions set forth in the amendments.

NOTE 2 – FAIR VALUES OF FINANCIAL INSTRUMENTS

Fair Value Hierarchy

ASC 820-10 establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The topic describes three levels of inputs that may be used to measure fair value:

•Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

•Level 2: Significant observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

•Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Assets and Liabilities Measured on a Recurring Basis

Securities Available-for-Sale: The fair values of securities available-for-sale are generally determined by quoted market prices in active markets, if available (Level 1). If quoted market prices are not available, we primarily employ independent pricing services that utilize pricing models to calculate fair value. Such fair value measurements consider observable data such as dealer quotes, market spreads, cash flows, yield curves, live trading levels, trade execution data, market consensus prepayment speeds, credit information, and respective terms and conditions for debt instruments. We employ procedures to monitor the pricing service's assumptions and establish processes to challenge the pricing service's valuations that appear unusual or unexpected. Multiple quotes or prices may be obtained in this process and we determine which fair value is most appropriate based on market information and analysis. Quotes obtained through this process are generally non-binding. We follow established procedures to ensure that assets and liabilities are properly classified in the fair value hierarchy. Level 2 securities include SBA loan pool securities, U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities, non-agency residential mortgage-backed securities, non-agency commercial mortgage-backed securities, collateralized loan obligations, and corporate debt securities. When a market is illiquid or there is a lack of transparency around the inputs to valuation, including at least one unobservable input, the securities are classified as Level 3 and reliance is placed upon internally developed models and management's judgment and evaluation for valuation. We had no securities available-for-sale classified as Level 3 at June 30, 2020 or December 31, 2019.

Loans Held-for-Sale, Carried at Fair Value: The fair value of loans held-for-sale is based on commitments outstanding from investors and current offerings in the secondary market for portfolios with similar characteristics, except for loans that are repurchased out of GNMA loan pools that become severely delinquent which are valued based on an internal model. Loans held-for-sale subject to recurring fair value adjustments are classified as Level 2, or in the case of loans repurchased, Level 3. The fair value includes the servicing value of the loans and any accrued interest.

Derivative Assets and Liabilities:

Interest Rate Swaps and Caps. We offer interest rate swap and cap products to certain loan clients to allow them to hedge the risk of rising interest rates on their variable rate loans. We originate a variable rate loan and enter into a variable-to-fixed interest rate swap with the client. We also enter into an offsetting swap with a correspondent bank. These back-to-back agreements are intended to offset each other and allow us to originate a variable rate loan while providing a contract for fixed interest payments for the client. The net cash flow for us is equal to the interest income received from a variable rate loan originated with the client plus a fee. The fair value of these derivatives is based on a discounted cash flow approach. Due to the observable nature of the inputs used in deriving the fair value of these derivative contracts, the valuation of interest rate swaps is classified as Level 2.

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Foreign Exchange Contracts. 

We offer short-term foreign exchange contracts to customers to purchase and/or sell foreign currencies at set rates in the future. These products allow customers to hedge the foreign exchange rate risk of their deposits and loans denominated in foreign currencies. In conjunction with these products, we also enter into offsetting contracts with institutional counterparties to hedge the Company’s foreign exchange rate risk. These back-to-back contracts allow us to offer our customers foreign exchange products while minimizing exposure to foreign exchange rate fluctuations. The fair value of these instruments is determined at each reporting period based on the change in the foreign exchange rate. Given the short-term nature of the contracts, the counterparties’ credit risks are considered nominal and result in no adjustments to the valuation of the short-term foreign exchange contracts. Due to the observable nature of the inputs used in deriving the fair value of these derivative contracts, the valuation of these contracts is classified as Level 2.

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The following table presents our financial assets and liabilities measured at fair value on a recurring basis as of the dates indicated:

			Fair Value Measurement Level
($ in thousands)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2020
Assets
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	105,555	$	—	$	105,555	$	—
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	201,136		—		201,136		—
Municipal securities	57,174		—		57,174		—
Non-agency residential mortgage-backed securities	164		—		164		—
Collateralized loan obligations	668,353		—		668,353		—
Corporate debt securities	143,647		—		143,647		—
Loans held-for-sale, carried at fair value	19,768		—		3,083		16,685
Derivative assets:
Interest rate swaps and caps (1)	8,598		—		8,598		—
Foreign exchange contracts (1)	137		—		137		—
Liabilities
Derivative liabilities:
Interest rate swaps and caps (2)	9,239		—		9,239		—
Foreign exchange contracts (2)	54		—		54		—
December 31, 2019
Assets
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	36,456	$	—	$	36,456	$	—
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	91,299		—		91,299		—
Municipal securities	52,689		—		52,689		—
Non-agency residential mortgage-backed securities	196		—		196		—
Collateralized loan obligations	718,361		—		718,361		—
Corporate debt securities	13,579		—		13,579		—
Loans held-for-sale, carried at fair value	22,642		—		3,409		19,233
Derivative assets:
Interest rate swaps and caps (1)	3,445		—		3,445		—
Foreign exchange contracts (1)	138		—		138		—
Liabilities
Derivative liabilities:
Interest rate swaps and caps (2)	3,717		—		3,717		—
Foreign exchange contracts (2)	136		—		136		—

(1)Included in Other assets in the Consolidated Statements of Financial Condition.

(2)Included in Accrued expenses and Other liabilities in the Consolidated Statements of Financial Condition.

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The following table presents a reconciliation of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3), on a consolidated operations basis, for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Loans repurchased from GNMA Loan Pools
Balance at beginning of period	$	17,127	$	23,069	$	19,233	$	25,040
Total gains (losses) (realized/unrealized):
Included in earnings—fair value adjustment	22		(6)		(1,369)		(3)
Additions	—		—		—		—
Sales, settlements, and other	(464)		(1,988)		(1,179)		(3,962)
Balance at end of period	$	16,685	$	21,075	$	16,685	$	21,075

Loans repurchased from GNMA loan pools had aggregate unpaid principal balances of $18.6 million and $19.8 million as of June 30, 2020 and December 31, 2019. The significant unobservable inputs used in the fair value measurement of our loans repurchased from GNMA loan pools at June 30, 2020 and December 31, 2019 included an expected loss rate of 1.55% for insured loans and 20.00% for uninsured loans. There may be inherent weaknesses in any calculation technique, and changes in the underlying assumptions used, including discount rates and estimates of future cash flows, could significantly affect the results.

Fair Value Option

Loans Held-for-Sale, Carried at Fair Value: We elected the fair value option for certain SFR mortgage loans held-for-sale. Electing to measure SFR mortgage loans held-for-sale at fair value reduces certain timing differences and better matches changes in the value of these assets with changes in the value of derivatives used as economic hedges for these assets. We also elected to record loans repurchased from GNMA at fair value, as we intend to sell them after curing any defects and, accordingly, they are classified as held-for-sale. Loans previously sold to GNMA that are delinquent more than 90 days are subject to a repurchase option when that condition exists and typically are repurchased by us. To the extent loans are subject to a repurchase option and not repurchased, the loans are re-recognized at fair value and offset by a secured borrowing, as the loans are still legally owned by GNMA. As of June 30, 2020 and December 31, 2019, there were no loans subject to such repurchase option and accordingly no related secured borrowings.

The following table presents the fair value and aggregate principal balance of certain assets, on a consolidated operations basis, under the fair value option:

	June 30, 2020						December 31, 2019
($ in thousands)	Fair Value		Unpaid Principal Balance		Difference		Fair Value		Unpaid Principal Balance		Difference
Loans held-for-sale, carried at fair value:
Total loans	$	19,768	$	22,208	$	(2,440)	$	22,642	$	23,455	$	(813)
Non-accrual loans (1)	6,147		7,244		(1,097)		8,125		8,370		(245)

(1) Includes loans guaranteed by the U.S. government of $4.4 million and $6.7 million at June 30, 2020 and December 31, 2019.

There were no loans held-for-sale that were 90 days or more past due and still accruing interest as of June 30, 2020 and December 31, 2019.

The assets accounted for under the fair value option are initially measured at fair value. Gains and losses from initial measurement and subsequent changes in fair value are recognized in earnings. The following table presents changes in fair value related to initial measurement and subsequent changes in fair value included in earnings for these assets measured at fair value for the periods indicated:

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	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Net (losses) gains from fair value changes:
Fair value adjustment for loans held-for-sale	$	25	$	59	$	(1,561)	$	60

Interest income on loans held-for-sale under the fair value option is measured based on the contractual interest rate and reported in interest income on loans, including fees in the consolidated statements of operations.

Assets and Liabilities Measured on a Non-Recurring Basis

Impaired Loans: The fair value of impaired loans with specific allocations of the ACL based on collateral is generally based on recent real estate appraisals and automated valuation models (“AVMs”). These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers for differences between the comparable sales and income data available. Such adjustments are typically deemed significant unobservable inputs used for determining fair value and result in a Level 3 classification.

The following table presents our financial assets and liabilities measured at fair value on a non-recurring basis as of the dates indicated:

			Fair Value Measurement Level
($ in thousands)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2020
Assets
Impaired loans:
Commercial and industrial	$	10,049	$	—	$	—	$	10,049
SBA	664		—		—		664
December 31, 2019
Assets
Impaired loans:
Single family residential mortgage	$	3,678	$	—	$	—	$	3,678
Commercial and industrial	15,409		—		—		15,409
SBA	1,711		—		—		1,711

The following table presents the losses recognized on assets measured at fair value on a non-recurring basis for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Impaired loans:
Single family residential mortgage	$	—	$	—	$	(531)	$	(490)
Commercial and industrial	(6,090)		—		(8,514)		—
SBA	(670)		—		(1,544)		(46)
Other consumer	—		—		(4)		(88)

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Estimated Fair Values of Financial Instruments

The following table presents the carrying amounts and estimated fair values of financial assets and liabilities as of the dates indicated:

	Carrying Amount		Fair Value Measurement Level
($ in thousands)			Level 1		Level 2		Level 3		Total
June 30, 2020
Financial assets
Cash and cash equivalents	$	420,640	$	420,640	$	—	$	—	$	420,640
Securities available-for-sale	1,176,029		—		1,176,029		—		1,176,029
Federal Home Loan Bank and other bank stock	46,585		—		46,585		—		46,585
Loans held-for-sale, carried at fair value	19,768		—		3,083		16,685		19,768
Loans receivable, net of allowance for loan losses	5,537,326		—		—		5,642,634		5,642,634
Accrued interest receivable	29,515		29,515		—		—		29,515
Derivative assets	8,735		—		8,735		—		8,735
Financial liabilities
Deposits	6,037,465		—		—		6,042,349		6,042,349
Advances from Federal Home Loan Bank	617,170		—		666,177		—		666,177
Long-term debt	173,537		—		178,030		—		178,030
Derivative liabilities	9,293		—		9,293		—		9,293
Accrued interest payable	4,297		4,297		—		—		4,297
December 31, 2019
Financial assets
Cash and cash equivalents	$	373,472	$	373,472	$	—	$	—	$	373,472
Securities available-for-sale	912,580		—		912,580		—		912,580
Federal Home Loan Bank and other bank stock	59,420		—		59,420		—		59,420
Loans held-for-sale	22,642		—		3,409		19,233		22,642
Loans receivable, net of allowance for credit losses	5,894,236		—		—		5,894,732		5,894,732
Accrued interest receivable	24,523		24,523		—		—		24,523
Derivative assets	3,583		—		3,583		—		3,583
Financial liabilities
Deposits	5,427,167		—		—		5,430,536		5,430,536
Advances from Federal Home Loan Bank	1,195,000		—		1,222,709		—		1,222,709
Long-term debt	173,421		—		180,213		—		180,213
Derivative liabilities	3,853		—		3,853		—		3,853
Accrued interest payable	4,687		4,687		—		—		4,687

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NOTE 3 – INVESTMENT SECURITIES

The following table presents the amortized cost and fair value of the investment securities portfolio as of the dates indicated:

($ in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
June 30, 2020
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	100,128	$	5,427	$	—	$	105,555
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	199,262		1,906		(32)		201,136
Municipal securities	52,973		4,201		—		57,174
Non-agency residential mortgage-backed securities	161		3		—		164
Collateralized loan obligations	703,605		—		(35,252)		668,353
Corporate debt securities	141,962		2,387		(702)		143,647
Total securities available-for-sale	$	1,198,091	$	13,924	$	(35,986)	$	1,176,029
December 31, 2019
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	37,613	$	—	$	(1,157)	$	36,456
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	91,543		16		(260)		91,299
Municipal securities	52,997		51		(359)		52,689
Non-agency residential mortgage-backed securities	191		5		—		196
Collateralized loan obligations	733,605		—		(15,244)		718,361
Corporate debt securities	13,500		79		—		13,579
Total securities available-for-sale	$	929,449	$	151	$	(17,020)	$	912,580

At June 30, 2020, our investment securities portfolio consisted of agency securities, municipal securities, mortgage-backed securities, collateralized loan obligations, and corporate debt securities. The expected maturities of these types of securities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

There was no allowance for credit losses for debt securities as of June 30, 2020. Accrued interest receivable on debt securities available-for-sale totaled $5.5 million and $5.6 million at June 30, 2020 and December 31, 2019, and is included within other assets in the accompanying consolidated statements of financial condition. Accrued interest receivable is excluded from the estimate of expected credit losses.

At June 30, 2020 and December 31, 2019, there were no holdings of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10 percent of our stockholders’ equity.

The following table presents proceeds from sales and calls of securities available-for-sale and the associated gross gains and losses realized through earnings upon the sales and calls of securities available-for-sale for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Gross realized gains on sales and calls of securities available-for-sale	$	2,011	$	—	$	2,011	$	208
Gross realized losses on sales and calls of securities available-for-sale	—		—		—		—
Net realized gains on sales and calls of securities available-for-sale	$	2,011	$	—	$	2,011	$	208
Proceeds from sales and calls of securities available-for-sale	$	22,728	$	298,156	$	52,728	$	820,048

Investment securities with carrying values of $42.2 million and $44.0 million as of June 30, 2020 and December 31, 2019, were pledged to secure FHLB advances, public deposits and for other purposes as required or permitted by law.

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The following table summarizes the investment securities with unrealized losses by security type and length of time in a continuous, unrealized loss position as of the dates indicated:

	Less Than 12 Months				12 Months or Longer				Total
($ in thousands)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
June 30, 2020
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	$	9,416	$	(32)	$	—	$	—	$	9,416	$	(32)
Collateralized loan obligations	63,040		(1,960)		605,313		(33,292)		668,353		(35,252)
Corporate debt securities	31,798		(702)		—		—		31,798		(702)
Total securities available-for-sale	$	104,254	$	(2,694)	$	605,313	$	(33,292)	$	709,567	$	(35,986)
December 31, 2019
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	35,872	$	(1,157)	$	—	$	—	$	35,872	$	(1,157)
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	73,379		(260)		—		—		73,379		(260)
Municipal securities	31,723		(359)		—		—		31,723		(359)
Collateralized loan obligations	49,553		(447)		668,808		(14,797)		718,361		(15,244)
Total securities available-for-sale	$	190,527	$	(2,223)	$	668,808	$	(14,797)	$	859,335	$	(17,020)

At June 30, 2020, our securities available-for-sale portfolio consisted of 102 securities, of which 50 securities were in an unrealized loss position. At December 31, 2019, our securities available-for-sale portfolio consisted of 70 securities, of which 60 securities were in an unrealized loss position.

We monitor our securities portfolio to ensure it has adequate credit support. The majority of unrealized losses are related to our collateralized loan obligations. We also consider the lowest credit rating for identification of credit impairment for other securities. As of June 30, 2020, all of our collateralized loan obligations investment securities in an unrealized loss position received an investment grade credit rating. The decline in fair value was attributable to a combination of changes in interest rates and general volatility in the credit market conditions in response to the economic uncertainty caused by the global pandemic. We do not currently intend to sell these 50 securities in an unrealized loss position and further believe, it is more likely than not, that we will not be required to sell these securities before their anticipated recovery.

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The following table presents maturities, based on the earlier of maturity dates or next repricing date, and yield information of the investment securities portfolio as of June 30, 2020:

	One year or less				More than One Year through Five Years				More than Five Years through Ten Years				More than Ten Years				Total
($ in thousands)	Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	—	—	%	$	—	—	%	$	30,413	2.20	%	$	75,142	2.35	%	$	105,555	2.31	%
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	118,163		0.74	%	11,608		2.02	%	25,579		1.63	%	45,786		0.93	%	201,136		0.96	%
Municipal securities	—		—	%	—		—	%	—		—	%	57,174		2.79	%	57,174		2.79	%
Non-agency residential mortgage-backed securities	—		—	%	—		—	%	—		—	%	164		6.14	%	164		6.14	%
Collateralized loan obligations	668,353		2.73	%	—		—	%	—		—	%	—		—	%	668,353		2.73	%
Corporate debt securities	—		—	%	122,301		4.99	%	21,346		5.64	%	—		—	%	143,647		5.08	%
Total securities available-for-sale	$	786,516	2.45	%	$	133,909	4.74	%	$	77,338	2.96	%	$	178,266	2.11	%	$	1,176,029	2.68	%

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NOTE 4 – LOANS AND ALLOWANCE FOR CREDIT LOSSES

The following table presents the balances in our loan portfolio as of the dates indicated:

($ in thousands)	June 30, 2020		December 31, 2019
Commercial:
Commercial and industrial	$	1,436,990	$	1,691,270
Commercial real estate	822,694		818,817
Multifamily	1,434,071		1,494,528
SBA(1)	310,784		70,981
Construction	212,979		231,350
Consumer:
Single family residential mortgage	1,370,785		1,590,774
Other consumer	39,393		54,165
Total loans(2)	$	5,627,696	$	5,951,885
Allowance for loan losses	(90,370)		(57,649)
Loans receivable, net	$	5,537,326	$	5,894,236

(1)Includes 1,069 PPP loans totaling $240.7 million, which included $5.6 million of net unamortized loan fees at June 30, 2020.

(2)Total loans include deferred loan origination costs/(fees) and premiums/(discounts), net, of $6.0 million and $14.3 million, respectively, at June 30, 2020 and December 31, 2019.

Credit Quality Indicators

We categorize loans into risk categories based on relevant information about the ability of borrowers to repay their debt such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. We perform a historical loss analysis that is combined with a comprehensive loan to value analysis to analyze the associated risks in the current loan portfolio. We analyze loans individually and grade each loan for credit risk. This analysis includes all loans delinquent over 60 days and non-homogeneous loans such as commercial and commercial real estate loans. We use the following definitions for credit risk ratings:

Pass: Loans risk rated as pass are in compliance in all respects with the Bank’s credit policy and regulatory requirements, and do not exhibit any potential or defined weakness as defined under “Special Mention”, “Substandard” or “Doubtful”.

Special Mention: Loans risk rated as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of our credit position at some future date.

Substandard: Loans risk rated as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so risk rated have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

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The following table presents the risk categories for total loans by class of loans and origination year as of June 30, 2020:

	Term Loans Amortized Cost Basis by Origination Year
($ in thousands)	2020		2019		2018		2017		2016		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Amortized Cost Basis Converted to Term		Total
June 30, 2020
Commercial:
Commercial and industrial
Pass	$	59,122	$	111,437	$	104,299	$	63,923	$	41,163	$	111,761	$	851,369	$	4,252	$	1,347,326
Special mention	—		6,382		5,988		—		—		1,379		812		189		14,750
Substandard	2,117		16,658		—		4,864		20,677		9,632		10,752		10,214		74,914
Doubtful	—		—		—		—		—		—		—		—		—
Commercial and industrial	61,239		134,477		110,287		68,787		61,840		122,772		862,933		14,655		1,436,990
Commercial real estate
Pass	15,261		153,017		215,385		72,949		102,465		198,242		36,628		1,586		795,533
Special mention	—		1,829		9,570		—		—		6,732		—		—		18,131
Substandard	—		—		—		—		—		9,030		—		—		9,030
Doubtful	—		—		—		—		—		—		—		—		—
Commercial real estate	15,261		154,846		224,955		72,949		102,465		214,004		36,628		1,586		822,694
Multifamily
Pass	84,873		421,045		334,029		272,657		131,646		187,823		—		—		1,432,073
Special mention	—		—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		1,998		—		—		1,998
Doubtful	—		—		—		—		—		—		—		—		—
Multifamily	84,873		421,045		334,029		272,657		131,646		189,821		—		—		1,434,071
SBA
Pass	241,305		16,021		1,359		5,195		14,975		19,479		3,238		797		302,369
Special mention	—		—		—		226		417		948		—		6		1,597
Substandard	—		—		—		1,009		1,513		1,440		320		1,126		5,408
Doubtful	—		—		390		—		—		633		—		387		1,410
SBA	241,305		16,021		1,749		6,430		16,905		22,500		3,558		2,316		310,784
Construction
Pass	14,139		33,423		63,217		86,787		—		—		—		—		197,566
Special mention	—		—		10,526		—		4,887		—		—		—		15,413
Substandard	—		—		—		—		—		—		—		—		—

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Doubtful	—		—		—		—		—		—		—		—		—
Construction	14,139		33,423		73,743		86,787		4,887		—		—		—		212,979
Consumer:
Single family residential mortgage
Pass	31,007		166,668		329,175		204,392		297,182		281,160		20,844		—		1,330,428
Special mention	—		—		1,152		668		4,416		3,503		—		—		9,739
Substandard	—		1,064		1,697		3,414		3,900		20,543		—		—		30,618
Doubtful	—		—		—		—		—		—		—		—		—
Single family residential mortgage	31,007		167,732		332,024		208,474		305,498		305,206		20,844		—		1,370,785
Other consumer
Pass	26		93		72		—		8		2,485		31,303		2,577		36,564
Special mention	—		—		27		—		—		33		248		147		455
Substandard	—		—		—		—		—		2,016		281		77		2,374
Doubtful	—		—		—		—		—		—		—		—		—
Other consumer	26		93		99		—		8		4,534		31,832		2,801		39,393
Total loans	$	447,850	$	927,637	$	1,076,886	$	716,084	$	623,249	$	858,837	$	955,795	$	21,358	$	5,627,696

The following table presents the risk categories for total loans by class of loans as of December 31, 2019:

($ in thousands)	Pass		Special Mention		Substandard		Doubtful		Total
December 31, 2019
Commercial:
Commercial and industrial	1,580,269		45,323		65,678		—		1,691,270
Commercial real estate	813,846		2,532		2,439		—		818,817
Multifamily	1,484,931		4,256		5,341		—		1,494,528
SBA	60,982		2,760		5,621		1,618		70,981
Construction	229,771		1,579		—		—		231,350
Consumer:
Single family residential mortgage	1,559,253		10,735		20,269		517		1,590,774
Other consumer	53,331		346		488		—		54,165
Total	$	5,782,383	$	67,531	$	99,836	$	2,135	$	5,951,885

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Past Due Loans

The following table presents the aging of the recorded investment in past due loans, excluding accrued interest receivable (which is not considered to be material), by class of loans as of the dates indicated:

($ in thousands)	30 - 59 Days Past Due		60 - 89 Days Past Due		Greater than 89 Days Past due		Total Past Due		Current		Total
June 30, 2020
Non-Traditional Mortgage (NTM) loans:
Single family residential mortgage	$	9,262	$	647	$	18,552	$	28,461	$	481,144	$	509,605
Other consumer	—		—		—		—		1,598		1,598
Total NTM loans	9,262		647		18,552		28,461		482,742		511,203
Traditional loans:
Commercial:
Commercial and industrial	891		28		13,072		13,991		1,422,999		1,436,990
Commercial real estate	—		1,464		2,189		3,653		819,041		822,694
Multifamily	664		—		—		664		1,433,407		1,434,071
SBA	1,517		—		2,627		4,144		306,640		310,784
Construction	—		—		—		—		212,979		212,979
Consumer:
Single family residential mortgage	29,281		4,286		8,252		41,819		819,361		861,180
Other consumer	285		1,485		692		2,462		35,333		37,795
Total traditional loans	32,638		7,263		26,832		66,733		5,049,760		5,116,493
Total	$	41,900	$	7,910	$	45,384	$	95,194	$	5,532,502	$	5,627,696
December 31, 2019
NTM loans:
Single family residential mortgage	$	3,973	$	3,535	$	13,019	$	20,527	$	577,830	$	598,357
Other consumer	—		—		—		—		2,299		2,299
Total NTM loans	3,973		3,535		13,019		20,527		580,129		600,656
Traditional loans:
Commercial:
Commercial and industrial	780		5,670		3,862		10,312		1,680,958		1,691,270
Commercial real estate	—		—		—		—		818,817		818,817
Multifamily	—		—		—		—		1,494,528		1,494,528
SBA	586		842		2,152		3,580		67,401		70,981
Construction	—		—		—		—		231,350		231,350
Consumer:
Single family residential mortgage	13,752		3,496		5,606		22,854		969,563		992,417
Other consumer	199		40		95		334		51,532		51,866
Total traditional loans	15,317		10,048		11,715		37,080		5,314,149		5,351,229
Total	$	19,290	$	13,583	$	24,734	$	57,607	$	5,894,278	$	5,951,885

In accordance with regulatory guidance, borrowers that received forbearance or deferment, which were current prior to becoming affected by the global pandemic, generally should not be reported as past due. At June 30, 2020, no loans that received forbearance or deferment were considered past due and, accordingly, are not included in the table above.

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Non-accrual Loans

The following table presents non-accrual loans as of the dates indicated:

	June 30, 2020								December 31, 2019
($ in thousands)	NTM Loans		Traditional Loans		Total Non-accrual Loans		Non-accrual Loans with no ACL		NTM Loans		Traditional Loans		Total Non-accrual Loans		Non-accrual Loans with no ACL
Non-accrual loans
Commercial:
Commercial and industrial	$	—	$	30,398	$	30,398	$	10,728	$	—	$	19,114	$	19,114	$	337
Commercial real estate	—		6,633		6,633		6,632		—		—		—		—
SBA	—		5,026		5,026		1,485		—		5,230		5,230		1,474
Construction	—		—		—		—		—		—		—		—
Consumer:
Single family residential mortgage	19,199		9,271		28,470		28,470		13,019		5,606		18,625		14,373
Other consumer	—		2,176		2,176		2,177		—		385		385		380
Total non-accrual loans	$	19,199	$	53,504	$	72,703	$	49,492	$	13,019	$	30,335	$	43,354	$	16,564

At June 30, 2020 and December 31, 2019, there were no loans that were past due 90 days or more and still accruing.

The non-traditional mortgage (“NTM”) loans on non-accrual status included $4.6 million of Green Loans and $14.6 million of interest-only loans at June 30, 2020 compared to $1.5 million of Green Loans and $11.5 million of interest-only loans at December 31, 2019.

Loans in Process of Foreclosure

At June 30, 2020 and December 31, 2019, consumer mortgage loans of $6.3 million and $15.7 million, respectively, were secured by residential real estate properties for which formal foreclosure proceedings were in process according to local requirements of the applicable jurisdiction.

Allowance for Credit Losses

Our ACL is comprised of our allowance for loan losses (“ALL”) and reserve for unfunded loan commitments. Our ACL methodology and resulting provision continues to be impacted by the current economic uncertainty and volatility caused by the COVID-19 pandemic. Our ACL methodology uses a nationally recognized, third-party model that includes many assumptions based on our historical and peer loss data, our current loan portfolio risk profile including risk ratings, and economic forecasts including macroeconomic variables (“MEVs”). As of June 30, 2020, we used economic forecasts released by our model provider during June 2020. Similar to the late March 2020 forecasts, these June 2020 forecasts reflect the onset of the pandemic, its impact on MEVs and the future economic recovery. These forecasts published by our model provider have deteriorated since the end of the first quarter of 2020, with June baseline unemployment rate forecasts for 2020 and 2021 increasing and real gross domestic product growth rates decreasing. Similar to our methodology used in the first quarter of 2020, we incorporated qualitative factors to account for certain loan portfolio characteristics that are not taken into consideration by our third-party model, including underlying strengths and weaknesses in the loan portfolio. As is the case with all estimates, we expect the ACL to be impacted in future periods by economic volatility, changing economic forecasts, actual and projected credit experience, and underlying model assumptions; all of which may be better than or worse than our current estimate.

The ACL process involves subjective and complex judgments as well as adjustments for numerous factors including those described in the federal banking agencies' joint interagency policy statement on ALL, which include underwriting experience and collateral value changes, among others. We evaluate all impaired loans individually using guidance from ASC 310 primarily through the evaluation of cash flows or collateral values.

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We have established credit risk management processes that include regular management review of the loan portfolio to identify problem loans. During the ordinary course of business, management may become aware of borrowers who may not be able to fulfill their contractual payment requirements within the loan agreements. Such loans are subject to increased monitoring. Consideration is given to placing these loans on non-accrual status, assessing the need for additional allowance for loan loss, and partially or fully charging off the principal balance. We maintain the allowance for loan losses at a level that is considered adequate to cover the expected credit losses in the loan portfolio.

The reserve for unfunded loan commitments is established to cover the expected credit losses for the estimated level of funding of these loan commitments, except for unconditionally cancellable commitments for which no reserve is required under ASC 326. At June 30, 2020 and December 31, 2019, the reserve for unfunded loan commitments was $4.2 million and $4.1 million, respectively, and was included in accrued expenses and other liabilities on the consolidated statements of financial condition.

The credit risk monitoring system is designed to identify impaired and potential problem loans, perform periodic evaluation of impairment, and determine the adequacy of the allowance for credit losses in a timely manner. In addition, management has adopted a credit policy that includes a credit review and control system that it believes should be effective in ensuring that we maintain an adequate allowance for credit losses. Further, the Board of Directors provides oversight and guidance for management’s allowance evaluation process.

The following table presents a summary of activity in the ACL for the periods indicated:

	Three Months Ended June 30,
($ in thousands)	2020						2019
	Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses		Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses
Balance at beginning of period	$	78,243	$	3,888	$	82,131	$	63,885	$	4,208	$	68,093
Loans charged off	—		—		—		(2,451)		—		(2,451)
Recoveries of loans previously charged off	608		—		608		76		—		76
Net charge-offs	608		—		608		(2,375)		—		(2,375)
Provision for (reversal of) credit losses	11,519		307		11,826		(1,987)		87		(1,900)
Balance at end of period	$	90,370	$	4,195	$	94,565	$	59,523	$	4,295	$	63,818

	Six Months Ended June 30,
($ in thousands)	2020						2019
	Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses		Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses
Balance at beginning of period	$	57,649	$	4,064	$	61,713	$	62,192	$	4,622	$	66,814
Impact of adopting ASU 2016-13	7,609		(1,226)		6,383		—		—		—
Loans charged off	(2,076)		—		(2,076)		(3,514)		—		(3,514)
Recoveries of loans previously charged off	958		—		958		320		—		320
Net charge-offs	(1,118)		—		(1,118)		(3,194)		—		(3,194)
Provision for (reversal of) credit losses	26,230		1,357		27,587		525		(327)		198
Balance at end of period	$	90,370	$	4,195	$	94,565	$	59,523	$	4,295	$	63,818

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Accrued interest receivable on loans receivable, net totaled $23.8 million and $18.9 million at June 30, 2020 and December 31, 2019, and is included within other assets in the accompanying consolidated statements of financial condition. Accrued interest receivable is excluded from the estimate of expected credit losses.

The following table presents the activity and balance in the ALL and the recorded investment, excluding accrued interest, in loans based on the impairment methodology as of or for the three and six months ended June 30, 2020:

($ in thousands)	Commercial and Industrial		Commercial Real Estate		Multifamily		SBA		Construction		Single Family Residential Mortgage		Other Consumer		Total
ALL:
Balance at March 31, 2020	$	23,573	$	13,620	$	20,072	$	3,652	$	7,052	$	9,593	$	681	$	78,243
Charge-offs	—		—		—		—		—		—		—		—
Recoveries	119		—		—		—		—		488		1		608
Net recoveries (charge-offs)	119		—		—		—		—		488		1		608
Provision for (reversal of) credit losses	2,926		3,752		5,033		532		(377)		(416)		69		11,519
Balance at June 30, 2020	$	26,618	$	17,372	$	25,105	$	4,184	$	6,675	$	9,665	$	751	$	90,370
Balance at December 31, 2019	$	22,353	$	5,941	$	11,405	$	3,120	$	3,906	$	10,486	$	438	$	57,649
Impact of adopting ASC 326	662		4,847		1,809		388		103		(420)		220		7,609
Charge-offs	(1,164)		—		—		(356)		—		(552)		(4)		(2,076)
Recoveries	149		—		—		121		—		639		49		958
Net (charge-offs) recoveries	(1,015)		—		—		(235)		—		87		45		(1,118)
Provision (reversal)	4,618		6,584		11,891		911		2,666		(488)		48		26,230
Balance at June 30, 2020	$	26,618	$	17,372	$	25,105	$	4,184	$	6,675	$	9,665	$	751	$	90,370
Individually evaluated for impairment	$	9,697	$	—	$	—	$	2,878	$	—	$	—	$	—	$	12,575
Collectively evaluated for impairment	16,921		17,372		25,105		1,306		6,675		9,665		751		77,795
Total ending ALL balance	$	26,618	$	17,372	$	25,105	$	4,184	$	6,675	$	9,665	$	751	$	90,370
Loans:
Individually evaluated for impairment	$	31,129	$	5,168	$	—	$	4,959	$	—	$	32,999	$	970	$	75,225
Collectively evaluated for impairment	1,405,861		817,526		1,434,071		305,825		212,979		1,337,786		38,423		5,552,471
Total ending loan balances	$	1,436,990	$	822,694	$	1,434,071	$	310,784	$	212,979	$	1,370,785	$	39,393	$	5,627,696

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The following table presents the activity and balance in the ALL and the recorded investment, excluding accrued interest, in loans based on the impairment methodology as of or for the three and six months ended June 30, 2019:

($ in thousands)	Commercial and Industrial		Commercial Real Estate		Multifamily		SBA		Construction		Lease Financing		Single Family Residential Mortgage		Other Consumer		Total
ALL:
Balance at March 31, 2019	$	18,893	$	6,838	$	18,898	$	3,057	$	3,453	$	—	$	12,142	$	604	$	63,885
Charge-offs	(2,022)		—		(6)		8		—		—		(425)		(6)		(2,451)
Recoveries	11		—		—		60		—		3		—		2		76
Net (charge-offs) recoveries	(2,011)		—		(6)		68		—		3		(425)		(4)		(2,375)
Provision for (reversal of) credit losses	4,647		39		(6,267)		(5)		262		(3)		(645)		(15)		(1,987)
Balance at June 30, 2019	$	21,529	$	6,877	$	12,625	$	3,120	$	3,715	$	—	$	11,072	$	585	$	59,523
Balance at December 31, 2018	$	18,191	$	6,674	$	17,970	$	1,827	$	3,461	$	—	$	13,128	$	941	$	62,192
Charge-offs	(2,115)		—		(6)		(348)		—		—		(951)		(94)		(3,514)
Recoveries	44		—		—		101		—		6		150		19		320
Net (charge-offs) recoveries	(2,071)		—		(6)		(247)		—		6		(801)		(75)		(3,194)
Provision (reversal)	5,409		203		(5,339)		1,540		254		(6)		(1,255)		(281)		525
Balance at June 30, 2019	$	21,529	$	6,877	$	12,625	$	3,120	$	3,715	$	—	$	11,072	$	585	$	59,523
Individually evaluated for impairment	$	1,239	$	—	$	—	$	1,563	$	—	$	—	$	—	$	22	$	2,824
Collectively evaluated for impairment	20,290		6,877		12,625		1,557		3,715		—		11,072		563		56,699
Total ending ALL balance	$	21,529	$	6,877	$	12,625	$	3,120	$	3,715	$	—	$	11,072	$	585	$	59,523
Loans:
Individually evaluated for impairment	$	20,429	$	—	$	—	$	3,262	$	2,519	$	—	$	21,021	$	1,169	$	48,400
Collectively evaluated for impairment	1,931,278		856,497		1,598,978		77,667		206,510		—		1,940,044		60,196		6,671,170
Total ending loan balances	$	1,951,707	$	856,497	$	1,598,978	$	80,929	$	209,029	$	—	$	1,961,065	$	61,365	$	6,719,570

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The following table presents loans individually evaluated for impairment by class of loans as of the dates indicated. The recorded investment, excluding accrued interest, presents customer balances net of any partial charge-offs recognized on the loans and net of any deferred fees and costs and any purchase premium or discount.

	June 30, 2020						December 31, 2019
($ in thousands)	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses		Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses
With no related ALL recorded:
Commercial:
Commercial and industrial	$	11,455	$	11,383	$	—	$	1,471	$	1,460	$	—
Commercial real estate	5,418		5,168		—		—		—		—
SBA	1,474		1,417		—		1,439		1,379		—
Consumer:
Single family residential mortgage	32,849		32,999		—		19,319		19,405		—
Other consumer	1,431		970		—		671		675		—
With an ALL recorded:
Commercial:
Commercial and industrial	19,739		19,746		9,697		18,776		18,776		3,367
SBA	3,731		3,542		2,878		3,921		3,757		2,045
Consumer:
Single family residential mortgage	—		—		—		4,213		4,252		574
Other consumer	—		—		—		4		4		4
Total	$	76,097	$	75,225	$	12,575	$	49,814	$	49,708	$	5,990

The following table presents information on impaired loans, disaggregated by class, for the periods indicated:

	Three Months Ended						Six Months Ended
($ in thousands)	Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Recognized		Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Recognized
June 30, 2020
Commercial:
Commercial and industrial	$	29,992	$	16	$	18	$	26,452	$	37	$	39
Commercial real estate	5,210		—		—		3,992		—		—
SBA	5,172		3		4		5,293		6		7
Consumer:
Single family residential mortgage	33,356		56		34		31,420		110		79
Other consumer	2,084		—		—		1,351		3		3
Total	$	75,814	$	75	$	56	$	68,508	$	156	$	128
June 30, 2019
Commercial:
Commercial and industrial	$	20,794	$	255	$	254	$	12,921	$	255	$	254
Commercial real estate	—		—		—		289		—		—
SBA	3,297		4		4		3,571		8		8
Construction	2,519		—		—		2,519		—		—
Consumer:
Single family residential mortgage	21,092		58		48		20,208		116		97
Other consumer	1,177		4		3		1,011		7		6
Total	$	48,879	$	321	$	309	$	40,519	$	386	$	365

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Troubled Debt Restructurings

A modification of a loan constitutes a TDR when we, for economic or legal reasons related to a borrower’s financial difficulties, grant a concession to the borrower that we would not otherwise consider. A concession or concessions may be granted in various forms, including a below-market change in the stated interest rate, a reduction in the loan balance or accrued interest, an extension of the maturity date, or a note split with principal forgiveness. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under our internal underwriting policy.

TDR loans consisted of the following as of the dates indicated:

	June 30, 2020						December 31, 2019
($ in thousands)	NTM Loans		Traditional Loans		Total		NTM Loans		Traditional Loans		Total
Commercial:
Commercial and industrial	$	—	$	20,808	$	20,808	$	—	$	16,245	$	16,245
SBA	—		266		266		—		266		266
Consumer:
Single family residential mortgage	2,628		2,170		4,798		2,638		2,394		5,032
Other consumer	—		—		—		294		—		294
Total	$	2,628	$	23,244	$	25,872	$	2,932	$	18,905	$	21,837

We had commitments to lend to customers with outstanding loans that were classified as TDRs of $135 thousand as of June 30, 2020 and December 31, 2019. Accruing TDRs were $5.6 million and non-accrual TDRs were $20.3 million at June 30, 2020 compared to accruing TDRs of $6.6 million and non-accrual TDRs of $15.2 million at December 31, 2019. The increase in TDRs during the six months ended June 30, 2020 was primarily due to one commercial and industrial relationship.

The following table summarizes the pre-modification and post-modification balances of the new TDRs for the periods indicated:

	Three Months Ended					Six Months Ended
($ in thousands)	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
June 30, 2020
Commercial:
Commercial and industrial	—	$	—	$	—	1	$	5,000	$	5,000
Total	—	—		—		1	$	5,000	$	5,000
June 30, 2019
Commercial:
Commercial and industrial	10	$	17,339	$	17,020	10	$	17,339	$	17,020
SBA	2	$	3,214	$	869	2	$	3,214	$	869
Total	12	$	20,553	$	17,889	12	$	20,553	$	17,889

We consider a TDR to be in payment default once it becomes 30 days or more past due following a modification. During each of the three and six months ended June 30, 2020, there was one loan that was modified as a TDR during the past 12 months that had subsequent payment defaults. During each of the three and six months ended June 30, 2019, there were no loans that were modified as TDRs during the past 12 months that had subsequent payment defaults.

The following table summarizes TDRs by modification type for the periods indicated:

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	Three Months Ended
	Modification Type
	Change in Principal Payments and Interest Rates			Change in Principal Payments			Total
($ in thousands)	Count	Amount		Count	Amount		Count	Amount
June 30, 2020
Commercial:
Commercial and industrial	—	$	—	—	$	—	—	$	—
Total	—	$	—	—	$	—	—	$	—
June 30, 2019
Commercial:
Commercial and industrial	10	$	17,020	—	$	—	10	$	17,020
SBA	2	$	869	—	$	—	2	$	869
Total	12	$	17,889	—	$	—	12	$	17,889

	Six Months Ended
	Modification Type
	Change in Principal Payments and Interest Rates			Change in Principal Payments			Total
($ in thousands)	Count	Amount		Count	Amount		Count	Amount
June 30, 2020
Commercial:
Commercial and industrial	1	$	5,000	—	$	—	1	$	5,000
Total	1	$	5,000	—	$	—	1	$	5,000
June 30, 2019
Commercial:
Commercial and industrial	10	$	17,020	—	$	—	10	$	17,020
SBA	2	869		—	—		2	869
Consumer:
Single family residential mortgage	—	—		—	—		—	—
Total	12	$	17,889	—	$	—	12	$	17,889

Purchases, Sales, and Transfers

From time to time, we purchase and sell loans in the secondary market. Certain loans are transferred from held-for-investment to held-for-sale at the lower of cost or fair value and any reductions in value on transfer are reflected as write-downs to allowance for credit losses. During the three and six months ended June 30, 2020 we purchased $25.8 million of single family residential mortgage loans. There were no purchases of loans during the three and six months ended June 30, 2019. The following table presents loans transferred from (to) loans held-for-sale by portfolio segment for the periods indicated:

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	Three Months Ended				Six Months Ended
($ in thousands)	Transfers from Held-For-Sale		Transfers (to) Held-For-Sale		Transfers from Held-For-Sale		Transfers (to) Held-For-Sale
June 30, 2020
Total	$	—	$	—	$	—	$	—
June 30, 2019
Commercial:
Commercial real estate	$	—	$	(573)	$	—	$	(573)
Multifamily	—		(752,087)		—		(752,087)
Consumer:
Single family residential mortgage	—		(131,315)		—		(374,679)
Total	$	—	$	(883,975)	$	—	$	(1,127,339)

There were no sales of loans during the three and six months ended June 30, 2020. Loss on sale of loans during the three and six months ended June 30, 2020 totaled zero and $27 thousand and related to certain adjustments for previously sold loans.

During the three and six months ended June 30, 2019, we sold $131.5 million and $374.7 million in single family residential loans, resulting in gains of $125 thousand and $1.8 million.

Non-Traditional Mortgage Loans (“NTM”)

Our NTM portfolio is comprised of three interest only products: Green Loans, Interest Only loans and a small number of additional loans with the potential for negative amortization. The initial credit guidelines for the NTM portfolio were established based on the borrower's Fair Isaac Corporation (“FICO”) score, LTV ratio, property type, occupancy type, loan amount, and geography. Additionally, from an ongoing credit risk management perspective, we have determined that the most significant performance indicators for NTMs are LTV ratios and FICO scores. We review the NTM loan portfolio periodically by refreshing FICO scores on the Green Loans and HELOCs and ordering third party automated valuation models (AVMs) to confirm collateral values. We no longer originate NTM loans.

The following table presents the composition of the NTM portfolio, which are included in the single family residential mortgage portfolio, as of the dates indicated:

	June 30, 2020						December 31, 2019
($ in thousands)	Count	Amount			Percent		Count	Amount			Percent
Consumer:
Single family residential mortgage:
Green Loans (HELOC) - first liens	61	$	43,604		8.5	%	69	$	49,959		8.3	%
Interest-only - first liens	329	463,666			90.7	%	376	545,371			90.8	%
Negative amortization	8	2,335			0.5	%	9	3,027			0.5	%
Total NTM - first liens	398	509,605			99.7	%	454	598,357			99.6	%
Other consumer:
Green Loans (HELOC) - second liens	5	1,598			0.3	%	7	2,299			0.4	%
Total NTM - second liens	5	1,598			0.3	%	7	2,299			0.4	%
Total NTM loans	403	$	511,203		100.0	%	461	$	600,656		100.0	%
Total loans receivable		$	5,627,696					$	5,951,885
% of total NTM loans to total loans receivable		9.1		%				10.1		%

NOTE 5 – GOODWILL AND OTHER INTANGIBLE ASSETS, NET

At June 30, 2020 and December 31, 2019, we had goodwill of $37.1 million. We evaluate goodwill impairment as of August 31^st each year, and more frequently if events or circumstances indicate that there may be impairment. We completed our most recent annual goodwill impairment test as of August 31, 2019 and determined that no goodwill impairment existed. As a

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result of the economic volatility caused by COVID-19 pandemic in both the second and first quarters of 2020, we analyzed the risk indicators related to potential goodwill impairment. Based on these analyses, we did not identify any impairment to goodwill during the first six months of 2020, however, there can be no assurance that prolonged market volatility resulting from the COVID-19 pandemic or other factors will not result in impairments to goodwill or other intangibles in future periods.

Core deposit intangibles are amortized over their useful lives ranging from four to ten years. As of June 30, 2020, the weighted average remaining amortization period for core deposit intangibles was approximately 4.3 years.

($ in thousands)	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
June 30, 2020
Core deposit intangibles	$	30,904	$	27,612	$	3,292
December 31, 2019
Core deposit intangibles	$	30,904	$	26,753	$	4,151

Aggregate amortization of intangible assets was $430 thousand and $621 thousand for the three months ended June 30, 2020 and 2019 and $859 thousand and $1.2 million for the six months ended June 30, 2020 and 2019. The following table presents estimated future amortization expenses as of June 30, 2020:

($ in thousands)	Remainder of 2020		2021		2022		2023		2024		Total
Estimated future amortization expense	$	659	$	1,082	$	799	$	517	$	235	$	3,292

NOTE 6 – FEDERAL HOME LOAN BANK ADVANCES AND OTHER BORROWINGS

The following table presents advances from the FHLB as of the dates indicated:

($ in thousands)	June 30, 2020				December 31, 2019
Fixed rate:
Outstanding balance	$	624,000		(1)	$	730,000
Interest rates ranging from	—		%	(2)	1.82		%
Interest rates ranging to	3.32		%		3.32		%
Weighted average interest rate	2.24		%		2.66		%
Variable rate:
Outstanding balance	—				465,000
Weighted average interest rate	—		%		1.66		%

(1)Excludes $6.8 million of unamortized debt issuance costs at June 30, 2020. 

(2)Includes $10.0 million in FHLB recovery advances with an interest rate of 0.00%, consisting of $5.0 million with a maturity date of November 27, 2020 and $5.0 million with a maturity date of May 27, 2021.

Each advance is payable at its maturity date. Advances paid early are subject to a prepayment penalty. In June 2020, we repaid a $100.0 million FHLB term advance with a weighted average interest rate of 2.07% and incurred a $2.5 million extinguishment fee that is included in other noninterest expense. Additionally, in June 2020 we refinanced $111.0 million of FHLB term advances to take advantage of the rapid decline in market interest rates. As a result of this refinancing, our weighted average effective interest rate on such FHLB term advances changed from 2.81% to 2.02% and the weighted average life extended from 2.52 years to 5.18 years. At the end of the second quarter, FHLB advances included no overnight borrowings, $58.0 million maturing within three months, and $566.0 million maturing beyond three months with a weighted average life of 4.1 years and weighted average interest rate of 2.39%.

At June 30, 2020 and December 31, 2019, the Bank’s advances from the FHLB were collateralized by certain real estate loans with an aggregate unpaid principal balance of $2.66 billion and $3.05 billion. Based on this collateral, the Bank was eligible to borrow an additional $1.06 billion at June 30, 2020.

The Bank’s investment in capital stock of the FHLB of San Francisco totaled $19.4 million and $32.3 million at June 30, 2020 and December 31, 2019.

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During the second quarter of 2020, we expanded our existing secured borrowing capacity with the Federal Reserve Bank of San Francisco (“Federal Reserve”) by participating in its Borrower-in-Custody (“BIC”) program. As a result, our borrowing capacity with the Federal Reserve increased to $370.4 million at June 30, 2020. Prior to participating in the BIC program, the Bank only pledged securities as collateral for access to the discount window. At June 30, 2020, the Bank has pledged certain qualifying loans with an unpaid principal balance of $870.1 million and securities with a carrying value of $23.0 million as collateral for this line of credit. Borrowings under this BIC program are overnight advances with interest chargeable at the discount window (“primary credit”) borrowing rate. There were no borrowings under this arrangement for the three and six months ended June 30, 2020 and 2019.

The Bank maintained available unsecured federal funds lines with five correspondent banks totaling $185.0 million, with no outstanding borrowings at June 30, 2020.

The Bank also maintained repurchase agreements and had no outstanding securities sold under agreements to repurchase at June 30, 2020 and December 31, 2019. Availabilities and terms on repurchase agreements are subject to the counterparties' discretion and the pledging of additional investment securities.

NOTE 7 – LONG-TERM DEBT

The following table presents our long-term debt as of the dates indicated:

	June 30, 2020				December 31, 2019
($ in thousands)	Par Value		Unamortized Debt Issuance Cost and Discount		Par Value		Unamortized Debt Issuance Cost and Discount
5.25% senior notes due April 15, 2025	$	175,000	$	(1,463)	$	175,000	$	(1,579)
Total	$	175,000	$	(1,463)	$	175,000	$	(1,579)

We were in compliance with all covenants under our 5.25% senior notes due April 15, 2025 at June 30, 2020.

NOTE 8 – INCOME TAXES

For the three and six months ended June 30, 2020, income tax benefit was $5.3 million and $7.5 million and the effective tax rate was 22.3% and 23.0%. For the three and six months ended June 30, 2019, income tax expense was $4.3 million and $7.0 million and the effective tax rate was 20.6% and 22.9%. Our effective tax rate of 22.3% and 23.0% for the three and six months ended June 30, 2020 differs from the 21% federal statutory rate due to the impact of state taxes as well as various tax credits.

We account for income taxes by recognizing deferred tax assets and liabilities based upon temporary differences between the amounts for financial reporting purposes and tax basis of its assets and liabilities. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all, of the deferred tax asset will not be realized. In assessing the realization of deferred tax assets, management will continue to evaluate both positive and negative evidence on a quarterly basis, including considering the four possible sources of future taxable income, such as future reversal of existing taxable temporary differences, future taxable income exclusive of reversing temporary differences and carryforwards, taxable income in prior carryback year(s), and future tax planning strategies. Based on this analysis, management determined, it was more likely than not, that all of the deferred tax assets would be realized; therefore, no valuation allowance was provided against the net deferred tax assets of $48.3 million and $44.9 million at June 30, 2020 and December 31, 2019, respectively. The overall increase in net deferred tax assets was primarily due to an increase in deferred tax assets of $1.5 million from the increase in net unrealized loss on securities available-for-sale and $1.9 million from the adoption of ASU 2016-13.

ASC 740-10-25 relates to the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. ASC 740-10-25 prescribes a threshold and a measurement process for recognizing in the financial statements a tax position taken or expected to be taken in a tax return and also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. We had unrecognized tax benefits of $1.0 million and $977 thousand at June 30, 2020 and December 31, 2019, respectively. We do not believe that the unrecognized tax benefits will change materially in the next twelve months. As of June 30, 2020, the total unrecognized tax benefit that, if recognized, would impact the effective tax rate was $820 thousand.

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At June 30, 2020 and December 31, 2019, we had no accrued interest or penalties. In the event we are assessed interest and/or penalties by federal or state tax authorities, such amounts will be classified in the consolidated financial statements as income tax expense.

We are subject to U.S. federal income tax as well as income tax in multiple state jurisdictions. We are no longer subject to examination by U.S. federal taxing authorities for years before 2016. The statute of limitations for the assessment of California franchise taxes has expired for tax years before 2014 (other state income and franchise tax statutes of limitations vary by state).

NOTE 9 – DERIVATIVE INSTRUMENTS

We use derivative instruments and other risk management techniques to reduce our exposure to adverse fluctuations in interest rates and foreign currency exchange rates in accordance with our risk management policies.

During the three and six months ended June 30, 2020, changes in fair value on interest rate swaps and caps on loans and foreign exchange contracts were $(107) thousand and $(288) thousand, respectively, compared to $(9.7) million and $(9.8) million for the three and six months ended June 30, 2019, respectively, and were included in other income on the consolidated statements of operations.

The following table presents the notional amount and fair value of derivative instruments included in the consolidated statements of financial condition as of the dates indicated.

	June 30, 2020				December 31, 2019
($ in thousands)	Notional Amount		Fair Value(1)		Notional Amount		Fair Value(1)
Derivative assets:
Interest rate swaps and caps on loans	$	69,266	$	8,598	$	70,674	$	3,445
Foreign exchange contracts	3,657		137		4,643		138
Total	$	72,923	$	8,735	$	75,317	$	3,583
Derivative liabilities:
Interest rate swaps and caps on loans	$	69,266	$	9,239	$	70,674	3,717
Foreign exchange contracts	3,657		54		4,643		136
Total	$	72,923	$	9,293	$	75,317	$	3,853

(1)The fair value of interest rate swaps and caps on loans are included in other assets and accrued expenses and other liabilities, respectively, in the accompanying consolidated statements of financial condition.

We have entered into agreements with counterparty financial institutions, which include master netting agreements that provide for the net settlement of all contracts with a single counterparty in the event of default. We elect, however, to account for all derivatives with counterparty institutions on a gross basis.

NOTE 10 – EMPLOYEE STOCK COMPENSATION

On May 31, 2018, our stockholders approved the Company's 2018 Omnibus Stock Incentive Plan (“2018 Omnibus Plan”). The 2018 Omnibus Plan provides that the maximum number of shares available for awards is 4,417,882. As of June 30, 2020, 3,359,922 shares were available for future awards.

Stock-based Compensation Expense

The following table presents stock-based compensation expense and the related tax benefits for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Stock options	$	2	$	(24)	$	4	$	(16)
Restricted stock awards and units	1,468		1,521		3,042		2,366
Total share-based compensation expense	$	1,470	$	1,497	$	3,046	$	2,350
Related tax benefits	$	433	$	440	$	897	$	691

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The following table presents unrecognized stock-based compensation expense as of June 30, 2020:

($ in thousands)	Unrecognized Expense		Weighted-Average Remaining Expected Recognition Period
Restricted stock awards and restricted stock units	9,530		2.3 years
Total	$	9,530	2.3 years

Stock Options

We issued stock options to certain employees, officers, and directors. Stock options are issued at the closing market price immediately before the grant date and generally have a three to five year vesting period and contractual terms of seven to ten years. We recognize an income tax deduction upon exercise of a stock option to the extent taxable income is recognized by the option holder. In the case of a non-qualified stock option, the option holder recognizes taxable income based on the fair market value of the shares acquired at the time of exercise less the exercise price.

The following table represents stock option activity for the three months ended June 30, 2020:

	Three Months Ended June 30, 2020
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	55,069	$	13.96	4.0 years
Outstanding at end of period	55,069	$	13.96	3.7 years	$	(194)
Exercisable at end of period	52,821	$	13.97	3.6 years	$	(187)

The following table represents stock option activity for the six months ended June 30, 2020:

	Six Months Ended June 30, 2020
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	62,521	$	13.85	4.3 years
Exercised	(7,452)	$	13.05	5.2 years
Outstanding at end of period	55,069	$	13.96	3.7 years	$	(194)
Exercisable at end of period	52,821	$	13.97	3.6 years	$	(187)

The following table sets forth information regarding unvested stock options for the three and six months ended June 30, 2020:

	Three Months Ended June 30, 2020			Six Months Ended June 30, 2020
	Number of Shares	Weighted-Average Exercise Price Per Share		Number of Shares	Weighted-Average Exercise Price Per Share
Outstanding at beginning of period	2,248	$	13.75	2,248	$	13.75
Vested	—	$	—	—	$	—
Forfeited	—	$	—	—	$	—
Outstanding at end of period	2,248	$	13.75	2,248	$	13.75

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Restricted Stock Awards and Restricted Stock Units

We also have granted restricted stock awards and restricted stock units to certain employees, officers, and directors. The restricted stock awards and units are valued at the closing price of our stock on the measurement date. The restricted stock awards and units fully vest after a specified period (generally ranging from one to five years) of continued service from the date of grant plus, in some cases, the satisfaction of performance conditions. These performance targets include conditions relating to our profitability and regulatory standing. The actual amounts of stock released upon vesting will be determined by the Compensation Committee of our Board of Directors upon the Committee's certification of the satisfaction of the target level of performance. We recognize an income tax deduction in an amount equal to the taxable income reported by the holders of the restricted stock, generally upon vesting or, in the case of restricted stock units, when settled. The following table presents unvested restricted stock awards and restricted stock units activity for the three and six months ended June 30, 2020:

	Three Months Ended June 30, 2020			Six Months Ended June 30, 2020
	Number of Shares	Weighted Average Grant Date Fair Value Per Share		Number of Shares	Weighted Average Grant Date Fair Value Per Share
Outstanding at beginning of period	1,083,107	$	15.65	923,482	$	15.74
Granted (1)	84,998	$	8.76	354,136	$	13.79
Vested (2)	(231,362)	$	16.09	(293,695)	$	15.95
Forfeited (3)	(24,073)	$	18.20	(71,253)	$	16.85
Outstanding at end of period	912,670	$	14.91	912,670	$	14.91

(1)There were zero and 78,771 performance-based shares/units included in shares granted for the three and six months ended June 30, 2020.

(2)There were 13,074 and 18,473 performance-based shares/units included in vested shares for the three and six months ended June 30, 2020.

(3)The number of forfeited shares includes aggregate performance-based shares/units of 1,782 and 17,404 for the three and six months ended June 30, 2020.

Stock Appreciation Rights

On August 21, 2012, we granted to the then, and now former, chief executive officer, a ten-year stock appreciation right (“SAR”).

The following table represents SARs activity and the weighted average exercise price per share as of and for the three months ended June 30, 2020:

	Three Months Ended June 30, 2020
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	1,559,012	$	11.60	2.4 years	$	(5,616)
Outstanding at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)
Exercisable at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)

The following table represents SARs activity and the weighted average exercise price per share as of and for the six months ended June 30, 2020:

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	Six Months Ended June 30,
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	1,559,012	$	11.60	2.6 years	$	8,508
Outstanding at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)
Exercisable at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)

NOTE 11 – STOCKHOLDERS’ EQUITY

Preferred Stock

We are authorized to issue 50,000,000 shares of preferred stock with par value of $0.01 per share. Preferred shares outstanding rank senior to common shares both as to dividends and liquidation preference but generally have no voting rights. All of our outstanding shares of preferred stock have a $1,000 per share liquidation preference. The following table presents our total outstanding preferred stock as of the dates indicated:

	June 30, 2020					December 31, 2019
($ in thousands)	Shares Outstanding	Liquidation Preference		Carrying Value		Shares Outstanding	Liquidation Preference		Carrying Value
Series D 7.375% non-cumulative perpetual	93,272	$	93,272	$	89,924	96,629	$	96,629	$	93,162
Series E 7.00% non-cumulative perpetual	98,865	98,865		95,113		100,477	100,477		96,663
Total	192,137	$	192,137	$	185,037	197,106	$	197,106	$	189,825

During the three and six months ended June 30, 2020, we repurchased depositary shares (Series D Depositary Shares), each representing a 1/40^th interest in a share of Series D Preferred Stock, liquidation amount of $1,000 per share of Series D Preferred Stock, resulting in the repurchase of 53,006 and 134,310 outstanding Series D Depositary Shares and the related retirement of 1,325 and 3,357 outstanding shares of Series D Preferred Stock. The repurchase price aggregated to $1.2 million and $2.7 million. The $40 thousand and $541 thousand difference between the consideration paid and the carrying value of the Series D Preferred Stock was reclassified to retained earnings and resulted in an increase to net (loss) income allocated to common stockholders.

During the three and six months ended June 30, 2020, we repurchased depositary shares (Series E Depositary Shares), each representing a 1/40^th interest in a share of Series E Preferred Stock, liquidation amount of $1,000 per share of Series E Preferred Stock, resulting in the repurchase of 57,065 and 64,465 outstanding Series E Depositary Shares and the related retirement of 1,427 and 1,612 outstanding shares of Series E Preferred Stock. The repurchase price aggregated to $1.4 million and $1.5 million. The $9 thousand and $34 thousand difference between the consideration paid and the carrying value of the Series E Preferred Stock was reclassified to retained earnings and resulted in an increase to net (loss) income allocated to common stockholders.

Share Repurchase Program

On February 10, 2020, we announced that our Board of Directors (the “Board”) authorized the repurchase of up to $45 million of our common stock. The repurchase authorization expires in February 2021, however given current macroeconomic conditions and the COVID-19 pandemic, we have suspended common stock repurchases for the immediate future. There were no repurchases of common stock for the three months ended June 30, 2020. During the six months ended June 30, 2020, we repurchased 827,584 shares of common stock at a weighted average price of $14.50 per share and an aggregate amount of $12.0 million. Purchases may be made in open-market transactions, in block transactions on or off an exchange, in privately negotiated transactions, or by other means as determined by our management and in accordance with the regulations of the Securities and Exchange Commission. The timing of purchases and the number of shares repurchased under the program will depend on a variety of factors including price, trading volume, corporate and regulatory requirements, and market conditions.

Change in Accumulated Other Comprehensive (Loss) Income ("AOCI")

Our AOCI includes unrealized gain (loss) on securities available-for-sale. Changes to AOCI are presented net of tax effect as a component of stockholders' equity. Reclassifications from AOCI are recorded on the consolidated statements of operations either as a gain or loss. The following table presents changes to AOCI for the periods indicated:

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	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Unrealized(loss) gain on securities available-for-sale
Balance at beginning of period	$	(54,148)	$	(18,091)	$	(11,900)	$	(24,117)
Unrealized gain (loss) arising during the period	56,701		7,678		(3,182)		16,422
Reclassification adjustment from other comprehensive income	(2,011)		—		(2,011)		(208)
Tax effect of current period changes	(16,107)		(2,255)		1,528		(4,765)
Total changes, net of taxes	38,583		5,423		(3,665)		11,449
Balance at end of period	$	(15,565)	$	(12,668)	$	(15,565)	$	(12,668)

NOTE 12 – VARIABLE INTEREST ENTITIES

We hold ownership interests in alternative energy partnerships and qualified affordable housing partnerships and have a variable interest in a multifamily securitization trust. We evaluate our interests in these entities to determine whether they meet the definition of a variable interest entity (VIE) and whether we are required to consolidate these entities. A VIE is consolidated by its primary beneficiary, which is the party that has both (i) the power to direct the activities that most significantly impact the economic performance of the VIE and (ii) a variable interest that could potentially be significant to the VIE. To determine whether or not a variable interest we hold could potentially be significant to the VIE, we consider both qualitative and quantitative factors regarding the nature, size, and form of our involvement with the VIE. We have determined that our interests in these entities meet the definition of variable interests.

Unconsolidated VIEs

Multifamily Securitization

During the third quarter of 2019, we transferred $573.5 million of multifamily loans, through a two-step process, to a third-party depositor which placed the multifamily loans into a third-party trust (a VIE) that issued structured pass-through certificates to investors. The transfer of these loans was accounted for as a sale for financial reporting purposes, in accordance with ASC 860. We determined that we are not the primary beneficiary of this VIE as we do not have the power to direct the activities that will have the most significant economic impact on the entity. Our continuing involvement in this securitization is limited to customary obligations associated with the securitization of loans, including the obligation to cure, repurchase, or substitute loans in the event of a material breach in representations. Additionally, we have the obligation to guarantee credit losses up to 12% of the aggregate unpaid principal balances at cut-off date of the securitization. This obligation is supported by a $68.8 million letter of credit between the Freddie Mac and the FHLB.

The maximum loss exposure that would be absorbed by us in the event that all of the assets in the securitization trust are deemed worthless is $68.8 million, which represents the aforementioned obligation to guarantee credit losses up to 12%. We believe that the loss exposure on the multifamily securitization is reduced by both loan-to-value ratios of the underlying collateral balances and the overcollateralization that exists within the securitization trust. At June 30, 2020, we have a $3.5 million repurchase reserve related to this VIE.

Alternative Energy Partnerships

We invest in certain alternative energy partnerships (limited liability companies) formed to provide sustainable energy projects that are designed to generate a return primarily through the realization of federal tax credits (energy tax credits). These entities were formed to invest in newly established residential and commercial solar leases and power purchase agreements. As a result of our investments, we have the right to certain investment tax credits and tax depreciation benefits (recognized on the flow through and income statement method in accordance with ASC 740), and to a lesser extent, cash flows generated from the installed solar systems leased to individual consumers for a fixed period of time. While our interest in the alternative energy partnerships meets the definition of a VIE in accordance with ASC 810, we have determined that we are not the primary beneficiary because we do not have the power to direct the activities that most significantly impact the economic performance of the entities including operational and credit risk management activities. As we are not the primary beneficiary, we did not consolidate the entities.

We use the Hypothetical Liquidation at Book Value (HLBV) method to account for our investments in energy tax credits as an equity investment under ASC 970-323-25-17. Under the HLBV method, an equity method investor determines its share of an investee's earnings by comparing its claim on the investee's book value at the beginning and end of the period, assuming the investee were to liquidate all assets at their U.S. GAAP amounts and distribute the resulting cash to creditors and investors

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under their respective priorities. The difference between the calculated liquidation distribution amounts at the beginning and the end of the reporting period, after adjusting for capital contributions and distributions, is our share of the earnings or losses from the equity investment for the period. To account for the tax credits earned on investments in alternative energy partnerships, we use the flow-through income statement method. Under this method, the tax credits are recognized as a reduction to income tax expense and the initial book-tax differences in the basis of the investments are recognized as additional tax expense in the year they are earned. Investments in alternative energy partnerships totaled $27.0 million and $29.3 million at June 30, 2020 and December 31, 2019.

The following table presents information regarding activity in our alternative energy partnerships for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Fundings	$	—	$	235	$	3,631	$	235
Cash distribution from investment	547		535		1,001		995
Gain (loss) on investments in alternative energy partnerships	167		355		(1,738)		(1,595)
Income tax credits recognized	—		1,723		—		1,723
Tax (expense) benefit recognized from HLBV application	(38)		380		398		380

The following table represents the carrying value of the associated unconsolidated assets and liabilities and the associated maximum loss exposure for alternative energy partnerships as of the dates indicated:

($ in thousands)	June 30, 2020		December 31, 2019
Cash	$	2,958	$	4,224
Equipment, net of depreciation	244,961		248,920
Other assets	6,751		6,301
Total unconsolidated assets	$	254,670	$	259,445
Total unconsolidated liabilities	$	6,326	$	7,143
Maximum loss exposure	$	26,967	$	32,525

The maximum loss exposure that would be absorbed by us in the event that all of the assets in alternative energy partnerships are deemed worthless is $27.0 million, which is our recorded investment amount at June 30, 2020.

We believe that the loss exposure on our investments is reduced considering our return on our investment is provided not only by the cash flows of the underlying client leases and power purchase agreements, but also through the significant tax benefits, including federal tax credits generated from the investments. In addition, the arrangements include a transition manager to support any transition of the solar company sponsor whose role includes that of the servicer and operation and maintenance provider, in the event the sponsor would be required to be removed from its responsibilities (e.g., bankruptcy, breach of contract, etc.), thereby further limiting our exposure.

Qualified Affordable Housing Partnerships

We invest in limited partnerships that operate qualified affordable housing projects. The returns on these investments are generated primarily through allocated Federal tax credits and other tax benefits. In addition, these investments contribute to our compliance with the Community Reinvestment Act. These limited partnerships are considered to be VIEs, because either (i) they do not have sufficient equity investment at risk or (ii) the limited partners with equity at risk do not have substantive kick-out rights through voting rights or substantive participating rights over the general partner. As a limited partner, we are not the primary beneficiary because the general partner has the ability to direct the activities of the VIEs that most significantly impact their economic performance. As a result, we do not consolidate these partnerships.

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The following table presents information regarding balances in our qualified affordable housing partnerships for the periods indicated:

($ in thousands)	June 30, 2020		December 31, 2019
Ending balance(1)	$	46,167	$	36,462
Aggregate funding commitment	61,278		49,278
Total amount funded	40,776		26,905
Unfunded commitment	20,502		22,373
Maximum loss exposure	46,167		36,462

(1)Included in other assets in the accompanying consolidated statements of financial condition.

The following table presents information regarding activity in our qualified affordable housing partnerships for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Fundings	$	9,312	$	—	$	13,871	$	454
Proportional amortization recognized	1,148		553		2,295		1,190
Income tax credits recognized	1,152		554		2,208		1,109

NOTE 13 – (LOSS) EARNINGS PER COMMON SHARE

The following table presents computations of basic and diluted (loss) earnings per common share ("EPS") for the three and six months ended June 30, 2020:

	Three Months Ended June 30, 2020				Six Months Ended June 30, 2020
($ in thousands except per share data)	Common Stock		Class B Common Stock		Common Stock		Class B Common Stock
Loss from operations	$	(18,273)	$	(176)	$	(24,804)	$	(238)
Less: participating securities dividends	(93)		(1)		(186)		(2)
Less: preferred stock dividends	(3,409)		(33)		(6,909)		(66)
Less: preferred stock redemption	49		—		570		5
Net loss allocated to common stockholders	$	(21,726)	$	(210)	$	(31,329)	$	(301)
Weighted average common shares outstanding	49,553,598		477,321		49,770,527		477,321
Dilutive effects of restricted shares/units	—		—		—		—
Dilutive effects of stock options	—		—		—		—
Average shares and dilutive common shares	49,553,598		477,321		49,770,527		477,321
Basic loss per common share	$	(0.44)	$	(0.44)	$	(0.63)	$	(0.63)
Diluted loss per common share	$	(0.44)	$	(0.44)	$	(0.63)	$	(0.63)

For the three and six months ended June 30, 2020, there were 960,090 and 960,883 of restricted shares/units and 55,069 and 55,438 of stock options that were not considered in computing diluted earnings per common share, because they were anti-dilutive.

The following table presents computations of basic and diluted EPS for the three and six months ended June 30, 2019:

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	Three Months Ended June 30, 2019				Six Months Ended June 30, 2019
($ in thousands except per share data)	Common Stock		Class B Common Stock		Common Stock		Class B Common Stock
Income from operations	$	16,426	$	156	$	23,397	$	222
Less: income allocated to participating securities	(268)		(3)		(152)		(1)
Less: participating securities dividends	(93)		(1)		(292)		(3)
Less: preferred stock dividends	(4,268)		(40)		(8,535)		(81)
Net income allocated to common stockholders	$	11,797	$	112	$	14,418	$	137
Weighted average common shares outstanding	50,379,816		477,321		50,290,107		477,321
Dilutive effects of stock units	103,677		—		119,967		—
Dilutive effects of stock options	4,142		—		7,795		—
Average shares and dilutive common shares	50,487,635		477,321		50,417,869		477,321
Basic earnings per common share	$	0.23	$	0.23	$	0.29	$	0.29
Diluted earnings per common share	$	0.23	$	0.23	$	0.29	$	0.29

For the three and six months ended June 30, 2019, there were 517,833 and 484,163, respectively, of stock units and 58,859 and 33,013, respectively, of stock options that were not considered in computing diluted earnings per common share, because they were anti-dilutive.

NOTE 14 – LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES

Some financial instruments, such as unfunded loan commitments, credit lines, letters of credit, and overdraft protection, are issued to meet customer financing needs. These are agreements to provide credit or to support the credit of others, as long as conditions established in the contract are met, and usually have expiration dates. Commitments may expire without being used. Risk of credit loss exists up to the face amount of these instruments. The same credit policies are used to make such commitments as are used for originating loans, including obtaining collateral at exercise of the commitment.

The following table presents the contractual amount of financial instruments with off-balance-sheet risk as of the periods indicated:

	June 30, 2020				December 31, 2019
($ in thousands)	Fixed Rate		Variable Rate		Fixed Rate		Variable Rate
Commitments to extend credit	$	6,249	$	73,844	$	473	$	129,495
Unused lines of credit	590		1,391,625		703		1,049,632
Letters of credit	336		3,243		134		5,316

Other Commitments

At June 30, 2020, we had unfunded commitments of $20.5 million, $7.1 million, and $501 thousand for affordable housing fund investments, Small Business Investment Company (SBIC) investments, and other investments, respectively.

NOTE 15 – REVENUE RECOGNITION

The following presents noninterest income, segregated by revenue streams, in-scope and out-of-scope of Topic 606 - Revenue From Contracts With Customers, for the periods indicated:

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	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Noninterest income (loss)
In scope of Topic 606
Deposit service fees	$	420	$	575	$	959	$	1,242
Debit card fees	380		178		557		291
Investment commissions	—		260		—		539
Other	59		109		108		216
Noninterest income (in-scope of Topic 606)	859		1,122		1,624		2,288
Noninterest income (out-of-scope of Topic 606)	4,669		(3,412)		5,965		1,717
Total noninterest income (loss)	$	5,528	$	(2,290)	$	7,589	$	4,005

We do not typically enter into long-term revenue contracts with customers. As of June 30, 2020 and December 31, 2019, we did not have any significant contract balances. As of June 30, 2020, we did not capitalize any contract acquisition costs.

NOTE 16 – RELATED-PARTY TRANSACTIONS

Certain of our executive officers and directors, and their related interests, are customers of, or have had transactions with, the Bank in the ordinary course of business, including deposits, loans and other financial services related transactions. From time to time, the Bank may make loans to executive officers and directors, and their related interests, in the ordinary course of business and on substantially the same terms and conditions, including interest rates and collateral, as those of comparable transactions with non-insiders prevailing at the time, in accordance with the Bank’s underwriting guidelines. These loans do not involve more than the normal risk of collectability or present other unfavorable features. As of June 30, 2020, no related party loans were categorized as non-accrual, past due, restructured, or potential problem loans.

Transactions with Related Parties

The Company and the Bank have engaged in transactions described below with the Company’s current or former directors, executive officers, and beneficial owners of more than 5 percent of the outstanding shares of the Company’s voting common stock and certain persons related to them.

As previously disclosed, the Company’s Board of Directors has authorized and directed the Company to provide indemnification, advancement, and/or reimbursement for the costs of separate, independent counsel retained by any then-current officer or director, in their individual capacity, with respect to matters related to (i) an investigation by the Special Committee of the Company’s Board of Directors, (ii) a formal order of investigation issued by the SEC on January 4, 2017 (since resolved), and (iii) any related civil or administrative proceedings against the Company as well as officers and directors currently or previously associated with the Company (collectively, the “Indemnity Matters”).

Indemnification costs were paid on behalf of certain current and former executive officers and directors in amounts less than $120 thousand for the three and six months ended June 30, 2020. During the three and six months ended June 30, 2019, indemnification costs paid by the Company included $4.7 million and $6.9 million incurred by the Company’s former Chair, President, and Chief Executive Officer, Steven A. Sugarman; $186 thousand and $741 thousand jointly incurred by the Company’s former Interim Chief Financial Officer and Chief Strategy Officer, J. Francisco A. Turner; and the Company’s former Chief Financial Officer, James J. McKinney; and $139 thousand and $142 thousand incurred by the Bank’s former director, Cynthia Abercrombie. Indemnification costs for the Company's former General Counsel Emeritus John Grosvenor were $149 thousand for the six months ended June 30, 2019. Indemnification costs were paid on behalf of other former executive officers and other former directors in lesser amounts for the three and six months ended June 30, 2019.

NOTE 17 – LITIGATION

From time to time, we are involved as plaintiff or defendant in various legal actions arising in the normal course of business. In accordance with applicable accounting guidance, we establish an accrued liability when those matters present loss contingencies that are both probable and estimable. We continue to monitor the matters for further developments that could affect the amount of the accrued liability that has been previously established.

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While the ultimate liability with respect to legal actions cannot be determined at this time, we believe that damages, if any, and other amounts relating to pending matters are not likely to be material to the consolidated financial statements.

NOTE 18 – SUBSEQUENT EVENTS

We have evaluated events from the date of the consolidated financial statements on June 30, 2020 through the issuance of these consolidated financial statements included in this Quarterly Report on Form 10-Q.

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ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following is management’s discussion and analysis of the major factors that influenced our results of operations and financial condition as of and for the three and six months ended June 30, 2020. This analysis should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2019 and with the unaudited consolidated financial statements and notes thereto set forth in this Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2020.

CRITICAL ACCOUNTING POLICIES

Our consolidated financial statements are prepared in accordance with GAAP and general practices within the banking industry. As certain accounting policies require significant estimates and assumptions that have a material impact on the carrying value of assets and liabilities, we have established critical accounting policies to facilitate making the judgment necessary to prepare financial statements. Our critical accounting policies are described in Note 1 to Consolidated Financial Statements and in the “Critical Accounting Policies” section of Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company's Annual Report on Form 10-K for the year ended December 31, 2019 and in Note 1 Consolidated Financial Statements (unaudited) included in Part I of this Quarterly Report on Form 10-Q.

Adoption of the Current Expected Credit Loss (CECL) Model

On January 1, 2020, we adopted the new accounting standard, commonly known as CECL, which uses a current expected credit loss model for determining allowance for credit losses (ACL). Upon adoption, we recognized a Day 1 increase in the ACL of $6.4 million and a related after-tax decrease to retained earnings of $4.5 million. Our Day 1 ACL under the new CECL model totaled $68.1 million compared to $61.7 million under the incurred loss model at December 31, 2019, and represented 1.14% of total loans. At June 30, 2020, the ACL totaled $94.6 million resulting in an ACL to total loans coverage ratio of 1.68%, up from 1.04% at December 31, 2019. Excluding PPP loans, the ACL to total loans coverage ratio was 1.76% at June 30, 2020. The ACL and provision for credit losses include amounts for the reserve for unfunded loan commitments.

Recent Accounting Pronouncements Not Yet Adopted

Our recent accounting pronouncements not yet adopted are described in Note 1 to Consolidated Financial Statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2019 and in Note 1 Consolidated Financial Statements (unaudited) included in Part I of this Quarterly Report on Form 10-Q.

Executive Overview

We are focused on providing core banking products and services, including customized and innovative banking and lending solutions, designed to cater to the unique needs of California's diverse businesses, entrepreneurs and communities through our 31 full service branches in Orange, Los Angeles, San Diego, and Santa Barbara Counties. Through our over 600 dedicated professionals, we are committed to servicing and building enduring relationships by providing a higher standard of banking. We offer a variety of financial products and services designed around our target clients in order to serve all of their banking and financial needs. We continue to focus on three main initiatives designed to improve our franchise and profitability on an ongoing basis: reducing our cost of deposits while adding value, optimizing the balance sheet to focus on higher-margin products while managing credit risk, and appropriately managing down expenses to the size and complexity of the business. Through these efforts, we continue to transform our franchise into a relationship-focused community bank, maintaining our credit quality and serving businesses, entrepreneurs and individuals within our footprint.

Financial Highlights

For the three months ended June 30, 2020 and 2019, net (loss) income was $(18.4) million and $16.6 million. Diluted (loss) earnings from operations per common share were $(0.44) and $0.23 for the three months ended June 30, 2020 and 2019. Financial results for the second quarter of 2020 included a one-time pre-tax charge of $26.8 million related to the restructuring of the Company’s relationship with the Los Angeles Football Club (“LAFC”). The restructuring of the relationship will result in estimated pre-tax cost savings of approximately $89 million over the next 12.5 years, or approximately $7.1 million per year.

Significant financial highlights during the three months ended June 30, 2020 included:

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•Noninterest-bearing deposit balances increased $135.4 million during the quarter and represented 23% of total deposits at June 30, 2020, up from 16% a year earlier

•Total checking balances increased $409.7 million during the quarter and represented 54% of total deposits at June 30, 2020, up from 40% a year earlier

•Net interest margin increased 12 basis points from the prior quarter to 3.09%

•Average cost of deposits declined 40 basis points from the prior quarter to 0.71%

•Allowance for credit losses strengthened to 1.68% of total loans

•Common Equity Tier 1 capital at 11.68%

COVID-19 Operational Update

The markets in which we operate are marked by continuing uncertainty about the pace and strength of reopening and recovering from the impacts of the global pandemic. Despite the challenges created by the coronavirus, we continue to execute on our strategic initiatives and the transformation of our balance sheet. We continue to operate 25 of our 31 branches as we temporarily consolidated some overlapping areas at the beginning of the pandemic to ensure an adequate balance between employee and client safety and business continuity to meet our clients' banking needs. The majority of our employees outside of our branches are working offsite with only essential employees onsite. We are classified as an 'essential' business and we have implemented social and physical safeguards for our customers and employees within all of our locations.

CARES Act Response Efforts

On March 27, 2020, the U.S. federal government signed the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) into law. The CARES Act provides emergency assistance and health care response for individuals, families, and businesses affected by the COVID-19 pandemic and includes numerous measures which we are utilizing to support our customers, including the Paycheck Protection Program (“PPP”).

The CARES Act initially allocated nearly $350 billion for the PPP, with an additional $310 billion added through an amendment bill several weeks later. This program is intended to assist small businesses affected by the pandemic and economic downturn with funds to pay payroll and other expenses through June 30, 2020. The program has been extended through August 8, 2020. The loans are 100% guaranteed by the Small Business Administration (“SBA”) and the full principal amount of the loans may qualify for loan forgiveness if certain conditions are met.

Within seven business days of the announcement of PPP, we redeployed resources to this program in support of our clients and others seeking financial relief under the program. As of June 30, 2020, we estimate we helped businesses that represent an aggregate workforce of more than 25,000 jobs through approvals of $262 million in PPP funds. We served existing clients with our high touch business framework in addition to successfully attracting many new clients by using the PPP opportunity to differentiate ourselves by demonstrating how true service can make a meaningful difference. As a result, we added many new clients who are consistent with the type of commercial customers that we target in our traditional business development efforts. During the three months ended June 30, 2020, we collected $7.5 million in fees on the 1,069 PPP loans funded, which will be recognized over their estimated life of nine months. We have started the loan forgiveness process with a number of clients and we expect this will be complete early next year.

Borrower Payment Relief Efforts

We are committed to supporting our existing borrowers and customers during this period of economic uncertainty.  We actively engaged with our borrowers seeking payment relief and waived certain fees for impacted clients.  One method we deployed was to offer forbearance and deferments to qualified clients.  For single family residential (“SFR”) loans, the forbearance period is 90 days in length and is patterned after the U.S. Department of Housing and Urban Development (“HUD”) guidelines where applicable.  With respect to our non-SFR loan portfolio, deferments are 90 days in length. 

Many of our deferred loans have recently reached the expiration of their initial 90-day deferral period and we are reviewing their current financial condition as we evaluate extension requests of deferral periods. For those commercial borrowers that demonstrate a continuing need for a deferral, we generally expect to obtain credit enhancements such as additional collateral, personal guarantees, and/or reserve requirements in order to grant an additional deferral period. We expect the legacy SFR loans to continue with a higher percentage of forbearances due to the applicable consumer regulations, however, the SFR portfolio is well secured with an average portfolio LTV below 70%.

For a discussion of the related risk factors, please refer to Part II, Item 1A. "Risk Factors" in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2020.

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The following table presents the composition of our loan portfolio for borrowers that received payment relief as of June 30, 2020:

	Deferment & Forbearances(1)(2)
		June 30, 2020
($ in thousands)		Number of Loans	Amount(1)(2)		% of Loan Category
Commercial:
Commercial and industrial		55	$	53,255	3.7	%
Commercial real estate		53	218,537		26.6	%
Multifamily		30	114,296		8.0	%
SBA		6	21,819		7.0	%
Construction		8	31,544		14.8	%
Total commercial		152	439,451		10.4	%
Consumer:
Single family residential mortgage		142	163,815		12.0	%
Other consumer		4	969		2.5	%
Total consumer		146	164,784		11.7	%
Total		298	$	604,235	10.7	%

(1)Excludes loans in forbearance that are current

(2)Excludes loans delinquent prior to COVID-19

With respect to our commercial portfolio, as of July 31, 2020, 67 loans totaling $192.8 million have reached expiration of their initial deferral period and have not requested an additional 90-day deferral period as of that date. As of July 31, 2020, 18 loans totaling $121.3 million have requested an additional 90-day deferral period, of which 5 loans totaling $35.2 million have been approved. We continue to review the remaining requests and will evaluate additional requests from commercial borrowers that have or will soon reach expiration of their initial deferral period as described above.

With respect to our consumer portfolio, consisting primarily of single family residential mortgage loans, as of July 31, 2020, the number of loans on forbearance remained relatively unchanged compared to June 30, 2020.

Other Efforts

To support our community, we partnered with Food Finders to provide over 300,000 meals to our most vulnerable neighbors in Southern California. We also made a donation to the Los Angeles Fire Department to help supply critical personal protective equipment to these first-responders. We developed online financial literacy classes for young adults and we sponsored five LAFC blood drives in partnership with the American Red Cross and Banc of California Stadium.

Termination of LAFC Agreement

On May 22, 2020, we entered into an agreement (the “Termination Agreement”) with the Los Angeles Football Club (LAFC) to amend and terminate certain agreements that we previously entered into with LAFC in 2017 (the “LAFC Agreements”). Among other things, the LAFC Agreements granted us the exclusive naming rights to the Banc of California Stadium, a soccer stadium of LAFC, as well as the right to be the official bank of LAFC. Pursuant to the LAFC Agreements, we agreed to pay LAFC $100 million over a period of 15 years, of which $15.9 million had been recognized as expense from January 1, 2018 through May 22, 2020. In addition to the stated contract amount of $100 million, the LAFC Agreements obligated us to pay for other annual expenses, which have averaged approximately $500 thousand per year.

Under the Termination Agreement, we agreed to restructure our partnership to allow LAFC to expand its roster of sponsors and partners into categories that were previously exclusive to us under the LAFC Agreements and we stepped away from our naming-rights position on LAFC’s soccer stadium. We will continue to serve as LAFC’s primary banking partner, subject to any new sponsor in the financial services space that offers banking services, and remain as a partner on a number of other collaborations. As part of the Termination Agreement, we agreed to pay LAFC a $20.1 million termination fee. The LAFC Agreements will be terminated on December 31, 2020, unless otherwise terminated earlier by LAFC pursuant to the Termination Agreement (the “Termination Date”). We will not have any continuing payment obligations to LAFC following the Termination Date. With respect to the remainder of 2020, we do not expect to have any additional payment obligations except in certain specified circumstances set forth in the Termination Agreement, which amount would not exceed $2.8 million.

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The pre-tax impact from our entry into the Termination Agreement was a one-time charge to operations of $26.8 million during the second quarter of 2020. The charge to operations includes the write-off of all of a prepaid advertising asset. As a result of the Termination Agreement, the Bank estimates an aggregate pre-tax cost savings of approximately $89.1 million, or approximately $7.1 million per year, over the remaining 12 ½ year life of the original LAFC Agreements.

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RESULTS OF OPERATIONS

Net Interest Income

The following table presents interest income, average interest-earning assets, interest expense, average interest-bearing liabilities, and their corresponding yields and costs expressed both in dollars and rates for the three months ended June 30, 2020, March 31, 2020 and June 30, 2019:

	Three Months Ended
	June 30, 2020							March 31, 2020							June 30, 2019
($ in thousands)	Average Balance			Interest and Dividends		Yield/Cost		Average Balance			Interest and Dividends		Yield/ Cost		Average Balance			Interest and Dividends		Yield/Cost
Interest-earning assets:
Total loans(1)	$	5,707,619		$	63,642	4.48	%	$	5,780,810		$	65,534	4.56	%	$	7,445,704		$	89,159	4.80	%
Securities	1,063,941			7,816		2.95	%	952,966			7,820		3.30	%	1,304,876			12,457		3.83	%
Other interest-earning assets (2)	424,776			1,239		1.17	%	297,444			1,360		1.84	%	342,908			2,424		2.84	%
Total interest-earning assets	7,196,336			72,697		4.06	%	7,031,220			74,714		4.27	%	9,093,488			104,040		4.59	%
ACL	(78,528)							(60,470)							(63,046)
BOLI and noninterest-earning assets (3)	622,398							592,192							580,133
Total assets	$	7,740,206						$	7,562,942						$	9,610,575
Interest-bearing liabilities:
Savings	$	905,997		2,718		1.21	%	$	890,830		3,296		1.49	%	$	1,083,571		4,950		1.83	%
Interest-bearing checking	1,710,038			2,186		0.51	%	1,520,922			3,728		0.99	%	1,580,165			4,554		1.16	%
Money market	592,872			850		0.58	%	608,926			1,760		1.16	%	853,007			3,902		1.83	%
Certificates of deposit	1,214,939			4,451		1.47	%	1,151,518			5,827		2.04	%	2,537,060			15,192		2.40	%
Total interest-bearing deposits	4,423,846			10,205		0.93	%	4,172,196			14,611		1.41	%	6,053,803			28,598		1.89	%
FHLB advances	819,166			4,818		2.37	%	1,039,055			5,883		2.28	%	1,287,121			8,289		2.58	%
Securities sold under repurchase agreements	1,024			2		0.79	%	—			—		—	%	2,173			16		2.95	%
Long-term debt and other interest-bearing liabilities	173,977			2,357		5.45	%	174,056			2,359		5.45	%	174,161			2,357		5.43	%
Total interest-bearing liabilities	5,418,013			17,382		1.29	%	5,385,307			22,853		1.71	%	7,517,258			39,260		2.09	%
Noninterest-bearing deposits	1,349,735							1,133,306							1,034,205
Noninterest-bearing liabilities	118,208							128,282							96,179
Total liabilities	6,885,956							6,646,895							8,647,642
Total stockholders’ equity	854,250							916,047							962,933
Total liabilities and stockholders’ equity	$	7,740,206						$	7,562,942						$	9,610,575
Net interest income/spread				$	55,315	2.77	%				$	51,861	2.56	%				$	64,780	2.50	%
Net interest margin (4)						3.09	%						2.97	%						2.86	%
Ratio of interest-earning assets to interest-bearing liabilities	132.82		%					130.56		%					120.97		%
Total deposits(5)	5,773,581			10,205		0.71	%	5,305,502			14,611		1.11	%	7,088,008			28,598		1.62	%
Total funding (6)	6,767,748			17,382		1.03	%	6,518,613			22,853		1.41	%	8,551,463			39,260		1.84	%

(1)Total loans are net of deferred fees, related direct costs and discounts. Non-accrual loans are included in the average balance. Net accretion (amortization) of deferred loan fees (costs) of $1.1 million, $(587) thousand and $106 thousand and accretion of discount on purchased loans of $347 thousand, $8 thousand and $28 thousand for the three months ended June 30, 2020, March 31, 2020 and June 30, 2019, respectively, are included in interest income.

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(2)Includes average balance of FHLB, FRB and other bank stock at cost and average time deposits with other financial institutions.

(3)Includes average balance of bank-owned life insurance of $110.4 million, $110.0 million and $107.8 million for the three months ended June 30, 2020, March 31, 2020 and June 30, 2019.

(4)Annualized net interest income divided by average interest-earning assets.

(5)Total deposits is the sum of interest-bearing deposits and noninterest-bearing deposits. The cost of total deposits is calculated as annualized total interest expense on deposits divided by average total deposits.

(6)Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding.

Three Months Ended June 30, 2020 Compared to Three Months Ended March 31, 2020

Net interest income increased $3.5 million to $55.3 million for the second quarter of 2020 due mostly to lower funding costs and higher average interest-earning assets, offset by a lower yield on such assets. Compared to the prior quarter, average interest-earning assets increased by $165.1 million to $7.20 billion, due to higher average securities of $111.0 million and other interest-earning assets of $127.3 million, offset by lower average loans of $73.2 million. The average interest-earning assets growth was funded by higher average noninterest-bearing deposits of $216.4 million and interest-bearing deposits of $251.7 million, partially offset by lower average FHLB advances of $219.9 million.

The net interest margin increased 12 basis points to 3.09% for the second quarter from 2.97% for the prior quarter. The increase was due to the 42 basis point decline on the average cost of interest-bearing liabilities outpacing the 21 basis point decline in the average yield on interest-earning assets. The decrease in the average interest-earning asset yield to 4.06% for the second quarter from 4.27% for the first quarter was due to lower yields on most interest-earning asset classes and the change in the mix of interest-earning assets. The lower yields on total loans, securities and other interest-earning assets was due to originating new business and repricing variable rate loans and investments in the lower interest rate environment given the rate cuts by the Federal Reserve in March 2020. Our average yield on loans declined 8 basis points to 4.48% and our average yield on securities decreased 35 basis points to 2.95%. The second quarter includes $1.7 million of PPP fee income, which increased the net interest margin by 3 basis points. The lower securities yield is due mostly to a 38 basis point decrease in the collateralized loan obligations (“CLOs”) yield to 3.22% for the second quarter from 3.60% for the first quarter as these CLOs reprice quarterly.

The average cost of funds decreased 39 basis points to 1.03% for the second quarter from 1.41% for the first quarter. This decrease was driven by the lower average cost of interest-bearing liabilities and improved funding mix, including higher average noninterest-bearing deposits. We have reduced our reliance on high cost transaction accounts, non-brokered certificates of deposits, and wholesale funds as we continue to execute on our relationship-focused business banking strategy. The 42 basis point decline in the average cost of interest-bearing liabilities to 1.29% for the second quarter, from 1.71% for the first quarter, was driven by the lower average cost of interest-bearing deposits. The average cost of interest-bearing deposits declined 48 basis points to 0.93% from the prior quarter due to actively managing down deposit rates in response to the interest rate cuts by the Federal Reserve in March 2020. Additionally, average noninterest-bearing deposits increased by $216.4 million and represented 23.4% of total average deposits in the second quarter compared to 21.4% of total average deposits for the first quarter. Our total cost of average deposits decreased 40 basis points to 0.71% for the second quarter. The spot rate of total deposits at the end of the second quarter of 2020 was 0.59%.

Three Months Ended June 30, 2020 Compared to Three Months Ended June 30, 2019

Net interest income was $55.3 million for the three months ended June 30, 2020, a decrease of $9.5 million, or 14.6%, from $64.8 million for the three months ended June 30, 2019. The decrease in net interest income from the prior period was due to lower average interest-earning assets, as a result of targeted sales of securities and loans during 2019, in line with our strategy of remixing the loan portfolio towards relationship based-lending, offset by a higher net interest margin. For the three months ended June 30, 2020, average interest-earning assets declined $1.90 billion to $7.20 billion and the net interest margin increased 23 basis points to 3.09% for the three months ended June 30, 2020 compared to 2.86% for the same 2019 period.

Our average yield on interest-earning assets decreased 53 basis points to 4.06% for the three months ended June 30, 2020, as compared to 4.59% during the same 2019 period. The decrease in yield was primarily attributable to lower average yields on the loan and securities portfolios, partially offset by an increased mix of loans versus

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securities. Our average yield on loans was 4.48% for the three months ended June 30, 2020, compared to 4.80% for the same 2019 period, primarily due to lower market interest rates and a lower percentage of higher-yielding commercial and industrial balances in the portfolio due to the market interest rate cuts totaling 225 basis points by the Federal Reserve in the third quarter of 2019 through March of 2020. Our average yield on securities decreased 88 basis points due mostly to CLOs repricing into the lower rate environment and a decrease in average CLO balances.

The average cost of funds decreased to 1.03% for the three months ended June 30, 2020 from 1.84% for the same 2019 period. This decrease was driven by the lower average cost of interest-bearing liabilities and the improved funding mix, including higher average noninterest-bearing deposits. The 80 basis point decline in the average cost of interest-bearing liabilities to 1.29% for the three months ended June 30, 2020 from 2.09% for the same 2019 period was driven by the lower average cost of interest-bearing deposits and rates paid on our FHLB term advances. The average cost of interest-bearing deposits declined 96 basis points to 0.93% from the prior period due to actively managing down deposit rates in response to the previously described interest rate cuts by the Federal Reserve and a lower reliance on brokered deposits. Additionally, average noninterest-bearing deposits increased by $315.5 million when compared to the same 2019 period. Our cost of average total deposits decreased 91 basis points to 0.71% for the three months ended June 30, 2020 when compared to the same 2019 period due to the lower cost of interest-bearing deposits and a higher mix of noninterest-bearing deposits. Average noninterest-bearing deposits represented 23.4% of total average deposits for the three months ended June 30, 2020 compared to 14.6% of total average deposits for the first quarter of 2019.

The following table presents interest income, average interest-earning assets, interest expense, average interest-bearing liabilities, and their corresponding yields and costs expressed both in dollars and rates, on a consolidated operations basis, for the six months ended June 30, 2020 and 2019:

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	Six Months Ended June 30,
	2020							2019
($ in thousands)	Average Balance			Interest and Dividends		Yield/Cost		Average Balance			Interest and Dividends		Yield/Cost
Interest-earning assets:
Total loans (1)	$	5,744,214		$	129,176	4.52	%	$	7,579,485		$	179,717	4.78	%
Securities	1,008,454			15,636		3.12	%	1,526,959			30,298		4.00	%
Other interest-earning assets (2)	361,110			2,599		1.45	%	332,424			4,737		2.87	%
Total interest-earning assets	7,113,778			147,411		4.17	%	9,438,868			214,752		4.59	%
ACL	(69,499)							(62,488)
BOLI and non-interest earning assets (3)	607,296							577,858
Total assets	$	7,651,575						$	9,954,238
Interest-bearing liabilities:
Savings	$	898,414		6,013		1.35	%	$	1,142,360		10,429		1.84	%
Interest-bearing checking	1,615,480			5,915		0.74	%	1,567,575			9,079		1.17	%
Money market	600,899			2,610		0.87	%	870,177			8,031		1.86	%
Certificates of deposit	1,183,229			10,278		1.75	%	2,758,789			32,502		2.38	%
Total interest-bearing deposits	4,298,022			24,816		1.16	%	6,338,901			60,041		1.91	%
FHLB advances	929,110			10,701		2.32	%	1,354,238			17,370		2.59	%
Securities sold under repurchase agreements	512			2		0.79		2,261			34		3.03	%
Long-term debt and other interest-bearing liabilities	174,017			4,716		5.45	%	174,195			4,719		5.46	%
Total interest-bearing liabilities	5,401,661			40,235		1.50	%	7,869,595			82,164		2.11	%
Noninterest-bearing deposits	1,241,521							1,028,008
Noninterest-bearing liabilities	123,244							96,801
Total liabilities	6,766,426							8,994,404
Total stockholders’ equity	885,149							959,834
Total liabilities and stockholders’ equity	$	7,651,575						$	9,954,238
Net interest income/spread				$	107,176	2.67	%				$	132,588	2.48	%
Net interest margin (4)						3.03	%						2.83	%
Ratio of interest-earning assets to interest-bearing liabilities	131.70		%					119.94		%
Total deposits(5)	5,539,543			24,816		0.90	%	7,366,909			60,041		1.64	%
Total funding (6)	6,643,182			40,235		1.22	%	8,897,603			82,164		1.86	%

(1)Total loans are net of deferred fees, related direct costs and discounts, but exclude the allowance for credit losses. Non-accrual loans are included in the average balance. Net accretion (amortization) of deferred loan fees (costs) of $553 thousand and $(83) thousand and accretion of discount on purchased loans of $355 thousand and $125 thousand for the six months ended June 30, 2020 and 2019, respectively, are included in interest income.

(2)Includes average balance of FHLB, FRB and other bank stock at cost and average time deposits with other financial institutions.

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(3)Includes average balance of bank-owned life insurance of $110.2 million and $107.5 million for the six months ended June 30, 2020 and 2019.

(4)Annualized net interest income divided by average interest-earning assets.

(5)Total deposits is the sum of interest-bearing deposits and noninterest-bearing deposits. The cost of total deposits is calculated as annualized total interest expense on deposits divided by average total deposits.

(6)Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding.

Six Months Ended June 30, 2020 Compared to Six Months Ended June 30, 2019

Net interest income for the six months ended June 30, 2020 decreased $25.4 million to $107.2 million from $132.6 million for the same 2019 period. This decrease was due to lower average interest-earning assets, as a result of targeted sales of securities and loans during 2019, in line with our strategy of remixing the loan portfolio towards relationship based-lending, partially offset by a higher net interest margin. For the six months ended June 30, 2020, average interest-earning assets declined $2.33 billion to $7.11 billion, and the net interest margin increased 20 basis points to 3.03% for the six months ended June 30, 2020 compared to 2.83% for the same 2019 period.

Our average yield on interest-earning assets decreased 42 basis points to 4.17% for the six months ended June 30, 2020 as compared to 4.59% during the same 2019 period. The decrease in yield was primarily attributable to lower average yields on the loan and securities portfolios, partially offset by an increased mix of loans versus securities. Our average yield on loans was 4.52% for the six months ended June 30, 2020, compared to 4.78% for the same 2019 period, primarily due to lower market interest rates and a lower percentage of higher-yielding commercial and industrial balances in the portfolio. Our average yield on securities decreased 88 basis points due mostly to CLOs repricing into the lower rate environment and a decrease in average CLO balances.

The average cost of funds decreased to 1.22% for the six months ended June 30, 2020 from 1.86% for the same 2019 period. This decrease was driven by the lower average cost of interest-bearing liabilities and the improved funding mix, including higher average noninterest-bearing deposits. The 61 basis point decline in the average cost of interest-bearing liabilities to 1.50% for the six months ended June 30, 2020 from 2.11% for the same 2019 period was driven by the lower average cost of interest-bearing deposits and rates paid on our FHLB term advances. The average cost of interest-bearing deposits declined 75 basis points to 1.16% from the prior period due to actively managing down deposit rates in response to the previously described market interest rate cuts by the Federal Reserve and a lower reliance on brokered deposits. Additionally, average noninterest-bearing deposits increased by $213.5 million when compared to the same 2019 period. Our cost of average total deposits decreased 74 basis points to 0.90% for the six months ended June 30, 2020 when compared to the same 2019 period due to the lower cost of interest-bearing deposits and higher noninterest-bearing deposits. Average noninterest-bearing deposits represented 22.4% of total average deposits for the six months ended June 30, 2020 compared to 14.0% of total average deposits for the same 2019 period.

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Rate/Volume Analysis

The following table presents the changes in interest income and interest expense for the major components of interest-earning assets and interest-bearing liabilities. The information provided presents the changes attributable to: (i) changes in volume multiplied by the prior rate; and (ii) changes in rate multiplied by the prior volume. Changes attributable to both rate and volume which cannot be segregated have been allocated proportionately to the change due to volume and the change due to rate.

	Three Months Ended June 30, 2020 vs. 2019						Six Months Ended June 30, 2020 vs. 2019
	Increase (Decrease) Due to				Net Increase (Decrease)		Increase (Decrease) Due to				Net Increase (Decrease)
($ In thousands)	Volume		Rate				Volume		Rate
Interest and dividend income:
Total loans	$	(19,848)	$	(5,669)	$	(25,517)	$	(41,270)	$	(9,271)	$	(50,541)
Securities	(2,068)		(2,573)		(4,641)		(8,897)		(5,765)		(14,662)
Other interest-earning assets	480		(1,665)		(1,185)		379		(2,517)		(2,138)
Total interest and dividend income	$	(21,436)	$	(9,907)	$	(31,343)	$	(49,788)	$	(17,553)	$	(67,341)
Interest expense:
Savings	$	(728)	$	(1,504)	$	(2,232)	$	(1,965)	$	(2,451)	$	(4,416)
Interest-bearing checking	351		(2,719)		(2,368)		272		(3,436)		(3,164)
Money market	(942)		(2,110)		(3,052)		(1,993)		(3,428)		(5,421)
Certificates of deposit	(6,161)		(4,580)		(10,741)		(15,186)		(7,038)		(22,224)
FHLB advances	(2,837)		(634)		(3,471)		(5,007)		(1,662)		(6,669)
Securities sold under repurchase agreements	(6)		(8)		(14)		(16)		(16)		(32)
Long-term debt and other interest-bearing liabilities	(2)		2		—		(1)		(2)		(3)
Total interest expense	(10,325)		(11,553)		(21,878)		(23,896)		(18,033)		(41,929)
Net interest income	$	(11,111)	$	1,646	$	(9,465)	$	(25,892)	$	480	$	(25,412)

Provision for (Reversal of) Credit Losses

The provision for (reversal of) credit losses is charged to operations to adjust the allowance for credit losses to the level required to cover current estimated credit losses in our loan portfolio and unfunded commitments. The following table presents the components of our provision for credit losses:

	Three Months Ended						Six Months Ended June 30,
($ in thousands)	June 30, 2020		March 31, 2020		June 30, 2019		2020		2019
Provision for (reversal of) loan losses	$	11,519	$	14,711	$	(1,987)	$	26,230	$	525
Provision for (reversal of) credit losses - unfunded loan commitments	307		1,050		87		1,357		(327)
Total provision for (reversal of) credit losses	$	11,826	$	15,761	$	(1,900)	$	27,587	$	198

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We recognized a provision for credit losses of $11.8 million during the second quarter of 2020, compared to $15.8 million during the first quarter of 2020 and a reversal of credit losses of $1.9 million for the second quarter of 2019. Our provision for credit losses during the second quarter of 2020 included $307 thousand related to unfunded commitments, compared to $1.1 million during the first quarter. The remaining second quarter of 2020 provision for credit losses was comprised of $5.0 million of general reserves and $6.8 million related to specific reserves, primarily related to a previously reported non-accrual, shared national credit. The general provision is due to a continued deterioration in key macro-economic forecast variables, such as unemployment and gross domestic product, and loan risk rating downgrades, offset by lower period end loan balances.

During the six months ended June 30, 2020, we recognized a provision for credit losses of $27.6 million under the CECL model, compared to $198 thousand under the incurred loss model during 2019. Our provision for credit losses included $1.4 million related to unfunded commitments during the six months ended June 30, 2020, compared to provision reversal of $327 thousand during the six months ended June 30, 2019. The higher provision for credit losses was driven by using the new CECL model, the estimated future impact of the health crisis on our loans, net charge-offs, and an increase in specific reserves, partially offset by lower period end loan balances of $1.09 billion as compared to June 30, 2019.

See further discussion in "Allowance for Credit Losses."

Noninterest Income (Loss)

The following table presents the components of noninterest income for the periods indicated:

	Three Months Ended						Six Months Ended June 30,
($ in thousands)	June 30, 2020		March 31, 2020		June 30, 2019		2020		2019
Customer service fees	$	1,224	$	1,096	$	1,434	$	2,320	$	2,949
Loan servicing income	95		75		121		170		239
Income from bank owned life insurance	591		578		580		1,169		1,105
Net gain on sale of securities available-for-sale	2,011		—		—		2,011		208
Fair value adjustment on loans held-for-sale	25		(1,586)		59		(1,561)		60
Net (loss) gain on sale of loans	—		(27)		2,767		(27)		4,319
Other income	1,582		1,925		(7,251)		3,507		(4,875)
Total noninterest income (loss)	$	5,528	$	2,061	$	(2,290)	$	7,589	$	4,005

Three Months Ended June 30, 2020 Compared to Three Months Ended March 31, 2020

Noninterest income was $5.5 million for the three months ended June 30, 2020; an increase of $3.5 million, or 168.2%, from $2.1 million for the three months ended March 31, 2020. The increase was primarily due to a gain on the sale of securities of $2.0 million compared to $0 in the prior quarter and lower net unrealized losses of $1.6 million for the change in fair value adjustment on loans held-for sale. During the three months ended June 30, 2020, we sold $20.7 million in securities, primarily consisting of corporate securities, resulting in a gain of $2.0 million. There were no sales of securities during the prior quarter.

In addition, during the three months ended June 30, 2020, customer service fees increased $128 thousand due mostly to higher depositor-related fees. Other income increased $343 thousand due mostly to lower sublease income of $423 thousand.

Three Months Ended June 30, 2020 Compared to Three Months Ended June 30, 2019

Noninterest income was $5.5 million for the three months ended June 30, 2020, an increase of $7.8 million, or 341.4%, from $(2.3) million for the three months ended June 30, 2019. The increase in noninterest income during the three months ended June 30, 2020 was mainly due to the aforementioned 2020 sale of securities and the 2019 second quarter $9.6 million unrealized loss from interest rate swap agreements entered into in order to offset the variability in the fair value of the Freddie Mac securitization completed during the third quarter of 2019, offset by lower net gain on sale of loans of $2.8 million.

Customer service fees decreased $210 thousand, or 14.6%, during the three months ended June 30, 2020 due mostly to lower borrower loan fees, such as extension and exit fees, offset by higher deposit-related transactional fees.

Net gains on sale of securities available-for-sale increased to $2.0 million during the three months ended June 30, 2020 from zero during the three months ended June 30, 2019. The increase between periods was due to the aforementioned $20.7 million

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sale of securities during the three months ended June 30, 2020, primarily consisting of corporate securities. There were no securities sales in the first quarter of 2019.

Net loss on sale of loans, which includes premium recapture of previously sold loans, was zero during the three months ended June 30, 2020 compared to $2.8 million during the comparable 2019 period. There were no sales of loans during the second quarter of 2020. During the second quarter of 2019, we sold jumbo SFR mortgage loans of $131.5 million resulting in a gain of $125 thousand and $178.2 million of multifamily residential loans resulting in a gain of $2.9 million.

Other income was $1.6 million for the three months ended June 30, 2020, compared to a loss of $7.3 million in the comparable 2019 period. The $8.8 million decrease was primarily attributable to the 2019 period including the aforementioned $9.6 million unrealized loss from interest rate swap agreements entered into in order to offset variability in the fair value of the Freddie Mac securitization completed during the third quarter of 2019.

Six Months Ended June 30, 2020 Compared to Six Months Ended June 30, 2019

Noninterest income was $7.6 million for the six months ended June 30, 2020, an increase of $3.6 million, or 89.5%, from $4.0 million for the six months ended June 30, 2019. The increase in noninterest income was mainly due to the $1.8 million increase in net gain on the securities available-for-sale, coupled with a $8.4 million decrease in other income (loss), partially offset by higher unrealized net losses on loans held-for-sale of $1.6 million and lower net gains on sale of loans of between periods of $4.3 million.

Customer service fees decreased $629 thousand, or 21.3%, during the three months ended June 30, 2020 due mostly to lower borrower loan fees, such as extension and exit fees.

Net gain on sale of securities available-for-sale was $2.0 million for the six months ended June 30, 2020, compared to $208 thousand for the six months ended June 30, 2019. During the six months ended June 30, 2020 we sold $20.7 million in securities, primarily consisting of corporate securities, resulting in a gain of $2.0 million. During the six months ended June 30, 2019, we sold $132.2 million of non-agency commercial mortgage-backed securities resulting in a gain of $9 thousand and $644.5 million in collateralized loan obligations resulting in a gain of $143 thousand.

Net (loss) gain on sale of loans, which includes premium recapture of previously sold loans, was $27 thousand for the six months ended June 30, 2020, compared to a gain of $4.3 million for the six months ended June 30, 2019. There were no sales of loans during the six months ended June 30, 2020. During the six months ended June 30, 2019, we sold jumbo SFR mortgage loans of $374.7 million resulting in a gain of $1.8 million and $178.2 million of multifamily residential loans resulting in a gain of $2.9 million.

Other income (loss) was $3.5 million for the six months ended June 30, 2020, compared to $(4.9) million for the six months ended June 30, 2019. The $8.4 million increase was primarily attributable to the aforementioned $9.6 million unrealized loss from interest rate swap agreements entered into in order to offset variability in the fair value of the Freddie Mac securitization completed during the third quarter of 2019, offset by lower sublease income of $312 thousand.

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Noninterest Expense

The following table presents the breakdown of noninterest expense for the periods indicated:

	Three Months Ended						Six Months Ended June 30,
($ in thousands)	June 30, 2020		March 31, 2020		June 30, 2019		2020		2019
Salaries and employee benefits	$	24,260	$	23,436	$	27,506	$	47,696	$	55,945
Naming rights termination	26,769		—		—		26,769		—
Occupancy and equipment	7,090		7,243		7,955		14,333		15,641
Professional fees	4,596		5,964		(2,903)		10,560		8,138
Data processing	1,536		1,773		1,672		3,309		3,168
Advertising	1,157		1,756		2,048		2,913		4,105
Regulatory assessments	725		484		2,136		1,209		4,618
Reversal of provision for loan repurchases	(34)		(600)		(61)		(634)		(177)
Amortization of intangible assets	430		429		621		859		1,241
Restructuring expense	—		—		(158)		—		2,637
All other expense	6,408		4,529		5,039		10,937		8,838
Noninterest expense before loss on investments in alternative energy partnerships	72,937		45,014		43,855		117,951		104,154
(Gain) loss on investments in alternative energy partnerships	(167)		1,905		(355)		1,738		1,595
Total noninterest expense	$	72,770	$	46,919	$	43,500	$	119,689	$	105,749

Three Months Ended June 30, 2020 Compared to Three Months Ended March 31, 2020

Noninterest expense was $72.8 million for the three months ended June 30, 2020, an increase of $25.9 million, or 55.1%, from $46.9 million for the three months ended March 31, 2020. The increase was mainly due to the aforementioned $26.8 million one-time charge related to the termination of our LAFC naming rights agreements and a $2.5 million debt extinguishment fee associated with the early repayment of certain FHLB term advances. There were no similar charges in any of the other periods presented. When these charges are excluded, noninterest expense decreased $3.4 million, due to (i) lower professional fees of $1.4 million as a result of the timing of certain indemnified legal costs and recoveries compared to the prior quarter, (ii) higher net gains on investments in alternative energy partnerships of $2.1 million, and (iii) lower advertising costs of $599 thousand, offset by (iv) higher salaries and benefits expense of $824 thousand due mostly to higher incentive accruals, (v) lower reversals of loan repurchases, and (vi) higher regulatory assessments of $241 thousand.

Professional fees were $4.6 million for the three months ended June 30, 2020, a decrease of $1.4 million, or 22.9%, from $6.0 million for the three months ended March 31, 2020. The decrease included lower indemnified legal costs and recoveries as the current quarter included $875 thousand of such legal costs compared to $1.7 million for the prior quarter. When these indemnified legal costs and recoveries are excluded, professional fees would have decreased $565 thousand from the prior quarter. The remaining decrease relates to lower audit fees and other legal costs.

Advertising costs were $1.2 million for the three months ended June 30, 2020, a decrease of $599 thousand, or 34.1%, from $1.8 million for the three months ended March 31, 2020. The decrease was mainly due to reductions in overall events and media spending due, in part, to the termination of the LAFC Agreement on May 22, 2020. Refer to the earlier discussion in the "Termination of LAFC Agreement" section.

Regulatory assessments were $725 thousand for the three months ended June 30, 2020, an increase of $241 thousand, or 49.8%, from $484 thousand for the three months ended March 31, 2020. The increase was mainly due to the first quarter of 2020 having a FDIC small bank assessment credit.

Reversal of provision for loan repurchases decreased $566 thousand and resulted in higher expenses. The reversal of provision for loan repurchases totaled $34 thousand for the three months ended June 30, 2020 compared to $600 thousand for the prior quarter. The decrease was due to changes in the credit quality of the previously sold loans resulting in a lower release of reserve amount.

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The (gain) loss on investments in alternative energy partnerships was a gain of $167 thousand for the three months ended June 30, 2020, an increase of $2.1 million, from a loss of $1.9 million for the three months ended March 31, 2020. The gain between periods was mainly due to decreased loss sharing allocations and resulting lower HLBV losses.

All other expense for the three months ended June 30, 2020 increased $1.9 million or 41.5%, to $6.4 million from $4.5 million for the three months ended March 31, 2020. The increase was primarily attributable to a $2.5 million debt extinguishment fee, partially offset by decreases in other expenses such as legal settlements, business travel, and the write-off of certain capitalized software cost. During the three months ended June 30, 2020, we repaid a $100.0 million FHLB term advance with a weighted average interest rate of 2.07% and incurred a $2.5 million debt extinguishment fee. All other expense for the three months ended March 31, 2020 included an $850 thousand charge to settle and conclude a legacy loan sale claim from an acquired bank.

Three Months Ended June 30, 2020 Compared to Three Months Ended June 30, 2019

Noninterest expense was $72.8 million for the three months ended June 30, 2020, an increase of $29.3 million, or 67.3%, from $43.5 million for the three months ended June 30, 2019. The increase was mainly due to the $26.8 million LAFC naming rights termination fee, coupled with higher professional fees of $7.5 million and other expenses of $1.4 million, offset by lower salaries and employee benefits of $3.2 million and lower regulatory assessments of $1.4 million.

Salaries and employee benefits expense was $24.3 million for the three months ended June 30, 2020, a decrease of $3.2 million, or 11.8%, from $27.5 million for the three months ended June 30, 2019. The decrease was primarily due to overall reductions in headcount between periods.

As discussed above, we terminated our naming rights agreements with LAFC and incurred a pre-tax, one-time charge to operations of $26.8 million. Refer to earlier discussion in "Termination of LAFC Agreement."

Occupancy and equipment was $7.1 million for the three months ended June 30, 2020, a decrease of $865 thousand or 10.9% from $8.0 million for the three months ended June 30, 2019. The decrease was primarily due to overall reductions in costs between periods as a result of exiting the TPMO and brokered single family lending businesses during the first quarter of 2019.

Professional fees were $4.6 million for the three months ended June 30, 2020, an increase of $7.5 million, or 258.3%, from recoveries of $2.9 million for the three months ended June 30, 2019. The increase was mainly due the 2019 period including net recoveries of legal fees of $6.4 million due to the timing of insurance recoveries related to securities litigation, indemnification, investigation and other legal expenses compared to legal fees of $1.7 million during the 2020 period. Offsetting this increase was a $677 thousand decrease in other professional fees.

Advertising costs were $1.2 million for the three months ended June 30, 2020, a decrease of $891 thousand, or 43.5%, from $2.0 million for the three months ended June 30, 2019. The decrease was mainly due to reductions in overall events and media spending due in part to the termination of the LAFC Agreement on May 22, 2020.

Regulatory assessments were $725 thousand for the three months ended June 30, 2020, a decrease of $1.4 million, or 66.1%, from $2.1 million for the three months ended June 30, 2019. The decrease was mainly due to a reduction in our FDIC assessment rate given the decrease in our asset size.

All other expense was $6.4 million for the three months ended June 30, 2020, an increase of $1.4 million, or 27.2%, from $5.0 million for the three months ended June 30, 2019. The increase was primarily attributable to the aforementioned $2.5 million debt extinguishment fee associated with the early repayment of certain FHLB term advances in the second quarter of 2020. All other expense during the same 2019 period included a $797 impairment of capitalized software projects. There were no similar impairment charges during the three months ended June 30, 2020.

Six Months Ended June 30, 2020 Compared to Six Months Ended June 30, 2019

Noninterest expense was $119.7 million for the six months ended June 30, 2020, an increase of $13.9 million, or 13.2%, from $105.7 million for the six months ended June 30, 2019. The increase was mainly due to the $26.8 million LAFC naming rights termination, coupled with a $2.4 million increase in professional fees and $2.1 million increase in all other expense, offset by a $8.2 million decrease in salaries and employee benefits, a $3.4 million decrease in regulatory assessments and a $2.6 million decrease in restructuring expense, as well as decreases in occupancy and equipment, and advertising expenses.

Salaries and employee benefits expense was $47.7 million for the six months ended June 30, 2020, a decrease of $8.2 million, or 14.7%, from $55.9 million for the six months ended June 30, 2019. The decrease was mainly due to decreases in number of employees, commissions, and temporary staff expenses, including overall reductions in headcount between periods as a result of exiting the TPMO and brokered single family lending businesses during the first quarter of 2019.

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Occupancy and equipment was $14.3 million for the three months ended June 30, 2020, a decrease of $1.3 million or 8.4% from $15.6 million for the six months ended June 30, 2019. The decrease was primarily due to overall reductions in costs between periods as a result of exiting the TPMO and brokered single family lending businesses during the first quarter of 2019.

Professional fees were $10.6 million for the six months ended June 30, 2020, an increase of $2.4 million, or 29.8%, from $8.1 million for the six months ended June 30, 2019. The increase in fees was primarily the result of higher legal fees (net of recoveries of $2.5 million) due to the timing of insurance recoveries related to securities litigation, indemnification, investigation and other legal expenses of $6.6 million, offset by lower other professional fees of $2.4 million.

Advertising costs were $2.9 million for the six months ended June 30, 2020, a decrease of $1.2 million, or 29.0%, from $4.1 million for the six months ended June 30, 2019. The decrease was mainly due to overall reductions in reductions in overall events and media spending, as well as a decrease in advertising costs related to the now-terminated LAFC naming rights commitment. Advertising costs for the six months ended June 30, 2020 included $2.6 million related to the now-terminated LAFC naming rights agreement compared to $3.3 million during six months ended June 30, 2019.

Regulatory assessments were $1.2 million for the six months ended June 30, 2020, a decrease of $3.4 million, or 73.8%, from $4.6 million for the six months ended June 30, 2019. The decrease was mainly due to a reduction in our FDIC assessment rate given the decrease in our asset size and an FDIC small bank assessment credit.

Restructuring expense was zero for the six months ended June 30, 2020. For the six months ended June 30, 2019, restructuring expense was $2.6 million and consisted of severance and retention costs associated with our exit from the TPMO and brokered single family lending businesses and CEO transition during the first quarter of 2019.

All other expenses were $10.9 million for the six months ended June 30, 2020, an increase of $2.1 million, or 23.7%, from $8.8 million for the six months ended June 30, 2019. The increase was mainly due to the aforementioned $2.5 million debt extinguishment fee associated with the early repayment of $100 million in FHLB term advances, combined with the aforementioned $850 thousand charge to settle and conclude a legacy loan sale claim from an acquired bank; All other expense during the comparable 2019 period included a $835 thousand impairment of capitalized software projects, compared to $157 thousand during the six months ended June 30, 2020. Offsetting these increases were overall expense reductions from our efforts to manage expenses on supplies, business travel, directors' fees, and other administrative expenditures.

Income Tax (Benefit) Expense

For the three months ended June 30, 2020, March 31, 2020 and June 30, 2019, income tax (benefit) expense was $(5.3) million, $(2.2) million, and $4.3 million, resulting in an effective tax rate of 22.3%, 24.7% and 20.6%. Our 22.3% effective tax rate for the three months ended June 30, 2020 differs from the 21% federal statutory rate was due to the impact of state taxes offset by various tax credits. The full year estimated effective tax rate for 2020 is expected to be approximately 23%.

For the six months ended June 30, 2020 and 2019, the income tax benefit was $7.5 million and the income tax expense was $7.0 million, resulting in an effective tax rate of 23.0% and 22.9%, respectively.

We use the flow-through income statement method to account for the annual investment tax credits forecasted to be earned on the solar investments in our annual effective tax rate. Under this method, the investment tax credits are recognized as a reduction to income tax expense and the initial book-tax difference in the basis of the investments are recognized as additional tax expense in the year they are earned.

For additional information, see Note 8 to Consolidated Financial Statements included in Part I of this Quarterly Report on Form 10-Q.

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FINANCIAL CONDITION

Investment Securities

At June 30, 2020, all of our investment securities were classified as available-for-sale.

The primary goal of our investment securities portfolio is to provide a relatively stable source of interest income while satisfactorily managing risk, including credit risk, reinvestment risk, liquidity risk, and interest rate risk. Certain investment securities provide a source of liquidity as collateral for FHLB advances, Federal Reserve Discount Window capacity, repurchase agreements, and certain public deposits.

The following table presents the amortized cost and fair value of the investment securities portfolio and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) as of the dates indicated:

	June 30, 2020						December 31, 2019
($ in thousands)	Amortized Cost		Fair Value		Unrealized Gain (Loss)		Amortized Cost		Fair Value		Unrealized Gain (Loss)
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	100,128	$	105,555	$	5,427	$	37,613	$	36,456	$	(1,157)
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	199,262		201,136		1,874		91,543		91,299		(244)
Municipal securities	52,973		57,174		4,201		52,997		52,689		(308)
Non-agency residential mortgage-backed securities	161		164		3		191		196		5
Collateralized loan obligations	703,605		668,353		(35,252)		733,605		718,361		(15,244)
Corporate debt securities	141,962		143,647		1,685		13,500		13,579		79
Total securities available-for-sale	$	1,198,091	$	1,176,029	$	(22,062)	$	929,449	$	912,580	$	(16,869)

Securities available-for-sale were $1.18 billion at June 30, 2020, an increase of $263.4 million, or 28.9%, from $912.6 million at December 31, 2019. The increase was mainly due to purchases of $322.6 million, including $174.0 million in U.S. government agency securities and $148.6 million in corporate debt securities, offset by a $30.0 million pay-off of one CLO holding, $20.7 million in sales, and higher net unrealized losses of $5.2 million.

CLOs totaled $668.4 million and $718.4 million at June 30, 2020 and December 31, 2019. CLOs are floating rate debt securities backed by pools of senior secured commercial loans to a diverse group of companies across a broad spectrum of industries. Underlying loans are generally secured by a company’s assets such as inventory, equipment, property, and/or real estate. CLOs are structured to diversify exposure to a broad sector of industries. The payments on these commercial loans support interest and principal on the CLOs across classes that range from AAA-rated to equity-grade tranches. At June 30, 2020, all of our CLO holdings were AAA and AA rated. We also perform pre-purchase due diligence and ongoing credit quality review of our CLO holdings, which includes monitoring performance factors such as external credit ratings, collateralization levels, collateral concentration levels, and other performance factors. We only acquire CLOs that we believe are Volcker Rule compliant.

We did not record credit impairment for any investment securities for the three and six months ended June 30, 2020 or 2019. We monitor our securities portfolio to ensure it has adequate credit support. As of June 30, 2020, we believe there was no credit impairment and we did not have the current intent to sell securities with a fair value below amortized cost at June 30, 2020, and it is more likely than not that we will not be required to sell such securities prior to the recovery of their amortized cost basis. We consider the lowest credit rating for identification of potential credit impairment. As of June 30, 2020, all of our investment securities in an unrealized loss position received an investment grade credit rating. Credit spreads for CLOs widened during the first quarter of 2020 and have narrowed during the second quarter. The overall net decline in fair value during 2020 was attributable to a combination of changes in interest rates and general volatility in the credit market conditions.

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The following table presents maturities, based on the earlier of maturity dates or next repricing dates, and yield information of the investment securities portfolio as of June 30, 2020:

	One Year or Less				More than One Year through Five Years				More than Five Years through Ten Years				More than Ten Years				Total
($ in thousands)	Fair Value		Weighted Average Yield		Fair Value		Weighted Average Yield		Fair Value		Weighted Average Yield		Fair Value		Weighted Average Yield		Fair Value		Weighted Average Yield
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	—	—	%	$	—	—	%	$	30,413	2.20	%	$	75,142	2.35	%	$	105,555	2.31	%
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	118,163		0.74	%	11,608		2.02	%	25,579		1.63	%	45,786		0.93	%	201,136		0.96	%
Municipal securities	—		—	%	—		—	%	—		—	%	57,174		2.79	%	57,174		2.79	%
Non-agency residential mortgage-backed securities	—		—	%	—		—	%	—		—	%	164		6.14	%	164		6.14	%
Collateralized loan obligations	668,353		2.73	%	—		—	%	—		—	%	—		—	%	668,353		2.73	%
Corporate debt securities	—		—	%	122,301		4.99	%	21,346		5.64	%	—		—	%	143,647		5.08	%
Total securities available-for-sale	$	786,516	2.45	%	$	133,909	4.74	%	$	77,338	2.96	%	$	178,266	2.11	%	$	1,176,029	2.68	%

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Loans Held-for-Sale

Total loans held-for-sale carried at fair value were $19.8 million and $22.6 million, respectively, at June 30, 2020 and December 31, 2019 and consisted mainly of repurchased conforming SFR mortgage loans that were previously sold and loans previously sold to GNMA that were delinquent more than 90 days and subject to a repurchase option by us. The $2.9 million, or 12.7%, decrease was mainly due to payoffs of $613 thousand and a decrease in fair value of $1.6 million.

Loans Receivable, Net

The following table presents the composition of our loan and lease portfolio as of the dates indicated:

($ in thousands)	June 30, 2020		December 31, 2019		Amount Change		Percentage Change
Commercial:
Commercial and industrial	$	1,436,990	$	1,691,270	$	(254,280)	(15.0)	%
Commercial real estate	822,694		818,817		3,877		0.5	%
Multifamily	1,434,071		1,494,528		(60,457)		(4.0)	%
SBA(1)	310,784		70,981		239,803		337.8	%
Construction	212,979		231,350		(18,371)		(7.9)	%
Consumer:
Single family residential mortgage	1,370,785		1,590,774		(219,989)		(13.8)	%
Other consumer	39,393		54,165		(14,772)		(27.3)	%
Total loans(2)	5,627,696		5,951,885		(324,189)		(5.4)	%
Allowance for loan losses	(90,370)		(57,649)		(32,721)		56.8	%
Total loans receivable, net	$	5,537,326	$	5,894,236	$	(356,910)	(6.1)	%

(1)Includes PPP loans totaling $240.7 million, which included $5.6 million of net unamortized loan fees at June 30, 2020. There were no PPP loans outstanding at December 31, 2019.

(2)Total loans include deferred loan origination costs/(fees) and premiums/(discounts), net of $6.0 million and $14.3 million, respectively, at June 30, 2020 and December 31, 2019.

Gross loans decreased $324.2 million to $5.63 billion during the year, due mostly to lower single family residential mortgage loans of $220.0 million, lower commercial and industrial (“C&I“) loans of $254.3 million, and lower multifamily loans of $60.5 million. The decline in single family residential mortgage loans was attributed to payoffs as the loans refinance away in the lower rate environment and these proceeds are invested in other core business loans. The decline in C&I loans was primarily in response to strategically reducing certain credit facilities in response to the changed economic landscape and corresponding lower outstanding balances. These decreases were partially offset by a $239.8 million increase in SBA loans attributable to the funding of loans under the SBA's PPP. Our focus on processing PPP loans, in addition to the impact of the COVID-19, pandemic tempered other loan production; additionally, we did not experience any significant increase in credit line usage.

We continue to remix our real estate loan portfolio toward relationship-based multifamily, bridge, light infill construction, and commercial real estate loans. Single family residential mortgage and multifamily loans comprised 49.9% of the total held-for-investment loan portfolio as compared to 53.0% one year ago. Commercial real estate loans comprised 14.6% of the loan portfolio and commercial and industrial loans constituted 25.5%. As of June 30, 2020, loans secured by residential real estate (single family, multifamily, single family construction, and warehouse credit facilities) represent approximately 66% of our total loans outstanding.

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The C&I portfolio has limited exposure to certain business sectors undergoing severe stress, as demonstrated by the following (as a percentage of total outstanding C&I loan balances):

	June 30, 2020
($ in thousands)	Amount		% of Portfolio
C&I Portfolio by Industry
Finance and insurance (includes Warehouse lending)	$	777,015	54	%
Real estate and rental leasing	201,630		14	%
Gas stations	76,510		5	%
Manufacturing	60,128		4	%
Healthcare	43,256		3	%
Wholesale trade	39,740		3	%
Other retail trade	37,699		3	%
Television/motion pictures	33,590		2	%
Food services	30,216		2	%
Professional services	14,975		1	%
Transportation	5,363		—	%
Accommodations	1,496		—	%
All other	115,372		8	%
Total	$	1,436,990	100	%

Non-Traditional Mortgage Portfolio ("NTM")

Our NTM portfolio is comprised of three interest only products: Green Loans, Interest Only loans and a small number of additional loans with the potential for negative amortization. As of June 30, 2020 and December 31, 2019, the NTM portfolio totaled $511.2 million, or 9.1% of the total gross loan portfolio, and $600.7 million, or 10.1% of the total gross loan portfolio. The total NTM portfolio decreased by $89.5 million, or 14.9% during the six months ended June 30, 2020. The decrease was primarily due to principal paydowns and payoffs.

The initial credit guidelines for the NTM portfolio were established based on the borrower's Fair Isaac Corporation (“FICO”) score, LTV ratio, property type, occupancy type, loan amount, and geography. Additionally, from an ongoing credit risk management perspective, we have determined that the most significant performance indicators for NTMs are LTV ratios and FICO scores. We review the NTM loan portfolio periodically, which includes refreshing FICO scores on the Green Loans and HELOCs and ordering third party automated valuation models (“AVMs”) to confirm collateral values. We no longer originate NTM loans.

Green Loans totaled $45.2 million at June 30, 2020, a decrease of $7.1 million, or 13.5% from $52.3 million at December 31, 2019, primarily due to principal paydowns and payoffs. The NTM loans on non-accrual status included $4.6 million of Green Loans and $14.6 million of interest-only loans at June 30, 2020 compared to $1.5 million of Green Loans and $11.5 million of interest-only loans at December 31, 2019.

The following table presents our Green Loans first lien portfolio at June 30, 2020 by FICO scores that were obtained during the quarter ended June 30, 2020, compared to the FICO scores for those same loans that were obtained during the quarter ended March 31, 2020:

	By FICO Scores Obtained During the Quarter Ended June 30, 2020					By FICO Scores Obtained During the Quarter Ended December 31, 2019					Change
($ in thousands)	Count	Amount		Percent		Count	Amount		Percent		Count	Amount		Percent
FICO Score
800+	12	$	2,870	6.6	%	13	$	3,509	7.0	%	(1)	$	(639)	(18.2)	%
700-799	31	21,756		49.9	%	38	27,011		54.1	%	(7)	(5,255)		(19.5)	%
600-699	10	11,974		27.4	%	10	12,400		24.8	%	—	(426)		(3.4)	%
<600	5	3,253		7.5	%	5	3,286		6.6	%	—	(33)		(1.0)	%
No FICO	3	3,751		8.6	%	3	3,753		7.5	%	—	(2)		(0.1)	%
Totals	61	$	43,604	100.0	%	69	$	49,959	100.0	%	(8)	$	(6,355)	(12.7)	%

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Loan-to-Value Ratio

LTV ratio represents estimated current loan to value ratio, determined by dividing the current unpaid principal balance by the latest estimated property value received per our policy. The table below represents our single family residential NTM first lien portfolio by LTV ratio ranges as of the dates indicated:

	Green					Interest Only					Negative Amortization					Total
($ in thousands)	Count	Amount		Percent		Count	Amount		Percent		Count	Amount		Percent		Count	Amount		Percent
June 30, 2020
< 61%	49	$	32,547	74.7	%	208	$	294,171	63.4	%	8	$	2,335	100.0	%	265	$	329,053	64.6	%
61-80%	10	9,257		21.2	%	116	158,111		34.1	%	—	—		—	%	126	167,368		32.8	%
81-100%	2	1,800		4.1	%	3	4,875		1.1	%	—	—		—	%	5	6,675		1.3	%
> 100%	—	—		—	%	2	6,509		1.4	%	—	—		—	%	2	6,509		1.3	%
Total	61	$	43,604	100.0	%	329	$	463,666	100.0	%	8	$	2,335	100.0	%	398	$	509,605	100.0	%
December 31, 2019
< 61%	54	$	37,804	75.6	%	231	$	346,899	63.6	%	9	$	3,027	100.0	%	294	$	387,730	64.8	%
61-80%	12	8,531		17.1	%	136	183,664		33.7	%	—	—		—	%	148	192,195		32.1	%
81-100%	3	3,624		7.3	%	6	7,081		1.3	%	—	—		—	%	9	10,705		1.8	%
> 100%	—	—		—	%	3	7,727		1.4	%	—	—		—	%	3	7,727		1.3	%
Total	69	$	49,959	100.0	%	376	$	545,371	100.0	%	9	$	3,027	100.0	%	454	$	598,357	100.0	%

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Non-Performing Assets

The following table presents a summary of total non-performing assets, excluding loans held-for-sale, as of the dates indicated:

($ in thousands)	June 30, 2020			December 31, 2019			Amount Change		Percentage Change
Loans past due 90 days or more still on accrual	$	—		$	—		$	—	—	%
Non-accrual loans	72,703			43,354			29,349		67.7	%
Total non-performing loans	72,703			43,354			29,349		67.7	%
Other real estate owned	—			—			—		—	%
Total non-performing assets	$	72,703		$	43,354		$	29,349	67.7	%
Performing restructured loans (1)	$	5,597		$	6,621		$	(1,024)	(15.5)	%
Total non-performing loans to total loans	1.29		%	0.73		%
Total non-performing assets to total assets	0.94		%	0.55		%
ALL to non-performing loans	124.30		%	132.97		%
ACL to non-performing loans	130.07		%	142.35		%

(1) Excluded from non-performing loans

Loans are generally placed on non-accrual status when they become 90 days past due, unless management believes the loan is well secured and in the process of collection. Past due loans may or may not be adequately collateralized, but collection efforts are continuously pursued. Loans may be restructured by management when a borrower experiences changes to their financial condition, causing an inability to meet the original repayment terms, and where we believe the borrower will eventually overcome those circumstances and repay the loan in full.

Additional interest income of approximately $952 thousand and $1.7 million would have been recorded during the three and six months ended June 30, 2020, had these loans been paid in accordance with their original terms throughout the periods indicated.

Non-performing loans totaled $72.7 million as of June 30, 2020, of which $21.9 million, or 30% of the balance relates to loans in a current payment status. The $16.2 million increase during the second quarter was primarily due to $18.6 million of loans being placed on non-accrual status, offset by cured loans and payoffs. The quarter-end balance included three large loan relationships totaling $36.9 million, or 51% of our total non-performing loans, which consist of one $16.4 million legacy shared national credit, a $9.1 million single family mortgage residential loan with a loan-to-value ratio of 58%, and an $11.5 million legacy relationship well-secured by commercial real estate and single family residential properties with an average loan-to-value ratio of 51%. Aside from those three loan relationships, non-performing single family residential loans totaled $19.4 million and the remaining non-performing loans totaled $16.4 million.

Troubled Debt Restructurings

Loans that we modify or restructure where the debtor is experiencing financial difficulties and makes a concession to the borrower in a below-market change in the stated interest rate, a reduction in the loan balance or accrued interest, an extension of the maturity date, or a note split with principal forgiveness are classified as troubled debt restructurings (“TDRs”). TDRs are loans modified for the purpose of alleviating temporary impairments to the borrower’s financial condition. A workout plan between a borrower and us is designed to provide a bridge for the cash flow shortfalls in the near term. If the borrower works through the near term issues, in most cases, the original contractual terms of the loan will be reinstated.

At June 30, 2020 and December 31, 2019, we had 26 and 25 loans, respectively, with an aggregate balance of $25.9 million and $21.8 million, respectively, classified as TDRs. When a loan becomes a TDR, we cease accruing interest, and classify it as non-accrual until the borrower demonstrates that the loan is again performing. The increase in TDRs during the three and six months ended June 30, 2020 was primarily due to one commercial and industrial relationship totaling $3.7 million.

At June 30, 2020, of the 26 loans classified as TDRs, 12 loans totaling $5.6 million were making payments according to their modified terms and were less than 90 days delinquent under the modified terms and, as such, were on accruing status. At December 31, 2019, of the 25 loans classified as TDRs, 14 loans totaling $6.6 million were making payments according to their modified terms and were less than 90 days delinquent under the modified terms and, as such, were on accruing status.

Troubled Debt Restructuring (TDR) Relief: Under U.S. GAAP, banks are required to assess modifications to a loan’s terms for potential classification as a TDR. A loan to a borrower experiencing financial difficulty is classified as a TDR when a lender grants a concession that it would otherwise not consider, such as a payment deferral or interest concession. In order to encourage banks to work with impacted borrowers, the CARES Act and U.S. banking regulatory agencies have provided relief

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from TDR accounting. The main benefits of TDR relief include 1) a capital benefit in the form of reduced risk-weighted assets, as TDRs are more heavily risk-weighted for capital purposes; 2) a delinquency status benefit, as the aging of loans are frozen, i.e., they will continue to be reported in the same delinquency bucket they were in at the time of modification; and 3) a non-accrual status benefit as the loans are generally not reported as non-accrual during the modification period. Refer to "Borrower Payment Relief Efforts" above for additional information regarding CARES Act deferrals.

Allowance for Credit Losses (ACL)

Our ACL is comprised of our allowance for loan losses ("ALL") and reserve for unfunded loan commitments. Our ACL methodology and resulting provision continues to be impacted by the current economic uncertainty and volatility caused by the COVID-19 pandemic. Our ACL methodology uses a nationally recognized third-party model that includes many assumptions based on our historical and peer loss data, our current loan portfolio risk profile including risk ratings, and economic forecasts including macroeconomic variables ("MEVs"). As of June 30, 2020, we used economic forecasts released by our model provider during June 2020. Similar to the late March 2020 forecasts, these June 2020 forecasts reflect the onset of the pandemic, its impact on the MEVs, and the future economic recovery. These forecasts published by our model provider have deteriorated since the end of the first quarter, with June baseline unemployment rate forecasts for 2020 and 2021 increasing and real gross domestic product growth rates decreasing. Similar to the first quarter of 2020, we incorporated qualitative factors to account for certain loan portfolio characteristics that are not taken into consideration by our third-party model including underlying strengths and weaknesses in the loan portfolio. As is the case with all estimates, we expect the ACL to be impacted in future periods by economic volatility, changing economic forecasts, actual and projected credit experience, and underlying model assumptions, all of which may be better than or worse than our current estimate.

The ACL process involves subjective and complex judgments. In addition, we use adjustments for numerous factors including those described in the federal banking agencies' joint interagency policy statement on ALL, which include underwriting experience and collateral value changes, among others. We evaluate all impaired loans individually using guidance from ASC 310 primarily through the evaluation of cash flows or collateral values.

The ACL, which includes the reserve for unfunded loan commitments, totaled $94.6 million, or 1.68% of total loans at June 30, 2020 compared to $82.1 million or 1.45% at March 31, 2020. The $12.4 million increase in the allowance for expected credit losses was due to: (i) $6.8 million provided for specific reserves, primarily related to one previously reported non-accrual shared national credit, (ii) $5.0 million provided for general reserves related to the continued deterioration in key macro-economic forecast variables, offset by the impact of lower loan balances, and (iii) net recoveries of $608 thousand. The ACL coverage of non-performing loans was 130% at June 30, 2020 compared to 145% at March 31, 2020 and 142% at December 31, 2019.

The reserve for unfunded loan commitments is established to cover the expected credit losses for the estimated level of funding of these loan commitments, except for unconditionally cancellable commitments for which no reserve is required under ASC 326. The reserve for unfunded loan commitments is included in accrued expenses and other liabilities on the consolidated statements of financial condition.

The following table provides a summary of components of the allowance for credit losses and related ratios as of the dates indicated:

($ in thousands)	June 30, 2020			December 31, 2019
Allowance for credit losses:
Allowance for loan losses (ALL)	$	90,370		$	57,649
Reserve for unfunded loan commitments	4,195			4,064
Total allowance for credit losses (ACL)	$	94,565		$	61,713
ALL to total loans	1.61		%	0.97		%
ACL to total loans	1.68		%	1.04		%

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The following tables provide summaries of activity in the allowance for credit losses for the periods indicated:

	Three Months Ended June 30,
($ in thousands)	2020						2019
	Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses		Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses
Balance at beginning of period	$	78,243	$	3,888	$	82,131	$	63,885	$	4,208	$	68,093
Loans charged off	—		—		—		(2,451)		—		(2,451)
Recoveries of loans previously charged off	608		—		608		76		—		76
Net charge-offs	608		—		608		(2,375)		—		(2,375)
Provision for credit losses	11,519		307		11,826		(1,987)		87		(1,900)
Balance at end of period	$	90,370	$	4,195	$	94,565	$	59,523	$	4,295	$	63,818

	Six Months Ended June 30,
($ in thousands)	2020						2019
	Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses		Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses
Balance at beginning of period	$	57,649	$	4,064	$	61,713	$	62,192	$	4,622	$	66,814
Impact of adopting ASU 2016-13(1)	7,609		(1,226)		6,383		—		—		—
Loans charged off	(2,076)		—		(2,076)		(3,514)		—		(3,514)
Recoveries of loans previously charged off	958		—		958		320		—		320
Net charge-offs	(1,118)		—		(1,118)		(3,194)		—		(3,194)
Provision for (reversal of) credit losses	26,230		1,357		27,587		525		(327)		198
Balance at end of period	$	90,370	$	4,195	$	94,565	$	59,523	$	4,295	$	63,818

(1)Represents the impact of adopting ASU 2016-13, Financial Instruments - Credit Losses on January 1, 2020. As a result of adopting ASU 2016-13, our methodology to compute our allowance for credit losses is based on a current expected credit loss methodology, rather that the previously applied incurred loss methodology.

The following table provides a summary of the allocation of the allowance for loan losses by loan category as well as loans receivable for each category as of the dates indicated:

	June 30, 2020						December 31, 2019
($ in thousands)	Allowance for Loan Losses		Loans Receivable		% of Loans in Category to Total Loans		Allowance for Loan Losses		Loans Receivable		% of Loans in Category to Total Loans
Commercial:
Commercial and industrial	$	26,618	$	1,436,990	25.5	%	$	22,353	$	1,691,270	28.4	%
Commercial real estate	17,372		822,694		14.6	%	5,941		818,817		13.8	%
Multifamily	25,105		1,434,071		25.5	%	11,405		1,494,528		25.1	%
SBA	4,184		310,784		5.5	%	3,120		70,981		1.2	%
Construction	6,675		212,979		3.8	%	3,906		231,350		3.9	%
Consumer:
Single family residential mortgage	9,665		1,370,785		24.4	%	10,486		1,590,774		26.7	%
Other consumer	751		39,393		0.7	%	438		54,165		0.9	%
Total	$	90,370	$	5,627,696	100.0	%	$	57,649	$	5,951,885	100.0	%

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The following table provides information regarding activity by loan class in the allowance for loan losses during the periods: indicated:

	Three Months Ended June 30,						Six Months Ended June 30,
($ in thousands)	2020			2019			2020			2019
ALL at beginning of period	$	78,243		$	63,885		$	57,649		$	62,192
Impact of adopting ASU 2016-13(1)	—			—			7,609			—
Charge-offs:
Commercial and industrial	—			(2,022)			(1,164)			(2,115)
SBA	—			8			(356)			(348)
Single family residential mortgage	—			(425)			(552)			(951)
Other consumer	—			(6)			(4)			(94)
Total charge-offs	—			(2,451)			(2,076)			(3,514)
Recoveries:
Commercial and industrial	119			11			149			44
SBA	—			60			121			101
Lease financing	—			3			—			6
Single family residential mortgage	488			—			639			150
Other consumer	1			2			49			19
Total recoveries	608			76			958			320
Net charge-offs	608			(2,375)			(1,118)			(3,194)
Provision for credit losses	11,519			(1,987)			26,230			525
ALL at end of period	$	90,370		$	59,523		$	90,370		$	59,523
Average total loans held-for-investment	$	5,687,652		$	7,398,471		$	5,723,094		$	7,540,145
Total loans held-for-investment at end of period	$	5,627,696		$	6,719,570		$	5,627,696		$	6,719,570
Ratios:
Annualized net charge-offs (recoveries) to average total loans held-for-investment	(0.04)		%	0.13		%	0.04		%	0.08		%
ALL to total loans held-for-investment	1.61		%	0.89		%	1.61		%	0.89		%

(1)Represents the impact of adopting ASU 2016-13, Financial Instruments - Credit Losses on January 1, 2020. As a result of adopting ASU 2016-13, our methodology to compute our allowance for credit losses is based on a current expected credit loss methodology, rather that the previously applied incurred loss methodology.

Alternative Energy Partnerships

We invest in certain alternative energy partnerships (limited liability companies) formed to provide sustainable energy projects that are designed to generate a return primarily through the realization of federal tax credits (energy tax credits) and other tax benefits. The investment helps promote the development of renewable energy sources and help lower the cost of housing for residents by lowering homeowners’ monthly utility costs.

As our respective investments in these entities are more than minor, we have significant influence, but not control, over the investee’s activities that most significantly impact its economic performance. As a result, we are required to apply the equity method of accounting, which generally prescribes applying the percentage ownership interest to the investee’s GAAP net income in order to determine the investor’s earnings or losses in a given period. However, because the liquidation rights, tax credit allocations and other benefits to investors can change upon the occurrence of specified events, application of the equity method based on the underlying ownership percentages would not accurately represent our investment. As a result, we apply the Hypothetical Liquidation at Book Value (“HLBV”) method of the equity method of accounting.

The HLBV method is a balance sheet approach whereby a calculation is prepared at each balance sheet date to estimate the amount that we would receive if the equity investment entity were to liquidate all of its assets (as valued in accordance with GAAP) and distribute that cash to the investors based on the contractually defined liquidation priorities. The difference between the calculated liquidation distribution amounts at the beginning and the end of the reporting period, after adjusting for capital contributions and distributions, is our share of the earnings or losses from the equity investment for the period.

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The following table presents the activity related to our investment in alternative energy partnerships for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Balance at beginning of period	$	27,347	$	26,578	$	29,300	$	28,988
New funding	—		235		3,631		235
Change in unfunded commitments	—		—		(3,225)		—
Cash distribution from investments	(547)		(535)		(1,001)		(995)
Gain (loss) on investments using HLBV method	167		355		(1,738)		(1,595)
Balance at end of period	$	26,967	$	26,633	$	26,967	$	26,633
Unfunded equity commitments at end of period	$	—	$	3,796	$	—	$	3,796

Our returns on investments in alternative energy partnerships are primarily obtained through the realization of energy tax credits and other tax benefits rather than through distributions or through the sale of the investment. The balance of these investments was $27.0 million and $29.3 million at June 30, 2020 and December 31, 2019.

During the three and six months ended June 30, 2020, we funded zero and $3.6 million for our alternative energy partnerships and did not receive any return of capital from our alternative energy partnerships. During each of the three and six months ended June 30, 2019, we did not receive any return of capital and funded $235 thousand into these partnerships.

During the three months ended June 30, 2020 and 2019, we recognized a gain on investment of $167 thousand and a loss on investment of $355 thousand through its HLBV application. During the six months ended June 30, 2020 and 2019, we recognized a loss on investment of $1.7 million and $1.6 million through our application of the HLBV method of accounting. The HLBV losses for the six months ended June 30, 2020 were largely driven by accelerated tax depreciation on equipment and the recognition of energy tax credits which reduces the amount distributable by the investee in a hypothetical liquidation under the contractual liquidation provisions. From an income tax benefit perspective, we recognized no investment tax credits during these periods; however, we recorded income tax (expense) benefit related to these investments of $(38) thousand and $398 thousand for the three and six months ended June 30, 2020 and $380 thousand for each of the three and six months ended June 30, 2019.

For additional information, see Note 12 to Consolidated Financial Statements (unaudited) included in Part I of this Quarterly Report on Form 10-Q.

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Deposits

The following table shows the composition of deposits by type as of the dates indicated:

	June 30, 2020				December 31, 2019
($ in thousands)	Amount		% of Total Deposits		Amount		% of Total Deposits		Amount Change
Noninterest-bearing deposits	$	1,391,504	23.0	%	$	1,088,516	20.1	%	$	302,988
Interest-bearing demand deposits	1,846,698		30.6	%	1,533,882		28.3	%	312,816
Money market accounts	765,854		12.7	%	715,479		13.2	%	50,375
Savings accounts	939,018		15.6	%	885,246		16.3	%	53,772
Certificates of deposit of $250,000 or less	585,314		9.7	%	582,772		10.7	%	2,542
Certificates of deposit of more than $250,000	509,077		8.4	%	621,272		11.4	%	(112,195)
Total deposits	$	6,037,465	100.0	%	$	5,427,167	100.0	%	$	610,298

Total deposits were $6.04 billion at June 30, 2020, an increase of $610.3 million, or 11.2%, from $5.43 billion at December 31, 2019. We continue to focus on growing relationship-based deposits, strategically supplemented by wholesale funding, as we proactively drive our funding costs down. Noninterest-bearing deposits totaled $1.39 billion and represented 23.0% of total deposits at June 30, 2020 compared to $1.09 billion and 20.1% at December 31, 2019.

During the six months ended June 30, 2020, demand deposits increased by $615.8 million, consisting of increases of $303.0 million in noninterest-bearing deposits and $312.8 million in interest-bearing demand deposits. In addition, money market accounts increased $50.4 million and savings accounts increased $53.8 million, offset by a decrease of $109.7 million in time deposits.

Brokered deposits were $179.8 million at June 30, 2020, an increase of $169.8 million from $10.0 million at December 31, 2019. The increase between periods related to brokered time deposits as we took advantage of attractive pricing in that market to reduce some of our remaining higher-cost interest bearing deposits.

The following table presents the scheduled maturities of certificates of deposit as of June 30, 2020:

($ in thousands)	Three Months or Less		Over Three Months Through Six Months		Over Six Months Through Twelve Months		Over One Year		Total
Certificates of deposit of $250,000 or less	$	222,856	$	169,487	$	150,881	$	42,090	$	585,314
Certificates of deposit of more than $250,000	211,569		193,671		60,687		43,150		509,077
Total certificates of deposit	$	434,425	$	363,158	$	211,568	$	85,240	$	1,094,391

Borrowings

We utilized Federal Home Loan Bank (“FHLB”) advances to leverage our capital base, to provide funds for lending and investing activities, as a source of liquidity, and to enhance interest rate risk management. We also maintained additional borrowing availabilities from Federal Reserve Discount Window and unsecured federal funds lines of credit.

Advances from the FHLB decreased $577.8 million, or 48.4%, to $617.2 million as of June 30, 2020, due to repayment of $447.0 million in short-term and overnight advances with the FHLB and $124.0 million in maturities and early repayments of long-term advances. During the three months ended June 30, 2020, we repaid a $100.0 million FHLB long-term advance with a weighted average interest rate of 2.07% and incurred a $2.5 million extinguishment fee. Additionally, in June 2020 we refinanced $111.0 million of FHLB term advances to take advantage of the rapid decline in market interest rates. As a result of this refinancing, our weighted average effective interest rate on such FHLB term advances changed from 2.81% to 2.02% and the weighted average life extended from 2.52 years to 5.18 years.

At June 30, 2020, FHLB advances included no overnight borrowings, $58.0 million maturing within three months, and $566.0 million maturing beyond three months with a weighted average life of 4.1 years and weighted average interest rate of 2.39%.

We did not utilize repurchase agreements at June 30, 2020 or December 31, 2019.

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For additional information, see Note 6 to Consolidated Financial Statements (unaudited) included in Part I of this Quarterly Report on Form 10-Q.

Long-term Debt

The following table presents our long-term debt as of the dates indicated:

	June 30, 2020				December 31, 2019
($ in thousands)	Par Value		Unamortized Debt Issuance Cost and Discount		Par Value		Unamortized Debt Issuance Cost and Discount
5.25% senior notes due April 15, 2025	$	175,000	$	(1,463)	$	175,000	$	(1,579)
Total	$	175,000	$	(1,463)	$	175,000	$	(1,579)

We were in compliance with all covenants under our 5.25% senior notes due April 15, 2025 at June 30, 2020.

Liquidity Management

We are required to maintain sufficient liquidity to ensure a safe and sound operation. Liquidity may increase or decrease depending upon availability of funds and comparative yields on investments in relation to the return on loans. Historically, we have maintained liquid assets above levels believed to be adequate to meet the requirements of normal operations, including both expected and unexpected cash flow needs such as funding loan commitments, potential deposit outflows and dividend payments. Cash flow projections are regularly reviewed and updated to ensure that adequate liquidity is maintained.

As a result of current economic conditions, including government stimulus in response to the pandemic, the Company has participated in the elevated levels of liquidity in the marketplace. A portion of the additional liquidity is viewed as short-term as it is expected to be used by clients in the near term and, accordingly, the Company has maintained higher levels of liquid assets. We have not observed a change in the level of clients' credit line usage and as the Bank's PPP loans are expected to be forgiven over the next 9 to 12 months, we expect additional liquidity that will likely be used to lower wholesale funding as it matures.

Banc of California, N.A.

During the second quarter of 2020, we expanded our existing secured borrowing capacity with the Federal Reserve by participating in its Borrower-in-Custody (“BIC”) program. As a result, our borrowing capacity with the Federal Reserve increased to $370.4 million at June 30, 2020. Prior to participating in the BIC program, the Bank had only pledged certain securities as collateral for access to the discount window. At June 30, 2020, the Bank has pledged certain qualifying loans with an unpaid principal balance of $870.1 million and securities with a carrying value of $23.0 million as collateral for this line of credit. Borrowings under the BIC program are overnight advances with interest chargeable at the discount window (“primary credit”) borrowing rate. There were no borrowings under this arrangement for the three and six months ended June 30, 2020 and 2019.

The Bank's liquidity, represented by cash and cash equivalents and securities available-for-sale, is a product of its operating, investing, and financing activities. The Bank's primary sources of funds are deposits, payments and maturities of outstanding loans and investment securities; sales of loans and investment securities and other short-term investments and funds provided from operations. While scheduled payments from the amortization of loans and investment securities, and maturing investment securities and short-term investments are relatively predictable sources of funds, deposit flows and loan prepayments are greatly influenced by general interest rates, economic conditions, and competition. In addition, the Bank invests excess funds in short-term interest-earning assets, which provide liquidity to meet lending requirements. The Bank also generates cash through borrowings. The Bank mainly utilizes FHLB advances from pre-established secured lines of credit and securities sold under repurchase agreements to leverage its capital base, to provide funds for its lending activities, as a source of liquidity, and to enhance its interest rate risk management. The Bank also has the ability to obtain brokered deposits and collect deposits through its wholesale and treasury operations as well as secured borrowings advances through the Federal Reserve BIC program. Liquidity management is both a daily and long-term function of business management. Any excess liquidity is typically invested in federal funds or investment securities. On a longer-term basis, the Bank maintains a strategy of investing in various lending products. The Bank uses its sources of funds primarily to meet its ongoing loan and other commitments, and to pay maturing certificates of deposit and savings withdrawals.

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Banc of California, Inc.

The primary sources of funds for Banc of California, Inc., on a stand-alone holding company basis, are dividends and intercompany tax payments from the Bank, outside borrowing, and its ability to raise capital and issue debt securities. Dividends from the Bank are largely dependent upon the Bank's earnings and are subject to restrictions under certain regulations that limit its ability to transfer funds to the holding company. OCC regulations impose various restrictions on the ability of a bank to make capital distributions, which include dividends, stock redemptions or repurchases, and certain other items. Generally, a well-capitalized bank may make capital distributions during any calendar year equal to up to 100 percent of year-to-date net income plus retained net income for the two preceding years without prior OCC approval. However, any dividend paid by the Bank would be limited by the need to maintain its well-capitalized status plus the capital buffer in order to avoid additional dividend restrictions (Refer to Capital - Dividend Restrictions below for additional information). Currently, the Bank does not have sufficient dividend-paying capacity to declare and pay such dividends to the holding company without obtaining prior approval from the OCC under the applicable regulations. During the six months ended June 30, 2020, the Bank paid $25.0 million of dividends to Banc of California, Inc. At June 30, 2020, Banc of California, Inc. had $61.1 million in cash, all of which was on deposit at the Bank.

On February 10, 2020, we announced that our Board of Directors authorized the repurchase of up to $45 million of our common stock. The repurchase authorization expires in February 2021, however given current macroeconomic conditions and the COVID-19 pandemic, we have suspended common stock repurchases for the immediate future. There were no repurchases of common stock for the three months ended June 30, 2020. During the six months ended June 30, 2020, we repurchased 827,584 shares of common stock at a weighted average price of $14.50 per share and an aggregate amount of $12.0 million. Purchases may be made in open-market transactions, in block transactions on or off an exchange, in privately negotiated transactions, or by other means as determined by our management and in accordance with the regulations of the Securities and Exchange Commission. The timing of purchases and the number of shares repurchased under the program will depend on a variety of factors including price, trading volume, corporate and regulatory requirements, and market conditions.

During the three months ended June 30, 2020, we repurchased depositary shares representing shares of our Series D and Series E preferred stock. The aggregate total consideration for each Series D Depositary Share purchased was $1.2 million. The aggregate total consideration for each Series E Depositary Share purchased was $1.4 million. The $49 thousand difference between the consideration paid and the $2.7 million aggregate carrying value of the Series D Preferred Stock and Series E Preferred Stock was reclassified to retained earnings and resulted in an increase to net income allocated to common stockholders.

During the six months ended June 30, 2020, we repurchased depositary shares representing shares of our Series D and Series E preferred stock. The aggregate total consideration for the Series D depositary shares purchased was $2.7 million. The aggregate total consideration for the Series E depositary shares purchased was $1.5 million. The $575 thousand difference between the consideration paid and the $4.8 million aggregate carrying value of the Series D Preferred Stock and Series E Preferred Stock was reclassified to retained earnings and resulted in an increase to net income allocated to common stockholders.

On a consolidated basis, we maintained $420.6 million of cash and cash equivalents, which was 5.4% of total assets at June 30, 2020. Our cash and cash equivalents increased by $47.2 million, or 12.6%, from $373.5 million, or 4.8% of total assets, at December 31, 2019. The increase was mainly due to the increase in deposits and runoff of our legacy single family residential mortgage portfolio, offset by reductions in FHLB advances.

At June 30, 2020, we had available unused secured borrowing capacities of $1.06 billion from the FHLB and $370.4 million from the Federal Reserve, as well as $185.0 million from unsecured federal funds lines of credit. We also maintained repurchase agreements of which none were outstanding at June 30, 2020. Availabilities and terms on repurchase agreements are subject to the counterparties' discretion and pledging additional investment securities. We also had unpledged securities available-for-sale of $1.13 billion at June 30, 2020.

We believe that our liquidity sources are stable and are adequate to meet our day-to-day cash flow requirements as of June 30, 2020. However, in light of the ongoing COVID-19 pandemic, we cannot predict at this time the extent to which the pandemic will negatively affect our business, financial condition, liquidity, capital and results of operations. For a discussion of the related risk factors, please refer to Part II, Item 1A. "Risk Factors" in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2020.

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Commitments and Contractual Obligations

The following table presents our commitments and contractual obligations as of June 30, 2020:

	Commitments and Contractual Obligations
($ in thousands)	Total Amount Committed		Within One Year		More Than One Year Through Three Years		More Than Three Year Through Five Years		Over Five Years
Commitments to extend credit	$	80,093	$	36,078	$	36,785	$	1,842	$	5,388
Unused lines of credit	1,392,215		1,225,270		70,385		52,710		43,850
Standby letters of credit	3,579		3,258		210		111		—
Total commitments	$	1,475,887	$	1,264,606	$	107,380	$	54,663	$	49,238
FHLB advances	$	624,000	$	213,000	$	—	$	291,000	$	120,000
Long-term debt	175,000		—		—		175,000		—
Operating and capital lease obligations	23,274		6,461		6,787		3,805		6,221
Certificate of deposits	1,094,391		1,009,151		80,783		4,457		—
Total contractual obligations	$	1,916,665	$	1,228,612	$	87,570	$	474,262	$	126,221

At June 30, 2020, we had unfunded commitments of $20.5 million, $7.1 million, and $501 thousand for affordable housing fund investments, SBIC investments, and other investments, including investments in alternative energy partnerships, respectively.

Capital

In order to maintain adequate levels of capital, we continuously assess projected sources and uses of capital to support projected asset growth, operating needs and credit risk. We consider, among other things, earnings generated from operations and access to capital from financial markets. In addition, we perform capital stress tests on an annual basis to assess the impact of adverse changes in the economy on our capital base.

Regulatory Capital

The Company and the Bank are subject to the regulatory capital adequacy guidelines that are established by the Federal banking regulators. In July 2013, the Federal banking regulators approved a final rule to implement the revised capital adequacy standards of the Basel III and to address relevant provisions of the Dodd-Frank Act. The final rule strengthens the definition of regulatory capital, increases risk-based capital requirements, makes selected changes to the calculation of risk-weighted assets, and adjusts the prompt corrective action thresholds. The Company and the Bank became subject to the new rule on January 1, 2015 and certain provisions of the new rule were phased in through January 1, 2019. Inclusive of the fully phased-in capital conservation buffer, the common equity Tier 1 capital, Tier 1 risk-based capital and total risk-based capital ratio minimums are 7.0%, 8.5% and 10.5%, respectively.

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The following table presents the regulatory capital amounts and ratios for the Company and the Bank as of dates indicated:

					Minimum Capital Requirements				Minimum Required to Be Well-Capitalized Under Prompt Corrective Action Provisions
($ in thousands)	Amount		Ratio		Amount		Ratio		Amount		Ratio
June 30, 2020
Banc of California, Inc.
Total risk-based capital	$	884,558	16.35	%	$	432,780	8.00	%	N/A		N/A
Tier 1 risk-based capital	816,655		15.10	%	324,585		6.00	%	N/A		N/A
Common equity tier 1 capital	631,618		11.68	%	243,439		4.50	%	N/A		N/A
Tier 1 leverage	816,655		10.56	%	309,388		4.00	%	N/A		N/A
Banc of California, NA
Total risk-based capital	$	981,477	18.17	%	$	432,124	8.00	%	$	540,155	10.00	%
Tier 1 risk-based capital	913,785		16.92	%	324,093		6.00	%	432,124		8.00	%
Common equity tier 1 capital	913,785		16.92	%	243,070		4.50	%	351,100		6.50	%
Tier 1 leverage	913,785		11.84	%	308,586		4.00	%	385,732		5.00	%
December 31, 2019
Banc of California, Inc.
Total risk-based capital	$	921,892	15.90	%	$	463,950	8.00	%	N/A		N/A
Tier 1 risk-based capital	860,179		14.83	%	347,963		6.00	%	N/A		N/A
Common equity tier 1 capital	670,355		11.56	%	260,972		4.50	%	N/A		N/A
Tier 1 leverage	860,179		10.89	%	315,825		4.00	%	N/A		N/A
Banc of California, NA
Total risk-based capital	$	1,007,762	17.46	%	$	461,843	8.00	%	$	577,304	10.00	%
Tier 1 risk-based capital	946,049		16.39	%	346,382		6.00	%	461,843		8.00	%
Common equity tier 1 capital	946,049		16.39	%	259,787		4.50	%	375,247		6.50	%
Tier 1 leverage	946,049		12.02	%	314,707		4.00	%	393,383		5.00	%

Dividend Restrictions

Payment of dividends by the Company are subject to guidance provided by the Federal Reserve. That guidance provides that bank holding companies that plan to pay dividends that exceed net earnings for a given period should first consult with the Federal Reserve. Because the Company’s current and, for the near term, future quarterly dividends are expected to exceed the applicable quarterly net earnings, payment of dividends in respect of the Company’s common and preferred stock will be subject to prior consultation and non-objection from the Federal Reserve.

Our principal source of funds for dividend payments is dividends received from the Bank. Federal banking laws and regulations limit the amount of dividends that may be paid without prior approval of regulatory agencies. Under these regulations, in the case of the Bank, the amount of dividends that may be paid in any calendar year is limited to the current year’s net profits, combined with the retained net profits of the preceding two years, subject to the capital requirements described above. Accordingly, any dividend granted by the Bank would be limited by the need to maintain its well capitalized status plus the capital buffer in order to avoid additional dividend restrictions. As described below, any near term dividend by the Bank will require OCC approval. During the three and six months ended June 30, 2020, the Bank received approval from the OCC and paid $25.0 million in dividends to Banc of California, Inc.

During the three and six months ended June 30, 2020, we declared and paid dividends on our common stock of $0.06 and $0.12 per share in addition to dividends on our preferred stock. Last year, in April 2019, our Board of Directors approved a plan to reduce the quarterly dividend from $0.13 to $0.06 per common share.

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ITEM 3 — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our Risk When Interest Rates Change. The rates of interest we earn on assets and pay on liabilities generally are established contractually for a period of time. Market interest rates change over time. Accordingly, our results of operations, like those of other financial institutions, are impacted by changes in interest rates and the interest rate sensitivity of our assets and liabilities. The risk associated with changes in interest rates and our ability to adapt to these changes is known as interest rate risk and is our most significant market risk.

How We Measure Our Risk of Interest Rate Changes. As part of our attempt to manage our exposure to changes in interest rates and comply with applicable regulations, we have established asset/liability committees to monitor our interest rate risk. In monitoring interest rate risk we continually analyze and manage assets and liabilities based on their payment streams and interest rates, the timing of their maturities and/or prepayments, and their sensitivity to actual or potential changes in market interest rates.

We maintain both a management asset/liability committee (“Management ALCO”), comprised of select members of senior management, and a joint asset/liability committee of the Boards of Directors of the Company and the Bank (“Board ALCO”, together with Management ALCO, “ALCOs”). In order to manage the risk of potential adverse effects of material and prolonged or volatile changes in interest rates on our results of operations, we have adopted asset/liability management policies to align maturities and repricing terms of interest-earning assets to interest-bearing liabilities. The asset/liability management policies establish guidelines for the volume and mix of assets and funding sources taking into account relative costs and spreads, interest rate sensitivity and liquidity needs, while the ALCOs monitor adherence to those guidelines. The objectives are to manage assets and funding sources to produce results that are consistent with liquidity, capital adequacy, growth, risk, and profitability goals. The ALCOs meet no less than quarterly to review, among other things, economic conditions and interest rate outlook, current and projected liquidity needs and capital position, anticipated changes in the volume and mix of assets and liabilities and interest rate risk exposure limits versus current projections pursuant to our net present value of equity analysis.

In order to manage our assets and liabilities and achieve the desired liquidity, credit quality, interest rate risk, profitability and capital targets, we evaluate various strategies including:

•Originating and purchasing adjustable rate mortgage loans,

•Selling longer duration fixed or hybrid mortgage loans,

•Originating shorter-term consumer loans,

•Managing the duration of investment securities,

•Managing our deposits to establish stable deposit relationships,

•Using FHLB advances and/or certain derivatives such as swaps to align maturities and repricing terms, and

•Managing the percentage of fixed rate loans in our portfolio.

At times, depending on the level of general interest rates, the relationship between long- and short-term interest rates, market conditions and competitive factors, the ALCOs may decide to increase our interest rate risk position within the asset/liability tolerance set forth by our Board of Directors.

As part of its procedures, the ALCOs regularly review interest rate risk by forecasting the impact of alternative interest rate environments on net interest income and market value of portfolio equity, which is defined as the net present value of an institution’s existing assets, liabilities and off-balance sheet instruments, and evaluating such impacts against the maximum potential changes in net interest income and market value of portfolio equity.

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Interest Rate Sensitivity of Economic Value of Equity and Net Interest Income

Interest rate risk results from our banking activities and is the primary market risk for us. Interest rate risk is caused by the following factors:

•Repricing risk - timing differences in the repricing and maturity of interest-earning assets and interest-bearing liabilities;

•Option risk - changes in the expected maturities of assets and liabilities, such as borrowers’ ability to prepay loans and depositors’ ability to redeem certificates of deposit before maturity;

•Yield curve risk - changes in the yield curve where interest rates increase or decrease in a nonparallel fashion; and

•Basis risk - changes in spread relationships between different yield curves, such as U.S. Treasuries, U.S. Prime Rate and London Interbank Offered Rate.

Since our earnings are primarily dependent on our ability to generate net interest income, we focus on actively monitoring and managing the effects of adverse changes in interest rates on our net interest income. Management of our interest rate risk is overseen by the Board ALCO. Board ALCO delegates the day to day management of interest rate risk to the Management ALCO. Management ALCO ensures that the Bank is following the appropriate and current regulatory guidance in the formulation and implementation of our interest rate risk program. Board ALCO reviews the results of our interest rate risk modeling quarterly to ensure that we have appropriately measured our interest rate risk, mitigated our exposures appropriately and any residual risk is acceptable. In addition to our annual review of the Asset Liability Management policy, our Board of Directors periodically reviews the interest rate risk policy limits.

Interest rate risk management is an active process that encompasses monitoring loan and deposit flows complemented by investment and funding activities. Effective management of interest rate risk begins with understanding the dynamic repricing characteristics of our assets and liabilities and determining the appropriate interest rate risk posture given business forecasts, management objectives, market expectations, and policy constraints.

Our interest rate risk exposure is measured and monitored through various risk management tools, including a simulation model that performs interest rate sensitivity analysis under multiple scenarios. The simulation model is based on the actual maturities and re-pricing characteristics of the Bank’s interest-rate sensitive assets and liabilities. The simulated interest rate scenarios include an instantaneous parallel shift in the yield curve (“Rate Shock”). We then evaluate the simulation results using two approaches: Net Interest Income at Risk (“NII at Risk”), and Economic Value of Equity (“EVE”). Under NII at Risk, the impact on net interest income from changes in interest rates on interest-earning assets and interest-bearing liabilities is modeled utilizing various assumptions for assets, liabilities, and derivatives.

EVE measures the period end market value of assets minus the market value of liabilities. Asset liability management uses this value to measure the changes in the economic value of the Bank under various interest rate scenarios. In some ways, the economic value approach provides a broader scope than net income volatility approach since it captures all anticipated cash flows.

The balance sheet is considered “asset sensitive” when an increase in short-term interest rates is expected to expand our net interest margin, as rates earned on our interest-earning assets reprice higher at a pace faster than rates paid on our interest-bearing liabilities. Conversely, the balance sheet is considered “liability sensitive” when an increase in short-term interest rates is expected to compress our net interest margin, as rates paid on our interest-bearing liabilities reprice higher at a pace faster than rates earned on our interest-earning assets.

At June 30, 2020, our interest rate risk profile reflects an “asset sensitive” position. Given the uncertainty of the magnitude, timing and direction of future interest rate movements, as well as the shape of the yield curve, actual results may vary from those predicted by our model.

The following table presents the projected change in the Bank’s economic value of equity at June 30, 2020 and net interest income over the next twelve months, that would occur upon an immediate change in interest rates based on independent analysis, but without giving effect to any steps that management might take to counteract that change:

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	Change in Interest Rates in Basis Points (bps) (1)
($ in thousands)	Economic Value of Equity						Net Interest Income
	Amount		Amount Change		Percentage Change		Amount		Amount Change		Percentage Change
June 30, 2020
+200 bps	$	1,332,616	$	196,900	17.3	%	$	222,391	$	14,467	7.0	%
+100 bps	1,249,336		113,620		10.0	%	215,258		7,334		3.5	%
0 bps	1,135,716						207,924
-100 bps	1,024,455		(111,261)		(9.8)	%	205,107		(2,817)		(1.4)	%

(1)Assumes an instantaneous uniform change in interest rates at all maturities and no rate shock has a rate lower than zero percent.

As with any method of measuring interest rate risk, certain shortcomings are inherent in the method of analysis presented in the foregoing table. For example, although certain assets and liabilities may have similar maturities or periods to repricing, they may react in different degrees to changes in market interest rates. Also, the interest rates on certain types of assets and liabilities may fluctuate in advance of changes in market interest rates, while interest rates on other types may lag behind changes in market rates. Additionally, certain assets, such as adjustable rate mortgage loans, have features which restrict changes in interest rates on a short-term basis and over the life of the asset. Further, if interest rates change, expected rates of prepayments on loans and early withdrawals from certificates of deposit could deviate significantly from those assumed in calculating the table.

Interest rate risk is the most significant market risk affecting us. Other types of market risk, such as foreign currency exchange risk and commodity price risk, do not arise in the normal course of our business activities and operations.

ITEM 4 - CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

An evaluation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the Act) as of June 30, 2020 was carried out under the supervision and with the participation of the Company’s Principal Executive Officer, Principal Financial Officer and other members of the Company’s senior management. The Company’s Principal Executive Officer and Principal Financial Officer concluded that, as of June 30, 2020, the Company’s disclosure controls and procedures were effective in ensuring that the information required to be disclosed by the Company in the reports it files or submits under the Act is: (i) accumulated and communicated to the Company’s management (including the Principal Executive Officer and Principal Financial Officer) to allow timely decisions regarding required disclosure; and (ii) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

There were no changes in the Company’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Act) that occurred during the three months ended June 30, 2020 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

The Company does not expect that its disclosure controls and procedures and internal control over financial reporting will prevent all errors and fraud. A control procedure, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control procedure are met. Because of the inherent limitations in all control procedures, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any control procedure also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control procedure, misstatements due to error or fraud may occur and not be detected.

78

PART II — OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS

From time to time we are involved as plaintiff or defendant in various legal actions arising in the normal course of business.

On April 2, 2019, the first of three shareholder derivative actions, Gordon v. Benett, No. 8:19-cv-621, was filed against current and former officers and directors of Banc of California, Inc. in the United States District Court for the Central District of California. The Gordon action asserts claims for breach of fiduciary duty against Halle J. Benett, Jonah Schnel, Jeffrey Karish, Robert Sznewajs, Eric Holoman, Chad Brownstein, Steven Sugarman, Richard Lashley, Douglas Bowers and John Grosvenor. On June 10, 2019, a second shareholder derivative action, Johnston v. Sznewajs, No. 8:19-cv-01152, was filed against current and former officers and directors of Banc of California, Inc. in the United States District Court for the Central District of California. The Johnston action asserts claims for breach of fiduciary duty and unjust enrichment against Robert Sznewajs, Jonah Schnel, Halle Benett, Richard Lashley, Steven Sugarman, John Grosvenor, Chad Brownstein, Jeffrey Karish and Eric Holoman. On June 18, 2019, a third shareholder derivative action, Witmer v. Sugarman, No. 19STCV21088, was filed against current and former officers and directors of Banc of California, Inc. in Los Angeles County Superior Court. The Witmer action asserts claims for breach of fiduciary duty, unjust enrichment and corporate waste against Steven Sugarman, Ronald Nicolas, Jr., Robert Sznewajs, Chad Brownstein, Halle Benett, Douglas Bowers, Jeffrey Karish, Richard Lashley, Jonah Schnel, Eric Holoman and Jeffrey Seabold. On June 24, 2019, the Witmer Action was removed to the United States District Court for the Central District of California and assigned docket number 2:19-cv-5488. On September 23, 2019, the Court, ordered that the Gordon, Johnston, and Witmer actions are consolidated for all purposes, including pre-trial proceedings and trial. On November 22, 2019, plaintiffs filed a consolidated complaint. The Company’s motion to dismiss is currently due on August 14, 2020.

In general, the consolidated complaint alleges that our board wrongfully refused demands that the plaintiffs made to our board of directors that we should initiate litigation against the various current and former officers and directors based on their alleged role in the purported concealment of the Company's alleged relationship with Jason Galanis and various statements made by the Company alleged to be false and misleading. The plaintiffs seek an unspecified amount of damages to be paid to the Company, adoption of corporate governance reforms, and equitable and injunctive relief. We do not believe that the demands made by these shareholder derivative plaintiffs were wrongfully refused, and we intend to vigorously contest these actions on that basis.

ITEM 1A - RISK FACTORS

There have been no material changes to the risk factors that appeared under Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2019 and Part II, Item 1A. “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2020.

ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

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	Purchase of Equity Securities by the Issuer
	Total Number of Shares	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans	Total Number of Shares That May Yet be Purchased Under the Plan
Common Stock:
From April 1, 2020 to April 30, 2020	47,939	$	8.19	—	—
From May 1, 2020 to May 31, 2020	2,188	$	11.40	—	—
From June 1, 2020 to June 30, 2020	7,610	$	10.62	—	—
Total	57,737	$	8.63	—	—
Preferred Stock (Depositary Shares):
From April 1, 2020 to April 30, 2020	94,813	$	23.39	—	—
From May 1, 2020 to May 31, 2020	12,269	$	24.80	—	—
From June 1, 2020 to June 30, 2020	2,989	$	24.97	—	—
Total	110,071	$	23.59	—	—

During the three months ended June 30, 2020, purchases of shares of common stock related to shares surrendered by employees in order to pay employee tax liabilities associated with vested awards under our employee stock benefit plans. There were no purchases of shares of common stock during the three months ended June 30, 2020 related to the Company's previously announced stock repurchase program discussed below.

On February 10, 2020, we announced a repurchase program of up to $45 million of our common stock. The repurchase authorization expires in February 2021. Purchases may be made in open-market transactions, in block transactions on or off an exchange, in privately negotiated transactions or by other means as determined by our management and in accordance with the regulations of the Securities and Exchange Commission. The timing of purchases and the number of shares repurchased under the program will depend on a variety of factors including price, trading volume, corporate and regulatory requirements and market conditions.

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4 MINE SAFETY DISCLOSURES

Not applicable

ITEM 5 - OTHER INFORMATION

None

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ITEM 6 - EXHIBITS

3.1	Second Articles of Restatement of the charter of the Registrant (Filed as an exhibit to the Registrant’s Current Report on Form 8-K filed on June 5, 2018 and incorporated herein by reference.)
3.2	Fifth Amended and Restated Bylaws of the Registrant (Filed as an exhibit to the Registrant’s Current Report on Form 8-K filed on June 30, 2017 and incorporated herein by reference.)
10.1	Amendment and Termination of LAFC-Banc of California Agreements dated May 22, 2020
31.1	Rule 13a-14(a) Certification (Principal Executive Officer)
31.2	Rule 13a-14(a) Certification (Principal Financial Officer)
32.0	Rule 13a-14(b) and 18 U.S.C. 1350 Certification
101.0	The following financial statements and footnotes from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2020 formatted in Extensible Business Reporting Language (XBRL): (i) Consolidated Statements of Financial Condition; (ii) Consolidated Statements of Operations; (iii) Consolidated Statements of Comprehensive Income (Loss); (iv) Consolidated Statements of Stockholders’ Equity; (v) Consolidated Statements of Cash Flows; and (vi) the Notes to Consolidated Financial Statements. The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		BANC OF CALIFORNIA, INC.
Date:	August 7, 2020	/s/ Jared Wolff
		Jared Wolff
		President/Chief Executive Officer (Principal Executive Officer)
Date:	August 7, 2020	/s/ Lynn M. Hopkins
		Lynn M. Hopkins
		Executive Vice President/Chief Financial Officer (Principal Financial Officer)
Date:	August 7, 2020	/s/ Mike Smith
		Mike Smith
		Senior Vice President/Chief Accounting Officer (Principal Accounting Officer)

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EX-10.1

CONFIDENTIAL		EXECUTION COPY

May 22, 2020

Banc of California, National Association

3 MacArthur Place

Santa Ana, CA 92707

        Re:  Amendment and Termination of LAFC-Banc of California Agreements

Ladies and Gentlemen:

        Reference is hereby made to that certain (i) Naming Rights Agreement dated as of February 28, 2017 by and among Banc of California, National Association (“BOC”), LAFC Sports, LLC (“LAFC TeamCo”), LAFC StadiumCo, LLC (“LAFC StadCo”) (LAFC TeamCo and LAFC StadCo may individually or collectively be referred to herein as “LAFC”) and LAFC Partners, LLLP (“LAFC Parent”) (the “Naming Rights Agreement”); (ii) Sponsor Agreement dated as of February 28, 2017 by and between LAFC TeamCo, BOC, LAFC Parent, LAFC StadCo, LAFC Sports Foundation, and LAFC AncillaryCo, LLC (the “Sponsor Agreement”); (iii) Community Engagement Agreement dated as of February 28, 2017 by and between BOC and LAFC TeamCo (the “Community Engagement Agreement”); (iv) Los Angeles Football Club Stadium Suite Lease Agreement dated as of April 27, 2018 by and between LAFC TeamCo and BOC (the “Existing Suite Agreement”); and (v) Sublease Agreement dated as of December 2018 by and between BOC and LAFC StadCo (“ATM Sublease Agreement”), with respect and relating to the naming rights, sponsorship and other agreements among such parties (each such agreement, together with any and all other agreements among any of such LAFC and BOC parties, are referred to herein collectively as the “Agreements”, provided that neither this letter agreement (this “Letter Agreement”) nor the Suite License Agreement (as defined below) is or shall be deemed an “Agreement” for purposes of this Letter Agreement). Capitalized terms used herein without definition have the meanings set forth in the Naming Rights Agreement. As used herein, the term “party” shall mean, as the context requires, (a) an entity listed on the signature page hereof or (b) BOC, on the one hand, and all of the entities listed on the signature page hereof other than BOC, on the other hand.

        For good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereby agree as follows:

1.Amendment of the Naming Rights Agreement.

a.Section 10.B of the Naming Rights Agreement is hereby amended as follows:

“Additional Termination Rights of Sponsor. Sponsor may terminate this Agreement upon: (a) the Team’s failure to operate as an active MLS franchise pursuant to League Rules; (b) any Force Majeure event that results in closure of all or any material portion of the Facility to the public for a period equal to or greater than six (6) consecutive calendar months; (c) any permanent relocation of the Team to any venue other than the Facility, other than ordinary course travel for Games that are not Home Games, and other than as expressly permitted by

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the Non-Relocation Agreement; (dc) any Team Change of Control in which the successor-in-interest of LAFC in and to the Team does not agree to honor all of the LAFC Parties’ obligations under this Agreement; and (ed) proper termination of the Lease.”

b.Except as expressly set forth in this Letter Agreement, and subject to Paragraph 3 below (Termination of the Agreements), all of the provisions of each of the Agreements are and shall otherwise remain unmodified and in full force and effect (including without limitation any financial literacy program and/or community events that are to be effected under the Community Engagement Agreement) until their expiration or termination. Notwithstanding the foregoing and notwithstanding anything to the contrary in the Agreements, BOC shall not be required to make any payments under any of the Agreements or to satisfy any of its obligations under any of the Agreements (i) from and after the date hereof until the date as of which the first LAFC MLS regular season home match is played at the Stadium after the date hereof with not fewer than 5,500 attendees having tickets granting access to the Stadium for such match in attendance at the Stadium for such match (the “Recommencement Date”), provided that in no event shall such obligations survive the Termination (as defined below), except as set forth in Paragraph 3(c) of this Letter Agreement, or (ii) during any Subsequent Shutdown Period (as defined below). Except as set forth in the following sentence, BOC shall not be deemed in breach or default under any of the Agreements for any failure to perform any of its obligations under any of the Agreements after the execution hereof. As of (or as promptly as reasonably practicable following) the later of the Recommencement Date and the date which is five business days after BOC’s receipt of written notice as to the date of the Recommencement Date (and provided such date takes place prior to the Termination, as defined below), BOC’s obligations under the Agreements shall recommence in accordance with the terms thereof until the effectiveness of the Termination (subject to such adjustments thereto as are appropriate under the circumstances, as agreed to by the parties in good faith), with any of BOC’s payment obligations and/or BOC’s obligations to incur expenses under the Agreements being deemed pro-rated on a 1/366 per day basis for the period commencing on the Recommencement Date and concluding as of the effectiveness of the Termination and being deemed satisfied if paid or incurred on or prior to December 31, 2020, provided that, in the event of a Subsequent Shutdown Period, (x) BOC’s obligations under the Agreements shall not apply during any Subsequent Shutdown Period and (y) no days during any Subsequent Shutdown Period shall be counted in the numerator for purposes of calculating BOC’s pro-rated payment obligations and obligations to incur expenses as described in this sentence.

For purposes of this Letter Agreement, “Subsequent Shutdown Period” shall mean any period after the Recommencement Date during which the MLS has suspended or cancelled the MLS season or MLS matches are no longer permitted (by the MLS, SUM, governmental authorities or otherwise) to be played at the Stadium with at least 5,500 attendees having tickets granting access to the Stadium for such match in attendance at the Stadium for such match.

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By way of example and not limitation, in the event that the period commencing on the Recommencement Date (assuming the Recommencement Date takes place prior to the effectiveness of the Termination) and concluding on the date of the effectiveness of the Termination were to consist of 100 days and there was a Subsequent Shutdown Period of 20 days during such period, the amount payable by BOC pursuant to Exhibit 13 of the Naming Rights Agreement with respect to such period (other than the Subsequent Shutdown Period, with respect to which no amount would be payable pursuant to the Agreements) would equal $1,205,050.93 (which, for the avoidance of doubt, would be in addition to, and in no way reduced by, the approximately$2,750,000 fee already paid to LAFC for 2020).

2.Consideration.

a.Within five (5) business days following the date hereof, BOC shall pay $20,100,000 (“Buyout Fee”) in one single lump sum to LAFC by wire transfer of immediately available funds into an account designated by LAFC on or prior to the date hereof.In the event that any portion of the Buyout Fee is not paid when due, BOC shall pay LAFC interest on the unpaid portion of the Buyout Fee at a rate equal to the “prime rate” published in the Wall Street Journal from time to time, from (and including) the date such amount was due to (but excluding) the date such amount is paid.

b.Notwithstanding anything to the contrary in any of the Agreements, and except as otherwise set forth in this Letter Agreement, any and all monies received by LAFC to-date under the Agreements are hereby deemed to be non-refundable and are not subject to be returned by LAFC for any reason whatsoever.

3.Termination of the Agreements.

a.Unless otherwise terminated earlier, and notwithstanding anything to the contrary in any of the Agreements, all of the Agreements shall each automatically (without any further action required of any party) terminate, and are hereby terminated, effective as of 11:59pm Pacific time on December 31, 2020.

b.Notwithstanding anything to the contrary in any of the Agreements, the Agreements then in effect may be terminated prior to 11:59pm Pacific time on December 31, 2020 by LAFC following written notice to BOC (“Notice of Termination”) at any time after it reaches agreement for (i) a naming rights arrangement or (ii) a sponsorship arrangement with any person or entity in or for the financial services category (any such agreement which BOC hereby expressly agrees may be reached by or on behalf of LAFC without the need for any approvals or waivers that might otherwise have been required under one or more of the Agreements), effective on the receipt by BOC from LAFC of the payment contemplated by Paragraph 3(d) hereof (or, if later, 10 days after delivery of the Notice of Termination), provided that (i) such termination shall not be effective until at least 10 days after delivery of Notice of Termination (with LAFC and BOC to work together diligently and in good faith during such 10 day period to

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resolve any disagreement pertaining to any monies that may or may not then be owed by one party to the other) and (ii) no rights granted pursuant to any such agreement shall be effective prior to the effectiveness of the termination of the Agreements if the grant of such rights would be in violation of the terms of the Agreements (or any of them).

c.Upon the effectiveness of termination of the Agreements (it being agreed that all of the Agreements shall be deemed, and hereby are, terminated effective as of the effectiveness of the termination of the Naming Rights Agreement), whether pursuant to this Letter Agreement or prior thereto in accordance with the terms of the Agreements (the “Termination”), and notwithstanding anything to the contrary in any of the Agreements, the Agreements will have no further force or effect, and no party shall have any further rights or obligations thereunder, except that (i) except to the extent expressly amended by this Letter Agreement and subject to the terms of this Letter Agreement (including without limitation Paragraphs 6 and 7 hereof), the provisions of Sections 6 (to the extent such provisions are intended to survive in connection with this Letter Agreement (e.g., because LAFC continues to display BOC intellectual property on or around the Premises)) and 9 (with respect to Demands arising before the effectiveness of the Termination) of the Naming Rights Agreement, Sections 3.A.ii., 5.B., 8 (with respect to Losses, as defined in the Sponsor Agreement, arising before the effectiveness of the Termination) and 9of the Sponsor Agreement and Sections 6.3 (with respect to Claims, as defined in the ATM Sublease Agreement, arising before the effectiveness of the Termination), 6.4 and 13.13 of the ATM Sublease Agreement shall survive the effectiveness of Termination, (ii) LAFC shall have the right (but not the obligation) to choose to keep some or all of the BOC static signage that has been provided under the Naming Rights Agreement (including, but not limited to, any such static signage attached to or associated with the Facility or LAFC’s two (2) digital board signs located on the 110 Interstate/Freeway) in place after the Termination (with all of the intellectual property and other rights and licenses needed to do so hereby being deemed to be provided hereunder) until the earlier of the date as of which such static signage is removed or replaced by LAFC in its sole discretion and the date which is four yearsafter the date hereof(or such later date as shall hereafter be agreed to in writing by the parties), (iii) LAFC and its affiliates shall have the right to use the Facility Marks and the Facility Logo (as defined in the Sponsor Agreement) in connection with any references to the Stadium until the removal of all static signage as contemplated in the foregoing subclause (ii), (iv) each of the parties and their respective affiliates shall have the right to use the Facility Marks and the Facility Logo (as defined in the Sponsor Agreement) (A) indefinitely from and after the date of the effectiveness of Termination for informational, archival, historical reference and other non-trademark purposes and (B) without limiting other use rights set forth in this Letter Agreement, for customary transitional purposes for a period not to exceed thirty (30) daysfrom and after the effectiveness of Termination (or such other period as the parties may hereafter mutually agree in writing), (v) each of the parties and their respective affiliates shall be free to dispose of (but not sell) then-existing inventory of products containing any Facility Mark or Facility Logo (as defined in the Sponsor Agreement) until the earlier of (x) all of such inventory has been depleted or (y) three (3) months after the date of the effectiveness of Termination and (vi) BOC

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and/or its affiliates shall not use the name “Banc of California Stadium” in connection with the naming of any other stadium, arena or other venue (regardless of BOC’s ownership of such name) during the ten year period immediately following the effectiveness of Termination. For the avoidance of doubt, except as otherwise set forth in this Letter Agreement, (A) no party nor any of its affiliates shall have the right pursuant to any of the Agreements or this Letter Agreement to use any of the Facility Marks or the Facility Logo (as defined in the Sponsor Agreement) (excluding any parts thereof that constitute marks owned by such party which are not Facility Marks or the Facility Logo (as defined in the Sponsor Agreement)) after the date of the effectiveness of Termination, (B) neither BOC nor any of its affiliates shall have the right pursuant to any of the Agreements or this Letter Agreement to use any of the LAFC Marks, Club Marks (as defined in the Sponsor Agreement), Designations (as defined in the Sponsor Agreement) or Player / Coach Likenesses (as defined in the Sponsor Agreement) after the date of the effectiveness of Termination and (C) none of the parties hereto (other than BOC) nor any of their respective affiliates (other than BOC’s affiliates) shall have the right pursuant to any of the Agreements or this Letter Agreement to use any of the Sponsor Marks (as defined in the Naming Rights Agreement) or the Sponsor Marks (as defined in the Sponsor Agreement) after the date of the effectiveness of Termination. The parties acknowledge and agree that (I) the name of “Banc of California” is a trademark owned by BOC (separate and apart from the Facility Marks and the Facility Logo (as defined in the Sponsor Agreement)), and nothing in this Letter Agreement (or the Agreements) shall be deemed to restrict BOC’s or its Affiliates’ right to use such mark after (or prior to) termination of the Agreements other than as set forth above with respect to the name “Banc of California Stadium” and (II) BOC shall have no obligation (A) to pay any costs or expenses associated with LAFC or any of its affiliates (or any third party providing such services for the benefit of LAFC or any of its affiliates) (w) removing, destroying and/or discarding signage reflecting any of the Facility Marks and/or the Facility Logo (as defined in the Sponsor Agreement), (x) preparing, producing, replacing, mounting and/or installing new or altered signage to reflect any change in the name of the Stadium, (y) removing, destroying and/or discarding any merchandise, equipment or collateral materials related to the Facility branding, promotion and publicity displaying any of the Facility Marks and/or the Facility Logo (as defined in the Sponsor Agreement) and/or (z) preparing, producing, replacing and/or distributing merchandise, equipment or other collateral materials related to the Facility branding, promotion and publicity reflecting any change in the name of the Stadium or (B) effective as of the effectiveness of the Termination, and except as specifically contemplated by this Letter Agreement, under any of the Agreements.

d.In the event that the Agreements are terminated effective prior to 11:59pm Pacific time on December 31, 2020, LAFC shall promptly (and in any event within five (5) business days) following the effectiveness of termination of the Agreements, refund to BOC, in accordance with payment instructions to be provided by BOC to LAFC, an amount (paid by BOC to LAFC on or after the Recommencement Date) equal to (i) all amounts (if any) paid by BOC on or after the Recommencement Date pursuant to the Agreements (or any of them) with respect to calendar year 2020 (which, for the avoidance of doubt, does not include the Buyout Fee

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payable pursuant to this Letter Agreement), multiplied by (ii) a fraction, the numerator of which equals the number of days in the period commencing on the date of the effectiveness of termination of the Agreements and concluding on December 31, 2020 and the denominator of which equals 366.

4.Continued Banking Services. Without limiting its obligations under the Agreements through the effectiveness of the Termination (which, subject to the terms set forth in other Paragraphs of this Letter Agreement, shall remain in effect in accordance with their terms until the effectiveness of the Termination), LAFC hereby agrees to continue to use BOC for the following banking services (specifically excluding, without limitation, payment processing and financing services which LAFC may, but shall not be obligated to, use BOC in its sole discretion) for which it currently uses BOC (in each case, on the same terms and conditions (e.g., service level, quality, etc.) that apply today), unless and until the earlier of (i) LAFC entering into a sponsorship or similar agreement with another financial services provider in good faith that requires (or which makes it beneficial to) LAFC to transfer such financial services/relationships to such other provider who provides such services, (ii) a refinancing by LAFC of its credit facility pursuant to which it is required or beneficial to LAFC to transfer any such financial services/relationships to another provider or (iii) December 31, 2023:

a.Accounts payable services;

b.Primary commercial banking services, including in respect of cash management requirements; and

c.Depository bank in respect of deposit accounts maintained by LAFC.

5.Use of Founders 9 Suite. From and after the effectiveness of Termination, BOC shall have access to the “Founders 9” suite (“Founders Suite”) at the Stadium pursuant to the terms of a Stadium Suite Lease Agreement between LAFC TeamCo and BOC dated and executed as of the date hereof and effective as of the effectiveness of the Termination (the “Suite License Agreement”). Additionally, BOC will have the opportunity to serve as “associate partner” for one (1) mutually agreed upon LAFC Sports Foundation event (“Foundation Asset”) each year throughout the term of the Suite License Agreement; provided, that LAFC may terminate BOC’s right to receive the Foundation Asset at any time after it reaches agreement in good faith for a sponsorship arrangement with any person or entity in or for the financial services category.

6.Releases.

a.Mutual Releases. Each party hereby generally and unconditionally releases the other party and the other party’s affiliates and the present and former officers, managers, directors, employees, members, shareholders, agents, representatives, insurers, predecessors, successors, assigns, administrators, executors and heirs of the other party and the other party’s affiliates (the “Related Parties”, provided that neither MLS nor SUM is or shall be deemed a

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“Related Party” for purposes of this Letter Agreement) of and from any and all claims, demands, rights, actions, causes of action, suits, liabilities, contracts, covenants, obligations, damages, losses, expenses (including, without limitation, attorneys' fees, except as expressly set forth within this Letter Agreement), penalties, costs and allegations of any kind, nature, and character whatsoever, whether legal, contractual, statutory, administrative or equitable in nature or otherwise, whether known or unknown, suspected or unsuspected, foreseen or unforeseen, anticipated or unanticipated, that such party now owns, holds, has or claims to have, or owned at any time, held, had or claimed to have had or may come to own, hold, have or claim to have against the other party and the other party’s Related Parties arising out of or relating to the Agreements (or any of them) based on any acts, events or circumstances that occurred prior to the execution hereof. Notwithstanding the foregoing, no party is releasing, acquitting, discharging, waiving, or relinquishing any claims arising out of or relating to the parties’ rights and obligations as preserved, amended, or created by this Letter Agreement or the Suite License Agreement.

b.Unknown Claims. Each of the parties hereby (i) represents, warrants and acknowledges that such party has had, or has had and waived, the opportunity to be advised by independent legal counsel as to the contents of Section 1542 of the California Civil Code (and any analogous law of any other state, locality or other jurisdiction) and (ii) expressly waives the benefits and protections thereof and any rights such party may have thereunder. Section 1542 of the California Civil Code provides as follows:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS (1) THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, (2) WHICH IF KNOWN BY HIM OR HER, (3) WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.

Each of the parties understands and acknowledges the significance and consequence of its specific waiver of Section 1542 of the Civil Code of the State of California and in the event that any releases become effective pursuant to this Letter Agreement, hereby assumes full responsibility for any injuries, damages, and losses which it may incur as a result of its waiver of Section 1542 of the California Civil Code.

7.Mutual Waivers. Except as contemplated by this Letter Agreement and/or the Suite License Agreement, each party hereby waives any right to terminate the Agreements (or any of them), exercise any remedies under the Agreements (or any of them) or bring a breach claim under the Agreements (or any of them), in each case based on any acts, events or circumstances that occurred prior to the execution hereof.

8.Indemnification.

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CONFIDENTIAL		EXECUTION COPY

a.LAFC Indemnification. LAFC hereby jointly and severally agrees to indemnify, defend and hold harmless BOC, BOC’s subsidiaries and affiliates, and their respective shareholders, members, directors, officers, servants, agents and employees (the “BOC Indemnitees”) from and against any and all liabilities, obligations, losses, damages, penalties, actions, suits and proceedings, including legal expenses and reasonable attorneys’ fees (the “Demand(s)”), of any kind and nature, imposed on, incurred by or asserted against the BOC Indemnitees (or any of them) arising directly or indirectly out of or in connection with any breach by any party hereto (other than BOC) of any covenant or warranty contained herein; but excluding therefrom any liability arising from the contribution thereto by the negligent or willful actions or omissions of the BOC Indemnitees (or any of them).

b.BOC Indemnification. BOC hereby agrees to indemnify, defend and hold harmless the parties hereto (other than BOC), MLS, and their respective subsidiaries and affiliates (including for indemnification purposes, Soccer United Marketing), and their respective shareholders, members, directors, officers, servants, agents and employees (collectively, the “LAFC Indemnitees”), from and against any and all Demands of any kind and nature, imposed on, incurred by or asserted against the LAFC Indemnitees (or any of them) arising directly or indirectly out of or in connection with any breach by BOC of any covenant or warranty contained herein; but excluding therefrom any liability arising from the contribution thereto by the negligent or willful actions or omissions of the LAFC Indemnitees (or any of them).

c.Indemnification Procedure. Each party agrees that, once the party seeking indemnification learns of any such Demand, the indemnified party will give the indemnifying party prompt written notice of any allegation and institution of any such suit; provided, however, that the right of a person or entity to be indemnified hereunder shall not be adversely affected by a failure to give such notice unless, and then only to the extent that, an indemnifying party is actually irrevocably and materially prejudiced thereby. The indemnified party will permit the indemnifying party, through competent counsel of its own choosing, to defend any such suit, provided that the indemnifying party will on a regular basis provide the indemnified party with full, complete information and updates relating to such suit and will not enter into any settlement or compromise related thereto without the indemnified party’s prior written consent.

9.Representations and Warranties. LAFC represents, warrants and agrees that LAFC has obtained all permits, consents, waivers, approvals and/or authorizations of, and has made all declarations to and/or filings or registrations with, any government or third party, including without limitation the MLS, SUM and the Lenders, which is required in connection with the execution, delivery and/or performance of this Letter Agreement and/or the Suite License Agreement. Each of the parties respectively represents, warrants and agrees that it:

a.has the full right and authority to enter into and fully perform this Letter Agreement in accordance with its terms without any further approval, and this Letter Agreement has been

8

CONFIDENTIAL		EXECUTION COPY

duly authorized, executed and delivered by such party and represents the valid and binding agreement of such party enforceable in accordance with its terms, except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally, and (ii) general principles of equity;

b.has received independent legal advice from its attorneys (if it so desires) with respect to the advisability of making this Letter Agreement, and such party is entering into this Letter Agreement voluntarily;

c.is under no obligation or restriction, and will not enter into any agreement or arrangement containing any obligation or restriction, that would in any way interfere or conflict with its performance hereunder;

d.is the sole and lawful owner of all right, title, and interest in and to every claim and other matter released and/or conferred by such party pursuant to this Letter Agreement, and that such party has not heretofore assigned or transferred, or purported to assign or transfer, to any person or entity, any claims or other matters herein released and/or conferred by such party; and

e.has made such investigation of the facts pertaining to this Letter Agreement and of all other matters pertaining hereto as it deems necessary.

10.Confidentiality. Each party is hereby authorized to issue a press release in substantially the form of Exhibit A hereto (the “Approved Press Release”). Otherwise, no party may issue a press release or make a public statement regarding this Letter Agreement, the Suite License Agreement, any of the Agreements or the subject matter hereof or thereof providing any information which is not provided in the Approved Press Release without the other party’s prior written approval. No party will disclose or communicate to anyone (other than such party’s directors, officers, employees, attorneys, advisors and/or representatives who agree to keep such information confidential in accordance with the terms of this Letter Agreement) any information regarding this Letter Agreement, the Suite License Agreement, any of the Agreements or the subject matter hereof or thereof, except as otherwise specifically permitted by this Letter Agreement or unless otherwise, on the advice of counsel, determined by such party in good faith as being required under applicable law, statute, court order and/or governmental rule or regulation (including under the Securities Act of 1933 (as amended), the Securities Exchange Act of 1934 (as amended), the regulations promulgated thereunder, and/or the rules of any applicable stock exchange), or as otherwise necessary to fulfill any obligations hereunder; provided that prior to making any disclosure so required by applicable laws, statutes, court orders and governmental rules or regulations (including the Securities Act of 1933 (as amended), the Securities Exchange Act of 1934 (as amended), the regulations promulgated thereunder, and/or the rules of any applicable stock exchange), the disclosing party shall, to the extent legally permissible, provide written notice of such legal requirement to the other party as soon as reasonably practicable and provide the other party with a reasonable opportunity to review the proposed disclosure (or the portion thereof to

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CONFIDENTIAL		EXECUTION COPY

which this Paragraph 10 relates). Notwithstanding anything to the contrary set forth above, subject to Paragraph 11 hereof, nothing herein will prohibit LAFC from making any disclosure to the Lenders, MLS and/or SUM.

11.Non-Disparagement. Effective as of the date hereof, no party nor any of its affiliates (nor any of their respective employees, officers, directors, managers, shareholders, members, agents, and/or representatives) will make (or encourage or expressly permit) any disparaging public, press or other external statements (including, without limitation, website postings) or releases (including “background” and/or “off-the-record” communications) about the other party, any of the other party’s affiliates or any of their respective officers, directors, managers, shareholders, members, employees, agents and/or representatives related to the performance or breach of this Letter Agreement, the Suite License Agreement or any of the Agreements. For the avoidance of doubt, nothing in this Paragraph 11 will be deemed to apply to any statements made in any court, regulatory, arbitration or similar proceeding or to address or correct any misstatement made in any public forum, in each case which are not made with the primary intent to disparage.

12.Notices. Any notices, documents, statements, demands, requests or other communications (each a “notice”) that any party desires or is required to give to or serve on the other party pursuant to this Letter Agreement or any of the Agreements will be in writing and will be delivered by personal or mail delivery (postage prepaid, registered mail, return receipt requested), by overnight courier, or by email to the parties at the addresses given below or to such other address as a party may hereafter designate in writing in the manner provided for herein. Any notice delivered in accordance with the terms of this Letter Agreement which relates to this Letter Agreement or any of the Agreements will be deemed to satisfy Section 11.G. of the Naming Rights Agreement, Section 12.M. of the Sponsor Agreement, Section 9.E. of the Community Engagement Agreement, Section 19(d). of Exhibit E to the Existing Suite Agreement and Section 13.2 of the ATM Sublease Agreement. Any such notice will be deemed given on the date of personal delivery or email (in the case of email, subject to proof of confirmation of transmission), the day after such notice is deposited with an overnight courier service, or three days after such notice is deposited with the United States Mail Service, as applicable. All such notices will be addressed as follows (or to such other address for a party as shall be directed by such party from time to time hereafter by notice delivered in accordance with the terms of this Letter Agreement):

a.If to LAFC or any other party hereto other than BOC:

i.LAFC Sports, LLC

818 W. 7^th Street #1200

Los Angeles, California 90017

Attn: General Counsel

Email: lafclegal@lafc.com

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CONFIDENTIAL		EXECUTION COPY

b.If to BOC:

i.Banc of California, National Association

3 MacArthur Place

Santa Ana, CA 92707

Attn: Ido Dotan

Email: ido.dotan@bancofcal.com

13.Further Assurances. Each party agrees to cooperate fully and to execute any and all supplementary documents (including the Suite License Agreement) and to take all additional actions that may be necessary or appropriate to give full force to the basic terms and intent of this Letter Agreement and which are not inconsistent with its terms.

14.Costs. Each party shall bear its own costs, expenses and attorneys’ fees in connection with the preparation and negotiation of this Letter Agreement.

15.Governing Law. This Letter Agreement shall be governed by and construed in accordance with the laws of the State of California, without reference to conflicts of law principles.

16.Dispute Resolution; Arbitration. The parties agree that any dispute, claim, question or controversy between BOC, on the one hand, and any or all of the other parties hereto, on the other hand, arising from or relating to this Letter Agreement, its construction, operation or effect, or a breach thereof (the “Dispute(s)”) that cannot be resolved through good faith consultation and negotiation of BOC and such other party or parties within 30 days of the commencement of such consultation and negotiation (or the attempt by a party to commence such consultation and negotiation) shall be finally resolved exclusively by binding arbitration administered by a single arbitrator of JAMS, or its successor, in accordance with the JAMS Comprehensive Arbitration Rules & Procedures in effect as of the date of this Letter Agreement and taking place in Los Angeles, California. The parties further agree that the arbitrator, and not a court, will have exclusive jurisdiction to decide all questions of arbitrability, including as to questions regarding the formation, validity and enforceability of this Letter Agreement and/or this Paragraph 16. Any judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction. Except as required by law, neither any party nor the arbitrator may disclose the existence, content, results or award of any arbitration without the prior written consent of all parties. The arbitrator will have no authority to award punitive or other damages not measured by the prevailing party’s actual damages. Each party shall bear its own costs and expenses, including attorneys’ fees, and an equal share of the arbitrators’ and administrative fees of arbitration. The parties expressly waive the right to resolve any Dispute through any other means, including by a jury trial. This dispute resolution provision cannot be modified except in a written agreement signed by all parties hereto with specific reference to this arbitration provision and the intent to modify or amend it. THE PARTIES EACH UNDERSTAND AND AGREE THAT THE PARTIES ARE ELECTING TO RESOLVE ANY DISPUTE UNDER THIS LETTER AGREEMENT THROUGH ARBITRATION AND ARE WAIVING THEIR RIGHT TO A JURY TRIAL.

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17.Neutral Construction. Each party hereby acknowledges and agrees that it has read, understood and approved this Letter Agreement and has been fully and competently represented by (and has consulted with) independent legal counsel of its own choosing in the negotiation and drafting of this Letter Agreement. Accordingly, each party hereby acknowledges and agrees that any rule of construction of contracts resolving any ambiguities against the drafting party shall be inapplicable to this Letter Agreement. Each party further acknowledges and agrees that it has entered into this Letter Agreement with the intent to be legally bound to the terms hereof.

18.Successors and Assigns. This Letter Agreement will bind and inure to the benefit of the parties hereto and their respective successors, permitted assigns, heirs, administrators, executors, personal representatives and conservators. No party may assign this Letter Agreement or any of its obligations under this Letter Agreement to any other person or entity without the prior written consent of the other party hereto. Notwithstanding the foregoing, (a) BOC may assign this Letter Agreement in its entirety to its parent company, Banc of California, Inc., a Maryland corporation, without the prior written consent of any party hereto (other than BOC) and (b) LAFC may (i) assign its rights and obligations under this Letter Agreement to MLS, SUM or any entity controlling, controlled by or under common control with LAFC, (ii) assign its right to receive payments hereunder, in whole or in part, to any person or entity and (iii) pledge or assign any of its rights under this Letter Agreement to lenders or financiers as security or as required by financing arrangements entered into by LAFC or its affiliates, in each case so long as LAFC is not relieved of any obligations hereunder in connection therewith and without the prior written consent of BOC.

19.Severability. If any part of this Letter Agreement is void or otherwise invalid, such invalid or void portion will be deemed to be separate and severable from the balance of this Letter Agreement, and this Letter Agreement will be given full force and effect as though the void or invalid provisions had never been a part of this Letter Agreement.

20.Amendment. This Letter Agreement may not be amended, modified or terminated, in whole or in part, except by an instrument in writing duly executed by all parties.

21.Counterparts. This Letter Agreement may be executed in any number of counterparts. Each counterpart shall constitute an original, but all of the counterparts together shall constitute one and the same instrument. Any signature page delivered electronically shall be binding to the same extent as an original signature page.

22.No Third Party Beneficiaries. Except as set forth in Paragraphs 6 and 8 hereof, this Agreement is for the sole benefit of the parties and their permitted assigns, and nothing herein expressed or implied shall give or be construed to give any person or entity, other than the parties and such permitted assigns, any legal or equitable rights hereunder.

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23.Entire Agreement. The Agreements, as further amended by this Letter Agreement, constitute the entire understanding of the parties with respect to the subject matter hereof and thereof, and any other prior or contemporaneous agreements, whether written or oral, with respect thereto are expressly superseded hereby and thereby.

[Signature Page to Follow]

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CONFIDENTIAL		EXECUTION COPY

        If the foregoing correctly reflects our agreement, please so indicate by signing in the space provided below.       

              Yours sincerely,

              LAFC Sports, LLC  

              By: /s/ Tom Penn   

              Its:  President   

              LAFC StadiumCo, LLC

              By: /s/ Tom Penn   

              Its:  President   

LAFC Partners, LLLP

              By: /s/ Tom Penn   

              Its:  President   

              LAFC Sports Foundation

              By: /s/ Tom Penn   

              Its:  Board Officer   

              LAFC AncillaryCo, LLC

              By: /s/ Tom Penn   

              Its:  President   

ACCEPTED AND AGREED:

Banc of California, National Association

By: /s/ Lynn M. Hopkins 

Its: CFO   

14

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Jared Wolff, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Banc of California, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	August 7, 2020	/s/ Jared Wolff
		Jared Wolff
		President/Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Lynn M. Hopkins, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Banc of California, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	August 7, 2020	/s/ Lynn M. Hopkins
		Lynn M. Hopkins
		Executive Vice President/Chief Financial Officer (Principal Financial Officer)

EX-32

Exhibit 32.0

SECTION 1350 CERTIFICATION

Each of the undersigned hereby certifies in his capacity as an officer of Banc of California, Inc. (“the Company”) that this Quarterly Report of the Company on Form 10-Q for the quarter ended June 30, 2020 fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and that the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods presented in the financial statements included in such report.

Date:	August 7, 2020	/s/ Jared Wolff
		Jared Wolff
		President/Chief Executive Officer (Principal Executive Officer)
Date:	August 7, 2020	/s/ Lynn M. Hopkins
		Lynn Hopkins
		Executive Vice President/Chief Financial Officer (Principal Financial Officer)

XML

Cover Page - shares	6 Months Ended
	Jun. 30, 2020	Aug. 03, 2020
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2020
Document Transition Report	false
Entity File Number	001-35522
Entity Registrant Name	BANC OF CALIFORNIA, INC.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	04-3639825
Entity Address, Address Line One	3 MacArthur Place
Entity Address, City or Town	Santa Ana
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92707
City Area Code	855
Local Phone Number	361-2262
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001169770
Current Fiscal Year End Date	--12-31
Amendment Flag	false
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q2
Common Stock
Document Information [Line Items]
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	BANC
Security Exchange Name	NYSE
Entity Common Stock, Shares Outstanding		49,754,330
Series D 7.375% non-cumulative perpetual
Document Information [Line Items]
Title of 12(b) Security	Depositary Shares each representing a 1/40th interest in a share of 7.375% Non-Cumulative Perpetual Preferred Stock, Series D
Trading Symbol	BANC PRD
Security Exchange Name	NYSE
Series E 7.00% non-cumulative perpetual
Document Information [Line Items]
Title of 12(b) Security	Depositary Shares each representing a 1/40th interest in a share of 7.00% Non-Cumulative Perpetual Preferred Stock, Series E
Trading Symbol	BANC PRE
Security Exchange Name	NYSE
Class B Non-Voting Non-Convertible Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		477,321

XML

Consolidated Statements of Financial Condition - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
ASSETS
Cash and due from banks	$ 23,394	$ 28,890
Interest-earning deposits in financial institutions	397,246	344,582
Total cash and cash equivalents	420,640	373,472
Securities available-for-sale, at fair value	1,176,029	912,580
Loans held-for-sale, carried at fair value	19,768	22,642
Loans receivable	5,627,696	5,951,885
Allowance for credit losses - loans	(90,370)	(57,649)
Loans receivable, net	5,537,326	5,894,236
Federal Home Loan Bank and other bank stock, at cost	46,585	59,420
Premises, equipment, net	125,247	128,021
Bank owned life insurance	110,487	109,819
Operating lease right-of-use assets	19,408	22,540
Investments in alternative energy partnerships, net	26,967	29,300
Deferred income taxes, net	48,288	44,906
Income tax receivable	13,094	4,233
Goodwill	37,144	37,144
Other intangible assets, net	3,292	4,151
Other assets	185,863	185,946
Total assets	7,770,138	7,828,410
LIABILITIES AND STOCKHOLDERS’ EQUITY
Noninterest-bearing deposits	1,391,504	1,088,516
Interest-bearing deposits	4,645,961	4,338,651
Total deposits	6,037,465	5,427,167
Federal Home Loan Bank advances, net	617,170	1,195,000
Long-term debt, net	173,537	173,421
Reserve for loss on repurchased loans	5,567	6,201
Operating lease liabilities	20,531	23,692
Accrued expenses and other liabilities	68,909	95,684
Total liabilities	6,923,179	6,921,165
Commitments and contingent liabilities
Preferred stock	185,037	189,825
Additional paid-in capital	632,117	629,848
Retained earnings	85,670	127,733
Treasury stock, at cost (2,410,964 and 1,583,380 shares at June 30, 2020 and December 31, 2019)	(40,827)	(28,786)
Accumulated other comprehensive loss, net	(15,565)	(11,900)
Total stockholders’ equity	846,959	907,245
Total liabilities and stockholders’ equity	7,770,138	7,828,410
Voting
LIABILITIES AND STOCKHOLDERS’ EQUITY
Common stock	522	520
Class B Common Stock
LIABILITIES AND STOCKHOLDERS’ EQUITY
Common stock	$ 5	$ 5

XML

Consolidated Statements of Financial Condition (Parenthetical) - $ / shares	Jun. 30, 2020	Dec. 31, 2019
Treasury stock (in shares)	2,410,964	1,583,380
Voting
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	446,863,844	446,863,844
Common stock, shares issued (in shares)	52,161,922	51,997,061
Common stock, shares outstanding (in shares)	49,750,958	50,413,681
Class B Common Stock
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	3,136,156	3,136,156
Common stock, shares issued (in shares)	477,321	477,321
Common stock, shares outstanding (in shares)	477,321	477,321

XML

Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Interest and dividend income
Loans, including fees	$ 63,642	$ 65,534	$ 89,159	$ 129,176	$ 179,717
Securities	7,816	7,820	12,457	15,636	30,298
Other interest-earning assets	1,239	1,360	2,424	2,599	4,737
Total interest and dividend income	72,697	74,714	104,040	147,411	214,752
Interest expense
Deposits	10,205	14,611	28,598	24,816	60,041
Federal Home Loan Bank advances	4,818	5,883	8,289	10,701	17,370
Securities sold under repurchase agreements	2	0	16	2	34
Long-term debt and other interest-bearing liabilities	2,357	2,359	2,357	4,716	4,719
Total interest expense	17,382	22,853	39,260	40,235	82,164
Net interest income	55,315	51,861	64,780	107,176	132,588
Provision for (reversal of) credit losses	11,826	15,761	(1,900)	27,587	198
Net interest income after provision for (reversal of) credit losses	43,489	36,100	66,680	79,589	132,390
Noninterest income
Customer service fees	1,224	1,096	1,434	2,320	2,949
Loan servicing income	95	75	121	170	239
Income from bank owned life insurance	591	578	580	1,169	1,105
Net gain on sale of securities available-for-sale	2,011	0	0	2,011	208
Fair value adjustment for loans held-for-sale	25	(1,586)	59	(1,561)	60
Net (loss) gain on sale of loans	0	(27)	2,767	(27)	4,319
Other income (loss)	1,582	1,925	(7,251)	3,507	(4,875)
Total noninterest income (loss)	5,528	2,061	(2,290)	7,589	4,005
Noninterest expense
Salaries and employee benefits	24,260	23,436	27,506	47,696	55,945
Write-off of other assets related to naming rights termination, net	26,769	0	0	26,769	0
Occupancy and equipment	7,090	7,243	7,955	14,333	15,641
Professional fees	4,596	5,964	(2,903)	10,560	8,138
Data processing	1,536	1,773	1,672	3,309	3,168
Advertising and promotion	1,157	1,756	2,048	2,913	4,105
Regulatory assessments	725	484	2,136	1,209	4,618
(Gain) loss on investments in alternative energy partnerships	(167)	1,905	(355)	1,738	1,595
Reversal of provision for loan repurchases	(34)	(600)	(61)	(634)	(177)
Amortization of intangible assets	430	429	621	859	1,241
Restructuring (reversal) expense	0	0	(158)	0	2,637
All other expense	6,408	4,529	5,039	10,937	8,838
Total noninterest expense	72,770	46,919	43,500	119,689	105,749
(Loss) income from operations before income taxes	(23,753)	(8,758)	20,890	(32,511)	30,646
Income tax (benefit) expense	(5,304)	(2,165)	4,308	(7,469)	7,027
Net (loss) income	(18,449)	(6,593)	16,582	(25,042)	23,619
Preferred stock dividends	3,442	3,533	4,308	6,975	8,616
Income allocated to participating securities	0	0	271	0	153
Participating securities dividends	94	94	94	188	295
Impact of preferred stock redemption	(49)	(526)	0	(575)	0
Net (loss) income available to common stockholders	(21,936)	$ (9,694)	11,909	(31,630)	14,555
Voting
Noninterest expense
Preferred stock dividends	3,409		4,268	6,909	8,535
Income allocated to participating securities			268		152
Participating securities dividends	93		$ 93	186	$ 292
Impact of preferred stock redemption	$ (49)			$ (570)
(Loss) earnings per common share:
Basic (in usd per share)	$ (0.44)	$ (0.19)	$ 0.23	$ (0.63)	$ 0.29
Diluted (loss) earnings per common share
Diluted (in usd per share)	$ (0.44)	(0.19)	$ 0.23	$ (0.63)	$ 0.29
Class B Common Stock
Noninterest expense
Preferred stock dividends	$ 33		$ 40	$ 66	$ 81
Income allocated to participating securities			3		1
Participating securities dividends	1		$ 1	2	$ 3
Impact of preferred stock redemption	$ 0			$ (5)
(Loss) earnings per common share:
Basic (in usd per share)	$ (0.44)	(0.19)	$ 0.23	$ (0.63)	$ 0.29
Diluted (loss) earnings per common share
Diluted (in usd per share)	$ (0.44)	$ (0.19)	$ 0.23	$ (0.63)	$ 0.29

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Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Statement of Comprehensive Income [Abstract]
Net (loss) income	$ (18,449)	$ (6,593)	$ 16,582	$ (25,042)	$ 23,619
Unrealized gain (loss) on available-for-sale securities:
Unrealized gain (loss) arising during the period	40,002	(42,248)	5,423	(2,246)	11,596
Reclassification adjustment for (gain) loss included in net (loss) income	(1,419)	0	0	(1,419)	(147)
Total change in unrealized gain (loss) on available-for-sale securities	38,583	(42,248)	5,423	(3,665)	11,449
Total other comprehensive income (loss)	38,583	(42,248)	5,423	(3,665)	11,449
Comprehensive income (loss)	$ 20,134	$ (48,841)	$ 22,005	$ (28,707)	$ 35,068

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Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Total	Preferred Stock	Common Stock Voting	Common Stock Class B Common Stock	Additional Paid-in Capital	Retained Earnings	Treasury Stock	Accumulated Other Comprehensive Loss	Impact of ASC 326 Adoption	Impact of ASC 326 Adoption Retained Earnings
Beginning Balance at Dec. 31, 2018	$ 945,534	$ 231,128	$ 518	$ 5	$ 625,834	$ 140,952	$ (28,786)	$ (24,117)
Comprehensive income (loss):
Net (loss) income	23,619					23,619
Other comprehensive income (loss), net	11,449							11,449
Issuance of common stock	0		2		(2)
Share-based compensation expense	2,350				2,350
Restricted stock surrendered due to employee tax liability	(876)				(876)
Shares purchased under the Dividend Reinvestment Plan	(76)				0	(76)
Stock appreciation right dividend equivalents	(296)					(296)
Dividends declared	(9,544)					(9,544)
Preferred stock dividends	(8,616)					(8,616)
Ending Balance at Jun. 30, 2019	963,544	231,128	520	5	627,306	146,039	(28,786)	(12,668)
Beginning Balance at Dec. 31, 2018	945,534	231,128	518	5	625,834	140,952	(28,786)	(24,117)
Ending Balance at Dec. 31, 2019	$ 907,245	189,825	520	5	629,848	127,733	(28,786)	(11,900)	$ (4,503)	$ (4,503)
Comprehensive income (loss):
Accounting Standards Update [Extensible List]	us-gaap:AccountingStandardsUpdate201613Member
Beginning Balance at Mar. 31, 2019	$ 948,325	231,128	518	5	626,608	136,943	(28,786)	(18,091)
Comprehensive income (loss):
Net (loss) income	16,582					16,582
Other comprehensive income (loss), net	5,423							5,423
Issuance of common stock	0		2		(2)
Share-based compensation expense	1,497				1,497
Restricted stock surrendered due to employee tax liability	(797)				(797)
Shares purchased under the Dividend Reinvestment Plan	(26)				0	(26)
Stock appreciation right dividend equivalents	(94)					(94)
Dividends declared	(3,058)					(3,058)
Preferred stock dividends	(4,308)					(4,308)
Ending Balance at Jun. 30, 2019	963,544	231,128	520	5	627,306	146,039	(28,786)	(12,668)
Beginning Balance at Dec. 31, 2019	907,245	189,825	520	5	629,848	127,733	(28,786)	(11,900)	(4,503)	(4,503)
Comprehensive income (loss):
Net (loss) income	(6,593)
Other comprehensive income (loss), net	(42,248)
Ending Balance at Mar. 31, 2020	835,002	187,687	520	5	631,125	110,640	(40,827)	(54,148)
Beginning Balance at Dec. 31, 2019	907,245	189,825	520	5	629,848	127,733	(28,786)	(11,900)	$ (4,503)	$ (4,503)
Comprehensive income (loss):
Net (loss) income	(25,042)					(25,042)
Other comprehensive income (loss), net	(3,665)							(3,665)
Issuance of common stock	0		2		(2)
Redemption of preferred stock	(4,213)	(4,788)				575
Purchase of treasury shares	(12,041)						(12,041)
Share-based compensation expense	3,046				3,046
Restricted stock surrendered due to employee tax liability	(775)				(775)
Shares purchased under the Dividend Reinvestment Plan	(47)					(47)
Stock appreciation right dividend equivalents	(188)					(188)
Dividends declared	(5,883)					(5,883)
Preferred stock dividends	(6,975)					(6,975)
Ending Balance at Jun. 30, 2020	$ 846,959	185,037	522	5	632,117	85,670	(40,827)	(15,565)
Comprehensive income (loss):
Accounting Standards Update [Extensible List]	us-gaap:AccountingStandardsUpdate201613Member
Beginning Balance at Mar. 31, 2020	$ 835,002	187,687	520	5	631,125	110,640	(40,827)	(54,148)
Comprehensive income (loss):
Net (loss) income	(18,449)					(18,449)
Other comprehensive income (loss), net	38,583							38,583
Issuance of common stock	0		2		(2)
Redemption of preferred stock	(2,601)	(2,650)				49
Share-based compensation expense	1,470				1,470
Restricted stock surrendered due to employee tax liability	(476)				(476)
Shares purchased under the Dividend Reinvestment Plan	(28)					(28)
Stock appreciation right dividend equivalents	(94)					(94)
Dividends declared	(3,006)					(3,006)
Preferred stock dividends	(3,442)					(3,442)
Ending Balance at Jun. 30, 2020	$ 846,959	$ 185,037	$ 522	$ 5	$ 632,117	$ 85,670	$ (40,827)	$ (15,565)

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Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Statement of Stockholders' Equity [Abstract]
Dividends declared, per common share (in dollars per share)	$ 0.06	$ 0.06	$ 0.12	$ 0.19
Shares repurchased (shares)			827,584

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Cash flows from operating activities:
Net (loss) income	$ (25,042)	$ 23,619
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities
Provision for credit losses	27,587	198
Reversal of provision for loan repurchases	(634)	(177)
Depreciation on premises and equipment	8,404	5,290
Amortization of intangible assets	859	1,241
Amortization of debt issuance costs	139	83
Net amortization of premium on securities	258	649
Net amortization of deferred loan costs and fees	(553)	83
Accretion of discounts on purchased loans	(355)	(125)
Write-off of other assets related to naming rights termination, net	6,669	0
Write-off of other assets related to naming rights termination, net	26,769	0
Debt extinguishment fee	2,515	0
Deferred income tax (benefit) expense	(71)	1,841
Bank owned life insurance income	(1,169)	(1,105)
Share-based compensation expense	3,046	2,350
Loss on interest rate swaps	288	9,583
Loss on investments in alternative energy partnerships and affordable housing investments	4,033	2,785
Impairment on capitalized software projects	157	835
Fair value adjustment for loans held-for-sale	1,561	(60)
Net loss (gain) on sale of loans	27	(4,319)
Net gain on sale of securities available-for-sale	(2,011)	(208)
Loss on sale or disposal of property and equipment	106	9
Repurchase of mortgage loans	0	(699)
Proceeds from sales of and principal collected on loans held-for-sale	613	3,849
Proceeds from sales of and principal collected on other loans held-for-sale	0	426
Change in accrued interest receivable and other assets	1,119	(14,593)
Change in accrued interest payable and other liabilities	(30,093)	(5,341)
Net cash (used in) provided by operating activities	(2,547)	26,214
Cash flows from investing activities:
Proceeds from sales of securities available-for-sale	22,728	782,019
Proceeds from maturities and calls of securities available-for-sale	30,000	38,029
Proceeds from principal repayments of securities available-for-sale	2,971	20,538
Purchases of securities available-for-sale	(322,590)	0
Cash received from bank-owned life insurance	501	0
Loan originations and principal collections, net	349,818	(149,182)
Purchase of loans and leases	(25,839)	0
Redemption of Federal Home Loan Bank stock	22,171	29,760
Purchase of Federal Home Loan Bank and other bank stock	(9,336)	(38,039)
Proceeds from sale of loans	0	558,021
Proceeds from sale of other real estate owned	0	551
Purchases of premises and equipment	(3,467)	(5,967)
Payments of capital lease obligations	(266)	(259)
Funding of equity investment	(14,201)	(1,501)
(Increase) decrease in investments in alternative energy partnerships	(2,630)	760
Net cash provided by investing activities	49,860	1,234,730
Cash flows provided by (used in) financing activities:
Net increase (decrease) in deposits	610,298	(1,624,354)
Net (decrease) increase in short-term Federal Home Loan Bank advances	(447,000)	305,000
Repayment of long-term Federal Home Loan Bank advances	(235,000)	0
Proceeds from long-term Federal Home Loan Bank advances	111,000	0
Debt extinguishment and financing fees paid	(9,368)	0
Redemption of preferred stock	(4,213)	0
Purchase of treasury stock	(12,041)	0
Purchase of restricted stock surrendered due to employee tax liability	(775)	(876)
Dividend equivalents paid on stock appreciation rights	(188)	(296)
Dividends paid on preferred stock	(6,975)	(8,616)
Dividends paid on common stock	(5,883)	(9,544)
Net cash used in financing activities	(145)	(1,338,686)
Net change in cash and cash equivalents	47,168	(77,742)
Cash and cash equivalents at beginning of period	373,472	391,592
Cash and cash equivalents at end of period	420,640	313,850
Supplemental cash flow information
Interest paid on deposits and borrowed funds	40,626	85,733
Income taxes paid	62	2,822
Income taxes refunds received	0	7
Supplemental disclosure of non-cash activities
Transfer from loans to other real estate owned, net	0	276
Transfer of loans held-for-investment to loans held-for-sale	0	1,127,339
Equipment acquired under capital leases	30	40
Operating lease right-of-use assets recognized	0	27,421
Operating lease liabilities recognized	0	28,822
Impact of adoption of ASU 2016-13 on retained earnings	$ 846,959	$ 963,544

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations: Banc of California, Inc. (collectively, with its consolidated subsidiaries, the Company, we, us, and our) is a financial holding company under the Bank Holding Company Act of 1956, as amended, headquartered in Santa Ana, California and incorporated under the laws of Maryland. Banc of California, Inc. is subject to regulation by the Board of Governors of the Federal Reserve System (“FRB”) and its wholly-owned subsidiary, Banc of California, National Association (the Bank), operates under a national bank charter issued by the Office of the Comptroller of the Currency (“OCC”), the Bank's primary regulator. The Bank is a member of the Federal Home Loan Bank (“FHLB”) system, and maintains insurance on deposit accounts with the Federal Deposit Insurance Corporation (“FDIC”).

The Bank offers a variety of financial services to meet the banking and financial needs of the communities it serves, with operations conducted through 31 full-service branches located throughout Southern California as of June 30, 2020.

Basis of Presentation: The accompanying unaudited interim consolidated financial statements have been prepared pursuant to Article 10 of SEC Regulation S-X and other SEC rules and regulations for reporting on the Quarterly Report on Form 10-Q. Accordingly, certain disclosures required by U.S. generally accepted accounting principles (“GAAP”) are not included herein. These interim statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report on Form 10-K for the year ended December 31, 2019 filed by us with the SEC. The December 31, 2019 consolidated statements of financial condition presented herein has been derived from the audited financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC. Certain prior period amounts have been reclassified to conform to current period presentation, including i) reclassification of the provision for losses on unfunded loan commitments from being included in other noninterest expense to being included within provision for credit losses, ii) showing the unrealized fair value adjustment for loans held-for-sale separate from the realized net (loss) gain on sale of loans, and iii) reclassification of outside services expense from "outside services fees" to "all other expense" in the consolidated statements of operations.

In the opinion of management of the Company, the accompanying unaudited interim consolidated financial statements reflect all of the adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the consolidated financial condition and consolidated results of operations as of the dates and for the periods presented. The results of operations for the three and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020.

Principles of Consolidation: The accompanying unaudited consolidated financial statements include the accounts of the Company and its consolidated subsidiaries as of June 30, 2020 and December 31, 2019 and for the three and six months ended June 30, 2020 and 2019. Significant intercompany accounts and transactions have been eliminated in consolidation. Unless the context requires otherwise, all references to the Company include its then wholly-owned subsidiaries.

Adopted Accounting Pronouncements:

On January 1, 2020, we adopted Accounting Standards Update (“ASU”) 2016-13, Financial Instruments-Credit Losses (Topic 326) (“ASU 2016-13”), which replaces the incurred loss impairment methodology with a methodology that reflects current expected credit losses (“CECL”) and requires consideration of a broader range of reasonable and supportable information to estimate expected credit losses. The measurement of expected credit losses under the CECL model is applicable to financial assets measured at amortized cost, including loan receivables, held-to-maturity debt securities and off-balance sheet credit exposures. ASU 2016-13 also requires credit losses relating to available-for-sale debt securities to be recorded through an allowance for credit losses. In addition, ASU 2016-13 modifies the other-than-temporary impairment (“OTTI”) model for available-for-sale (“AFS”) debt securities to require an allowance for credit impairment instead of a direct write-down, which allows for reversal of credit impairments in future periods based on improvements in credit quality.

We adopted ASU 2016-13 using the modified retrospective method for our financial assets measured at cost, including loans receivable and off-balance sheet credit exposures. Results for reporting periods beginning January 1, 2020 are reported under ASU 2016-13 (or Accounting Standards Codification 326), while prior period results continue to be reported under the previously applicable GAAP. The adoption of ASU 2016-13 on January 1, 2020 resulted in an increase of $6.4 million to our allowance for credit losses and an after-tax net decrease in retained earnings of $4.5 million. This transition adjustment reflects the development of our models to estimate lifetime expected credit losses on our loans, unfunded commitments, and other off-balance sheet credit exposure primarily using a lifetime loss methodology.

The following table presents the impact of adopting ASU 2016-13 on January 1, 2020:

($ in thousands)	As Reported Under ASC 326		Pre- ASC 326 Adoption		Impact of ASC 326 Adoption
Assets:
Allowance for credit losses - loans
Commercial:
Commercial and industrial	$	23,015	$	22,353	$	662
Commercial real estate	10,788		5,941		4,847
Multifamily	13,214		11,405		1,809
SBA	3,508		3,120		388
Construction	4,009		3,906		103
Consumer:
Single family residential mortgage	10,066		10,486		(420)
Other consumer	658		438		220
Total	65,258		57,649		7,609
Liabilities:
Allowance for credit losses - unfunded loan commitments	$	2,838	$	4,064	$	(1,226)

Significant Accounting Policies: The accounting and reporting policies of the Company are based upon GAAP and conform to predominant practices within the banking industry. We have not made any significant changes in our critical accounting policies from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC, except for the accounting for loans and the allowance for credit losses, the allowance for credit losses on unfunded loan commitments, troubled debt restructurings, and available-for-sale debt securities as described below.

Allowance for Credit Losses (ACL): The ACL is a reserve established through a provision for credit loss expense and represents management’s best estimate of the net amount expected to be collected from loans receivable as of the date of the consolidated statements of financial condition. Confirmed losses are charged against the ACL. Subsequent recoveries, if any, are credited to the ACL. We perform an analysis of the adequacy of the ACL at least quarterly. Management estimates the required ACL balance using past loan loss experience, the nature and volume of the portfolio, information about specific borrower situations, estimated collateral values, economic conditions, and other factors. The ACL consists of; (i) a specific allowance established for probable losses on individually identified impaired loans, (ii) a quantitative allowance for current expected loan losses based on the portfolio and expected economic conditions over a reasonable and supportable forecast period that reverts back to long-term trends to cover the life of loan; and (iii) a qualitative allowance to capture factors and trends that are not adequately reflected in the quantitative allowance, including an evaluation of our underwriting, other credit-related processes, and other credit risk factors such as concentration risk. Accrued interest is excluded from our expected credit loss estimates.

Expected credit losses are estimated over the contractual term of the loans, adjusted for prepayments, as appropriate. The contractual term excludes expected extensions and renewals unless those extension or renewal options are included in the underlying contract and we do not have the ability to unconditionally cancel. The contractual term also excludes expected modifications unless management has a reasonable expectation, at the reporting period, that a troubled debt restructuring will be executed.

A loan is deemed impaired when, based on current information and events, it is probable that we will be unable to collect all amounts due according to the contractual terms of the loan agreement. We measure expected credit losses on all impaired loans individually under the guidance of ASC 326, Receivables, primarily through the evaluation of collateral values and estimated cash flows expected to be collected. Cash receipts on impaired loans for which the accrual of interest has been discontinued are applied first to principal and then to interest income. Loans for which the terms have been modified by granting a concession that normally would not be provided and where the borrower is experiencing financial difficulties are considered troubled debt restructurings (“TDRs”) and classified as impaired.

Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls, generally, are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the

borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. The impairment amount on a collateral dependent loan is generally charged-off to the ACL and the impairment amount on a loan, that is not collateral dependent, is set-up as a specific reserve. TDRs are also measured at the present value of estimated future cash flows using the loan’s effective rate at inception or at the fair value of collateral, less costs to sell, if repayment is expected solely from the collateral. For TDRs that subsequently default, we determine the amount of reserve in accordance with the accounting policy for the ACL.

At June 30, 2020, the following loan portfolio segments have been identified:

•Commercial and industrial (general commercial and industrial, warehouse lending, and indirect/direct leveraged lending)

•Commercial real estate

•Multifamily

•Small Business Administration (“SBA”)

•Construction

•SFR - 1st deeds of trust (generally SFR mortgage and other)

•Other consumer (HELOC and other)

We categorize loans into risk categories based on relevant information about the ability of borrowers to service their obligations such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. We analyze loans individually by classifying the loans as to credit risk.

Loans secured by multifamily and commercial real estate properties generally involve a greater degree of credit risk than SFR mortgage loans. Because payments on loans secured by multifamily and commercial real estate properties are often dependent on the successful operation or management of the properties, repayment of these loans may be subject to adverse conditions in the real estate market or the economy. Commercial and industrial loans are also considered to have a greater degree of credit risk than SFR mortgage loans due to the fact commercial and industrial loans are typically made on the basis of the borrower’s ability to make repayment from the cash flow of the borrower’s business. As a result, the availability of funds for the repayment of commercial and industrial loans may be substantially dependent on the success of the business itself (which, in turn, is often dependent, in part, upon general economic conditions). SBA loans are similar to commercial and industrial loans, however, they have additional credit enhancement in the form of a guaranty provided by the U.S. Small Business Administration, for up to 85% of the loan amount for loans up to $150 thousand and 75% of the loan amount for loans of more than $150 thousand. SBA loans originated as part of the Paycheck Protection Program (“PPP”) established by the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) have additional credit enhancement provided by the U.S. Small Business Administration for up to 100% of the loan amount. As of June 30, 2020, we funded $240.7 million in PPP loans. During the three months ended June 30, 2020, we collected $7.5 million in fees on PPP loans funded during the quarter, which will be recognized over their estimated life of 9 months. The 9 months estimated life of PPP loans is based on our understanding of our clients' cash use, expected forgiveness probability, and loan forgiveness process. The availability of funds for the repayment of financing may be substantially dependent on the success of the business itself which is often dependent, in part, upon general economic conditions. Consumer loans may have greater risk than SFR mortgage loans given that collection of these loans is dependent on the borrower’s continuing financial stability and, thus, are more likely to be adversely affected by job loss, divorce, illness, or personal bankruptcy.

Green Loans are considered to carry a higher degree of credit risk due to their unique cash flows. Credit risk on this asset class is also managed through the completion of regular third party automated valuation models (“AVMs”) of the underlying collateral and monitoring of the borrower’s usage of this account to determine if the borrower is making monthly payments from external sources or “drawdowns” on their line. In cases where the property values have declined to levels less than the original loan to value (“LTV”) ratios, or other levels deemed prudent by us, we may curtail the line and/or require monthly payments or principal reductions to bring the loan in balance.

On interest only loans, we project future payment changes to determine if there will be a material increase in the required payment and then monitor the loans for possible delinquency. Individual loans are monitored for possible downgrading of risk rating.

Troubled Debt Restructurings: A loan is identified as a TDR when a borrower is experiencing financial difficulties and, for economic or legal reasons related to these difficulties, we grant a concession to the borrower in the restructuring that we would not otherwise consider. We have granted a concession when, as a result of the restructuring to a troubled borrower, we do not expect to collect all amounts due, including principal and/or interest accrued at the original terms of the loan. The concessions may be granted in various forms, including a below-market change in the stated interest rate, a reduction in the loan balance or accrued interest, an extension of the maturity date, or a note split with principal forgiveness. Loans for which the borrower has been discharged under Chapter 7 bankruptcy are considered collateral dependent TDRs, impaired at the date of discharge, and

charged down to the fair value of collateral less cost to sell. A restructuring executed at an interest rate that is at market interest rates based on the current credit characteristics of the borrower is not a TDR.

Our policy is to place consumer loan TDRs, except those that were performing prior to TDR status, on non-accrual status for a minimum period of 6 months. Commercial TDRs are evaluated on a case-by-case basis for determination whether or not to place them on non-accrual status. Loans qualify for return to accrual status once they have demonstrated performance under the restructured terms of the loan for a minimum of 6 months. Initially, all TDRs are reported as impaired. Generally, TDRs are classified as impaired loans and reported as TDRs for the remaining life of the loan. Impaired and TDR classification may be removed if the borrower demonstrates compliance with the modified terms for a minimum of 6 months, through one fiscal year-end and the restructuring agreement specifies a market rate of interest equal to that which would be provided to a borrower with similar credit at the time of restructuring. In the limited circumstance that a loan is removed from TDR classification, it is our policy to continue to base our measure of loan impairment on the contractual terms specified by the loan agreement.

Troubled Debt Restructuring (TDR) Relief: Under U.S. GAAP, banks are required to assess modifications to a loan’s terms for potential classification as a TDR. A loan to a borrower experiencing financial difficulty is classified as a TDR when a lender grants a concession that it would otherwise not consider, such as a payment deferral or interest concession. In order to encourage banks to work with impacted borrowers, the CARES Act and U.S. banking regulatory agencies have provided relief from TDR accounting. The main benefits of TDR relief include 1) a capital benefit in the form of reduced risk-weighted assets, as TDRs are more heavily risk-weighted for capital purposes; 2) a delinquency status benefit, as the aging of loans are frozen, i.e., they will continue to be reported in the same delinquency bucket they were in at the time of modification; and 3) a non-accrual status benefit as the loans are generally not reported as non-accrual during the modification period.

Reserve for Unfunded Loan Commitments: The reserve for unfunded loan commitments provides for estimated credit losses for the unused portion of lending commitments expected to be funded, except for unconditionally cancellable commitments for which no reserve is required under ASC 326. The reserve for unfunded loan commitments includes factors that are consistent with ACL methodology for loans using the expected loss factors and a draw down factor applied to the underlying borrower risk and facility grades. Changes in the reserve for unfunded loan commitments are reported as a component of provision for credit losses in the consolidated statements of operations and the reserve for unfunded loan commitments is included in other liabilities in the consolidated statements of financial condition.

Available-for-Sale Debt Securities: Available-for-sale debt securities are analyzed for credit losses under ASC 326, which requires the Company to determine whether impairment exists as of the reporting date and whether that impairment is due to credit losses. An allowance for credit losses is established for losses on available-for-sale debt securities due to credit losses and is reported as a component of provision for credit losses. Accrued interest is excluded from our expected credit loss estimates. Available-for-sale debt securities are typically classified as non-accrual when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about the further collectability of principal or interest. When available-for-sale debt securities are placed on non-accrual status, unpaid interest recognized as interest income is reversed.

Use of Estimates in the Preparation of Financial Statements: The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the consolidated financial statements and disclosures provided, and actual results could differ. The ACL, reserve for loss on repurchased loans, reserve for unfunded loan commitments, realization of deferred tax assets, the valuation of goodwill and other intangible assets, mortgage banking, other derivatives, Hypothetical Liquidation at Book Value (“HLBV”) of investments in alternative energy partnerships, and the fair value measurement of financial instruments are particularly subject to change and such change could have a material effect on the consolidated financial statements.

Recent Accounting Guidance, Not Yet Effective: In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). The amendments in this Update simplify the accounting for income taxes by removing certain exceptions for investments, intra-period allocations, and interim calculations, and add guidance to reduce the complexity of applying Topic 740. This ASU will be effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2020. We will adopt this guidance on January 1, 2021. We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.

In March 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-04, Reference Rate Reform (Topic 848), which provides optional guidance, for a limited period of time, to ease the potential burden in accounting for (or recognizing the benefits of) reference rate reform on financial reporting. The amendments in ASU 2020-04 are elective and apply to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria. When elected, the optional expedients for contract modifications must be applied consistently for all eligible contracts or eligible transactions within the relevant topic or industry subtopic within the

codification that contains the guidance that otherwise would be required to be applied. The amendments in ASU 2020-04 are effective for all entities as of March 12, 2020 through December 31, 2022. We are in the process of evaluating the potential impact the discontinuation of LIBOR will have on our contracts and expect to elect the optional expedients and exceptions set forth in the amendments.

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FAIR VALUES OF FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

FAIR VALUES OF FINANCIAL INSTRUMENTS

FAIR VALUES OF FINANCIAL INSTRUMENTS

Fair Value Hierarchy

ASC 820-10 establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The topic describes three levels of inputs that may be used to measure fair value:

•Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

•Level 2: Significant observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

•Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Assets and Liabilities Measured on a Recurring Basis

Securities Available-for-Sale: The fair values of securities available-for-sale are generally determined by quoted market prices in active markets, if available (Level 1). If quoted market prices are not available, we primarily employ independent pricing services that utilize pricing models to calculate fair value. Such fair value measurements consider observable data such as dealer quotes, market spreads, cash flows, yield curves, live trading levels, trade execution data, market consensus prepayment speeds, credit information, and respective terms and conditions for debt instruments. We employ procedures to monitor the pricing service's assumptions and establish processes to challenge the pricing service's valuations that appear unusual or unexpected. Multiple quotes or prices may be obtained in this process and we determine which fair value is most appropriate based on market information and analysis. Quotes obtained through this process are generally non-binding. We follow established procedures to ensure that assets and liabilities are properly classified in the fair value hierarchy. Level 2 securities include SBA loan pool securities, U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities, non-agency residential mortgage-backed securities, non-agency commercial mortgage-backed securities, collateralized loan obligations, and corporate debt securities. When a market is illiquid or there is a lack of transparency around the inputs to valuation, including at least one unobservable input, the securities are classified as Level 3 and reliance is placed upon internally developed models and management's judgment and evaluation for valuation. We had no securities available-for-sale classified as Level 3 at June 30, 2020 or December 31, 2019.

Loans Held-for-Sale, Carried at Fair Value: The fair value of loans held-for-sale is based on commitments outstanding from investors and current offerings in the secondary market for portfolios with similar characteristics, except for loans that are repurchased out of GNMA loan pools that become severely delinquent which are valued based on an internal model. Loans held-for-sale subject to recurring fair value adjustments are classified as Level 2, or in the case of loans repurchased, Level 3. The fair value includes the servicing value of the loans and any accrued interest.

Derivative Assets and Liabilities:

Interest Rate Swaps and Caps. We offer interest rate swap and cap products to certain loan clients to allow them to hedge the risk of rising interest rates on their variable rate loans. We originate a variable rate loan and enter into a variable-to-fixed interest rate swap with the client. We also enter into an offsetting swap with a correspondent bank. These back-to-back agreements are intended to offset each other and allow us to originate a variable rate loan while providing a contract for fixed interest payments for the client. The net cash flow for us is equal to the interest income received from a variable rate loan originated with the client plus a fee. The fair value of these derivatives is based on a discounted cash flow approach. Due to the observable nature of the inputs used in deriving the fair value of these derivative contracts, the valuation of interest rate swaps is classified as Level 2.

Foreign Exchange Contracts. 

We offer short-term foreign exchange contracts to customers to purchase and/or sell foreign currencies at set rates in the future. These products allow customers to hedge the foreign exchange rate risk of their deposits and loans denominated in foreign currencies. In conjunction with these products, we also enter into offsetting contracts with institutional counterparties to hedge the Company’s foreign exchange rate risk. These back-to-back contracts allow us to offer our customers foreign exchange products while minimizing exposure to foreign exchange rate fluctuations. The fair value of these instruments is determined at each reporting period based on the change in the foreign exchange rate. Given the short-term nature of the contracts, the counterparties’ credit risks are considered nominal and result in no adjustments to the valuation of the short-term foreign exchange contracts. Due to the observable nature of the inputs used in deriving the fair value of these derivative contracts, the valuation of these contracts is classified as Level 2.

The following table presents our financial assets and liabilities measured at fair value on a recurring basis as of the dates indicated:

			Fair Value Measurement Level
($ in thousands)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2020
Assets
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	105,555	$	—	$	105,555	$	—
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	201,136		—		201,136		—
Municipal securities	57,174		—		57,174		—
Non-agency residential mortgage-backed securities	164		—		164		—
Collateralized loan obligations	668,353		—		668,353		—
Corporate debt securities	143,647		—		143,647		—
Loans held-for-sale, carried at fair value	19,768		—		3,083		16,685
Derivative assets:
Interest rate swaps and caps (1)	8,598		—		8,598		—
Foreign exchange contracts (1)	137		—		137		—
Liabilities
Derivative liabilities:
Interest rate swaps and caps (2)	9,239		—		9,239		—
Foreign exchange contracts (2)	54		—		54		—
December 31, 2019
Assets
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	36,456	$	—	$	36,456	$	—
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	91,299		—		91,299		—
Municipal securities	52,689		—		52,689		—
Non-agency residential mortgage-backed securities	196		—		196		—
Collateralized loan obligations	718,361		—		718,361		—
Corporate debt securities	13,579		—		13,579		—
Loans held-for-sale, carried at fair value	22,642		—		3,409		19,233
Derivative assets:
Interest rate swaps and caps (1)	3,445		—		3,445		—
Foreign exchange contracts (1)	138		—		138		—
Liabilities
Derivative liabilities:
Interest rate swaps and caps (2)	3,717		—		3,717		—
Foreign exchange contracts (2)	136		—		136		—

(1)Included in Other assets in the Consolidated Statements of Financial Condition.

(2)Included in Accrued expenses and Other liabilities in the Consolidated Statements of Financial Condition.

The following table presents a reconciliation of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3), on a consolidated operations basis, for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Loans repurchased from GNMA Loan Pools
Balance at beginning of period	$	17,127	$	23,069	$	19,233	$	25,040
Total gains (losses) (realized/unrealized):
Included in earnings—fair value adjustment	22		(6)		(1,369)		(3)
Additions	—		—		—		—
Sales, settlements, and other	(464)		(1,988)		(1,179)		(3,962)
Balance at end of period	$	16,685	$	21,075	$	16,685	$	21,075

Loans repurchased from GNMA loan pools had aggregate unpaid principal balances of $18.6 million and $19.8 million as of June 30, 2020 and December 31, 2019. The significant unobservable inputs used in the fair value measurement of our loans repurchased from GNMA loan pools at June 30, 2020 and December 31, 2019 included an expected loss rate of 1.55% for insured loans and 20.00% for uninsured loans. There may be inherent weaknesses in any calculation technique, and changes in the underlying assumptions used, including discount rates and estimates of future cash flows, could significantly affect the results.

Fair Value Option

Loans Held-for-Sale, Carried at Fair Value: We elected the fair value option for certain SFR mortgage loans held-for-sale. Electing to measure SFR mortgage loans held-for-sale at fair value reduces certain timing differences and better matches changes in the value of these assets with changes in the value of derivatives used as economic hedges for these assets. We also elected to record loans repurchased from GNMA at fair value, as we intend to sell them after curing any defects and, accordingly, they are classified as held-for-sale. Loans previously sold to GNMA that are delinquent more than 90 days are subject to a repurchase option when that condition exists and typically are repurchased by us. To the extent loans are subject to a repurchase option and not repurchased, the loans are re-recognized at fair value and offset by a secured borrowing, as the loans are still legally owned by GNMA. As of June 30, 2020 and December 31, 2019, there were no loans subject to such repurchase option and accordingly no related secured borrowings.

The following table presents the fair value and aggregate principal balance of certain assets, on a consolidated operations basis, under the fair value option:

	June 30, 2020						December 31, 2019
($ in thousands)	Fair Value		Unpaid Principal Balance		Difference		Fair Value		Unpaid Principal Balance		Difference
Loans held-for-sale, carried at fair value:
Total loans	$	19,768	$	22,208	$	(2,440)	$	22,642	$	23,455	$	(813)
Non-accrual loans (1)	6,147		7,244		(1,097)		8,125		8,370		(245)

(1) Includes loans guaranteed by the U.S. government of $4.4 million and $6.7 million at June 30, 2020 and December 31, 2019.

There were no loans held-for-sale that were 90 days or more past due and still accruing interest as of June 30, 2020 and December 31, 2019.

The assets accounted for under the fair value option are initially measured at fair value. Gains and losses from initial measurement and subsequent changes in fair value are recognized in earnings. The following table presents changes in fair value related to initial measurement and subsequent changes in fair value included in earnings for these assets measured at fair value for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Net (losses) gains from fair value changes:
Fair value adjustment for loans held-for-sale	$	25	$	59	$	(1,561)	$	60

Interest income on loans held-for-sale under the fair value option is measured based on the contractual interest rate and reported in interest income on loans, including fees in the consolidated statements of operations.

Assets and Liabilities Measured on a Non-Recurring Basis

Impaired Loans: The fair value of impaired loans with specific allocations of the ACL based on collateral is generally based on recent real estate appraisals and automated valuation models (“AVMs”). These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers for differences between the comparable sales and income data available. Such adjustments are typically deemed significant unobservable inputs used for determining fair value and result in a Level 3 classification.

The following table presents our financial assets and liabilities measured at fair value on a non-recurring basis as of the dates indicated:

			Fair Value Measurement Level
($ in thousands)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2020
Assets
Impaired loans:
Commercial and industrial	$	10,049	$	—	$	—	$	10,049
SBA	664		—		—		664
December 31, 2019
Assets
Impaired loans:
Single family residential mortgage	$	3,678	$	—	$	—	$	3,678
Commercial and industrial	15,409		—		—		15,409
SBA	1,711		—		—		1,711

The following table presents the losses recognized on assets measured at fair value on a non-recurring basis for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Impaired loans:
Single family residential mortgage	$	—	$	—	$	(531)	$	(490)
Commercial and industrial	(6,090)		—		(8,514)		—
SBA	(670)		—		(1,544)		(46)
Other consumer	—		—		(4)		(88)

Estimated Fair Values of Financial Instruments

The following table presents the carrying amounts and estimated fair values of financial assets and liabilities as of the dates indicated:

	Carrying Amount		Fair Value Measurement Level
($ in thousands)			Level 1		Level 2		Level 3		Total
June 30, 2020
Financial assets
Cash and cash equivalents	$	420,640	$	420,640	$	—	$	—	$	420,640
Securities available-for-sale	1,176,029		—		1,176,029		—		1,176,029
Federal Home Loan Bank and other bank stock	46,585		—		46,585		—		46,585
Loans held-for-sale, carried at fair value	19,768		—		3,083		16,685		19,768
Loans receivable, net of allowance for loan losses	5,537,326		—		—		5,642,634		5,642,634
Accrued interest receivable	29,515		29,515		—		—		29,515
Derivative assets	8,735		—		8,735		—		8,735
Financial liabilities
Deposits	6,037,465		—		—		6,042,349		6,042,349
Advances from Federal Home Loan Bank	617,170		—		666,177		—		666,177
Long-term debt	173,537		—		178,030		—		178,030
Derivative liabilities	9,293		—		9,293		—		9,293
Accrued interest payable	4,297		4,297		—		—		4,297
December 31, 2019
Financial assets
Cash and cash equivalents	$	373,472	$	373,472	$	—	$	—	$	373,472
Securities available-for-sale	912,580		—		912,580		—		912,580
Federal Home Loan Bank and other bank stock	59,420		—		59,420		—		59,420
Loans held-for-sale	22,642		—		3,409		19,233		22,642
Loans receivable, net of allowance for credit losses	5,894,236		—		—		5,894,732		5,894,732
Accrued interest receivable	24,523		24,523		—		—		24,523
Derivative assets	3,583		—		3,583		—		3,583
Financial liabilities
Deposits	5,427,167		—		—		5,430,536		5,430,536
Advances from Federal Home Loan Bank	1,195,000		—		1,222,709		—		1,222,709
Long-term debt	173,421		—		180,213		—		180,213
Derivative liabilities	3,853		—		3,853		—		3,853
Accrued interest payable	4,687		4,687		—		—		4,687

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INVESTMENT SECURITIES

6 Months Ended

Jun. 30, 2020

Investments, Debt and Equity Securities [Abstract]

INVESTMENT SECURITIES

INVESTMENT SECURITIES

The following table presents the amortized cost and fair value of the investment securities portfolio as of the dates indicated:

($ in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
June 30, 2020
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	100,128	$	5,427	$	—	$	105,555
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	199,262		1,906		(32)		201,136
Municipal securities	52,973		4,201		—		57,174
Non-agency residential mortgage-backed securities	161		3		—		164
Collateralized loan obligations	703,605		—		(35,252)		668,353
Corporate debt securities	141,962		2,387		(702)		143,647
Total securities available-for-sale	$	1,198,091	$	13,924	$	(35,986)	$	1,176,029
December 31, 2019
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	37,613	$	—	$	(1,157)	$	36,456
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	91,543		16		(260)		91,299
Municipal securities	52,997		51		(359)		52,689
Non-agency residential mortgage-backed securities	191		5		—		196
Collateralized loan obligations	733,605		—		(15,244)		718,361
Corporate debt securities	13,500		79		—		13,579
Total securities available-for-sale	$	929,449	$	151	$	(17,020)	$	912,580

At June 30, 2020, our investment securities portfolio consisted of agency securities, municipal securities, mortgage-backed securities, collateralized loan obligations, and corporate debt securities. The expected maturities of these types of securities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

There was no allowance for credit losses for debt securities as of June 30, 2020. Accrued interest receivable on debt securities available-for-sale totaled $5.5 million and $5.6 million at June 30, 2020 and December 31, 2019, and is included within other assets in the accompanying consolidated statements of financial condition. Accrued interest receivable is excluded from the estimate of expected credit losses.

At June 30, 2020 and December 31, 2019, there were no holdings of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10 percent of our stockholders’ equity.

The following table presents proceeds from sales and calls of securities available-for-sale and the associated gross gains and losses realized through earnings upon the sales and calls of securities available-for-sale for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Gross realized gains on sales and calls of securities available-for-sale	$	2,011	$	—	$	2,011	$	208
Gross realized losses on sales and calls of securities available-for-sale	—		—		—		—
Net realized gains on sales and calls of securities available-for-sale	$	2,011	$	—	$	2,011	$	208
Proceeds from sales and calls of securities available-for-sale	$	22,728	$	298,156	$	52,728	$	820,048

Investment securities with carrying values of $42.2 million and $44.0 million as of June 30, 2020 and December 31, 2019, were pledged to secure FHLB advances, public deposits and for other purposes as required or permitted by law.

The following table summarizes the investment securities with unrealized losses by security type and length of time in a continuous, unrealized loss position as of the dates indicated:

	Less Than 12 Months				12 Months or Longer				Total
($ in thousands)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
June 30, 2020
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	$	9,416	$	(32)	$	—	$	—	$	9,416	$	(32)
Collateralized loan obligations	63,040		(1,960)		605,313		(33,292)		668,353		(35,252)
Corporate debt securities	31,798		(702)		—		—		31,798		(702)
Total securities available-for-sale	$	104,254	$	(2,694)	$	605,313	$	(33,292)	$	709,567	$	(35,986)
December 31, 2019
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	35,872	$	(1,157)	$	—	$	—	$	35,872	$	(1,157)
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	73,379		(260)		—		—		73,379		(260)
Municipal securities	31,723		(359)		—		—		31,723		(359)
Collateralized loan obligations	49,553		(447)		668,808		(14,797)		718,361		(15,244)
Total securities available-for-sale	$	190,527	$	(2,223)	$	668,808	$	(14,797)	$	859,335	$	(17,020)

At June 30, 2020, our securities available-for-sale portfolio consisted of 102 securities, of which 50 securities were in an unrealized loss position. At December 31, 2019, our securities available-for-sale portfolio consisted of 70 securities, of which 60 securities were in an unrealized loss position.

We monitor our securities portfolio to ensure it has adequate credit support. The majority of unrealized losses are related to our collateralized loan obligations. We also consider the lowest credit rating for identification of credit impairment for other securities. As of June 30, 2020, all of our collateralized loan obligations investment securities in an unrealized loss position received an investment grade credit rating. The decline in fair value was attributable to a combination of changes in interest rates and general volatility in the credit market conditions in response to the economic uncertainty caused by the global pandemic. We do not currently intend to sell these 50 securities in an unrealized loss position and further believe, it is more likely than not, that we will not be required to sell these securities before their anticipated recovery.

The following table presents maturities, based on the earlier of maturity dates or next repricing date, and yield information of the investment securities portfolio as of June 30, 2020:

	One year or less				More than One Year through Five Years				More than Five Years through Ten Years				More than Ten Years				Total
($ in thousands)	Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	—	—	%	$	—	—	%	$	30,413	2.20	%	$	75,142	2.35	%	$	105,555	2.31	%
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	118,163		0.74	%	11,608		2.02	%	25,579		1.63	%	45,786		0.93	%	201,136		0.96	%
Municipal securities	—		—	%	—		—	%	—		—	%	57,174		2.79	%	57,174		2.79	%
Non-agency residential mortgage-backed securities	—		—	%	—		—	%	—		—	%	164		6.14	%	164		6.14	%
Collateralized loan obligations	668,353		2.73	%	—		—	%	—		—	%	—		—	%	668,353		2.73	%
Corporate debt securities	—		—	%	122,301		4.99	%	21,346		5.64	%	—		—	%	143,647		5.08	%
Total securities available-for-sale	$	786,516	2.45	%	$	133,909	4.74	%	$	77,338	2.96	%	$	178,266	2.11	%	$	1,176,029	2.68	%

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LOANS AND ALLOWANCE FOR CREDIT LOSSES

6 Months Ended

Jun. 30, 2020

Receivables [Abstract]

LOANS AND ALLOWANCE FOR CREDIT LOSSES

LOANS AND ALLOWANCE FOR CREDIT LOSSES

The following table presents the balances in our loan portfolio as of the dates indicated:

($ in thousands)	June 30, 2020		December 31, 2019
Commercial:
Commercial and industrial	$	1,436,990	$	1,691,270
Commercial real estate	822,694		818,817
Multifamily	1,434,071		1,494,528
SBA(1)	310,784		70,981
Construction	212,979		231,350
Consumer:
Single family residential mortgage	1,370,785		1,590,774
Other consumer	39,393		54,165
Total loans(2)	$	5,627,696	$	5,951,885
Allowance for loan losses	(90,370)		(57,649)
Loans receivable, net	$	5,537,326	$	5,894,236

(1)Includes 1,069 PPP loans totaling $240.7 million, which included $5.6 million of net unamortized loan fees at June 30, 2020.

(2)Total loans include deferred loan origination costs/(fees) and premiums/(discounts), net, of $6.0 million and $14.3 million, respectively, at June 30, 2020 and December 31, 2019.

Credit Quality Indicators

We categorize loans into risk categories based on relevant information about the ability of borrowers to repay their debt such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. We perform a historical loss analysis that is combined with a comprehensive loan to value analysis to analyze the associated risks in the current loan portfolio. We analyze loans individually and grade each loan for credit risk. This analysis includes all loans delinquent over 60 days and non-homogeneous loans such as commercial and commercial real estate loans. We use the following definitions for credit risk ratings:

Pass: Loans risk rated as pass are in compliance in all respects with the Bank’s credit policy and regulatory requirements, and do not exhibit any potential or defined weakness as defined under “Special Mention”, “Substandard” or “Doubtful”.

Special Mention: Loans risk rated as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of our credit position at some future date.

Substandard: Loans risk rated as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so risk rated have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

The following table presents the risk categories for total loans by class of loans and origination year as of June 30, 2020:

	Term Loans Amortized Cost Basis by Origination Year
($ in thousands)	2020		2019		2018		2017		2016		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Amortized Cost Basis Converted to Term		Total
June 30, 2020
Commercial:
Commercial and industrial
Pass	$	59,122	$	111,437	$	104,299	$	63,923	$	41,163	$	111,761	$	851,369	$	4,252	$	1,347,326
Special mention	—		6,382		5,988		—		—		1,379		812		189		14,750
Substandard	2,117		16,658		—		4,864		20,677		9,632		10,752		10,214		74,914
Doubtful	—		—		—		—		—		—		—		—		—
Commercial and industrial	61,239		134,477		110,287		68,787		61,840		122,772		862,933		14,655		1,436,990
Commercial real estate
Pass	15,261		153,017		215,385		72,949		102,465		198,242		36,628		1,586		795,533
Special mention	—		1,829		9,570		—		—		6,732		—		—		18,131
Substandard	—		—		—		—		—		9,030		—		—		9,030
Doubtful	—		—		—		—		—		—		—		—		—
Commercial real estate	15,261		154,846		224,955		72,949		102,465		214,004		36,628		1,586		822,694
Multifamily
Pass	84,873		421,045		334,029		272,657		131,646		187,823		—		—		1,432,073
Special mention	—		—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		1,998		—		—		1,998
Doubtful	—		—		—		—		—		—		—		—		—
Multifamily	84,873		421,045		334,029		272,657		131,646		189,821		—		—		1,434,071
SBA
Pass	241,305		16,021		1,359		5,195		14,975		19,479		3,238		797		302,369
Special mention	—		—		—		226		417		948		—		6		1,597
Substandard	—		—		—		1,009		1,513		1,440		320		1,126		5,408
Doubtful	—		—		390		—		—		633		—		387		1,410
SBA	241,305		16,021		1,749		6,430		16,905		22,500		3,558		2,316		310,784
Construction
Pass	14,139		33,423		63,217		86,787		—		—		—		—		197,566
Special mention	—		—		10,526		—		4,887		—		—		—		15,413
Substandard	—		—		—		—		—		—		—		—		—

Doubtful	—		—		—		—		—		—		—		—		—
Construction	14,139		33,423		73,743		86,787		4,887		—		—		—		212,979
Consumer:
Single family residential mortgage
Pass	31,007		166,668		329,175		204,392		297,182		281,160		20,844		—		1,330,428
Special mention	—		—		1,152		668		4,416		3,503		—		—		9,739
Substandard	—		1,064		1,697		3,414		3,900		20,543		—		—		30,618
Doubtful	—		—		—		—		—		—		—		—		—
Single family residential mortgage	31,007		167,732		332,024		208,474		305,498		305,206		20,844		—		1,370,785
Other consumer
Pass	26		93		72		—		8		2,485		31,303		2,577		36,564
Special mention	—		—		27		—		—		33		248		147		455
Substandard	—		—		—		—		—		2,016		281		77		2,374
Doubtful	—		—		—		—		—		—		—		—		—
Other consumer	26		93		99		—		8		4,534		31,832		2,801		39,393
Total loans	$	447,850	$	927,637	$	1,076,886	$	716,084	$	623,249	$	858,837	$	955,795	$	21,358	$	5,627,696

The following table presents the risk categories for total loans by class of loans as of December 31, 2019:

($ in thousands)	Pass		Special Mention		Substandard		Doubtful		Total
December 31, 2019
Commercial:
Commercial and industrial	1,580,269		45,323		65,678		—		1,691,270
Commercial real estate	813,846		2,532		2,439		—		818,817
Multifamily	1,484,931		4,256		5,341		—		1,494,528
SBA	60,982		2,760		5,621		1,618		70,981
Construction	229,771		1,579		—		—		231,350
Consumer:
Single family residential mortgage	1,559,253		10,735		20,269		517		1,590,774
Other consumer	53,331		346		488		—		54,165
Total	$	5,782,383	$	67,531	$	99,836	$	2,135	$	5,951,885

Past Due Loans

The following table presents the aging of the recorded investment in past due loans, excluding accrued interest receivable (which is not considered to be material), by class of loans as of the dates indicated:

($ in thousands)	30 - 59 Days Past Due		60 - 89 Days Past Due		Greater than 89 Days Past due		Total Past Due		Current		Total
June 30, 2020
Non-Traditional Mortgage (NTM) loans:
Single family residential mortgage	$	9,262	$	647	$	18,552	$	28,461	$	481,144	$	509,605
Other consumer	—		—		—		—		1,598		1,598
Total NTM loans	9,262		647		18,552		28,461		482,742		511,203
Traditional loans:
Commercial:
Commercial and industrial	891		28		13,072		13,991		1,422,999		1,436,990
Commercial real estate	—		1,464		2,189		3,653		819,041		822,694
Multifamily	664		—		—		664		1,433,407		1,434,071
SBA	1,517		—		2,627		4,144		306,640		310,784
Construction	—		—		—		—		212,979		212,979
Consumer:
Single family residential mortgage	29,281		4,286		8,252		41,819		819,361		861,180
Other consumer	285		1,485		692		2,462		35,333		37,795
Total traditional loans	32,638		7,263		26,832		66,733		5,049,760		5,116,493
Total	$	41,900	$	7,910	$	45,384	$	95,194	$	5,532,502	$	5,627,696
December 31, 2019
NTM loans:
Single family residential mortgage	$	3,973	$	3,535	$	13,019	$	20,527	$	577,830	$	598,357
Other consumer	—		—		—		—		2,299		2,299
Total NTM loans	3,973		3,535		13,019		20,527		580,129		600,656
Traditional loans:
Commercial:
Commercial and industrial	780		5,670		3,862		10,312		1,680,958		1,691,270
Commercial real estate	—		—		—		—		818,817		818,817
Multifamily	—		—		—		—		1,494,528		1,494,528
SBA	586		842		2,152		3,580		67,401		70,981
Construction	—		—		—		—		231,350		231,350
Consumer:
Single family residential mortgage	13,752		3,496		5,606		22,854		969,563		992,417
Other consumer	199		40		95		334		51,532		51,866
Total traditional loans	15,317		10,048		11,715		37,080		5,314,149		5,351,229
Total	$	19,290	$	13,583	$	24,734	$	57,607	$	5,894,278	$	5,951,885

In accordance with regulatory guidance, borrowers that received forbearance or deferment, which were current prior to becoming affected by the global pandemic, generally should not be reported as past due. At June 30, 2020, no loans that received forbearance or deferment were considered past due and, accordingly, are not included in the table above.

Non-accrual Loans

The following table presents non-accrual loans as of the dates indicated:

	June 30, 2020								December 31, 2019
($ in thousands)	NTM Loans		Traditional Loans		Total Non-accrual Loans		Non-accrual Loans with no ACL		NTM Loans		Traditional Loans		Total Non-accrual Loans		Non-accrual Loans with no ACL
Non-accrual loans
Commercial:
Commercial and industrial	$	—	$	30,398	$	30,398	$	10,728	$	—	$	19,114	$	19,114	$	337
Commercial real estate	—		6,633		6,633		6,632		—		—		—		—
SBA	—		5,026		5,026		1,485		—		5,230		5,230		1,474
Construction	—		—		—		—		—		—		—		—
Consumer:
Single family residential mortgage	19,199		9,271		28,470		28,470		13,019		5,606		18,625		14,373
Other consumer	—		2,176		2,176		2,177		—		385		385		380
Total non-accrual loans	$	19,199	$	53,504	$	72,703	$	49,492	$	13,019	$	30,335	$	43,354	$	16,564

At June 30, 2020 and December 31, 2019, there were no loans that were past due 90 days or more and still accruing.

The non-traditional mortgage (“NTM”) loans on non-accrual status included $4.6 million of Green Loans and $14.6 million of interest-only loans at June 30, 2020 compared to $1.5 million of Green Loans and $11.5 million of interest-only loans at December 31, 2019.

Loans in Process of Foreclosure

At June 30, 2020 and December 31, 2019, consumer mortgage loans of $6.3 million and $15.7 million, respectively, were secured by residential real estate properties for which formal foreclosure proceedings were in process according to local requirements of the applicable jurisdiction.

Allowance for Credit Losses

Our ACL is comprised of our allowance for loan losses (“ALL”) and reserve for unfunded loan commitments. Our ACL methodology and resulting provision continues to be impacted by the current economic uncertainty and volatility caused by the COVID-19 pandemic. Our ACL methodology uses a nationally recognized, third-party model that includes many assumptions based on our historical and peer loss data, our current loan portfolio risk profile including risk ratings, and economic forecasts including macroeconomic variables (“MEVs”). As of June 30, 2020, we used economic forecasts released by our model provider during June 2020. Similar to the late March 2020 forecasts, these June 2020 forecasts reflect the onset of the pandemic, its impact on MEVs and the future economic recovery. These forecasts published by our model provider have deteriorated since the end of the first quarter of 2020, with June baseline unemployment rate forecasts for 2020 and 2021 increasing and real gross domestic product growth rates decreasing. Similar to our methodology used in the first quarter of 2020, we incorporated qualitative factors to account for certain loan portfolio characteristics that are not taken into consideration by our third-party model, including underlying strengths and weaknesses in the loan portfolio. As is the case with all estimates, we expect the ACL to be impacted in future periods by economic volatility, changing economic forecasts, actual and projected credit experience, and underlying model assumptions; all of which may be better than or worse than our current estimate.

The ACL process involves subjective and complex judgments as well as adjustments for numerous factors including those described in the federal banking agencies' joint interagency policy statement on ALL, which include underwriting experience and collateral value changes, among others. We evaluate all impaired loans individually using guidance from ASC 310 primarily through the evaluation of cash flows or collateral values.

We have established credit risk management processes that include regular management review of the loan portfolio to identify problem loans. During the ordinary course of business, management may become aware of borrowers who may not be able to fulfill their contractual payment requirements within the loan agreements. Such loans are subject to increased monitoring. Consideration is given to placing these loans on non-accrual status, assessing the need for additional allowance for loan loss, and partially or fully charging off the principal balance. We maintain the allowance for loan losses at a level that is considered adequate to cover the expected credit losses in the loan portfolio.

The reserve for unfunded loan commitments is established to cover the expected credit losses for the estimated level of funding of these loan commitments, except for unconditionally cancellable commitments for which no reserve is required under ASC 326. At June 30, 2020 and December 31, 2019, the reserve for unfunded loan commitments was $4.2 million and $4.1 million, respectively, and was included in accrued expenses and other liabilities on the consolidated statements of financial condition.

The credit risk monitoring system is designed to identify impaired and potential problem loans, perform periodic evaluation of impairment, and determine the adequacy of the allowance for credit losses in a timely manner. In addition, management has adopted a credit policy that includes a credit review and control system that it believes should be effective in ensuring that we maintain an adequate allowance for credit losses. Further, the Board of Directors provides oversight and guidance for management’s allowance evaluation process.

The following table presents a summary of activity in the ACL for the periods indicated:

	Three Months Ended June 30,
($ in thousands)	2020						2019
	Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses		Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses
Balance at beginning of period	$	78,243	$	3,888	$	82,131	$	63,885	$	4,208	$	68,093
Loans charged off	—		—		—		(2,451)		—		(2,451)
Recoveries of loans previously charged off	608		—		608		76		—		76
Net charge-offs	608		—		608		(2,375)		—		(2,375)
Provision for (reversal of) credit losses	11,519		307		11,826		(1,987)		87		(1,900)
Balance at end of period	$	90,370	$	4,195	$	94,565	$	59,523	$	4,295	$	63,818

	Six Months Ended June 30,
($ in thousands)	2020						2019
	Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses		Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses
Balance at beginning of period	$	57,649	$	4,064	$	61,713	$	62,192	$	4,622	$	66,814
Impact of adopting ASU 2016-13	7,609		(1,226)		6,383		—		—		—
Loans charged off	(2,076)		—		(2,076)		(3,514)		—		(3,514)
Recoveries of loans previously charged off	958		—		958		320		—		320
Net charge-offs	(1,118)		—		(1,118)		(3,194)		—		(3,194)
Provision for (reversal of) credit losses	26,230		1,357		27,587		525		(327)		198
Balance at end of period	$	90,370	$	4,195	$	94,565	$	59,523	$	4,295	$	63,818

Accrued interest receivable on loans receivable, net totaled $23.8 million and $18.9 million at June 30, 2020 and December 31, 2019, and is included within other assets in the accompanying consolidated statements of financial condition. Accrued interest receivable is excluded from the estimate of expected credit losses.

The following table presents the activity and balance in the ALL and the recorded investment, excluding accrued interest, in loans based on the impairment methodology as of or for the three and six months ended June 30, 2020:

($ in thousands)	Commercial and Industrial		Commercial Real Estate		Multifamily		SBA		Construction		Single Family Residential Mortgage		Other Consumer		Total
ALL:
Balance at March 31, 2020	$	23,573	$	13,620	$	20,072	$	3,652	$	7,052	$	9,593	$	681	$	78,243
Charge-offs	—		—		—		—		—		—		—		—
Recoveries	119		—		—		—		—		488		1		608
Net recoveries (charge-offs)	119		—		—		—		—		488		1		608
Provision for (reversal of) credit losses	2,926		3,752		5,033		532		(377)		(416)		69		11,519
Balance at June 30, 2020	$	26,618	$	17,372	$	25,105	$	4,184	$	6,675	$	9,665	$	751	$	90,370
Balance at December 31, 2019	$	22,353	$	5,941	$	11,405	$	3,120	$	3,906	$	10,486	$	438	$	57,649
Impact of adopting ASC 326	662		4,847		1,809		388		103		(420)		220		7,609
Charge-offs	(1,164)		—		—		(356)		—		(552)		(4)		(2,076)
Recoveries	149		—		—		121		—		639		49		958
Net (charge-offs) recoveries	(1,015)		—		—		(235)		—		87		45		(1,118)
Provision (reversal)	4,618		6,584		11,891		911		2,666		(488)		48		26,230
Balance at June 30, 2020	$	26,618	$	17,372	$	25,105	$	4,184	$	6,675	$	9,665	$	751	$	90,370
Individually evaluated for impairment	$	9,697	$	—	$	—	$	2,878	$	—	$	—	$	—	$	12,575
Collectively evaluated for impairment	16,921		17,372		25,105		1,306		6,675		9,665		751		77,795
Total ending ALL balance	$	26,618	$	17,372	$	25,105	$	4,184	$	6,675	$	9,665	$	751	$	90,370
Loans:
Individually evaluated for impairment	$	31,129	$	5,168	$	—	$	4,959	$	—	$	32,999	$	970	$	75,225
Collectively evaluated for impairment	1,405,861		817,526		1,434,071		305,825		212,979		1,337,786		38,423		5,552,471
Total ending loan balances	$	1,436,990	$	822,694	$	1,434,071	$	310,784	$	212,979	$	1,370,785	$	39,393	$	5,627,696

The following table presents the activity and balance in the ALL and the recorded investment, excluding accrued interest, in loans based on the impairment methodology as of or for the three and six months ended June 30, 2019:

($ in thousands)	Commercial and Industrial		Commercial Real Estate		Multifamily		SBA		Construction		Lease Financing		Single Family Residential Mortgage		Other Consumer		Total
ALL:
Balance at March 31, 2019	$	18,893	$	6,838	$	18,898	$	3,057	$	3,453	$	—	$	12,142	$	604	$	63,885
Charge-offs	(2,022)		—		(6)		8		—		—		(425)		(6)		(2,451)
Recoveries	11		—		—		60		—		3		—		2		76
Net (charge-offs) recoveries	(2,011)		—		(6)		68		—		3		(425)		(4)		(2,375)
Provision for (reversal of) credit losses	4,647		39		(6,267)		(5)		262		(3)		(645)		(15)		(1,987)
Balance at June 30, 2019	$	21,529	$	6,877	$	12,625	$	3,120	$	3,715	$	—	$	11,072	$	585	$	59,523
Balance at December 31, 2018	$	18,191	$	6,674	$	17,970	$	1,827	$	3,461	$	—	$	13,128	$	941	$	62,192
Charge-offs	(2,115)		—		(6)		(348)		—		—		(951)		(94)		(3,514)
Recoveries	44		—		—		101		—		6		150		19		320
Net (charge-offs) recoveries	(2,071)		—		(6)		(247)		—		6		(801)		(75)		(3,194)
Provision (reversal)	5,409		203		(5,339)		1,540		254		(6)		(1,255)		(281)		525
Balance at June 30, 2019	$	21,529	$	6,877	$	12,625	$	3,120	$	3,715	$	—	$	11,072	$	585	$	59,523
Individually evaluated for impairment	$	1,239	$	—	$	—	$	1,563	$	—	$	—	$	—	$	22	$	2,824
Collectively evaluated for impairment	20,290		6,877		12,625		1,557		3,715		—		11,072		563		56,699
Total ending ALL balance	$	21,529	$	6,877	$	12,625	$	3,120	$	3,715	$	—	$	11,072	$	585	$	59,523
Loans:
Individually evaluated for impairment	$	20,429	$	—	$	—	$	3,262	$	2,519	$	—	$	21,021	$	1,169	$	48,400
Collectively evaluated for impairment	1,931,278		856,497		1,598,978		77,667		206,510		—		1,940,044		60,196		6,671,170
Total ending loan balances	$	1,951,707	$	856,497	$	1,598,978	$	80,929	$	209,029	$	—	$	1,961,065	$	61,365	$	6,719,570

The following table presents loans individually evaluated for impairment by class of loans as of the dates indicated. The recorded investment, excluding accrued interest, presents customer balances net of any partial charge-offs recognized on the loans and net of any deferred fees and costs and any purchase premium or discount.

	June 30, 2020						December 31, 2019
($ in thousands)	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses		Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses
With no related ALL recorded:
Commercial:
Commercial and industrial	$	11,455	$	11,383	$	—	$	1,471	$	1,460	$	—
Commercial real estate	5,418		5,168		—		—		—		—
SBA	1,474		1,417		—		1,439		1,379		—
Consumer:
Single family residential mortgage	32,849		32,999		—		19,319		19,405		—
Other consumer	1,431		970		—		671		675		—
With an ALL recorded:
Commercial:
Commercial and industrial	19,739		19,746		9,697		18,776		18,776		3,367
SBA	3,731		3,542		2,878		3,921		3,757		2,045
Consumer:
Single family residential mortgage	—		—		—		4,213		4,252		574
Other consumer	—		—		—		4		4		4
Total	$	76,097	$	75,225	$	12,575	$	49,814	$	49,708	$	5,990

The following table presents information on impaired loans, disaggregated by class, for the periods indicated:

	Three Months Ended						Six Months Ended
($ in thousands)	Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Recognized		Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Recognized
June 30, 2020
Commercial:
Commercial and industrial	$	29,992	$	16	$	18	$	26,452	$	37	$	39
Commercial real estate	5,210		—		—		3,992		—		—
SBA	5,172		3		4		5,293		6		7
Consumer:
Single family residential mortgage	33,356		56		34		31,420		110		79
Other consumer	2,084		—		—		1,351		3		3
Total	$	75,814	$	75	$	56	$	68,508	$	156	$	128
June 30, 2019
Commercial:
Commercial and industrial	$	20,794	$	255	$	254	$	12,921	$	255	$	254
Commercial real estate	—		—		—		289		—		—
SBA	3,297		4		4		3,571		8		8
Construction	2,519		—		—		2,519		—		—
Consumer:
Single family residential mortgage	21,092		58		48		20,208		116		97
Other consumer	1,177		4		3		1,011		7		6
Total	$	48,879	$	321	$	309	$	40,519	$	386	$	365

Troubled Debt Restructurings

A modification of a loan constitutes a TDR when we, for economic or legal reasons related to a borrower’s financial difficulties, grant a concession to the borrower that we would not otherwise consider. A concession or concessions may be granted in various forms, including a below-market change in the stated interest rate, a reduction in the loan balance or accrued interest, an extension of the maturity date, or a note split with principal forgiveness. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under our internal underwriting policy.

TDR loans consisted of the following as of the dates indicated:

	June 30, 2020						December 31, 2019
($ in thousands)	NTM Loans		Traditional Loans		Total		NTM Loans		Traditional Loans		Total
Commercial:
Commercial and industrial	$	—	$	20,808	$	20,808	$	—	$	16,245	$	16,245
SBA	—		266		266		—		266		266
Consumer:
Single family residential mortgage	2,628		2,170		4,798		2,638		2,394		5,032
Other consumer	—		—		—		294		—		294
Total	$	2,628	$	23,244	$	25,872	$	2,932	$	18,905	$	21,837

We had commitments to lend to customers with outstanding loans that were classified as TDRs of $135 thousand as of June 30, 2020 and December 31, 2019. Accruing TDRs were $5.6 million and non-accrual TDRs were $20.3 million at June 30, 2020 compared to accruing TDRs of $6.6 million and non-accrual TDRs of $15.2 million at December 31, 2019. The increase in TDRs during the six months ended June 30, 2020 was primarily due to one commercial and industrial relationship.

The following table summarizes the pre-modification and post-modification balances of the new TDRs for the periods indicated:

	Three Months Ended					Six Months Ended
($ in thousands)	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
June 30, 2020
Commercial:
Commercial and industrial	—	$	—	$	—	1	$	5,000	$	5,000
Total	—	—		—		1	$	5,000	$	5,000
June 30, 2019
Commercial:
Commercial and industrial	10	$	17,339	$	17,020	10	$	17,339	$	17,020
SBA	2	$	3,214	$	869	2	$	3,214	$	869
Total	12	$	20,553	$	17,889	12	$	20,553	$	17,889

We consider a TDR to be in payment default once it becomes 30 days or more past due following a modification. During each of the three and six months ended June 30, 2020, there was one loan that was modified as a TDR during the past 12 months that had subsequent payment defaults. During each of the three and six months ended June 30, 2019, there were no loans that were modified as TDRs during the past 12 months that had subsequent payment defaults.

The following table summarizes TDRs by modification type for the periods indicated:

	Three Months Ended
	Modification Type
	Change in Principal Payments and Interest Rates			Change in Principal Payments			Total
($ in thousands)	Count	Amount		Count	Amount		Count	Amount
June 30, 2020
Commercial:
Commercial and industrial	—	$	—	—	$	—	—	$	—
Total	—	$	—	—	$	—	—	$	—
June 30, 2019
Commercial:
Commercial and industrial	10	$	17,020	—	$	—	10	$	17,020
SBA	2	$	869	—	$	—	2	$	869
Total	12	$	17,889	—	$	—	12	$	17,889

	Six Months Ended
	Modification Type
	Change in Principal Payments and Interest Rates			Change in Principal Payments			Total
($ in thousands)	Count	Amount		Count	Amount		Count	Amount
June 30, 2020
Commercial:
Commercial and industrial	1	$	5,000	—	$	—	1	$	5,000
Total	1	$	5,000	—	$	—	1	$	5,000
June 30, 2019
Commercial:
Commercial and industrial	10	$	17,020	—	$	—	10	$	17,020
SBA	2	869		—	—		2	869
Consumer:
Single family residential mortgage	—	—		—	—		—	—
Total	12	$	17,889	—	$	—	12	$	17,889

Purchases, Sales, and Transfers

From time to time, we purchase and sell loans in the secondary market. Certain loans are transferred from held-for-investment to held-for-sale at the lower of cost or fair value and any reductions in value on transfer are reflected as write-downs to allowance for credit losses. During the three and six months ended June 30, 2020 we purchased $25.8 million of single family residential mortgage loans. There were no purchases of loans during the three and six months ended June 30, 2019. The following table presents loans transferred from (to) loans held-for-sale by portfolio segment for the periods indicated:

	Three Months Ended				Six Months Ended
($ in thousands)	Transfers from Held-For-Sale		Transfers (to) Held-For-Sale		Transfers from Held-For-Sale		Transfers (to) Held-For-Sale
June 30, 2020
Total	$	—	$	—	$	—	$	—
June 30, 2019
Commercial:
Commercial real estate	$	—	$	(573)	$	—	$	(573)
Multifamily	—		(752,087)		—		(752,087)
Consumer:
Single family residential mortgage	—		(131,315)		—		(374,679)
Total	$	—	$	(883,975)	$	—	$	(1,127,339)

There were no sales of loans during the three and six months ended June 30, 2020. Loss on sale of loans during the three and six months ended June 30, 2020 totaled zero and $27 thousand and related to certain adjustments for previously sold loans.

During the three and six months ended June 30, 2019, we sold $131.5 million and $374.7 million in single family residential loans, resulting in gains of $125 thousand and $1.8 million.

Non-Traditional Mortgage Loans (“NTM”)

Our NTM portfolio is comprised of three interest only products: Green Loans, Interest Only loans and a small number of additional loans with the potential for negative amortization. The initial credit guidelines for the NTM portfolio were established based on the borrower's Fair Isaac Corporation (“FICO”) score, LTV ratio, property type, occupancy type, loan amount, and geography. Additionally, from an ongoing credit risk management perspective, we have determined that the most significant performance indicators for NTMs are LTV ratios and FICO scores. We review the NTM loan portfolio periodically by refreshing FICO scores on the Green Loans and HELOCs and ordering third party automated valuation models (AVMs) to confirm collateral values. We no longer originate NTM loans.

The following table presents the composition of the NTM portfolio, which are included in the single family residential mortgage portfolio, as of the dates indicated:

	June 30, 2020						December 31, 2019
($ in thousands)	Count	Amount			Percent		Count	Amount			Percent
Consumer:
Single family residential mortgage:
Green Loans (HELOC) - first liens	61	$	43,604		8.5	%	69	$	49,959		8.3	%
Interest-only - first liens	329	463,666			90.7	%	376	545,371			90.8	%
Negative amortization	8	2,335			0.5	%	9	3,027			0.5	%
Total NTM - first liens	398	509,605			99.7	%	454	598,357			99.6	%
Other consumer:
Green Loans (HELOC) - second liens	5	1,598			0.3	%	7	2,299			0.4	%
Total NTM - second liens	5	1,598			0.3	%	7	2,299			0.4	%
Total NTM loans	403	$	511,203		100.0	%	461	$	600,656		100.0	%
Total loans receivable		$	5,627,696					$	5,951,885
% of total NTM loans to total loans receivable		9.1		%				10.1		%

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GOODWILL AND OTHER INTANGIBLE ASSETS, NET

6 Months Ended

Jun. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER INTANGIBLE ASSETS, NET

GOODWILL AND OTHER INTANGIBLE ASSETS, NETAt June 30, 2020 and December 31, 2019, we had goodwill of $37.1 million. We evaluate goodwill impairment as of August 31^st each year, and more frequently if events or circumstances indicate that there may be impairment. We completed our most recent annual goodwill impairment test as of August 31, 2019 and determined that no goodwill impairment existed. As a

result of the economic volatility caused by COVID-19 pandemic in both the second and first quarters of 2020, we analyzed the risk indicators related to potential goodwill impairment. Based on these analyses, we did not identify any impairment to goodwill during the first six months of 2020, however, there can be no assurance that prolonged market volatility resulting from the COVID-19 pandemic or other factors will not result in impairments to goodwill or other intangibles in future periods.

Core deposit intangibles are amortized over their useful lives ranging from four to ten years. As of June 30, 2020, the weighted average remaining amortization period for core deposit intangibles was approximately 4.3 years.

($ in thousands)	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
June 30, 2020
Core deposit intangibles	$	30,904	$	27,612	$	3,292
December 31, 2019
Core deposit intangibles	$	30,904	$	26,753	$	4,151

Aggregate amortization of intangible assets was $430 thousand and $621 thousand for the three months ended June 30, 2020 and 2019 and $859 thousand and $1.2 million for the six months ended June 30, 2020 and 2019. The following table presents estimated future amortization expenses as of June 30, 2020:

($ in thousands)	Remainder of 2020		2021		2022		2023		2024		Total
Estimated future amortization expense	$	659	$	1,082	$	799	$	517	$	235	$	3,292

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FEDERAL HOME LOAN BANK ADVANCES AND OTHER BORROWINGS

6 Months Ended

Jun. 30, 2020

Federal Home Loan Banks [Abstract]

FEDERAL HOME LOAN BANK ADVANCES AND OTHER BORROWINGS

FEDERAL HOME LOAN BANK ADVANCES AND OTHER BORROWINGS

The following table presents advances from the FHLB as of the dates indicated:

($ in thousands)	June 30, 2020				December 31, 2019
Fixed rate:
Outstanding balance	$	624,000		(1)	$	730,000
Interest rates ranging from	—		%	(2)	1.82		%
Interest rates ranging to	3.32		%		3.32		%
Weighted average interest rate	2.24		%		2.66		%
Variable rate:
Outstanding balance	—				465,000
Weighted average interest rate	—		%		1.66		%

(1)Excludes $6.8 million of unamortized debt issuance costs at June 30, 2020. 

(2)Includes $10.0 million in FHLB recovery advances with an interest rate of 0.00%, consisting of $5.0 million with a maturity date of November 27, 2020 and $5.0 million with a maturity date of May 27, 2021.

Each advance is payable at its maturity date. Advances paid early are subject to a prepayment penalty. In June 2020, we repaid a $100.0 million FHLB term advance with a weighted average interest rate of 2.07% and incurred a $2.5 million extinguishment fee that is included in other noninterest expense. Additionally, in June 2020 we refinanced $111.0 million of FHLB term advances to take advantage of the rapid decline in market interest rates. As a result of this refinancing, our weighted average effective interest rate on such FHLB term advances changed from 2.81% to 2.02% and the weighted average life extended from 2.52 years to 5.18 years. At the end of the second quarter, FHLB advances included no overnight borrowings, $58.0 million maturing within three months, and $566.0 million maturing beyond three months with a weighted average life of 4.1 years and weighted average interest rate of 2.39%.

At June 30, 2020 and December 31, 2019, the Bank’s advances from the FHLB were collateralized by certain real estate loans with an aggregate unpaid principal balance of $2.66 billion and $3.05 billion. Based on this collateral, the Bank was eligible to borrow an additional $1.06 billion at June 30, 2020.

The Bank’s investment in capital stock of the FHLB of San Francisco totaled $19.4 million and $32.3 million at June 30, 2020 and December 31, 2019.

During the second quarter of 2020, we expanded our existing secured borrowing capacity with the Federal Reserve Bank of San Francisco (“Federal Reserve”) by participating in its Borrower-in-Custody (“BIC”) program. As a result, our borrowing capacity with the Federal Reserve increased to $370.4 million at June 30, 2020. Prior to participating in the BIC program, the Bank only pledged securities as collateral for access to the discount window. At June 30, 2020, the Bank has pledged certain qualifying loans with an unpaid principal balance of $870.1 million and securities with a carrying value of $23.0 million as collateral for this line of credit. Borrowings under this BIC program are overnight advances with interest chargeable at the discount window (“primary credit”) borrowing rate. There were no borrowings under this arrangement for the three and six months ended June 30, 2020 and 2019.

The Bank maintained available unsecured federal funds lines with five correspondent banks totaling $185.0 million, with no outstanding borrowings at June 30, 2020.

The Bank also maintained repurchase agreements and had no outstanding securities sold under agreements to repurchase at June 30, 2020 and December 31, 2019. Availabilities and terms on repurchase agreements are subject to the counterparties' discretion and the pledging of additional investment securities.

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LONG-TERM DEBT

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

LONG-TERM DEBT

LONG-TERM DEBT

The following table presents our long-term debt as of the dates indicated:

	June 30, 2020				December 31, 2019
($ in thousands)	Par Value		Unamortized Debt Issuance Cost and Discount		Par Value		Unamortized Debt Issuance Cost and Discount
5.25% senior notes due April 15, 2025	$	175,000	$	(1,463)	$	175,000	$	(1,579)
Total	$	175,000	$	(1,463)	$	175,000	$	(1,579)

We were in compliance with all covenants under our 5.25% senior notes due April 15, 2025 at June 30, 2020.

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INCOME TAXES

6 Months Ended

Jun. 30, 2020

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

For the three and six months ended June 30, 2020, income tax benefit was $5.3 million and $7.5 million and the effective tax rate was 22.3% and 23.0%. For the three and six months ended June 30, 2019, income tax expense was $4.3 million and $7.0 million and the effective tax rate was 20.6% and 22.9%. Our effective tax rate of 22.3% and 23.0% for the three and six months ended June 30, 2020 differs from the 21% federal statutory rate due to the impact of state taxes as well as various tax credits.

We account for income taxes by recognizing deferred tax assets and liabilities based upon temporary differences between the amounts for financial reporting purposes and tax basis of its assets and liabilities. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all, of the deferred tax asset will not be realized. In assessing the realization of deferred tax assets, management will continue to evaluate both positive and negative evidence on a quarterly basis, including considering the four possible sources of future taxable income, such as future reversal of existing taxable temporary differences, future taxable income exclusive of reversing temporary differences and carryforwards, taxable income in prior carryback year(s), and future tax planning strategies. Based on this analysis, management determined, it was more likely than not, that all of the deferred tax assets would be realized; therefore, no valuation allowance was provided against the net deferred tax assets of $48.3 million and $44.9 million at June 30, 2020 and December 31, 2019, respectively. The overall increase in net deferred tax assets was primarily due to an increase in deferred tax assets of $1.5 million from the increase in net unrealized loss on securities available-for-sale and $1.9 million from the adoption of ASU 2016-13.

ASC 740-10-25 relates to the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. ASC 740-10-25 prescribes a threshold and a measurement process for recognizing in the financial statements a tax position taken or expected to be taken in a tax return and also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. We had unrecognized tax benefits of $1.0 million and $977 thousand at June 30, 2020 and December 31, 2019, respectively. We do not believe that the unrecognized tax benefits will change materially in the next twelve months. As of June 30, 2020, the total unrecognized tax benefit that, if recognized, would impact the effective tax rate was $820 thousand.

At June 30, 2020 and December 31, 2019, we had no accrued interest or penalties. In the event we are assessed interest and/or penalties by federal or state tax authorities, such amounts will be classified in the consolidated financial statements as income tax expense.

We are subject to U.S. federal income tax as well as income tax in multiple state jurisdictions. We are no longer subject to examination by U.S. federal taxing authorities for years before 2016. The statute of limitations for the assessment of California franchise taxes has expired for tax years before 2014 (other state income and franchise tax statutes of limitations vary by state).

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DERIVATIVE INSTRUMENTS

6 Months Ended

Jun. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE INSTRUMENTS

DERIVATIVE INSTRUMENTS

We use derivative instruments and other risk management techniques to reduce our exposure to adverse fluctuations in interest rates and foreign currency exchange rates in accordance with our risk management policies.

During the three and six months ended June 30, 2020, changes in fair value on interest rate swaps and caps on loans and foreign exchange contracts were $(107) thousand and $(288) thousand, respectively, compared to $(9.7) million and $(9.8) million for the three and six months ended June 30, 2019, respectively, and were included in other income on the consolidated statements of operations.

The following table presents the notional amount and fair value of derivative instruments included in the consolidated statements of financial condition as of the dates indicated.

	June 30, 2020				December 31, 2019
($ in thousands)	Notional Amount		Fair Value(1)		Notional Amount		Fair Value(1)
Derivative assets:
Interest rate swaps and caps on loans	$	69,266	$	8,598	$	70,674	$	3,445
Foreign exchange contracts	3,657		137		4,643		138
Total	$	72,923	$	8,735	$	75,317	$	3,583
Derivative liabilities:
Interest rate swaps and caps on loans	$	69,266	$	9,239	$	70,674	3,717
Foreign exchange contracts	3,657		54		4,643		136
Total	$	72,923	$	9,293	$	75,317	$	3,853

(1)The fair value of interest rate swaps and caps on loans are included in other assets and accrued expenses and other liabilities, respectively, in the accompanying consolidated statements of financial condition.

We have entered into agreements with counterparty financial institutions, which include master netting agreements that provide for the net settlement of all contracts with a single counterparty in the event of default. We elect, however, to account for all derivatives with counterparty institutions on a gross basis.

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EMPLOYEE STOCK COMPENSATION

6 Months Ended

Jun. 30, 2020

Share-based Payment Arrangement [Abstract]

EMPLOYEE STOCK COMPENSATION

EMPLOYEE STOCK COMPENSATION

On May 31, 2018, our stockholders approved the Company's 2018 Omnibus Stock Incentive Plan (“2018 Omnibus Plan”). The 2018 Omnibus Plan provides that the maximum number of shares available for awards is 4,417,882. As of June 30, 2020, 3,359,922 shares were available for future awards.

Stock-based Compensation Expense

The following table presents stock-based compensation expense and the related tax benefits for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Stock options	$	2	$	(24)	$	4	$	(16)
Restricted stock awards and units	1,468		1,521		3,042		2,366
Total share-based compensation expense	$	1,470	$	1,497	$	3,046	$	2,350
Related tax benefits	$	433	$	440	$	897	$	691

The following table presents unrecognized stock-based compensation expense as of June 30, 2020:

($ in thousands)	Unrecognized Expense		Weighted-Average Remaining Expected Recognition Period
Restricted stock awards and restricted stock units	9,530		2.3 years
Total	$	9,530	2.3 years

Stock Options

We issued stock options to certain employees, officers, and directors. Stock options are issued at the closing market price immediately before the grant date and generally have a three to five year vesting period and contractual terms of seven to ten years. We recognize an income tax deduction upon exercise of a stock option to the extent taxable income is recognized by the option holder. In the case of a non-qualified stock option, the option holder recognizes taxable income based on the fair market value of the shares acquired at the time of exercise less the exercise price.

The following table represents stock option activity for the three months ended June 30, 2020:

	Three Months Ended June 30, 2020
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	55,069	$	13.96	4.0 years
Outstanding at end of period	55,069	$	13.96	3.7 years	$	(194)
Exercisable at end of period	52,821	$	13.97	3.6 years	$	(187)

The following table represents stock option activity for the six months ended June 30, 2020:

	Six Months Ended June 30, 2020
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	62,521	$	13.85	4.3 years
Exercised	(7,452)	$	13.05	5.2 years
Outstanding at end of period	55,069	$	13.96	3.7 years	$	(194)
Exercisable at end of period	52,821	$	13.97	3.6 years	$	(187)

The following table sets forth information regarding unvested stock options for the three and six months ended June 30, 2020:

	Three Months Ended June 30, 2020			Six Months Ended June 30, 2020
	Number of Shares	Weighted-Average Exercise Price Per Share		Number of Shares	Weighted-Average Exercise Price Per Share
Outstanding at beginning of period	2,248	$	13.75	2,248	$	13.75
Vested	—	$	—	—	$	—
Forfeited	—	$	—	—	$	—
Outstanding at end of period	2,248	$	13.75	2,248	$	13.75

Restricted Stock Awards and Restricted Stock Units

We also have granted restricted stock awards and restricted stock units to certain employees, officers, and directors. The restricted stock awards and units are valued at the closing price of our stock on the measurement date. The restricted stock awards and units fully vest after a specified period (generally ranging from one to five years) of continued service from the date of grant plus, in some cases, the satisfaction of performance conditions. These performance targets include conditions relating to our profitability and regulatory standing. The actual amounts of stock released upon vesting will be determined by the Compensation Committee of our Board of Directors upon the Committee's certification of the satisfaction of the target level of performance. We recognize an income tax deduction in an amount equal to the taxable income reported by the holders of the restricted stock, generally upon vesting or, in the case of restricted stock units, when settled. The following table presents unvested restricted stock awards and restricted stock units activity for the three and six months ended June 30, 2020:

	Three Months Ended June 30, 2020			Six Months Ended June 30, 2020
	Number of Shares	Weighted Average Grant Date Fair Value Per Share		Number of Shares	Weighted Average Grant Date Fair Value Per Share
Outstanding at beginning of period	1,083,107	$	15.65	923,482	$	15.74
Granted (1)	84,998	$	8.76	354,136	$	13.79
Vested (2)	(231,362)	$	16.09	(293,695)	$	15.95
Forfeited (3)	(24,073)	$	18.20	(71,253)	$	16.85
Outstanding at end of period	912,670	$	14.91	912,670	$	14.91

(1)There were zero and 78,771 performance-based shares/units included in shares granted for the three and six months ended June 30, 2020.

(2)There were 13,074 and 18,473 performance-based shares/units included in vested shares for the three and six months ended June 30, 2020.

(3)The number of forfeited shares includes aggregate performance-based shares/units of 1,782 and 17,404 for the three and six months ended June 30, 2020.

Stock Appreciation Rights

On August 21, 2012, we granted to the then, and now former, chief executive officer, a ten-year stock appreciation right (“SAR”).

The following table represents SARs activity and the weighted average exercise price per share as of and for the three months ended June 30, 2020:

	Three Months Ended June 30, 2020
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	1,559,012	$	11.60	2.4 years	$	(5,616)
Outstanding at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)
Exercisable at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)

The following table represents SARs activity and the weighted average exercise price per share as of and for the six months ended June 30, 2020:

	Six Months Ended June 30,
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	1,559,012	$	11.60	2.6 years	$	8,508
Outstanding at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)
Exercisable at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)

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STOCKHOLDERS' EQUITY

6 Months Ended

Jun. 30, 2020

Equity [Abstract]

STOCKHOLDERS' EQUITY

STOCKHOLDERS’ EQUITY

Preferred Stock

We are authorized to issue 50,000,000 shares of preferred stock with par value of $0.01 per share. Preferred shares outstanding rank senior to common shares both as to dividends and liquidation preference but generally have no voting rights. All of our outstanding shares of preferred stock have a $1,000 per share liquidation preference. The following table presents our total outstanding preferred stock as of the dates indicated:

	June 30, 2020					December 31, 2019
($ in thousands)	Shares Outstanding	Liquidation Preference		Carrying Value		Shares Outstanding	Liquidation Preference		Carrying Value
Series D 7.375% non-cumulative perpetual	93,272	$	93,272	$	89,924	96,629	$	96,629	$	93,162
Series E 7.00% non-cumulative perpetual	98,865	98,865		95,113		100,477	100,477		96,663
Total	192,137	$	192,137	$	185,037	197,106	$	197,106	$	189,825

During the three and six months ended June 30, 2020, we repurchased depositary shares (Series D Depositary Shares), each representing a 1/40^th interest in a share of Series D Preferred Stock, liquidation amount of $1,000 per share of Series D Preferred Stock, resulting in the repurchase of 53,006 and 134,310 outstanding Series D Depositary Shares and the related retirement of 1,325 and 3,357 outstanding shares of Series D Preferred Stock. The repurchase price aggregated to $1.2 million and $2.7 million. The $40 thousand and $541 thousand difference between the consideration paid and the carrying value of the Series D Preferred Stock was reclassified to retained earnings and resulted in an increase to net (loss) income allocated to common stockholders.

During the three and six months ended June 30, 2020, we repurchased depositary shares (Series E Depositary Shares), each representing a 1/40^th interest in a share of Series E Preferred Stock, liquidation amount of $1,000 per share of Series E Preferred Stock, resulting in the repurchase of 57,065 and 64,465 outstanding Series E Depositary Shares and the related retirement of 1,427 and 1,612 outstanding shares of Series E Preferred Stock. The repurchase price aggregated to $1.4 million and $1.5 million. The $9 thousand and $34 thousand difference between the consideration paid and the carrying value of the Series E Preferred Stock was reclassified to retained earnings and resulted in an increase to net (loss) income allocated to common stockholders.

Share Repurchase Program

On February 10, 2020, we announced that our Board of Directors (the “Board”) authorized the repurchase of up to $45 million of our common stock. The repurchase authorization expires in February 2021, however given current macroeconomic conditions and the COVID-19 pandemic, we have suspended common stock repurchases for the immediate future. There were no repurchases of common stock for the three months ended June 30, 2020. During the six months ended June 30, 2020, we repurchased 827,584 shares of common stock at a weighted average price of $14.50 per share and an aggregate amount of $12.0 million. Purchases may be made in open-market transactions, in block transactions on or off an exchange, in privately negotiated transactions, or by other means as determined by our management and in accordance with the regulations of the Securities and Exchange Commission. The timing of purchases and the number of shares repurchased under the program will depend on a variety of factors including price, trading volume, corporate and regulatory requirements, and market conditions.

Change in Accumulated Other Comprehensive (Loss) Income ("AOCI")

Our AOCI includes unrealized gain (loss) on securities available-for-sale. Changes to AOCI are presented net of tax effect as a component of stockholders' equity. Reclassifications from AOCI are recorded on the consolidated statements of operations either as a gain or loss. The following table presents changes to AOCI for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Unrealized(loss) gain on securities available-for-sale
Balance at beginning of period	$	(54,148)	$	(18,091)	$	(11,900)	$	(24,117)
Unrealized gain (loss) arising during the period	56,701		7,678		(3,182)		16,422
Reclassification adjustment from other comprehensive income	(2,011)		—		(2,011)		(208)
Tax effect of current period changes	(16,107)		(2,255)		1,528		(4,765)
Total changes, net of taxes	38,583		5,423		(3,665)		11,449
Balance at end of period	$	(15,565)	$	(12,668)	$	(15,565)	$	(12,668)

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VARIABLE INTEREST ENTITIES

6 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

VARIABLE INTEREST ENTITIES

VARIABLE INTEREST ENTITIES

We hold ownership interests in alternative energy partnerships and qualified affordable housing partnerships and have a variable interest in a multifamily securitization trust. We evaluate our interests in these entities to determine whether they meet the definition of a variable interest entity (VIE) and whether we are required to consolidate these entities. A VIE is consolidated by its primary beneficiary, which is the party that has both (i) the power to direct the activities that most significantly impact the economic performance of the VIE and (ii) a variable interest that could potentially be significant to the VIE. To determine whether or not a variable interest we hold could potentially be significant to the VIE, we consider both qualitative and quantitative factors regarding the nature, size, and form of our involvement with the VIE. We have determined that our interests in these entities meet the definition of variable interests.

Unconsolidated VIEs

Multifamily Securitization

During the third quarter of 2019, we transferred $573.5 million of multifamily loans, through a two-step process, to a third-party depositor which placed the multifamily loans into a third-party trust (a VIE) that issued structured pass-through certificates to investors. The transfer of these loans was accounted for as a sale for financial reporting purposes, in accordance with ASC 860. We determined that we are not the primary beneficiary of this VIE as we do not have the power to direct the activities that will have the most significant economic impact on the entity. Our continuing involvement in this securitization is limited to customary obligations associated with the securitization of loans, including the obligation to cure, repurchase, or substitute loans in the event of a material breach in representations. Additionally, we have the obligation to guarantee credit losses up to 12% of the aggregate unpaid principal balances at cut-off date of the securitization. This obligation is supported by a $68.8 million letter of credit between the Freddie Mac and the FHLB.

The maximum loss exposure that would be absorbed by us in the event that all of the assets in the securitization trust are deemed worthless is $68.8 million, which represents the aforementioned obligation to guarantee credit losses up to 12%. We believe that the loss exposure on the multifamily securitization is reduced by both loan-to-value ratios of the underlying collateral balances and the overcollateralization that exists within the securitization trust. At June 30, 2020, we have a $3.5 million repurchase reserve related to this VIE.

Alternative Energy Partnerships

We invest in certain alternative energy partnerships (limited liability companies) formed to provide sustainable energy projects that are designed to generate a return primarily through the realization of federal tax credits (energy tax credits). These entities were formed to invest in newly established residential and commercial solar leases and power purchase agreements. As a result of our investments, we have the right to certain investment tax credits and tax depreciation benefits (recognized on the flow through and income statement method in accordance with ASC 740), and to a lesser extent, cash flows generated from the installed solar systems leased to individual consumers for a fixed period of time. While our interest in the alternative energy partnerships meets the definition of a VIE in accordance with ASC 810, we have determined that we are not the primary beneficiary because we do not have the power to direct the activities that most significantly impact the economic performance of the entities including operational and credit risk management activities. As we are not the primary beneficiary, we did not consolidate the entities.

We use the Hypothetical Liquidation at Book Value (HLBV) method to account for our investments in energy tax credits as an equity investment under ASC 970-323-25-17. Under the HLBV method, an equity method investor determines its share of an investee's earnings by comparing its claim on the investee's book value at the beginning and end of the period, assuming the investee were to liquidate all assets at their U.S. GAAP amounts and distribute the resulting cash to creditors and investors

under their respective priorities. The difference between the calculated liquidation distribution amounts at the beginning and the end of the reporting period, after adjusting for capital contributions and distributions, is our share of the earnings or losses from the equity investment for the period. To account for the tax credits earned on investments in alternative energy partnerships, we use the flow-through income statement method. Under this method, the tax credits are recognized as a reduction to income tax expense and the initial book-tax differences in the basis of the investments are recognized as additional tax expense in the year they are earned. Investments in alternative energy partnerships totaled $27.0 million and $29.3 million at June 30, 2020 and December 31, 2019.

The following table presents information regarding activity in our alternative energy partnerships for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Fundings	$	—	$	235	$	3,631	$	235
Cash distribution from investment	547		535		1,001		995
Gain (loss) on investments in alternative energy partnerships	167		355		(1,738)		(1,595)
Income tax credits recognized	—		1,723		—		1,723
Tax (expense) benefit recognized from HLBV application	(38)		380		398		380

The following table represents the carrying value of the associated unconsolidated assets and liabilities and the associated maximum loss exposure for alternative energy partnerships as of the dates indicated:

($ in thousands)	June 30, 2020		December 31, 2019
Cash	$	2,958	$	4,224
Equipment, net of depreciation	244,961		248,920
Other assets	6,751		6,301
Total unconsolidated assets	$	254,670	$	259,445
Total unconsolidated liabilities	$	6,326	$	7,143
Maximum loss exposure	$	26,967	$	32,525

The maximum loss exposure that would be absorbed by us in the event that all of the assets in alternative energy partnerships are deemed worthless is $27.0 million, which is our recorded investment amount at June 30, 2020.

We believe that the loss exposure on our investments is reduced considering our return on our investment is provided not only by the cash flows of the underlying client leases and power purchase agreements, but also through the significant tax benefits, including federal tax credits generated from the investments. In addition, the arrangements include a transition manager to support any transition of the solar company sponsor whose role includes that of the servicer and operation and maintenance provider, in the event the sponsor would be required to be removed from its responsibilities (e.g., bankruptcy, breach of contract, etc.), thereby further limiting our exposure.

Qualified Affordable Housing Partnerships

We invest in limited partnerships that operate qualified affordable housing projects. The returns on these investments are generated primarily through allocated Federal tax credits and other tax benefits. In addition, these investments contribute to our compliance with the Community Reinvestment Act. These limited partnerships are considered to be VIEs, because either (i) they do not have sufficient equity investment at risk or (ii) the limited partners with equity at risk do not have substantive kick-out rights through voting rights or substantive participating rights over the general partner. As a limited partner, we are not the primary beneficiary because the general partner has the ability to direct the activities of the VIEs that most significantly impact their economic performance. As a result, we do not consolidate these partnerships.

The following table presents information regarding balances in our qualified affordable housing partnerships for the periods indicated:

($ in thousands)	June 30, 2020		December 31, 2019
Ending balance(1)	$	46,167	$	36,462
Aggregate funding commitment	61,278		49,278
Total amount funded	40,776		26,905
Unfunded commitment	20,502		22,373
Maximum loss exposure	46,167		36,462

(1)Included in other assets in the accompanying consolidated statements of financial condition.

The following table presents information regarding activity in our qualified affordable housing partnerships for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Fundings	$	9,312	$	—	$	13,871	$	454
Proportional amortization recognized	1,148		553		2,295		1,190
Income tax credits recognized	1,152		554		2,208		1,109

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(LOSS) EARNINGS PER COMMON SHARE

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

(LOSS) EARNINGS PER COMMON SHARE

(LOSS) EARNINGS PER COMMON SHARE

The following table presents computations of basic and diluted (loss) earnings per common share ("EPS") for the three and six months ended June 30, 2020:

	Three Months Ended June 30, 2020				Six Months Ended June 30, 2020
($ in thousands except per share data)	Common Stock		Class B Common Stock		Common Stock		Class B Common Stock
Loss from operations	$	(18,273)	$	(176)	$	(24,804)	$	(238)
Less: participating securities dividends	(93)		(1)		(186)		(2)
Less: preferred stock dividends	(3,409)		(33)		(6,909)		(66)
Less: preferred stock redemption	49		—		570		5
Net loss allocated to common stockholders	$	(21,726)	$	(210)	$	(31,329)	$	(301)
Weighted average common shares outstanding	49,553,598		477,321		49,770,527		477,321
Dilutive effects of restricted shares/units	—		—		—		—
Dilutive effects of stock options	—		—		—		—
Average shares and dilutive common shares	49,553,598		477,321		49,770,527		477,321
Basic loss per common share	$	(0.44)	$	(0.44)	$	(0.63)	$	(0.63)
Diluted loss per common share	$	(0.44)	$	(0.44)	$	(0.63)	$	(0.63)

For the three and six months ended June 30, 2020, there were 960,090 and 960,883 of restricted shares/units and 55,069 and 55,438 of stock options that were not considered in computing diluted earnings per common share, because they were anti-dilutive.

The following table presents computations of basic and diluted EPS for the three and six months ended June 30, 2019:

	Three Months Ended June 30, 2019				Six Months Ended June 30, 2019
($ in thousands except per share data)	Common Stock		Class B Common Stock		Common Stock		Class B Common Stock
Income from operations	$	16,426	$	156	$	23,397	$	222
Less: income allocated to participating securities	(268)		(3)		(152)		(1)
Less: participating securities dividends	(93)		(1)		(292)		(3)
Less: preferred stock dividends	(4,268)		(40)		(8,535)		(81)
Net income allocated to common stockholders	$	11,797	$	112	$	14,418	$	137
Weighted average common shares outstanding	50,379,816		477,321		50,290,107		477,321
Dilutive effects of stock units	103,677		—		119,967		—
Dilutive effects of stock options	4,142		—		7,795		—
Average shares and dilutive common shares	50,487,635		477,321		50,417,869		477,321
Basic earnings per common share	$	0.23	$	0.23	$	0.29	$	0.29
Diluted earnings per common share	$	0.23	$	0.23	$	0.29	$	0.29

For the three and six months ended June 30, 2019, there were 517,833 and 484,163, respectively, of stock units and 58,859 and 33,013, respectively, of stock options that were not considered in computing diluted earnings per common share, because they were anti-dilutive.

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LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES

6 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES

LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES

Some financial instruments, such as unfunded loan commitments, credit lines, letters of credit, and overdraft protection, are issued to meet customer financing needs. These are agreements to provide credit or to support the credit of others, as long as conditions established in the contract are met, and usually have expiration dates. Commitments may expire without being used. Risk of credit loss exists up to the face amount of these instruments. The same credit policies are used to make such commitments as are used for originating loans, including obtaining collateral at exercise of the commitment.

The following table presents the contractual amount of financial instruments with off-balance-sheet risk as of the periods indicated:

	June 30, 2020				December 31, 2019
($ in thousands)	Fixed Rate		Variable Rate		Fixed Rate		Variable Rate
Commitments to extend credit	$	6,249	$	73,844	$	473	$	129,495
Unused lines of credit	590		1,391,625		703		1,049,632
Letters of credit	336		3,243		134		5,316

Other Commitments

At June 30, 2020, we had unfunded commitments of $20.5 million, $7.1 million, and $501 thousand for affordable housing fund investments, Small Business Investment Company (SBIC) investments, and other investments, respectively.

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REVENUE RECOGNITION

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

REVENUE RECOGNITIONThe following presents noninterest income, segregated by revenue streams, in-scope and out-of-scope of Topic 606 - Revenue From Contracts With Customers, for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Noninterest income (loss)
In scope of Topic 606
Deposit service fees	$	420	$	575	$	959	$	1,242
Debit card fees	380		178		557		291
Investment commissions	—		260		—		539
Other	59		109		108		216
Noninterest income (in-scope of Topic 606)	859		1,122		1,624		2,288
Noninterest income (out-of-scope of Topic 606)	4,669		(3,412)		5,965		1,717
Total noninterest income (loss)	$	5,528	$	(2,290)	$	7,589	$	4,005

We do not typically enter into long-term revenue contracts with customers. As of June 30, 2020 and December 31, 2019, we did not have any significant contract balances. As of June 30, 2020, we did not capitalize any contract acquisition costs.

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RELATED-PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2020

Related Party Transactions [Abstract]

RELATED-PARTY TRANSACTIONS

RELATED-PARTY TRANSACTIONS

Certain of our executive officers and directors, and their related interests, are customers of, or have had transactions with, the Bank in the ordinary course of business, including deposits, loans and other financial services related transactions. From time to time, the Bank may make loans to executive officers and directors, and their related interests, in the ordinary course of business and on substantially the same terms and conditions, including interest rates and collateral, as those of comparable transactions with non-insiders prevailing at the time, in accordance with the Bank’s underwriting guidelines. These loans do not involve more than the normal risk of collectability or present other unfavorable features. As of June 30, 2020, no related party loans were categorized as non-accrual, past due, restructured, or potential problem loans.

Transactions with Related Parties

The Company and the Bank have engaged in transactions described below with the Company’s current or former directors, executive officers, and beneficial owners of more than 5 percent of the outstanding shares of the Company’s voting common stock and certain persons related to them.

As previously disclosed, the Company’s Board of Directors has authorized and directed the Company to provide indemnification, advancement, and/or reimbursement for the costs of separate, independent counsel retained by any then-current officer or director, in their individual capacity, with respect to matters related to (i) an investigation by the Special Committee of the Company’s Board of Directors, (ii) a formal order of investigation issued by the SEC on January 4, 2017 (since resolved), and (iii) any related civil or administrative proceedings against the Company as well as officers and directors currently or previously associated with the Company (collectively, the “Indemnity Matters”).

Indemnification costs were paid on behalf of certain current and former executive officers and directors in amounts less than $120 thousand for the three and six months ended June 30, 2020. During the three and six months ended June 30, 2019, indemnification costs paid by the Company included $4.7 million and $6.9 million incurred by the Company’s former Chair, President, and Chief Executive Officer, Steven A. Sugarman; $186 thousand and $741 thousand jointly incurred by the Company’s former Interim Chief Financial Officer and Chief Strategy Officer, J. Francisco A. Turner; and the Company’s former Chief Financial Officer, James J. McKinney; and $139 thousand and $142 thousand incurred by the Bank’s former director, Cynthia Abercrombie. Indemnification costs for the Company's former General Counsel Emeritus John Grosvenor were $149 thousand for the six months ended June 30, 2019. Indemnification costs were paid on behalf of other former executive officers and other former directors in lesser amounts for the three and six months ended June 30, 2019.

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LITIGATION	6 Months Ended
	Jun. 30, 2020
Commitments and Contingencies Disclosure [Abstract]
LITIGATION	LITIGATIONFrom time to time, we are involved as plaintiff or defendant in various legal actions arising in the normal course of business. In accordance with applicable accounting guidance, we establish an accrued liability when those matters present loss contingencies that are both probable and estimable. We continue to monitor the matters for further developments that could affect the amount of the accrued liability that has been previously established. While the ultimate liability with respect to legal actions cannot be determined at this time, we believe that damages, if any, and other amounts relating to pending matters are not likely to be material to the consolidated financial statements.

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SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2020
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	SUBSEQUENT EVENTSWe have evaluated events from the date of the consolidated financial statements on June 30, 2020 through the issuance of these consolidated financial statements included in this Quarterly Report on Form 10-Q.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation: The accompanying unaudited interim consolidated financial statements have been prepared pursuant to Article 10 of SEC Regulation S-X and other SEC rules and regulations for reporting on the Quarterly Report on Form 10-Q. Accordingly, certain disclosures required by U.S. generally accepted accounting principles (“GAAP”) are not included herein. These interim statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report on Form 10-K for the year ended December 31, 2019 filed by us with the SEC. The December 31, 2019 consolidated statements of financial condition presented herein has been derived from the audited financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC.

Reclassification

In the opinion of management of the Company, the accompanying unaudited interim consolidated financial statements reflect all of the adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the consolidated financial condition and consolidated results of operations as of the dates and for the periods presented.

Principles of Consolidation

Principles of Consolidation: The accompanying unaudited consolidated financial statements include the accounts of the Company and its consolidated subsidiaries as of June 30, 2020 and December 31, 2019 and for the three and six months ended June 30, 2020 and 2019. Significant intercompany accounts and transactions have been eliminated in consolidation. Unless the context requires otherwise, all references to the Company include its then wholly-owned subsidiaries.

Adopted Accounting Pronouncements and Significant Accounting Policies

Adopted Accounting Pronouncements:

On January 1, 2020, we adopted Accounting Standards Update (“ASU”) 2016-13, Financial Instruments-Credit Losses (Topic 326) (“ASU 2016-13”), which replaces the incurred loss impairment methodology with a methodology that reflects current expected credit losses (“CECL”) and requires consideration of a broader range of reasonable and supportable information to estimate expected credit losses. The measurement of expected credit losses under the CECL model is applicable to financial assets measured at amortized cost, including loan receivables, held-to-maturity debt securities and off-balance sheet credit exposures. ASU 2016-13 also requires credit losses relating to available-for-sale debt securities to be recorded through an allowance for credit losses. In addition, ASU 2016-13 modifies the other-than-temporary impairment (“OTTI”) model for available-for-sale (“AFS”) debt securities to require an allowance for credit impairment instead of a direct write-down, which allows for reversal of credit impairments in future periods based on improvements in credit quality.

We adopted ASU 2016-13 using the modified retrospective method for our financial assets measured at cost, including loans receivable and off-balance sheet credit exposures. Results for reporting periods beginning January 1, 2020 are reported under ASU 2016-13 (or Accounting Standards Codification 326), while prior period results continue to be reported under the previously applicable GAAP. The adoption of ASU 2016-13 on January 1, 2020 resulted in an increase of $6.4 million to our allowance for credit losses and an after-tax net decrease in retained earnings of $4.5 million. This transition adjustment reflects the development of our models to estimate lifetime expected credit losses on our loans, unfunded commitments, and other off-balance sheet credit exposure primarily using a lifetime loss methodology.

The following table presents the impact of adopting ASU 2016-13 on January 1, 2020:

($ in thousands)	As Reported Under ASC 326		Pre- ASC 326 Adoption		Impact of ASC 326 Adoption
Assets:
Allowance for credit losses - loans
Commercial:
Commercial and industrial	$	23,015	$	22,353	$	662
Commercial real estate	10,788		5,941		4,847
Multifamily	13,214		11,405		1,809
SBA	3,508		3,120		388
Construction	4,009		3,906		103
Consumer:
Single family residential mortgage	10,066		10,486		(420)
Other consumer	658		438		220
Total	65,258		57,649		7,609
Liabilities:
Allowance for credit losses - unfunded loan commitments	$	2,838	$	4,064	$	(1,226)

Significant Accounting Policies: The accounting and reporting policies of the Company are based upon GAAP and conform to predominant practices within the banking industry. We have not made any significant changes in our critical accounting policies from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC, except for the accounting for loans and the allowance for credit losses, the allowance for credit losses on unfunded loan commitments, troubled debt restructurings, and available-for-sale debt securities as described below.

Allowance for Credit Losses (ACL): The ACL is a reserve established through a provision for credit loss expense and represents management’s best estimate of the net amount expected to be collected from loans receivable as of the date of the consolidated statements of financial condition. Confirmed losses are charged against the ACL. Subsequent recoveries, if any, are credited to the ACL. We perform an analysis of the adequacy of the ACL at least quarterly. Management estimates the required ACL balance using past loan loss experience, the nature and volume of the portfolio, information about specific borrower situations, estimated collateral values, economic conditions, and other factors. The ACL consists of; (i) a specific allowance established for probable losses on individually identified impaired loans, (ii) a quantitative allowance for current expected loan losses based on the portfolio and expected economic conditions over a reasonable and supportable forecast period that reverts back to long-term trends to cover the life of loan; and (iii) a qualitative allowance to capture factors and trends that are not adequately reflected in the quantitative allowance, including an evaluation of our underwriting, other credit-related processes, and other credit risk factors such as concentration risk. Accrued interest is excluded from our expected credit loss estimates.

Expected credit losses are estimated over the contractual term of the loans, adjusted for prepayments, as appropriate. The contractual term excludes expected extensions and renewals unless those extension or renewal options are included in the underlying contract and we do not have the ability to unconditionally cancel. The contractual term also excludes expected modifications unless management has a reasonable expectation, at the reporting period, that a troubled debt restructuring will be executed.

A loan is deemed impaired when, based on current information and events, it is probable that we will be unable to collect all amounts due according to the contractual terms of the loan agreement. We measure expected credit losses on all impaired loans individually under the guidance of ASC 326, Receivables, primarily through the evaluation of collateral values and estimated cash flows expected to be collected. Cash receipts on impaired loans for which the accrual of interest has been discontinued are applied first to principal and then to interest income. Loans for which the terms have been modified by granting a concession that normally would not be provided and where the borrower is experiencing financial difficulties are considered troubled debt restructurings (“TDRs”) and classified as impaired.

Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls, generally, are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the

borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. The impairment amount on a collateral dependent loan is generally charged-off to the ACL and the impairment amount on a loan, that is not collateral dependent, is set-up as a specific reserve. TDRs are also measured at the present value of estimated future cash flows using the loan’s effective rate at inception or at the fair value of collateral, less costs to sell, if repayment is expected solely from the collateral. For TDRs that subsequently default, we determine the amount of reserve in accordance with the accounting policy for the ACL.

At June 30, 2020, the following loan portfolio segments have been identified:

•Commercial and industrial (general commercial and industrial, warehouse lending, and indirect/direct leveraged lending)

•Commercial real estate

•Multifamily

•Small Business Administration (“SBA”)

•Construction

•SFR - 1st deeds of trust (generally SFR mortgage and other)

•Other consumer (HELOC and other)

We categorize loans into risk categories based on relevant information about the ability of borrowers to service their obligations such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. We analyze loans individually by classifying the loans as to credit risk.

Loans secured by multifamily and commercial real estate properties generally involve a greater degree of credit risk than SFR mortgage loans. Because payments on loans secured by multifamily and commercial real estate properties are often dependent on the successful operation or management of the properties, repayment of these loans may be subject to adverse conditions in the real estate market or the economy. Commercial and industrial loans are also considered to have a greater degree of credit risk than SFR mortgage loans due to the fact commercial and industrial loans are typically made on the basis of the borrower’s ability to make repayment from the cash flow of the borrower’s business. As a result, the availability of funds for the repayment of commercial and industrial loans may be substantially dependent on the success of the business itself (which, in turn, is often dependent, in part, upon general economic conditions). SBA loans are similar to commercial and industrial loans, however, they have additional credit enhancement in the form of a guaranty provided by the U.S. Small Business Administration, for up to 85% of the loan amount for loans up to $150 thousand and 75% of the loan amount for loans of more than $150 thousand. SBA loans originated as part of the Paycheck Protection Program (“PPP”) established by the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) have additional credit enhancement provided by the U.S. Small Business Administration for up to 100% of the loan amount. As of June 30, 2020, we funded $240.7 million in PPP loans. During the three months ended June 30, 2020, we collected $7.5 million in fees on PPP loans funded during the quarter, which will be recognized over their estimated life of 9 months. The 9 months estimated life of PPP loans is based on our understanding of our clients' cash use, expected forgiveness probability, and loan forgiveness process. The availability of funds for the repayment of financing may be substantially dependent on the success of the business itself which is often dependent, in part, upon general economic conditions. Consumer loans may have greater risk than SFR mortgage loans given that collection of these loans is dependent on the borrower’s continuing financial stability and, thus, are more likely to be adversely affected by job loss, divorce, illness, or personal bankruptcy.

Green Loans are considered to carry a higher degree of credit risk due to their unique cash flows. Credit risk on this asset class is also managed through the completion of regular third party automated valuation models (“AVMs”) of the underlying collateral and monitoring of the borrower’s usage of this account to determine if the borrower is making monthly payments from external sources or “drawdowns” on their line. In cases where the property values have declined to levels less than the original loan to value (“LTV”) ratios, or other levels deemed prudent by us, we may curtail the line and/or require monthly payments or principal reductions to bring the loan in balance.

On interest only loans, we project future payment changes to determine if there will be a material increase in the required payment and then monitor the loans for possible delinquency. Individual loans are monitored for possible downgrading of risk rating.

Troubled Debt Restructurings: A loan is identified as a TDR when a borrower is experiencing financial difficulties and, for economic or legal reasons related to these difficulties, we grant a concession to the borrower in the restructuring that we would not otherwise consider. We have granted a concession when, as a result of the restructuring to a troubled borrower, we do not expect to collect all amounts due, including principal and/or interest accrued at the original terms of the loan. The concessions may be granted in various forms, including a below-market change in the stated interest rate, a reduction in the loan balance or accrued interest, an extension of the maturity date, or a note split with principal forgiveness. Loans for which the borrower has been discharged under Chapter 7 bankruptcy are considered collateral dependent TDRs, impaired at the date of discharge, and

charged down to the fair value of collateral less cost to sell. A restructuring executed at an interest rate that is at market interest rates based on the current credit characteristics of the borrower is not a TDR.

Our policy is to place consumer loan TDRs, except those that were performing prior to TDR status, on non-accrual status for a minimum period of 6 months. Commercial TDRs are evaluated on a case-by-case basis for determination whether or not to place them on non-accrual status. Loans qualify for return to accrual status once they have demonstrated performance under the restructured terms of the loan for a minimum of 6 months. Initially, all TDRs are reported as impaired. Generally, TDRs are classified as impaired loans and reported as TDRs for the remaining life of the loan. Impaired and TDR classification may be removed if the borrower demonstrates compliance with the modified terms for a minimum of 6 months, through one fiscal year-end and the restructuring agreement specifies a market rate of interest equal to that which would be provided to a borrower with similar credit at the time of restructuring. In the limited circumstance that a loan is removed from TDR classification, it is our policy to continue to base our measure of loan impairment on the contractual terms specified by the loan agreement.

Troubled Debt Restructuring (TDR) Relief: Under U.S. GAAP, banks are required to assess modifications to a loan’s terms for potential classification as a TDR. A loan to a borrower experiencing financial difficulty is classified as a TDR when a lender grants a concession that it would otherwise not consider, such as a payment deferral or interest concession. In order to encourage banks to work with impacted borrowers, the CARES Act and U.S. banking regulatory agencies have provided relief from TDR accounting. The main benefits of TDR relief include 1) a capital benefit in the form of reduced risk-weighted assets, as TDRs are more heavily risk-weighted for capital purposes; 2) a delinquency status benefit, as the aging of loans are frozen, i.e., they will continue to be reported in the same delinquency bucket they were in at the time of modification; and 3) a non-accrual status benefit as the loans are generally not reported as non-accrual during the modification period.

Reserve for Unfunded Loan Commitments: The reserve for unfunded loan commitments provides for estimated credit losses for the unused portion of lending commitments expected to be funded, except for unconditionally cancellable commitments for which no reserve is required under ASC 326. The reserve for unfunded loan commitments includes factors that are consistent with ACL methodology for loans using the expected loss factors and a draw down factor applied to the underlying borrower risk and facility grades. Changes in the reserve for unfunded loan commitments are reported as a component of provision for credit losses in the consolidated statements of operations and the reserve for unfunded loan commitments is included in other liabilities in the consolidated statements of financial condition.

Available-for-Sale Debt Securities: Available-for-sale debt securities are analyzed for credit losses under ASC 326, which requires the Company to determine whether impairment exists as of the reporting date and whether that impairment is due to credit losses. An allowance for credit losses is established for losses on available-for-sale debt securities due to credit losses and is reported as a component of provision for credit losses. Accrued interest is excluded from our expected credit loss estimates. Available-for-sale debt securities are typically classified as non-accrual when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about the further collectability of principal or interest. When available-for-sale debt securities are placed on non-accrual status, unpaid interest recognized as interest income is reversed.

Use of Estimates in the Preparation of Financial Statements: The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the consolidated financial statements and disclosures provided, and actual results could differ. The ACL, reserve for loss on repurchased loans, reserve for unfunded loan commitments, realization of deferred tax assets, the valuation of goodwill and other intangible assets, mortgage banking, other derivatives, Hypothetical Liquidation at Book Value (“HLBV”) of investments in alternative energy partnerships, and the fair value measurement of financial instruments are particularly subject to change and such change could have a material effect on the consolidated financial statements.

Recent Accounting Guidance, Not Yet Effective: In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). The amendments in this Update simplify the accounting for income taxes by removing certain exceptions for investments, intra-period allocations, and interim calculations, and add guidance to reduce the complexity of applying Topic 740. This ASU will be effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2020. We will adopt this guidance on January 1, 2021. We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.

In March 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-04, Reference Rate Reform (Topic 848), which provides optional guidance, for a limited period of time, to ease the potential burden in accounting for (or recognizing the benefits of) reference rate reform on financial reporting. The amendments in ASU 2020-04 are elective and apply to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria. When elected, the optional expedients for contract modifications must be applied consistently for all eligible contracts or eligible transactions within the relevant topic or industry subtopic within the

codification that contains the guidance that otherwise would be required to be applied. The amendments in ASU 2020-04 are effective for all entities as of March 12, 2020 through December 31, 2022. We are in the process of evaluating the potential impact the discontinuation of LIBOR will have on our contracts and expect to elect the optional expedients and exceptions set forth in the amendments.

Use of Estimates in the Preparation of Financial Statements

Use of Estimates in the Preparation of Financial Statements: The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the consolidated financial statements and disclosures provided, and actual results could differ. The ACL, reserve for loss on repurchased loans, reserve for unfunded loan commitments, realization of deferred tax assets, the valuation of goodwill and other intangible assets, mortgage banking, other derivatives, Hypothetical Liquidation at Book Value (“HLBV”) of investments in alternative energy partnerships, and the fair value measurement of financial instruments are particularly subject to change and such change could have a material effect on the consolidated financial statements.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Impact of Adopting ASU 2016-13

The following table presents the impact of adopting ASU 2016-13 on January 1, 2020:

($ in thousands)	As Reported Under ASC 326		Pre- ASC 326 Adoption		Impact of ASC 326 Adoption
Assets:
Allowance for credit losses - loans
Commercial:
Commercial and industrial	$	23,015	$	22,353	$	662
Commercial real estate	10,788		5,941		4,847
Multifamily	13,214		11,405		1,809
SBA	3,508		3,120		388
Construction	4,009		3,906		103
Consumer:
Single family residential mortgage	10,066		10,486		(420)
Other consumer	658		438		220
Total	65,258		57,649		7,609
Liabilities:
Allowance for credit losses - unfunded loan commitments	$	2,838	$	4,064	$	(1,226)

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FAIR VALUES OF FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value Assets Measured on a Recurring Basis

The following table presents our financial assets and liabilities measured at fair value on a recurring basis as of the dates indicated:

			Fair Value Measurement Level
($ in thousands)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2020
Assets
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	105,555	$	—	$	105,555	$	—
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	201,136		—		201,136		—
Municipal securities	57,174		—		57,174		—
Non-agency residential mortgage-backed securities	164		—		164		—
Collateralized loan obligations	668,353		—		668,353		—
Corporate debt securities	143,647		—		143,647		—
Loans held-for-sale, carried at fair value	19,768		—		3,083		16,685
Derivative assets:
Interest rate swaps and caps (1)	8,598		—		8,598		—
Foreign exchange contracts (1)	137		—		137		—
Liabilities
Derivative liabilities:
Interest rate swaps and caps (2)	9,239		—		9,239		—
Foreign exchange contracts (2)	54		—		54		—
December 31, 2019
Assets
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	36,456	$	—	$	36,456	$	—
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	91,299		—		91,299		—
Municipal securities	52,689		—		52,689		—
Non-agency residential mortgage-backed securities	196		—		196		—
Collateralized loan obligations	718,361		—		718,361		—
Corporate debt securities	13,579		—		13,579		—
Loans held-for-sale, carried at fair value	22,642		—		3,409		19,233
Derivative assets:
Interest rate swaps and caps (1)	3,445		—		3,445		—
Foreign exchange contracts (1)	138		—		138		—
Liabilities
Derivative liabilities:
Interest rate swaps and caps (2)	3,717		—		3,717		—
Foreign exchange contracts (2)	136		—		136		—

(1)Included in Other assets in the Consolidated Statements of Financial Condition.

(2)Included in Accrued expenses and Other liabilities in the Consolidated Statements of Financial Condition.

Fair Value Liabilities Measured on a Recurring Basis

The following table presents our financial assets and liabilities measured at fair value on a recurring basis as of the dates indicated:

			Fair Value Measurement Level
($ in thousands)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2020
Assets
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	105,555	$	—	$	105,555	$	—
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	201,136		—		201,136		—
Municipal securities	57,174		—		57,174		—
Non-agency residential mortgage-backed securities	164		—		164		—
Collateralized loan obligations	668,353		—		668,353		—
Corporate debt securities	143,647		—		143,647		—
Loans held-for-sale, carried at fair value	19,768		—		3,083		16,685
Derivative assets:
Interest rate swaps and caps (1)	8,598		—		8,598		—
Foreign exchange contracts (1)	137		—		137		—
Liabilities
Derivative liabilities:
Interest rate swaps and caps (2)	9,239		—		9,239		—
Foreign exchange contracts (2)	54		—		54		—
December 31, 2019
Assets
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	36,456	$	—	$	36,456	$	—
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	91,299		—		91,299		—
Municipal securities	52,689		—		52,689		—
Non-agency residential mortgage-backed securities	196		—		196		—
Collateralized loan obligations	718,361		—		718,361		—
Corporate debt securities	13,579		—		13,579		—
Loans held-for-sale, carried at fair value	22,642		—		3,409		19,233
Derivative assets:
Interest rate swaps and caps (1)	3,445		—		3,445		—
Foreign exchange contracts (1)	138		—		138		—
Liabilities
Derivative liabilities:
Interest rate swaps and caps (2)	3,717		—		3,717		—
Foreign exchange contracts (2)	136		—		136		—

(1)Included in Other assets in the Consolidated Statements of Financial Condition.

(2)Included in Accrued expenses and Other liabilities in the Consolidated Statements of Financial Condition.

Reconciliation of Assets Measured at Fair Value on Recurring Basis

The following table presents a reconciliation of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3), on a consolidated operations basis, for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Loans repurchased from GNMA Loan Pools
Balance at beginning of period	$	17,127	$	23,069	$	19,233	$	25,040
Total gains (losses) (realized/unrealized):
Included in earnings—fair value adjustment	22		(6)		(1,369)		(3)
Additions	—		—		—		—
Sales, settlements, and other	(464)		(1,988)		(1,179)		(3,962)
Balance at end of period	$	16,685	$	21,075	$	16,685	$	21,075

Fair value option of certain assets

The following table presents the fair value and aggregate principal balance of certain assets, on a consolidated operations basis, under the fair value option:

	June 30, 2020						December 31, 2019
($ in thousands)	Fair Value		Unpaid Principal Balance		Difference		Fair Value		Unpaid Principal Balance		Difference
Loans held-for-sale, carried at fair value:
Total loans	$	19,768	$	22,208	$	(2,440)	$	22,642	$	23,455	$	(813)
Non-accrual loans (1)	6,147		7,244		(1,097)		8,125		8,370		(245)

(1) Includes loans guaranteed by the U.S. government of $4.4 million and $6.7 million at June 30, 2020 and December 31, 2019.

The following table presents changes in fair value related to initial measurement and subsequent changes in fair value included in earnings for these assets measured at fair value for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Net (losses) gains from fair value changes:
Fair value adjustment for loans held-for-sale	$	25	$	59	$	(1,561)	$	60

Schedule of Assets and Liabilities Measured on Non-recurring Basis

The following table presents our financial assets and liabilities measured at fair value on a non-recurring basis as of the dates indicated:

			Fair Value Measurement Level
($ in thousands)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2020
Assets
Impaired loans:
Commercial and industrial	$	10,049	$	—	$	—	$	10,049
SBA	664		—		—		664
December 31, 2019
Assets
Impaired loans:
Single family residential mortgage	$	3,678	$	—	$	—	$	3,678
Commercial and industrial	15,409		—		—		15,409
SBA	1,711		—		—		1,711

Schedule of Gains and (Losses) Recognized on Assets Measured at Fair Value on Non-recurring Basis

The following table presents the losses recognized on assets measured at fair value on a non-recurring basis for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Impaired loans:
Single family residential mortgage	$	—	$	—	$	(531)	$	(490)
Commercial and industrial	(6,090)		—		(8,514)		—
SBA	(670)		—		(1,544)		(46)
Other consumer	—		—		(4)		(88)

Carrying Amounts and Estimated Fair Values of Financial Instruments

Estimated Fair Values of Financial Instruments

The following table presents the carrying amounts and estimated fair values of financial assets and liabilities as of the dates indicated:

	Carrying Amount		Fair Value Measurement Level
($ in thousands)			Level 1		Level 2		Level 3		Total
June 30, 2020
Financial assets
Cash and cash equivalents	$	420,640	$	420,640	$	—	$	—	$	420,640
Securities available-for-sale	1,176,029		—		1,176,029		—		1,176,029
Federal Home Loan Bank and other bank stock	46,585		—		46,585		—		46,585
Loans held-for-sale, carried at fair value	19,768		—		3,083		16,685		19,768
Loans receivable, net of allowance for loan losses	5,537,326		—		—		5,642,634		5,642,634
Accrued interest receivable	29,515		29,515		—		—		29,515
Derivative assets	8,735		—		8,735		—		8,735
Financial liabilities
Deposits	6,037,465		—		—		6,042,349		6,042,349
Advances from Federal Home Loan Bank	617,170		—		666,177		—		666,177
Long-term debt	173,537		—		178,030		—		178,030
Derivative liabilities	9,293		—		9,293		—		9,293
Accrued interest payable	4,297		4,297		—		—		4,297
December 31, 2019
Financial assets
Cash and cash equivalents	$	373,472	$	373,472	$	—	$	—	$	373,472
Securities available-for-sale	912,580		—		912,580		—		912,580
Federal Home Loan Bank and other bank stock	59,420		—		59,420		—		59,420
Loans held-for-sale	22,642		—		3,409		19,233		22,642
Loans receivable, net of allowance for credit losses	5,894,236		—		—		5,894,732		5,894,732
Accrued interest receivable	24,523		24,523		—		—		24,523
Derivative assets	3,583		—		3,583		—		3,583
Financial liabilities
Deposits	5,427,167		—		—		5,430,536		5,430,536
Advances from Federal Home Loan Bank	1,195,000		—		1,222,709		—		1,222,709
Long-term debt	173,421		—		180,213		—		180,213
Derivative liabilities	3,853		—		3,853		—		3,853
Accrued interest payable	4,687		4,687		—		—		4,687

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INVESTMENT SECURITIES (Tables)

6 Months Ended

Jun. 30, 2020

Investments, Debt and Equity Securities [Abstract]

Summary of Amortized Cost and Fair Value of Available-for-Sale Investment Securities

The following table presents the amortized cost and fair value of the investment securities portfolio as of the dates indicated:

($ in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
June 30, 2020
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	100,128	$	5,427	$	—	$	105,555
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	199,262		1,906		(32)		201,136
Municipal securities	52,973		4,201		—		57,174
Non-agency residential mortgage-backed securities	161		3		—		164
Collateralized loan obligations	703,605		—		(35,252)		668,353
Corporate debt securities	141,962		2,387		(702)		143,647
Total securities available-for-sale	$	1,198,091	$	13,924	$	(35,986)	$	1,176,029
December 31, 2019
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	37,613	$	—	$	(1,157)	$	36,456
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	91,543		16		(260)		91,299
Municipal securities	52,997		51		(359)		52,689
Non-agency residential mortgage-backed securities	191		5		—		196
Collateralized loan obligations	733,605		—		(15,244)		718,361
Corporate debt securities	13,500		79		—		13,579
Total securities available-for-sale	$	929,449	$	151	$	(17,020)	$	912,580

Proceeds from Sales and Calls of Securities and Associated Gross Gains and Losses

The following table presents proceeds from sales and calls of securities available-for-sale and the associated gross gains and losses realized through earnings upon the sales and calls of securities available-for-sale for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Gross realized gains on sales and calls of securities available-for-sale	$	2,011	$	—	$	2,011	$	208
Gross realized losses on sales and calls of securities available-for-sale	—		—		—		—
Net realized gains on sales and calls of securities available-for-sale	$	2,011	$	—	$	2,011	$	208
Proceeds from sales and calls of securities available-for-sale	$	22,728	$	298,156	$	52,728	$	820,048

Summary of Investment Securities with Unrealized Losses

The following table summarizes the investment securities with unrealized losses by security type and length of time in a continuous, unrealized loss position as of the dates indicated:

	Less Than 12 Months				12 Months or Longer				Total
($ in thousands)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
June 30, 2020
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	$	9,416	$	(32)	$	—	$	—	$	9,416	$	(32)
Collateralized loan obligations	63,040		(1,960)		605,313		(33,292)		668,353		(35,252)
Corporate debt securities	31,798		(702)		—		—		31,798		(702)
Total securities available-for-sale	$	104,254	$	(2,694)	$	605,313	$	(33,292)	$	709,567	$	(35,986)
December 31, 2019
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	35,872	$	(1,157)	$	—	$	—	$	35,872	$	(1,157)
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	73,379		(260)		—		—		73,379		(260)
Municipal securities	31,723		(359)		—		—		31,723		(359)
Collateralized loan obligations	49,553		(447)		668,808		(14,797)		718,361		(15,244)
Total securities available-for-sale	$	190,527	$	(2,223)	$	668,808	$	(14,797)	$	859,335	$	(17,020)

Composition, Repricing and Yield Information of Investment Securities Portfolio

The following table presents maturities, based on the earlier of maturity dates or next repricing date, and yield information of the investment securities portfolio as of June 30, 2020:

	One year or less				More than One Year through Five Years				More than Five Years through Ten Years				More than Ten Years				Total
($ in thousands)	Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield		Fair Value		Weighted-Average Yield
Securities available-for-sale:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities	$	—	—	%	$	—	—	%	$	30,413	2.20	%	$	75,142	2.35	%	$	105,555	2.31	%
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations	118,163		0.74	%	11,608		2.02	%	25,579		1.63	%	45,786		0.93	%	201,136		0.96	%
Municipal securities	—		—	%	—		—	%	—		—	%	57,174		2.79	%	57,174		2.79	%
Non-agency residential mortgage-backed securities	—		—	%	—		—	%	—		—	%	164		6.14	%	164		6.14	%
Collateralized loan obligations	668,353		2.73	%	—		—	%	—		—	%	—		—	%	668,353		2.73	%
Corporate debt securities	—		—	%	122,301		4.99	%	21,346		5.64	%	—		—	%	143,647		5.08	%
Total securities available-for-sale	$	786,516	2.45	%	$	133,909	4.74	%	$	77,338	2.96	%	$	178,266	2.11	%	$	1,176,029	2.68	%

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LOANS AND ALLOWANCE FOR CREDIT LOSSES (Tables)

6 Months Ended

Jun. 30, 2020

Receivables [Abstract]

Loans and Leases Receivable

The following table presents the balances in our loan portfolio as of the dates indicated:

($ in thousands)	June 30, 2020		December 31, 2019
Commercial:
Commercial and industrial	$	1,436,990	$	1,691,270
Commercial real estate	822,694		818,817
Multifamily	1,434,071		1,494,528
SBA(1)	310,784		70,981
Construction	212,979		231,350
Consumer:
Single family residential mortgage	1,370,785		1,590,774
Other consumer	39,393		54,165
Total loans(2)	$	5,627,696	$	5,951,885
Allowance for loan losses	(90,370)		(57,649)
Loans receivable, net	$	5,537,326	$	5,894,236

(1)Includes 1,069 PPP loans totaling $240.7 million, which included $5.6 million of net unamortized loan fees at June 30, 2020.

(2)Total loans include deferred loan origination costs/(fees) and premiums/(discounts), net, of $6.0 million and $14.3 million, respectively, at June 30, 2020 and December 31, 2019.

Risk Categories for Loans and Leases

The following table presents the risk categories for total loans by class of loans and origination year as of June 30, 2020:

	Term Loans Amortized Cost Basis by Origination Year
($ in thousands)	2020		2019		2018		2017		2016		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Amortized Cost Basis Converted to Term		Total
June 30, 2020
Commercial:
Commercial and industrial
Pass	$	59,122	$	111,437	$	104,299	$	63,923	$	41,163	$	111,761	$	851,369	$	4,252	$	1,347,326
Special mention	—		6,382		5,988		—		—		1,379		812		189		14,750
Substandard	2,117		16,658		—		4,864		20,677		9,632		10,752		10,214		74,914
Doubtful	—		—		—		—		—		—		—		—		—
Commercial and industrial	61,239		134,477		110,287		68,787		61,840		122,772		862,933		14,655		1,436,990
Commercial real estate
Pass	15,261		153,017		215,385		72,949		102,465		198,242		36,628		1,586		795,533
Special mention	—		1,829		9,570		—		—		6,732		—		—		18,131
Substandard	—		—		—		—		—		9,030		—		—		9,030
Doubtful	—		—		—		—		—		—		—		—		—
Commercial real estate	15,261		154,846		224,955		72,949		102,465		214,004		36,628		1,586		822,694
Multifamily
Pass	84,873		421,045		334,029		272,657		131,646		187,823		—		—		1,432,073
Special mention	—		—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		1,998		—		—		1,998
Doubtful	—		—		—		—		—		—		—		—		—
Multifamily	84,873		421,045		334,029		272,657		131,646		189,821		—		—		1,434,071
SBA
Pass	241,305		16,021		1,359		5,195		14,975		19,479		3,238		797		302,369
Special mention	—		—		—		226		417		948		—		6		1,597
Substandard	—		—		—		1,009		1,513		1,440		320		1,126		5,408
Doubtful	—		—		390		—		—		633		—		387		1,410
SBA	241,305		16,021		1,749		6,430		16,905		22,500		3,558		2,316		310,784
Construction
Pass	14,139		33,423		63,217		86,787		—		—		—		—		197,566
Special mention	—		—		10,526		—		4,887		—		—		—		15,413
Substandard	—		—		—		—		—		—		—		—		—

Doubtful	—		—		—		—		—		—		—		—		—
Construction	14,139		33,423		73,743		86,787		4,887		—		—		—		212,979
Consumer:
Single family residential mortgage
Pass	31,007		166,668		329,175		204,392		297,182		281,160		20,844		—		1,330,428
Special mention	—		—		1,152		668		4,416		3,503		—		—		9,739
Substandard	—		1,064		1,697		3,414		3,900		20,543		—		—		30,618
Doubtful	—		—		—		—		—		—		—		—		—
Single family residential mortgage	31,007		167,732		332,024		208,474		305,498		305,206		20,844		—		1,370,785
Other consumer
Pass	26		93		72		—		8		2,485		31,303		2,577		36,564
Special mention	—		—		27		—		—		33		248		147		455
Substandard	—		—		—		—		—		2,016		281		77		2,374
Doubtful	—		—		—		—		—		—		—		—		—
Other consumer	26		93		99		—		8		4,534		31,832		2,801		39,393
Total loans	$	447,850	$	927,637	$	1,076,886	$	716,084	$	623,249	$	858,837	$	955,795	$	21,358	$	5,627,696

The following table presents the risk categories for total loans by class of loans as of December 31, 2019:

($ in thousands)	Pass		Special Mention		Substandard		Doubtful		Total
December 31, 2019
Commercial:
Commercial and industrial	1,580,269		45,323		65,678		—		1,691,270
Commercial real estate	813,846		2,532		2,439		—		818,817
Multifamily	1,484,931		4,256		5,341		—		1,494,528
SBA	60,982		2,760		5,621		1,618		70,981
Construction	229,771		1,579		—		—		231,350
Consumer:
Single family residential mortgage	1,559,253		10,735		20,269		517		1,590,774
Other consumer	53,331		346		488		—		54,165
Total	$	5,782,383	$	67,531	$	99,836	$	2,135	$	5,951,885

Aging of Recorded Investment in Past Due Loans and Leases

The following table presents the aging of the recorded investment in past due loans, excluding accrued interest receivable (which is not considered to be material), by class of loans as of the dates indicated:

($ in thousands)	30 - 59 Days Past Due		60 - 89 Days Past Due		Greater than 89 Days Past due		Total Past Due		Current		Total
June 30, 2020
Non-Traditional Mortgage (NTM) loans:
Single family residential mortgage	$	9,262	$	647	$	18,552	$	28,461	$	481,144	$	509,605
Other consumer	—		—		—		—		1,598		1,598
Total NTM loans	9,262		647		18,552		28,461		482,742		511,203
Traditional loans:
Commercial:
Commercial and industrial	891		28		13,072		13,991		1,422,999		1,436,990
Commercial real estate	—		1,464		2,189		3,653		819,041		822,694
Multifamily	664		—		—		664		1,433,407		1,434,071
SBA	1,517		—		2,627		4,144		306,640		310,784
Construction	—		—		—		—		212,979		212,979
Consumer:
Single family residential mortgage	29,281		4,286		8,252		41,819		819,361		861,180
Other consumer	285		1,485		692		2,462		35,333		37,795
Total traditional loans	32,638		7,263		26,832		66,733		5,049,760		5,116,493
Total	$	41,900	$	7,910	$	45,384	$	95,194	$	5,532,502	$	5,627,696
December 31, 2019
NTM loans:
Single family residential mortgage	$	3,973	$	3,535	$	13,019	$	20,527	$	577,830	$	598,357
Other consumer	—		—		—		—		2,299		2,299
Total NTM loans	3,973		3,535		13,019		20,527		580,129		600,656
Traditional loans:
Commercial:
Commercial and industrial	780		5,670		3,862		10,312		1,680,958		1,691,270
Commercial real estate	—		—		—		—		818,817		818,817
Multifamily	—		—		—		—		1,494,528		1,494,528
SBA	586		842		2,152		3,580		67,401		70,981
Construction	—		—		—		—		231,350		231,350
Consumer:
Single family residential mortgage	13,752		3,496		5,606		22,854		969,563		992,417
Other consumer	199		40		95		334		51,532		51,866
Total traditional loans	15,317		10,048		11,715		37,080		5,314,149		5,351,229
Total	$	19,290	$	13,583	$	24,734	$	57,607	$	5,894,278	$	5,951,885

Composition of Nonaccrual Loans and Leases

The following table presents non-accrual loans as of the dates indicated:

	June 30, 2020								December 31, 2019
($ in thousands)	NTM Loans		Traditional Loans		Total Non-accrual Loans		Non-accrual Loans with no ACL		NTM Loans		Traditional Loans		Total Non-accrual Loans		Non-accrual Loans with no ACL
Non-accrual loans
Commercial:
Commercial and industrial	$	—	$	30,398	$	30,398	$	10,728	$	—	$	19,114	$	19,114	$	337
Commercial real estate	—		6,633		6,633		6,632		—		—		—		—
SBA	—		5,026		5,026		1,485		—		5,230		5,230		1,474
Construction	—		—		—		—		—		—		—		—
Consumer:
Single family residential mortgage	19,199		9,271		28,470		28,470		13,019		5,606		18,625		14,373
Other consumer	—		2,176		2,176		2,177		—		385		385		380
Total non-accrual loans	$	19,199	$	53,504	$	72,703	$	49,492	$	13,019	$	30,335	$	43,354	$	16,564

Allowance for Loan and Lease Losses and Recorded Investment, Excluding Accrued Interest, in Loans

The following table presents a summary of activity in the ACL for the periods indicated:

	Three Months Ended June 30,
($ in thousands)	2020						2019
	Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses		Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses
Balance at beginning of period	$	78,243	$	3,888	$	82,131	$	63,885	$	4,208	$	68,093
Loans charged off	—		—		—		(2,451)		—		(2,451)
Recoveries of loans previously charged off	608		—		608		76		—		76
Net charge-offs	608		—		608		(2,375)		—		(2,375)
Provision for (reversal of) credit losses	11,519		307		11,826		(1,987)		87		(1,900)
Balance at end of period	$	90,370	$	4,195	$	94,565	$	59,523	$	4,295	$	63,818

	Six Months Ended June 30,
($ in thousands)	2020						2019
	Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses		Allowance for Loan Losses		Reserve for Unfunded Loan Commitments		Allowance for Credit Losses
Balance at beginning of period	$	57,649	$	4,064	$	61,713	$	62,192	$	4,622	$	66,814
Impact of adopting ASU 2016-13	7,609		(1,226)		6,383		—		—		—
Loans charged off	(2,076)		—		(2,076)		(3,514)		—		(3,514)
Recoveries of loans previously charged off	958		—		958		320		—		320
Net charge-offs	(1,118)		—		(1,118)		(3,194)		—		(3,194)
Provision for (reversal of) credit losses	26,230		1,357		27,587		525		(327)		198
Balance at end of period	$	90,370	$	4,195	$	94,565	$	59,523	$	4,295	$	63,818

The following table presents the activity and balance in the ALL and the recorded investment, excluding accrued interest, in loans based on the impairment methodology as of or for the three and six months ended June 30, 2020:

($ in thousands)	Commercial and Industrial		Commercial Real Estate		Multifamily		SBA		Construction		Single Family Residential Mortgage		Other Consumer		Total
ALL:
Balance at March 31, 2020	$	23,573	$	13,620	$	20,072	$	3,652	$	7,052	$	9,593	$	681	$	78,243
Charge-offs	—		—		—		—		—		—		—		—
Recoveries	119		—		—		—		—		488		1		608
Net recoveries (charge-offs)	119		—		—		—		—		488		1		608
Provision for (reversal of) credit losses	2,926		3,752		5,033		532		(377)		(416)		69		11,519
Balance at June 30, 2020	$	26,618	$	17,372	$	25,105	$	4,184	$	6,675	$	9,665	$	751	$	90,370
Balance at December 31, 2019	$	22,353	$	5,941	$	11,405	$	3,120	$	3,906	$	10,486	$	438	$	57,649
Impact of adopting ASC 326	662		4,847		1,809		388		103		(420)		220		7,609
Charge-offs	(1,164)		—		—		(356)		—		(552)		(4)		(2,076)
Recoveries	149		—		—		121		—		639		49		958
Net (charge-offs) recoveries	(1,015)		—		—		(235)		—		87		45		(1,118)
Provision (reversal)	4,618		6,584		11,891		911		2,666		(488)		48		26,230
Balance at June 30, 2020	$	26,618	$	17,372	$	25,105	$	4,184	$	6,675	$	9,665	$	751	$	90,370
Individually evaluated for impairment	$	9,697	$	—	$	—	$	2,878	$	—	$	—	$	—	$	12,575
Collectively evaluated for impairment	16,921		17,372		25,105		1,306		6,675		9,665		751		77,795
Total ending ALL balance	$	26,618	$	17,372	$	25,105	$	4,184	$	6,675	$	9,665	$	751	$	90,370
Loans:
Individually evaluated for impairment	$	31,129	$	5,168	$	—	$	4,959	$	—	$	32,999	$	970	$	75,225
Collectively evaluated for impairment	1,405,861		817,526		1,434,071		305,825		212,979		1,337,786		38,423		5,552,471
Total ending loan balances	$	1,436,990	$	822,694	$	1,434,071	$	310,784	$	212,979	$	1,370,785	$	39,393	$	5,627,696

The following table presents the activity and balance in the ALL and the recorded investment, excluding accrued interest, in loans based on the impairment methodology as of or for the three and six months ended June 30, 2019:

($ in thousands)	Commercial and Industrial		Commercial Real Estate		Multifamily		SBA		Construction		Lease Financing		Single Family Residential Mortgage		Other Consumer		Total
ALL:
Balance at March 31, 2019	$	18,893	$	6,838	$	18,898	$	3,057	$	3,453	$	—	$	12,142	$	604	$	63,885
Charge-offs	(2,022)		—		(6)		8		—		—		(425)		(6)		(2,451)
Recoveries	11		—		—		60		—		3		—		2		76
Net (charge-offs) recoveries	(2,011)		—		(6)		68		—		3		(425)		(4)		(2,375)
Provision for (reversal of) credit losses	4,647		39		(6,267)		(5)		262		(3)		(645)		(15)		(1,987)
Balance at June 30, 2019	$	21,529	$	6,877	$	12,625	$	3,120	$	3,715	$	—	$	11,072	$	585	$	59,523
Balance at December 31, 2018	$	18,191	$	6,674	$	17,970	$	1,827	$	3,461	$	—	$	13,128	$	941	$	62,192
Charge-offs	(2,115)		—		(6)		(348)		—		—		(951)		(94)		(3,514)
Recoveries	44		—		—		101		—		6		150		19		320
Net (charge-offs) recoveries	(2,071)		—		(6)		(247)		—		6		(801)		(75)		(3,194)
Provision (reversal)	5,409		203		(5,339)		1,540		254		(6)		(1,255)		(281)		525
Balance at June 30, 2019	$	21,529	$	6,877	$	12,625	$	3,120	$	3,715	$	—	$	11,072	$	585	$	59,523
Individually evaluated for impairment	$	1,239	$	—	$	—	$	1,563	$	—	$	—	$	—	$	22	$	2,824
Collectively evaluated for impairment	20,290		6,877		12,625		1,557		3,715		—		11,072		563		56,699
Total ending ALL balance	$	21,529	$	6,877	$	12,625	$	3,120	$	3,715	$	—	$	11,072	$	585	$	59,523
Loans:
Individually evaluated for impairment	$	20,429	$	—	$	—	$	3,262	$	2,519	$	—	$	21,021	$	1,169	$	48,400
Collectively evaluated for impairment	1,931,278		856,497		1,598,978		77,667		206,510		—		1,940,044		60,196		6,671,170
Total ending loan balances	$	1,951,707	$	856,497	$	1,598,978	$	80,929	$	209,029	$	—	$	1,961,065	$	61,365	$	6,719,570

Loans and Leases Individually Evaluated for Impairment by Class of Loans and Leases

The following table presents loans individually evaluated for impairment by class of loans as of the dates indicated. The recorded investment, excluding accrued interest, presents customer balances net of any partial charge-offs recognized on the loans and net of any deferred fees and costs and any purchase premium or discount.

	June 30, 2020						December 31, 2019
($ in thousands)	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses		Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses
With no related ALL recorded:
Commercial:
Commercial and industrial	$	11,455	$	11,383	$	—	$	1,471	$	1,460	$	—
Commercial real estate	5,418		5,168		—		—		—		—
SBA	1,474		1,417		—		1,439		1,379		—
Consumer:
Single family residential mortgage	32,849		32,999		—		19,319		19,405		—
Other consumer	1,431		970		—		671		675		—
With an ALL recorded:
Commercial:
Commercial and industrial	19,739		19,746		9,697		18,776		18,776		3,367
SBA	3,731		3,542		2,878		3,921		3,757		2,045
Consumer:
Single family residential mortgage	—		—		—		4,213		4,252		574
Other consumer	—		—		—		4		4		4
Total	$	76,097	$	75,225	$	12,575	$	49,814	$	49,708	$	5,990

The following table presents information on impaired loans, disaggregated by class, for the periods indicated:

	Three Months Ended						Six Months Ended
($ in thousands)	Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Recognized		Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Recognized
June 30, 2020
Commercial:
Commercial and industrial	$	29,992	$	16	$	18	$	26,452	$	37	$	39
Commercial real estate	5,210		—		—		3,992		—		—
SBA	5,172		3		4		5,293		6		7
Consumer:
Single family residential mortgage	33,356		56		34		31,420		110		79
Other consumer	2,084		—		—		1,351		3		3
Total	$	75,814	$	75	$	56	$	68,508	$	156	$	128
June 30, 2019
Commercial:
Commercial and industrial	$	20,794	$	255	$	254	$	12,921	$	255	$	254
Commercial real estate	—		—		—		289		—		—
SBA	3,297		4		4		3,571		8		8
Construction	2,519		—		—		2,519		—		—
Consumer:
Single family residential mortgage	21,092		58		48		20,208		116		97
Other consumer	1,177		4		3		1,011		7		6
Total	$	48,879	$	321	$	309	$	40,519	$	386	$	365

Troubled Debt Restructurings

TDR loans consisted of the following as of the dates indicated:

	June 30, 2020						December 31, 2019
($ in thousands)	NTM Loans		Traditional Loans		Total		NTM Loans		Traditional Loans		Total
Commercial:
Commercial and industrial	$	—	$	20,808	$	20,808	$	—	$	16,245	$	16,245
SBA	—		266		266		—		266		266
Consumer:
Single family residential mortgage	2,628		2,170		4,798		2,638		2,394		5,032
Other consumer	—		—		—		294		—		294
Total	$	2,628	$	23,244	$	25,872	$	2,932	$	18,905	$	21,837

The following table summarizes the pre-modification and post-modification balances of the new TDRs for the periods indicated:

	Three Months Ended					Six Months Ended
($ in thousands)	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
June 30, 2020
Commercial:
Commercial and industrial	—	$	—	$	—	1	$	5,000	$	5,000
Total	—	—		—		1	$	5,000	$	5,000
June 30, 2019
Commercial:
Commercial and industrial	10	$	17,339	$	17,020	10	$	17,339	$	17,020
SBA	2	$	3,214	$	869	2	$	3,214	$	869
Total	12	$	20,553	$	17,889	12	$	20,553	$	17,889

The following table summarizes TDRs by modification type for the periods indicated:

	Three Months Ended
	Modification Type
	Change in Principal Payments and Interest Rates			Change in Principal Payments			Total
($ in thousands)	Count	Amount		Count	Amount		Count	Amount
June 30, 2020
Commercial:
Commercial and industrial	—	$	—	—	$	—	—	$	—
Total	—	$	—	—	$	—	—	$	—
June 30, 2019
Commercial:
Commercial and industrial	10	$	17,020	—	$	—	10	$	17,020
SBA	2	$	869	—	$	—	2	$	869
Total	12	$	17,889	—	$	—	12	$	17,889

	Six Months Ended
	Modification Type
	Change in Principal Payments and Interest Rates			Change in Principal Payments			Total
($ in thousands)	Count	Amount		Count	Amount		Count	Amount
June 30, 2020
Commercial:
Commercial and industrial	1	$	5,000	—	$	—	1	$	5,000
Total	1	$	5,000	—	$	—	1	$	5,000
June 30, 2019
Commercial:
Commercial and industrial	10	$	17,020	—	$	—	10	$	17,020
SBA	2	869		—	—		2	869
Consumer:
Single family residential mortgage	—	—		—	—		—	—
Total	12	$	17,889	—	$	—	12	$	17,889

Summary of Significant Activities

The following table presents loans transferred from (to) loans held-for-sale by portfolio segment for the periods indicated:

	Three Months Ended				Six Months Ended
($ in thousands)	Transfers from Held-For-Sale		Transfers (to) Held-For-Sale		Transfers from Held-For-Sale		Transfers (to) Held-For-Sale
June 30, 2020
Total	$	—	$	—	$	—	$	—
June 30, 2019
Commercial:
Commercial real estate	$	—	$	(573)	$	—	$	(573)
Multifamily	—		(752,087)		—		(752,087)
Consumer:
Single family residential mortgage	—		(131,315)		—		(374,679)
Total	$	—	$	(883,975)	$	—	$	(1,127,339)

Non Traditional Mortgages Portfolio

The following table presents the composition of the NTM portfolio, which are included in the single family residential mortgage portfolio, as of the dates indicated:

	June 30, 2020						December 31, 2019
($ in thousands)	Count	Amount			Percent		Count	Amount			Percent
Consumer:
Single family residential mortgage:
Green Loans (HELOC) - first liens	61	$	43,604		8.5	%	69	$	49,959		8.3	%
Interest-only - first liens	329	463,666			90.7	%	376	545,371			90.8	%
Negative amortization	8	2,335			0.5	%	9	3,027			0.5	%
Total NTM - first liens	398	509,605			99.7	%	454	598,357			99.6	%
Other consumer:
Green Loans (HELOC) - second liens	5	1,598			0.3	%	7	2,299			0.4	%
Total NTM - second liens	5	1,598			0.3	%	7	2,299			0.4	%
Total NTM loans	403	$	511,203		100.0	%	461	$	600,656		100.0	%
Total loans receivable		$	5,627,696					$	5,951,885
% of total NTM loans to total loans receivable		9.1		%				10.1		%

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GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Tables)

6 Months Ended

Jun. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets

As of June 30, 2020, the weighted average remaining amortization period for core deposit intangibles was approximately 4.3 years.

($ in thousands)	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
June 30, 2020
Core deposit intangibles	$	30,904	$	27,612	$	3,292
December 31, 2019
Core deposit intangibles	$	30,904	$	26,753	$	4,151

Estimated Future Amortization Expense

The following table presents estimated future amortization expenses as of June 30, 2020:

($ in thousands)	Remainder of 2020		2021		2022		2023		2024		Total
Estimated future amortization expense	$	659	$	1,082	$	799	$	517	$	235	$	3,292

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FEDERAL HOME LOAN BANK ADVANCES AND OTHER BORROWINGS (Tables)

6 Months Ended

Jun. 30, 2020

Federal Home Loan Banks [Abstract]

Summary of Advances from the FHLB

The following table presents advances from the FHLB as of the dates indicated:

($ in thousands)	June 30, 2020				December 31, 2019
Fixed rate:
Outstanding balance	$	624,000		(1)	$	730,000
Interest rates ranging from	—		%	(2)	1.82		%
Interest rates ranging to	3.32		%		3.32		%
Weighted average interest rate	2.24		%		2.66		%
Variable rate:
Outstanding balance	—				465,000
Weighted average interest rate	—		%		1.66		%

(1)Excludes $6.8 million of unamortized debt issuance costs at June 30, 2020. 

(2)Includes $10.0 million in FHLB recovery advances with an interest rate of 0.00%, consisting of $5.0 million with a maturity date of November 27, 2020 and $5.0 million with a maturity date of May 27, 2021.

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LONG-TERM DEBT (Tables)

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments

The following table presents our long-term debt as of the dates indicated:

	June 30, 2020				December 31, 2019
($ in thousands)	Par Value		Unamortized Debt Issuance Cost and Discount		Par Value		Unamortized Debt Issuance Cost and Discount
5.25% senior notes due April 15, 2025	$	175,000	$	(1,463)	$	175,000	$	(1,579)
Total	$	175,000	$	(1,463)	$	175,000	$	(1,579)

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DERIVATIVE INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Amount and Market Value of Mortgage Banking Derivatives

The following table presents the notional amount and fair value of derivative instruments included in the consolidated statements of financial condition as of the dates indicated.

	June 30, 2020				December 31, 2019
($ in thousands)	Notional Amount		Fair Value(1)		Notional Amount		Fair Value(1)
Derivative assets:
Interest rate swaps and caps on loans	$	69,266	$	8,598	$	70,674	$	3,445
Foreign exchange contracts	3,657		137		4,643		138
Total	$	72,923	$	8,735	$	75,317	$	3,583
Derivative liabilities:
Interest rate swaps and caps on loans	$	69,266	$	9,239	$	70,674	3,717
Foreign exchange contracts	3,657		54		4,643		136
Total	$	72,923	$	9,293	$	75,317	$	3,853

(1)The fair value of interest rate swaps and caps on loans are included in other assets and accrued expenses and other liabilities, respectively, in the accompanying consolidated statements of financial condition.

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EMPLOYEE STOCK COMPENSATION (Tables)

6 Months Ended

Jun. 30, 2020

Share-based Payment Arrangement [Abstract]

Summary of Share-Based Compensation Expense

The following table presents stock-based compensation expense and the related tax benefits for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Stock options	$	2	$	(24)	$	4	$	(16)
Restricted stock awards and units	1,468		1,521		3,042		2,366
Total share-based compensation expense	$	1,470	$	1,497	$	3,046	$	2,350
Related tax benefits	$	433	$	440	$	897	$	691

Unrecognized Share-Based Compensation Expense

The following table presents unrecognized stock-based compensation expense as of June 30, 2020:

($ in thousands)	Unrecognized Expense		Weighted-Average Remaining Expected Recognition Period
Restricted stock awards and restricted stock units	9,530		2.3 years
Total	$	9,530	2.3 years

Option Activity

The following table represents stock option activity for the three months ended June 30, 2020:

	Three Months Ended June 30, 2020
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	55,069	$	13.96	4.0 years
Outstanding at end of period	55,069	$	13.96	3.7 years	$	(194)
Exercisable at end of period	52,821	$	13.97	3.6 years	$	(187)

The following table represents stock option activity for the six months ended June 30, 2020:

	Six Months Ended June 30, 2020
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	62,521	$	13.85	4.3 years
Exercised	(7,452)	$	13.05	5.2 years
Outstanding at end of period	55,069	$	13.96	3.7 years	$	(194)
Exercisable at end of period	52,821	$	13.97	3.6 years	$	(187)

Nonvested Share Activity

The following table sets forth information regarding unvested stock options for the three and six months ended June 30, 2020:

	Three Months Ended June 30, 2020			Six Months Ended June 30, 2020
	Number of Shares	Weighted-Average Exercise Price Per Share		Number of Shares	Weighted-Average Exercise Price Per Share
Outstanding at beginning of period	2,248	$	13.75	2,248	$	13.75
Vested	—	$	—	—	$	—
Forfeited	—	$	—	—	$	—
Outstanding at end of period	2,248	$	13.75	2,248	$	13.75

Restricted Stock and Restricted Stock Units Activity

The following table presents unvested restricted stock awards and restricted stock units activity for the three and six months ended June 30, 2020:

	Three Months Ended June 30, 2020			Six Months Ended June 30, 2020
	Number of Shares	Weighted Average Grant Date Fair Value Per Share		Number of Shares	Weighted Average Grant Date Fair Value Per Share
Outstanding at beginning of period	1,083,107	$	15.65	923,482	$	15.74
Granted (1)	84,998	$	8.76	354,136	$	13.79
Vested (2)	(231,362)	$	16.09	(293,695)	$	15.95
Forfeited (3)	(24,073)	$	18.20	(71,253)	$	16.85
Outstanding at end of period	912,670	$	14.91	912,670	$	14.91

(1)There were zero and 78,771 performance-based shares/units included in shares granted for the three and six months ended June 30, 2020.

(2)There were 13,074 and 18,473 performance-based shares/units included in vested shares for the three and six months ended June 30, 2020.

(3)The number of forfeited shares includes aggregate performance-based shares/units of 1,782 and 17,404 for the three and six months ended June 30, 2020.

Summary of all Outstanding SARs

The following table represents SARs activity and the weighted average exercise price per share as of and for the three months ended June 30, 2020:

	Three Months Ended June 30, 2020
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	1,559,012	$	11.60	2.4 years	$	(5,616)
Outstanding at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)
Exercisable at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)

The following table represents SARs activity and the weighted average exercise price per share as of and for the six months ended June 30, 2020:

	Six Months Ended June 30,
($ in thousands except per share data)	Number of Shares	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contract Term	Aggregated Intrinsic Value
Outstanding at beginning of period	1,559,012	$	11.60	2.6 years	$	8,508
Outstanding at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)
Exercisable at end of period	1,559,012	$	11.60	2.1 years	$	(1,812)

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STOCKHOLDERS' EQUITY (Tables)

6 Months Ended

Jun. 30, 2020

Equity [Abstract]

Summary of Preferred Stock

The following table presents our total outstanding preferred stock as of the dates indicated:

	June 30, 2020					December 31, 2019
($ in thousands)	Shares Outstanding	Liquidation Preference		Carrying Value		Shares Outstanding	Liquidation Preference		Carrying Value
Series D 7.375% non-cumulative perpetual	93,272	$	93,272	$	89,924	96,629	$	96,629	$	93,162
Series E 7.00% non-cumulative perpetual	98,865	98,865		95,113		100,477	100,477		96,663
Total	192,137	$	192,137	$	185,037	197,106	$	197,106	$	189,825

Changes to Accumulate Other Comprehensive Income by Components

The following table presents changes to AOCI for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Unrealized(loss) gain on securities available-for-sale
Balance at beginning of period	$	(54,148)	$	(18,091)	$	(11,900)	$	(24,117)
Unrealized gain (loss) arising during the period	56,701		7,678		(3,182)		16,422
Reclassification adjustment from other comprehensive income	(2,011)		—		(2,011)		(208)
Tax effect of current period changes	(16,107)		(2,255)		1,528		(4,765)
Total changes, net of taxes	38,583		5,423		(3,665)		11,449
Balance at end of period	$	(15,565)	$	(12,668)	$	(15,565)	$	(12,668)

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VARIABLE INTEREST ENTITIES (Tables)

6 Months Ended

Jun. 30, 2020

Variable Interest Entity [Line Items]

Summary of Unconsolidated VIEs

The following table represents the carrying value of the associated unconsolidated assets and liabilities and the associated maximum loss exposure for alternative energy partnerships as of the dates indicated:

($ in thousands)	June 30, 2020		December 31, 2019
Cash	$	2,958	$	4,224
Equipment, net of depreciation	244,961		248,920
Other assets	6,751		6,301
Total unconsolidated assets	$	254,670	$	259,445
Total unconsolidated liabilities	$	6,326	$	7,143
Maximum loss exposure	$	26,967	$	32,525

Affordable Housing Fund Investment

Variable Interest Entity [Line Items]

Summary of Unconsolidated VIEs

The following table presents information regarding balances in our qualified affordable housing partnerships for the periods indicated:

($ in thousands)	June 30, 2020		December 31, 2019
Ending balance(1)	$	46,167	$	36,462
Aggregate funding commitment	61,278		49,278
Total amount funded	40,776		26,905
Unfunded commitment	20,502		22,373
Maximum loss exposure	46,167		36,462

(1)Included in other assets in the accompanying consolidated statements of financial condition.

The following table presents information regarding activity in our qualified affordable housing partnerships for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Fundings	$	9,312	$	—	$	13,871	$	454
Proportional amortization recognized	1,148		553		2,295		1,190
Income tax credits recognized	1,152		554		2,208		1,109

Variable Interest Entity, Not Primary Beneficiary

Variable Interest Entity [Line Items]

Summary of Unconsolidated VIEs

The following table presents information regarding activity in our alternative energy partnerships for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Fundings	$	—	$	235	$	3,631	$	235
Cash distribution from investment	547		535		1,001		995
Gain (loss) on investments in alternative energy partnerships	167		355		(1,738)		(1,595)
Income tax credits recognized	—		1,723		—		1,723
Tax (expense) benefit recognized from HLBV application	(38)		380		398		380

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(LOSS) EARNINGS PER COMMON SHARE (Tables)

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Basic and Diluted Earnings Per Common Share

The following table presents computations of basic and diluted (loss) earnings per common share ("EPS") for the three and six months ended June 30, 2020:

	Three Months Ended June 30, 2020				Six Months Ended June 30, 2020
($ in thousands except per share data)	Common Stock		Class B Common Stock		Common Stock		Class B Common Stock
Loss from operations	$	(18,273)	$	(176)	$	(24,804)	$	(238)
Less: participating securities dividends	(93)		(1)		(186)		(2)
Less: preferred stock dividends	(3,409)		(33)		(6,909)		(66)
Less: preferred stock redemption	49		—		570		5
Net loss allocated to common stockholders	$	(21,726)	$	(210)	$	(31,329)	$	(301)
Weighted average common shares outstanding	49,553,598		477,321		49,770,527		477,321
Dilutive effects of restricted shares/units	—		—		—		—
Dilutive effects of stock options	—		—		—		—
Average shares and dilutive common shares	49,553,598		477,321		49,770,527		477,321
Basic loss per common share	$	(0.44)	$	(0.44)	$	(0.63)	$	(0.63)
Diluted loss per common share	$	(0.44)	$	(0.44)	$	(0.63)	$	(0.63)

The following table presents computations of basic and diluted EPS for the three and six months ended June 30, 2019:

	Three Months Ended June 30, 2019				Six Months Ended June 30, 2019
($ in thousands except per share data)	Common Stock		Class B Common Stock		Common Stock		Class B Common Stock
Income from operations	$	16,426	$	156	$	23,397	$	222
Less: income allocated to participating securities	(268)		(3)		(152)		(1)
Less: participating securities dividends	(93)		(1)		(292)		(3)
Less: preferred stock dividends	(4,268)		(40)		(8,535)		(81)
Net income allocated to common stockholders	$	11,797	$	112	$	14,418	$	137
Weighted average common shares outstanding	50,379,816		477,321		50,290,107		477,321
Dilutive effects of stock units	103,677		—		119,967		—
Dilutive effects of stock options	4,142		—		7,795		—
Average shares and dilutive common shares	50,487,635		477,321		50,417,869		477,321
Basic earnings per common share	$	0.23	$	0.23	$	0.29	$	0.29
Diluted earnings per common share	$	0.23	$	0.23	$	0.29	$	0.29

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LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES (Tables)

6 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Contractual Amount of Financial Instruments with Off-Balance-Sheet Risk

The following table presents the contractual amount of financial instruments with off-balance-sheet risk as of the periods indicated:

	June 30, 2020				December 31, 2019
($ in thousands)	Fixed Rate		Variable Rate		Fixed Rate		Variable Rate
Commitments to extend credit	$	6,249	$	73,844	$	473	$	129,495
Unused lines of credit	590		1,391,625		703		1,049,632
Letters of credit	336		3,243		134		5,316

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REVENUE RECOGNITION (Tables)

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

Summary of Noninterest (Loss) Income

The following presents noninterest income, segregated by revenue streams, in-scope and out-of-scope of Topic 606 - Revenue From Contracts With Customers, for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2020		2019		2020		2019
Noninterest income (loss)
In scope of Topic 606
Deposit service fees	$	420	$	575	$	959	$	1,242
Debit card fees	380		178		557		291
Investment commissions	—		260		—		539
Other	59		109		108		216
Noninterest income (in-scope of Topic 606)	859		1,122		1,624		2,288
Noninterest income (out-of-scope of Topic 606)	4,669		(3,412)		5,965		1,717
Total noninterest income (loss)	$	5,528	$	(2,290)	$	7,589	$	4,005

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) $ in Thousands		3 Months Ended	6 Months Ended	12 Months Ended
	Jan. 01, 2020 USD ($)	Jun. 30, 2020 USD ($)	Jun. 30, 2020 USD ($) banking_office	Dec. 31, 2019 USD ($)	Mar. 31, 2020 USD ($)	Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Number of banking offices | banking_office			31
Accounting Standards Update [Extensible List]	us-gaap:AccountingStandardsUpdate201613Member		us-gaap:AccountingStandardsUpdate201613Member	us-gaap:AccountingStandardsUpdate201613Member
Impact of adopting ASU 2016-13 on retained earnings		$ (846,959)	$ (846,959)	$ (907,245)	$ (835,002)	$ (963,544)	$ (948,325)	$ (945,534)
Loans funded		5,627,696	5,627,696	5,951,885		6,719,570
PPP loans | Commercial
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Loans funded		240,700	240,700
Proceeds from loan fees		$ 7,500
Estimated life		9 months
Retained Earnings
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Impact of adopting ASU 2016-13 on retained earnings		$ (85,670)	$ (85,670)	(127,733)	$ (110,640)	$ (146,039)	$ (136,943)	$ (140,952)
Impact of ASC 326 Adoption
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Increase to allowance for credit losses	$ 6,400
Impact of adopting ASU 2016-13 on retained earnings				4,503
Impact of ASC 326 Adoption | Retained Earnings
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Impact of adopting ASU 2016-13 on retained earnings				$ 4,503

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Impact of Adopting ASU 2016-13 (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Mar. 31, 2020	Jan. 01, 2020	Dec. 31, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans	$ 90,370		$ 57,649	$ 57,649
Allowance for credit losses - unfunded loan commitments			4,064
Commercial real estate
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans	$ 94,565	$ 82,131		61,713	$ 63,818	$ 68,093	$ 66,814
Commercial | Commercial and industrial
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			22,353
Commercial | Commercial real estate
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			5,941
Commercial | Multifamily
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			11,405
Commercial | SBA
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			3,120
Commercial | Construction
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			3,906
Consumer | Single family residential mortgage
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			10,486
Consumer | Other consumer
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			438
As Reported Under ASC 326
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			65,258
Allowance for credit losses - unfunded loan commitments			2,838
As Reported Under ASC 326 | Commercial | Commercial and industrial
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			23,015
As Reported Under ASC 326 | Commercial | Commercial real estate
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			10,788
As Reported Under ASC 326 | Commercial | Multifamily
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			13,214
As Reported Under ASC 326 | Commercial | SBA
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			3,508
As Reported Under ASC 326 | Commercial | Construction
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			4,009
As Reported Under ASC 326 | Consumer | Single family residential mortgage
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			10,066
As Reported Under ASC 326 | Consumer | Other consumer
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			658
Impact of ASC 326 Adoption
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			7,609
Allowance for credit losses - unfunded loan commitments			(1,226)
Impact of ASC 326 Adoption | Commercial real estate
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans				$ 6,383			$ 0
Impact of ASC 326 Adoption | Commercial | Commercial and industrial
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			662
Impact of ASC 326 Adoption | Commercial | Commercial real estate
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			4,847
Impact of ASC 326 Adoption | Commercial | Multifamily
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			1,809
Impact of ASC 326 Adoption | Commercial | SBA
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			388
Impact of ASC 326 Adoption | Commercial | Construction
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			103
Impact of ASC 326 Adoption | Consumer | Single family residential mortgage
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			(420)
Impact of ASC 326 Adoption | Consumer | Other consumer
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit losses - loans			$ 220

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FAIR VALUES OF FINANCIAL INSTRUMENTS - Additional Information (Detail) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
GNMA loans eligible for repurchase	$ 0	$ 0
Secured borrowings	0	0
Discontinued Operations
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Loans held-for-sale that were 90 days or more past due and still accruing	0	0
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Aggregate unpaid principal balance	$ 18,600,000	$ 19,800,000
Insured Loans
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Expected loss rate	1.55%	1.55%
Uninsured Loans
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Expected loss rate	20.00%	20.00%

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FAIR VALUES OF FINANCIAL INSTRUMENTS - Recurring Basis (Detail) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	$ 1,176,029,000	$ 912,580,000
Derivative assets	8,735,000	3,583,000
Derivative liabilities	9,293,000	3,853,000
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Derivative assets	0	0
Derivative liabilities	0	0
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	1,176,029,000	912,580,000
Derivative assets	8,735,000	3,583,000
Derivative liabilities	9,293,000	3,853,000
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Derivative assets	0	0
Derivative liabilities	0	0
Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	1,176,029,000	912,580,000
Derivative assets	8,735,000	3,583,000
Derivative liabilities	9,293,000	3,853,000
Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans held-for-sale, carried at fair value	0	0
Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans held-for-sale, carried at fair value	3,083,000	3,409,000
Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Loans held-for-sale, carried at fair value	16,685,000	19,233,000
Recurring | Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans held-for-sale, carried at fair value	19,768,000	22,642,000
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	105,555,000	36,456,000
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities | Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities | Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	105,555,000	36,456,000
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities | Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities | Recurring | Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	105,555,000	36,456,000
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	201,136,000	91,299,000
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations | Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations | Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	201,136,000	91,299,000
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations | Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations | Recurring | Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	201,136,000	91,299,000
Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	57,174,000	52,689,000
Municipal securities | Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Municipal securities | Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	57,174,000	52,689,000
Municipal securities | Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Municipal securities | Recurring | Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	57,174,000	52,689,000
Non-agency residential mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	164,000	196,000
Non-agency residential mortgage-backed securities | Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Non-agency residential mortgage-backed securities | Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	164,000	196,000
Non-agency residential mortgage-backed securities | Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Non-agency residential mortgage-backed securities | Recurring | Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	164,000	196,000
Collateralized loan obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	668,353,000	718,361,000
Collateralized loan obligations | Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Collateralized loan obligations | Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	668,353,000	718,361,000
Collateralized loan obligations | Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Collateralized loan obligations | Recurring | Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	668,353,000	718,361,000
Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	143,647,000	13,579,000
Corporate debt securities | Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Corporate debt securities | Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	143,647,000	13,579,000
Corporate debt securities | Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Corporate debt securities | Recurring | Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	143,647,000	13,579,000
Interest rate swaps and caps on loans | Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Interest rate swaps and caps on loans | Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	8,598,000	3,445,000
Derivative liabilities	9,239,000	3,717,000
Interest rate swaps and caps on loans | Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Interest rate swaps and caps on loans | Recurring | Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	8,598,000	3,445,000
Derivative liabilities	9,239,000	3,717,000
Foreign exchange contracts | Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Foreign exchange contracts | Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	137,000	138,000
Derivative liabilities	54,000	136,000
Foreign exchange contracts | Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Foreign exchange contracts | Recurring | Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	137,000	138,000
Derivative liabilities	$ 54,000	$ 136,000

XML

FAIR VALUES OF FINANCIAL INSTRUMENTS - Reconciliation of Assets Measured at Fair Value on Recurring Basis (Detail) - Recurring - Significant Unobservable Inputs (Level 3) - U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at beginning of period	$ 17,127	$ 23,069	$ 19,233	$ 25,040
Total gains (losses) (realized/unrealized):
Included in earnings—fair value adjustment	22	(6)	(1,369)	(3)
Additions	0	0	0	0
Sales, settlements, and other	(464)	(1,988)	(1,179)	(3,962)
Balance at end of period	$ 16,685	$ 21,075	$ 16,685	$ 21,075

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FAIR VALUES OF FINANCIAL INSTRUMENTS - Fair Value Option Loans Held-for-Sale (Details) - Continuing Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Fair Value
Total loans	$ 19,768		$ 19,768		$ 22,642
Non-accrual loans	6,147		6,147		8,125
Unpaid Principal Balance
Total loans	22,208		22,208		23,455
Non-accrual loans	7,244		7,244		8,370
Difference
Total loans	(2,440)		(2,440)		(813)
Non-accrual loans	(1,097)		(1,097)		(245)
Non-accrual loans, guaranteed by US government	4,400		4,400		$ 6,700
Net (losses) gains from fair value changes:	$ 25	$ 59	$ (1,561)	$ 60

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FAIR VALUES OF FINANCIAL INSTRUMENTS - Nonrecurring Basis (Details) - Nonrecurring - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Quoted Prices in Active Markets for Identical Assets (Level 1) | Single family residential mortgage
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans		$ 0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Commercial and industrial
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	$ 0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | SBA
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	0	0
Significant Other Observable Inputs (Level 2) | Single family residential mortgage
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans		0
Significant Other Observable Inputs (Level 2) | Commercial and industrial
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	0	0
Significant Other Observable Inputs (Level 2) | SBA
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	0	0
Significant Unobservable Inputs (Level 3) | Single family residential mortgage
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans		3,678
Significant Unobservable Inputs (Level 3) | Commercial and industrial
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	10,049	15,409
Significant Unobservable Inputs (Level 3) | SBA
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	664	1,711
Carrying Value | Single family residential mortgage
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans		3,678
Carrying Value | Commercial and industrial
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	10,049	15,409
Carrying Value | SBA
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	$ 664	$ 1,711

XML

FAIR VALUES OF FINANCIAL INSTRUMENTS - Gains and (Losses) on Non-Recurring Assets (Detail) - Nonrecurring - Impaired loans - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Single family residential mortgage
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Losses recognized on assets measured at fair value	$ 0	$ 0	$ (531)	$ (490)
Commercial and industrial
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Losses recognized on assets measured at fair value	(6,090)	0	(8,514)	0
SBA
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Losses recognized on assets measured at fair value	(670)	0	(1,544)	(46)
Other consumer
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Losses recognized on assets measured at fair value	$ 0	$ 0	$ (4)	$ (88)

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FAIR VALUES OF FINANCIAL INSTRUMENTS - Carrying Amounts and Estimated Fair Values of Financial Instruments (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Financial assets
Cash and cash equivalents	$ 420,640	$ 373,472
Securities available-for-sale, at fair value	1,176,029	912,580
Federal Home Loan Bank and other bank stock	46,585	59,420
Loans held-for-sale, carried at fair value	19,768	22,642
Loans receivable, net of allowance for loan losses	5,642,634	5,894,732
Accrued interest receivable	29,515	24,523
Derivative assets	8,735	3,583
Financial liabilities
Deposits	6,042,349	5,430,536
Advances from Federal Home Loan Bank	666,177	1,222,709
Long-term debt	178,030	180,213
Derivative liabilities	9,293	3,853
Accrued interest payable	4,297	4,687
Quoted Prices in Active Markets for Identical Assets (Level 1)
Financial assets
Cash and cash equivalents	420,640	373,472
Securities available-for-sale, at fair value	0	0
Federal Home Loan Bank and other bank stock	0	0
Loans held-for-sale, carried at fair value	0	0
Loans receivable, net of allowance for loan losses	0	0
Accrued interest receivable	29,515	24,523
Derivative assets	0	0
Financial liabilities
Deposits	0	0
Advances from Federal Home Loan Bank	0	0
Long-term debt	0	0
Derivative liabilities	0	0
Accrued interest payable	4,297	4,687
Significant Other Observable Inputs (Level 2)
Financial assets
Cash and cash equivalents	0	0
Securities available-for-sale, at fair value	1,176,029	912,580
Federal Home Loan Bank and other bank stock	46,585	59,420
Loans held-for-sale, carried at fair value	3,083	3,409
Loans receivable, net of allowance for loan losses	0	0
Accrued interest receivable	0	0
Derivative assets	8,735	3,583
Financial liabilities
Deposits	0	0
Advances from Federal Home Loan Bank	666,177	1,222,709
Long-term debt	178,030	180,213
Derivative liabilities	9,293	3,853
Accrued interest payable	0	0
Significant Unobservable Inputs (Level 3)
Financial assets
Cash and cash equivalents	0	0
Securities available-for-sale, at fair value	0	0
Federal Home Loan Bank and other bank stock	0	0
Loans held-for-sale, carried at fair value	16,685	19,233
Loans receivable, net of allowance for loan losses	5,642,634	5,894,732
Accrued interest receivable	0	0
Derivative assets	0	0
Financial liabilities
Deposits	6,042,349	5,430,536
Advances from Federal Home Loan Bank	0	0
Long-term debt	0	0
Derivative liabilities	0	0
Accrued interest payable	0	0
Carrying Value
Financial assets
Cash and cash equivalents	420,640	373,472
Securities available-for-sale, at fair value	1,176,029	912,580
Federal Home Loan Bank and other bank stock	46,585	59,420
Loans held-for-sale, carried at fair value	19,768	22,642
Loans receivable, net of allowance for loan losses	5,537,326	5,894,236
Accrued interest receivable	29,515	24,523
Derivative assets	8,735	3,583
Financial liabilities
Deposits	6,037,465	5,427,167
Advances from Federal Home Loan Bank	617,170	1,195,000
Long-term debt	173,537	173,421
Derivative liabilities	9,293	3,853
Accrued interest payable	$ 4,297	$ 4,687

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INVESTMENT SECURITIES - Summary of Amortized Cost and Fair Value (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]
Amortized Cost	$ 1,198,091	$ 929,449
Gross Unrealized Gains	13,924	151
Gross Unrealized Losses	(35,986)	(17,020)
Securities available-for-sale, at fair value	1,176,029	912,580
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]
Amortized Cost	100,128	37,613
Gross Unrealized Gains	5,427	0
Gross Unrealized Losses	0	(1,157)
Securities available-for-sale, at fair value	105,555	36,456
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]
Amortized Cost	199,262	91,543
Gross Unrealized Gains	1,906	16
Gross Unrealized Losses	(32)	(260)
Securities available-for-sale, at fair value	201,136	91,299
Municipal securities
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]
Amortized Cost	52,973	52,997
Gross Unrealized Gains	4,201	51
Gross Unrealized Losses	0	(359)
Securities available-for-sale, at fair value	57,174	52,689
Non-agency residential mortgage-backed securities
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]
Amortized Cost	161	191
Gross Unrealized Gains	3	5
Gross Unrealized Losses	0	0
Securities available-for-sale, at fair value	164	196
Collateralized loan obligations
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]
Amortized Cost	703,605	733,605
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(35,252)	(15,244)
Securities available-for-sale, at fair value	668,353	718,361
Corporate debt securities
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]
Amortized Cost	141,962	13,500
Gross Unrealized Gains	2,387	79
Gross Unrealized Losses	(702)	0
Securities available-for-sale, at fair value	$ 143,647	$ 13,579

XML

INVESTMENT SECURITIES - Additional Information (Detail)	Jun. 30, 2020 USD ($) security	Dec. 31, 2019 USD ($) security
Debt Securities, Available-for-sale [Line Items]
Allowance for credit losses for debt securities	$ 0
Securities available for sale portfolio | security	102	70
Available for sale securities in unrealized loss position | security	50	60
Collateral Pledged
Debt Securities, Available-for-sale [Line Items]
Securities pledged	$ 42,200,000	$ 44,000,000.0
Available-for-sale securities
Debt Securities, Available-for-sale [Line Items]
Accrued interest receivable on debt securities available-for-sale	$ 5,500,000	$ 5,600,000

XML

INVESTMENT SECURITIES - Proceeds from Sales and Calls of Securities and Associated Gross Gains and Losses (Detail) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Investments, Debt and Equity Securities [Abstract]
Gross realized gains on sales and calls of securities available-for-sale	$ 2,011		$ 0	$ 2,011	$ 208
Gross realized losses on sales and calls of securities available-for-sale	0		0	0	0
Net realized gains on sales and calls of securities available-for-sale	2,011	$ 0	0	2,011	208
Proceeds from sales and calls of securities available-for-sale	$ 22,728		$ 298,156	$ 52,728	$ 820,048

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INVESTMENT SECURITIES - Summary of Investment Securities with Unrealized Losses (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Securities available-for-sale:
Less Than 12 Months	$ 104,254	$ 190,527
12 Months or Longer	605,313	668,808
Total	709,567	859,335
Gross Unrealized Losses
Less Than 12 Months	(2,694)	(2,223)
12 Months or Longer	(33,292)	(14,797)
Total	(35,986)	(17,020)
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities
Securities available-for-sale:
Less Than 12 Months	9,416	35,872
12 Months or Longer	0	0
Total	9,416	35,872
Gross Unrealized Losses
Less Than 12 Months	(32)	(1,157)
12 Months or Longer	0	0
Total	(32)	(1,157)
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations
Securities available-for-sale:
Less Than 12 Months		73,379
12 Months or Longer		0
Total		73,379
Gross Unrealized Losses
Less Than 12 Months		(260)
12 Months or Longer		0
Total		(260)
Municipal securities
Securities available-for-sale:
Less Than 12 Months		31,723
12 Months or Longer		0
Total		31,723
Gross Unrealized Losses
Less Than 12 Months		(359)
12 Months or Longer		0
Total		(359)
Collateralized loan obligations
Securities available-for-sale:
Less Than 12 Months	63,040	49,553
12 Months or Longer	605,313	668,808
Total	668,353	718,361
Gross Unrealized Losses
Less Than 12 Months	(1,960)	(447)
12 Months or Longer	(33,292)	(14,797)
Total	(35,252)	$ (15,244)
Corporate debt securities
Securities available-for-sale:
Less Than 12 Months	31,798
12 Months or Longer	0
Total	31,798
Gross Unrealized Losses
Less Than 12 Months	(702)
12 Months or Longer	0
Total	$ (702)

XML

INVESTMENT SECURITIES - Composition, Repricing and Yield Information of Investment Securities Portfolio (Details) $ in Thousands	Jun. 30, 2020 USD ($)
Debt Securities, Available-for-sale [Line Items]
Securities available-for-sale, one year or less, fair value	$ 786,516
Securities available-for-sale, one year or less, weighted average yield (percent)	2.45%
Securities available-for-sale, more than one year through five years, fair value	$ 133,909
Securities available-for-sale, more than one year through five years, weighted average yield (percent)	4.74%
Securities available-for-sale, more than five years through ten years, fair value	$ 77,338
Securities available-for-sale, more than five years through ten years, weighted average yield (percent)	2.96%
Securities available-for-sale, more than ten years, fair value	$ 178,266
Securities available-for-sale, more than ten years, weighted average yield (percent)	2.11%
Securities available-for-sale, fair value	$ 1,176,029
Securities available-for-sale, weighted average yield (percent)	2.68%
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities
Debt Securities, Available-for-sale [Line Items]
Securities available-for-sale, one year or less, fair value	$ 0
Securities available-for-sale, one year or less, weighted average yield (percent)	0.00%
Securities available-for-sale, more than one year through five years, fair value	$ 0
Securities available-for-sale, more than one year through five years, weighted average yield (percent)	0.00%
Securities available-for-sale, more than five years through ten years, fair value	$ 30,413
Securities available-for-sale, more than five years through ten years, weighted average yield (percent)	2.20%
Securities available-for-sale, more than ten years, fair value	$ 75,142
Securities available-for-sale, more than ten years, weighted average yield (percent)	2.35%
Securities available-for-sale, fair value	$ 105,555
Securities available-for-sale, weighted average yield (percent)	2.31%
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations
Debt Securities, Available-for-sale [Line Items]
Securities available-for-sale, one year or less, fair value	$ 118,163
Securities available-for-sale, one year or less, weighted average yield (percent)	0.74%
Securities available-for-sale, more than one year through five years, fair value	$ 11,608
Securities available-for-sale, more than one year through five years, weighted average yield (percent)	2.02%
Securities available-for-sale, more than five years through ten years, fair value	$ 25,579
Securities available-for-sale, more than five years through ten years, weighted average yield (percent)	1.63%
Securities available-for-sale, more than ten years, fair value	$ 45,786
Securities available-for-sale, more than ten years, weighted average yield (percent)	0.93%
Securities available-for-sale, fair value	$ 201,136
Securities available-for-sale, weighted average yield (percent)	0.96%
Municipal securities
Debt Securities, Available-for-sale [Line Items]
Securities available-for-sale, one year or less, fair value	$ 0
Securities available-for-sale, one year or less, weighted average yield (percent)	0.00%
Securities available-for-sale, more than one year through five years, fair value	$ 0
Securities available-for-sale, more than one year through five years, weighted average yield (percent)	0.00%
Securities available-for-sale, more than five years through ten years, fair value	$ 0
Securities available-for-sale, more than five years through ten years, weighted average yield (percent)	0.00%
Securities available-for-sale, more than ten years, fair value	$ 57,174
Securities available-for-sale, more than ten years, weighted average yield (percent)	2.79%
Securities available-for-sale, fair value	$ 57,174
Securities available-for-sale, weighted average yield (percent)	2.79%
Non-agency residential mortgage-backed securities
Debt Securities, Available-for-sale [Line Items]
Securities available-for-sale, one year or less, fair value	$ 0
Securities available-for-sale, one year or less, weighted average yield (percent)	0.00%
Securities available-for-sale, more than one year through five years, fair value	$ 0
Securities available-for-sale, more than one year through five years, weighted average yield (percent)	0.00%
Securities available-for-sale, more than five years through ten years, fair value	$ 0
Securities available-for-sale, more than five years through ten years, weighted average yield (percent)	0.00%
Securities available-for-sale, more than ten years, fair value	$ 164
Securities available-for-sale, more than ten years, weighted average yield (percent)	6.14%
Securities available-for-sale, fair value	$ 164
Securities available-for-sale, weighted average yield (percent)	6.14%
Collateralized loan obligations
Debt Securities, Available-for-sale [Line Items]
Securities available-for-sale, one year or less, fair value	$ 668,353
Securities available-for-sale, one year or less, weighted average yield (percent)	2.73%
Securities available-for-sale, more than one year through five years, fair value	$ 0
Securities available-for-sale, more than one year through five years, weighted average yield (percent)	0.00%
Securities available-for-sale, more than five years through ten years, fair value	$ 0
Securities available-for-sale, more than five years through ten years, weighted average yield (percent)	0.00%
Securities available-for-sale, more than ten years, fair value	$ 0
Securities available-for-sale, more than ten years, weighted average yield (percent)	0.00%
Securities available-for-sale, fair value	$ 668,353
Securities available-for-sale, weighted average yield (percent)	2.73%
Corporate debt securities
Debt Securities, Available-for-sale [Line Items]
Securities available-for-sale, one year or less, fair value	$ 0
Securities available-for-sale, one year or less, weighted average yield (percent)	0.00%
Securities available-for-sale, more than one year through five years, fair value	$ 122,301
Securities available-for-sale, more than one year through five years, weighted average yield (percent)	4.99%
Securities available-for-sale, more than five years through ten years, fair value	$ 21,346
Securities available-for-sale, more than five years through ten years, weighted average yield (percent)	5.64%
Securities available-for-sale, more than ten years, fair value	$ 0
Securities available-for-sale, more than ten years, weighted average yield (percent)	0.00%
Securities available-for-sale, fair value	$ 143,647
Securities available-for-sale, weighted average yield (percent)	5.08%

XML

LOANS AND ALLOWANCE FOR CREDIT LOSSES - Schedule of Loans Receivable (Detail) $ in Thousands	Jun. 30, 2020 USD ($) loan	Mar. 31, 2020 USD ($)	Jan. 01, 2020 USD ($)	Dec. 31, 2019 USD ($)	Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans receivable	$ 5,627,696			$ 5,951,885	$ 6,719,570
Allowance for loan losses	(90,370)		$ (57,649)	(57,649)
Loans receivable, net	5,537,326			5,894,236
Deferred loan costs/(fees) and premiums/(discounts), net	6,000			14,300
Commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Allowance for loan losses	(94,565)	$ (82,131)		(61,713)	(63,818)	$ (68,093)	$ (66,814)
Commercial | Commercial and industrial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans receivable	1,436,990			1,691,270	1,951,707
Allowance for loan losses			(22,353)
Commercial | Commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans receivable	822,694			818,817	856,497
Allowance for loan losses			(5,941)
Commercial | Multifamily
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans receivable	1,434,071			1,494,528	1,598,978
Allowance for loan losses			(11,405)
Commercial | SBA
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans receivable	310,784			70,981	80,929
Allowance for loan losses			(3,120)
Commercial | Construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans receivable	212,979			231,350	$ 209,029
Allowance for loan losses			(3,906)
Commercial | PPP loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans receivable	$ 240,700
Number of loans | loan	1,069
Deferred loan costs/(fees) and premiums/(discounts), net	$ 5,600
Consumer | Single family residential mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans receivable	1,370,785			1,590,774
Allowance for loan losses			(10,486)
Consumer | Other consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans receivable	$ 39,393			$ 54,165
Allowance for loan losses			$ (438)

XML

LOANS AND ALLOWANCE FOR CREDIT LOSSES - Credit Quality Indicators Additional Information (Details)	6 Months Ended
	Jun. 30, 2020
Receivables [Abstract]
Loans delinquent	60 days

XML

LOANS AND ALLOWANCE FOR CREDIT LOSSES - Risk Categories for Loans (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019	Jun. 30, 2019
Financing Receivable, Credit Quality Indicator [Line Items]
2020	$ 447,850
2019	927,637
2018	1,076,886
2017	716,084
2016	623,249
Prior	858,837
Revolving Loans Amortized Cost Basis	955,795
Revolving Loans Amortized Cost Basis Converted to Term	21,358
Total	5,627,696	$ 5,951,885	$ 6,719,570
Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total		5,782,383
Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total		67,531
Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total		99,836
Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
Total		2,135
Commercial | Commercial and industrial
Financing Receivable, Credit Quality Indicator [Line Items]
2020	61,239
2019	134,477
2018	110,287
2017	68,787
2016	61,840
Prior	122,772
Revolving Loans Amortized Cost Basis	862,933
Revolving Loans Amortized Cost Basis Converted to Term	14,655
Total	1,436,990	1,691,270	1,951,707
Commercial | Commercial and industrial | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	59,122
2019	111,437
2018	104,299
2017	63,923
2016	41,163
Prior	111,761
Revolving Loans Amortized Cost Basis	851,369
Revolving Loans Amortized Cost Basis Converted to Term	4,252
Total	1,347,326	1,580,269
Commercial | Commercial and industrial | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	6,382
2018	5,988
2017	0
2016	0
Prior	1,379
Revolving Loans Amortized Cost Basis	812
Revolving Loans Amortized Cost Basis Converted to Term	189
Total	14,750	45,323
Commercial | Commercial and industrial | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	2,117
2019	16,658
2018	0
2017	4,864
2016	20,677
Prior	9,632
Revolving Loans Amortized Cost Basis	10,752
Revolving Loans Amortized Cost Basis Converted to Term	10,214
Total	74,914	65,678
Commercial | Commercial and industrial | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	0	0
Commercial | Commercial real estate
Financing Receivable, Credit Quality Indicator [Line Items]
2020	15,261
2019	154,846
2018	224,955
2017	72,949
2016	102,465
Prior	214,004
Revolving Loans Amortized Cost Basis	36,628
Revolving Loans Amortized Cost Basis Converted to Term	1,586
Total	822,694	818,817	856,497
Commercial | Commercial real estate | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	15,261
2019	153,017
2018	215,385
2017	72,949
2016	102,465
Prior	198,242
Revolving Loans Amortized Cost Basis	36,628
Revolving Loans Amortized Cost Basis Converted to Term	1,586
Total	795,533	813,846
Commercial | Commercial real estate | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	1,829
2018	9,570
2017	0
2016	0
Prior	6,732
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	18,131	2,532
Commercial | Commercial real estate | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	9,030
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	9,030	2,439
Commercial | Commercial real estate | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	0	0
Commercial | Multifamily
Financing Receivable, Credit Quality Indicator [Line Items]
2020	84,873
2019	421,045
2018	334,029
2017	272,657
2016	131,646
Prior	189,821
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	1,434,071	1,494,528	1,598,978
Commercial | Multifamily | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	84,873
2019	421,045
2018	334,029
2017	272,657
2016	131,646
Prior	187,823
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	1,432,073	1,484,931
Commercial | Multifamily | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	0	4,256
Commercial | Multifamily | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	1,998
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	1,998	5,341
Commercial | Multifamily | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	0	0
Commercial | SBA
Financing Receivable, Credit Quality Indicator [Line Items]
2020	241,305
2019	16,021
2018	1,749
2017	6,430
2016	16,905
Prior	22,500
Revolving Loans Amortized Cost Basis	3,558
Revolving Loans Amortized Cost Basis Converted to Term	2,316
Total	310,784	70,981	80,929
Commercial | SBA | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	241,305
2019	16,021
2018	1,359
2017	5,195
2016	14,975
Prior	19,479
Revolving Loans Amortized Cost Basis	3,238
Revolving Loans Amortized Cost Basis Converted to Term	797
Total	302,369	60,982
Commercial | SBA | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	226
2016	417
Prior	948
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	6
Total	1,597	2,760
Commercial | SBA | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	1,009
2016	1,513
Prior	1,440
Revolving Loans Amortized Cost Basis	320
Revolving Loans Amortized Cost Basis Converted to Term	1,126
Total	5,408	5,621
Commercial | SBA | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	390
2017	0
2016	0
Prior	633
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	387
Total	1,410	1,618
Commercial | Construction
Financing Receivable, Credit Quality Indicator [Line Items]
2020	14,139
2019	33,423
2018	73,743
2017	86,787
2016	4,887
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	212,979	231,350	$ 209,029
Commercial | Construction | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	14,139
2019	33,423
2018	63,217
2017	86,787
2016	0
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	197,566	229,771
Commercial | Construction | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	10,526
2017	0
2016	4,887
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	15,413	1,579
Commercial | Construction | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	0	0
Commercial | Construction | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	0	0
Consumer | Single family residential mortgage
Financing Receivable, Credit Quality Indicator [Line Items]
2020	31,007
2019	167,732
2018	332,024
2017	208,474
2016	305,498
Prior	305,206
Revolving Loans Amortized Cost Basis	20,844
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	1,370,785	1,590,774
Consumer | Single family residential mortgage | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	31,007
2019	166,668
2018	329,175
2017	204,392
2016	297,182
Prior	281,160
Revolving Loans Amortized Cost Basis	20,844
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	1,330,428	1,559,253
Consumer | Single family residential mortgage | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	1,152
2017	668
2016	4,416
Prior	3,503
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	9,739	10,735
Consumer | Single family residential mortgage | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	1,064
2018	1,697
2017	3,414
2016	3,900
Prior	20,543
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	30,618	20,269
Consumer | Single family residential mortgage | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	0	517
Consumer | Other consumer
Financing Receivable, Credit Quality Indicator [Line Items]
2020	26
2019	93
2018	99
2017	0
2016	8
Prior	4,534
Revolving Loans Amortized Cost Basis	31,832
Revolving Loans Amortized Cost Basis Converted to Term	2,801
Total	39,393	54,165
Consumer | Other consumer | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	26
2019	93
2018	72
2017	0
2016	8
Prior	2,485
Revolving Loans Amortized Cost Basis	31,303
Revolving Loans Amortized Cost Basis Converted to Term	2,577
Total	36,564	53,331
Consumer | Other consumer | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	27
2017	0
2016	0
Prior	33
Revolving Loans Amortized Cost Basis	248
Revolving Loans Amortized Cost Basis Converted to Term	147
Total	455	346
Consumer | Other consumer | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	2,016
Revolving Loans Amortized Cost Basis	281
Revolving Loans Amortized Cost Basis Converted to Term	77
Total	2,374	488
Consumer | Other consumer | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0
2019	0
2018	0
2017	0
2016	0
Prior	0
Revolving Loans Amortized Cost Basis	0
Revolving Loans Amortized Cost Basis Converted to Term	0
Total	$ 0	$ 0

XML

LOANS AND ALLOWANCE FOR CREDIT LOSSES - Aging of Recorded Investment in Past Due Loans (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019	Jun. 30, 2019
Financing Receivable, Past Due [Line Items]
Total Past Due	$ 95,194	$ 57,607
Current	5,532,502	5,894,278
Total	5,627,696	5,951,885	$ 6,719,570
30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	41,900	19,290
60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	7,910	13,583
Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	45,384	24,734
Traditional Loans
Financing Receivable, Past Due [Line Items]
Total Past Due	66,733	37,080
Current	5,049,760	5,314,149
Total	5,116,493	5,351,229
Traditional Loans | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	32,638	15,317
Traditional Loans | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	7,263	10,048
Traditional Loans | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	26,832	11,715
Consumer | Single family residential mortgage
Financing Receivable, Past Due [Line Items]
Total	1,370,785	1,590,774
Consumer | Other consumer
Financing Receivable, Past Due [Line Items]
Total	39,393	54,165
Consumer | Non-Traditional Mortgage (NTM) loans
Financing Receivable, Past Due [Line Items]
Total Past Due	28,461	20,527
Current	482,742	580,129
Total	511,203	600,656
Consumer | Non-Traditional Mortgage (NTM) loans | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	9,262	3,973
Consumer | Non-Traditional Mortgage (NTM) loans | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	647	3,535
Consumer | Non-Traditional Mortgage (NTM) loans | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	18,552	13,019
Consumer | Non-Traditional Mortgage (NTM) loans | Single family residential mortgage
Financing Receivable, Past Due [Line Items]
Total Past Due	28,461	20,527
Current	481,144	577,830
Total	509,605	598,357
Consumer | Non-Traditional Mortgage (NTM) loans | Single family residential mortgage | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	9,262	3,973
Consumer | Non-Traditional Mortgage (NTM) loans | Single family residential mortgage | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	647	3,535
Consumer | Non-Traditional Mortgage (NTM) loans | Single family residential mortgage | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	18,552	13,019
Consumer | Non-Traditional Mortgage (NTM) loans | Other consumer
Financing Receivable, Past Due [Line Items]
Total Past Due	0	0
Current	1,598	2,299
Total	1,598	2,299
Consumer | Non-Traditional Mortgage (NTM) loans | Other consumer | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	0	0
Consumer | Non-Traditional Mortgage (NTM) loans | Other consumer | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	0	0
Consumer | Non-Traditional Mortgage (NTM) loans | Other consumer | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	0	0
Consumer | Traditional Loans | Single family residential mortgage
Financing Receivable, Past Due [Line Items]
Total Past Due	41,819	22,854
Current	819,361	969,563
Total	861,180	992,417
Consumer | Traditional Loans | Single family residential mortgage | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	29,281	13,752
Consumer | Traditional Loans | Single family residential mortgage | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	4,286	3,496
Consumer | Traditional Loans | Single family residential mortgage | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	8,252	5,606
Consumer | Traditional Loans | Other consumer
Financing Receivable, Past Due [Line Items]
Total Past Due	2,462	334
Current	35,333	51,532
Total	37,795	51,866
Consumer | Traditional Loans | Other consumer | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	285	199
Consumer | Traditional Loans | Other consumer | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	1,485	40
Consumer | Traditional Loans | Other consumer | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	692	95
Commercial | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Total	1,436,990	1,691,270	1,951,707
Commercial | Commercial real estate
Financing Receivable, Past Due [Line Items]
Total	822,694	818,817	856,497
Commercial | Multifamily
Financing Receivable, Past Due [Line Items]
Total	1,434,071	1,494,528	1,598,978
Commercial | SBA
Financing Receivable, Past Due [Line Items]
Total	310,784	70,981	80,929
Commercial | Construction
Financing Receivable, Past Due [Line Items]
Total	212,979	231,350	$ 209,029
Commercial | Traditional Loans | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Total Past Due	13,991	10,312
Current	1,422,999	1,680,958
Total	1,436,990	1,691,270
Commercial | Traditional Loans | Commercial and industrial | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	891	780
Commercial | Traditional Loans | Commercial and industrial | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	28	5,670
Commercial | Traditional Loans | Commercial and industrial | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	13,072	3,862
Commercial | Traditional Loans | Commercial real estate
Financing Receivable, Past Due [Line Items]
Total Past Due	3,653	0
Current	819,041	818,817
Total	822,694	818,817
Commercial | Traditional Loans | Commercial real estate | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	0	0
Commercial | Traditional Loans | Commercial real estate | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	1,464	0
Commercial | Traditional Loans | Commercial real estate | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	2,189	0
Commercial | Traditional Loans | Multifamily
Financing Receivable, Past Due [Line Items]
Total Past Due	664	0
Current	1,433,407	1,494,528
Total	1,434,071	1,494,528
Commercial | Traditional Loans | Multifamily | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	664	0
Commercial | Traditional Loans | Multifamily | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	0	0
Commercial | Traditional Loans | Multifamily | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	0	0
Commercial | Traditional Loans | SBA
Financing Receivable, Past Due [Line Items]
Total Past Due	4,144	3,580
Current	306,640	67,401
Total	310,784	70,981
Commercial | Traditional Loans | SBA | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	1,517	586
Commercial | Traditional Loans | SBA | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	0	842
Commercial | Traditional Loans | SBA | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	2,627	2,152
Commercial | Traditional Loans | Construction
Financing Receivable, Past Due [Line Items]
Total Past Due	0	0
Current	212,979	231,350
Total	212,979	231,350
Commercial | Traditional Loans | Construction | 30 - 59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	0	0
Commercial | Traditional Loans | Construction | 60 - 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	0	0
Commercial | Traditional Loans | Construction | Greater than 89 Days Past due
Financing Receivable, Past Due [Line Items]
Total Past Due	$ 0	$ 0

XML

LOANS AND ALLOWANCE FOR CREDIT LOSSES - Composition of Nonaccrual Loans (Detail) $ in Thousands	Jun. 30, 2020 USD ($) loan	Dec. 31, 2019 USD ($)
Receivables [Abstract]
Number of past due loans in forbearance or deferment | loan	0
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	$ 72,703	$ 43,354
Non-accrual Loans with no ACL	49,492	16,564
NTM Loans
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	19,199	13,019
Traditional Loans
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	53,504	30,335
Commercial | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	30,398	19,114
Non-accrual Loans with no ACL	10,728	337
Commercial | Commercial real estate
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	6,633	0
Non-accrual Loans with no ACL	6,632	0
Commercial | SBA
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	5,026	5,230
Non-accrual Loans with no ACL	1,485	1,474
Commercial | Construction
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	0	0
Non-accrual Loans with no ACL	0	0
Commercial | NTM Loans | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	0	0
Commercial | NTM Loans | Commercial real estate
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	0	0
Commercial | NTM Loans | SBA
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	0	0
Commercial | NTM Loans | Construction
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	0	0
Commercial | Traditional Loans | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	30,398	19,114
Commercial | Traditional Loans | Commercial real estate
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	6,633	0
Commercial | Traditional Loans | SBA
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	5,026	5,230
Commercial | Traditional Loans | Construction
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	0	0
Consumer | Single family residential mortgage
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	28,470	18,625
Non-accrual Loans with no ACL	28,470	14,373
Consumer | Other consumer
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	2,176	385
Non-accrual Loans with no ACL	2,177	380
Consumer | NTM Loans | Single family residential mortgage
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	19,199	13,019
Consumer | NTM Loans | Other consumer
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	0	0
Consumer | Traditional Loans | Single family residential mortgage
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	9,271	5,606
Consumer | Traditional Loans | Other consumer
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	$ 2,176	$ 385

XML

LOANS AND ALLOWANCE FOR CREDIT LOSSES - Nonaccrual Loans and Leases Additional Information (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Financing Receivable, Past Due [Line Items]
Loans 90 days past due and still accruing	$ 0	$ 0
Loans on non-accrual status	72,703,000	43,354,000
Consumer | Single family residential mortgage
Financing Receivable, Past Due [Line Items]
Loans on non-accrual status	28,470,000	18,625,000
Loans in process of foreclosure	6,300,000	15,700,000
NTM Loans
Financing Receivable, Past Due [Line Items]
Loans on non-accrual status	19,199,000	13,019,000
NTM Loans | Consumer | Single family residential mortgage
Financing Receivable, Past Due [Line Items]
Loans on non-accrual status	19,199,000	13,019,000
NTM Loans | Green Loans | Non-performing loans | Consumer
Financing Receivable, Past Due [Line Items]
Loans on non-accrual status	4,600,000	1,500,000
Green Loans (HELOC) - first liens | NTM Loans | Interest Only Loans | Non-performing loans | Consumer
Financing Receivable, Past Due [Line Items]
Loans on non-accrual status	$ 14,600,000	$ 11,500,000

XML

LOANS AND ALLOWANCE FOR CREDIT LOSSES - Allowance for Credit Losses Additional Information (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Jan. 01, 2020	Dec. 31, 2019
Accounts, Notes, Loans and Financing Receivable [Line Items]
Unfunded loan commitments	$ 90,370	$ 57,649	$ 57,649
Unfunded Loan Commitment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Unfunded loan commitments	4,200		4,100
Loans receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accrued interest receivable on loans receivable	$ 23,800		$ 18,900

XML

LOANS AND ALLOWANCE FOR CREDIT LOSSES - Allowance for Loan Losses (Detail) - USD ($) $ in Thousands		3 Months Ended			6 Months Ended		12 Months Ended
	Jan. 01, 2020	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 57,649		$ 57,649		$ 57,649
Provision for (reversal of) credit losses		$ 11,826	15,761	$ (1,900)	27,587	$ 198
Balance at end of period	$ 57,649	90,370			$ 90,370		$ 57,649
Accounting Standards Update [Extensible List]	us-gaap:AccountingStandardsUpdate201613Member				us-gaap:AccountingStandardsUpdate201613Member		us-gaap:AccountingStandardsUpdate201613Member
Loans
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 61,713	82,131	61,713	68,093	$ 61,713	66,814	$ 66,814
Charge-offs		0		(2,451)	(2,076)	(3,514)
Recoveries		608		76	958	320
Net (charge-offs) recoveries		608		(2,375)	(1,118)	(3,194)
Provision for (reversal of) credit losses		11,826		(1,900)	27,587	198
Balance at end of period		94,565	82,131	63,818	94,565	63,818	61,713
Impact of adopting ASU 2016-13
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at end of period	7,609
Impact of adopting ASU 2016-13 | Loans
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	6,383		6,383		6,383	0	0
Balance at end of period							6,383
Allowance for Loan Losses
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	57,649	78,243	57,649	63,885	57,649	62,192	62,192
Charge-offs		0		(2,451)	(2,076)	(3,514)
Recoveries		608		76	958	320
Net (charge-offs) recoveries		608		(2,375)	(1,118)	(3,194)
Provision for (reversal of) credit losses		11,519		(1,987)	26,230	525
Balance at end of period		90,370	78,243	59,523	90,370	59,523	57,649
Allowance for Loan Losses | Loans
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	57,649	78,243	57,649	63,885	57,649	62,192	62,192
Charge-offs		0		(2,451)	(2,076)	(3,514)
Recoveries		608		76	958	320
Net (charge-offs) recoveries		608		(2,375)	(1,118)	(3,194)
Provision for (reversal of) credit losses		11,519		(1,987)	26,230	525
Balance at end of period		90,370	78,243	59,523	90,370	59,523	57,649
Allowance for Loan Losses | Impact of adopting ASU 2016-13
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	7,609		7,609		7,609
Balance at end of period							7,609
Allowance for Loan Losses | Impact of adopting ASU 2016-13 | Loans
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	7,609		7,609		7,609	0	0
Balance at end of period							7,609
Reserve for Unfunded Loan Commitments | Loans
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	4,064	3,888	4,064	4,208	4,064	4,622	4,622
Charge-offs		0		0	0	0
Recoveries		0		0	0	0
Net (charge-offs) recoveries		0		0	0	0
Provision for (reversal of) credit losses		307		87	1,357	(327)
Balance at end of period		$ 4,195	3,888	$ 4,295	4,195	4,295	4,064
Reserve for Unfunded Loan Commitments | Impact of adopting ASU 2016-13 | Loans
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ (1,226)		$ (1,226)		$ (1,226)	$ 0	0
Balance at end of period							$ (1,226)

XML

LOANS AND ALLOWANCE FOR CREDIT LOSSES - Allowance for Loan Losses and Recorded Investment Excluding Accrued Interest in Loans (Detail) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		$ 57,649		$ 57,649
Provision for (reversal of) credit losses	$ 11,826	15,761	$ (1,900)	27,587	$ 198
Balance at end of period	90,370			90,370
Loans:
Individually evaluated for impairment	75,225		48,400	75,225	48,400
Collectively evaluated for impairment	5,552,471		6,671,170	5,552,471	6,671,170
Total	5,627,696		6,719,570	5,627,696	6,719,570	$ 5,951,885
Commercial real estate
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	82,131	61,713	68,093	61,713	66,814
Charge-offs	0		(2,451)	(2,076)	(3,514)
Recoveries of loans previously charged off	608		76	958	320
Net (charge-offs) recoveries	608		(2,375)	(1,118)	(3,194)
Provision for (reversal of) credit losses	11,826		(1,900)	27,587	198
Balance at end of period	94,565	82,131	63,818	94,565	63,818
Commercial | Commercial and industrial
Loans:
Individually evaluated for impairment	31,129		20,429	31,129	20,429
Collectively evaluated for impairment	1,405,861		1,931,278	1,405,861	1,931,278
Total	1,436,990		1,951,707	1,436,990	1,951,707	1,691,270
Commercial | Commercial real estate
Loans:
Individually evaluated for impairment	5,168		0	5,168	0
Collectively evaluated for impairment	817,526		856,497	817,526	856,497
Total	822,694		856,497	822,694	856,497	818,817
Commercial | Multifamily
Loans:
Individually evaluated for impairment	0		0	0	0
Collectively evaluated for impairment	1,434,071		1,598,978	1,434,071	1,598,978
Total	1,434,071		1,598,978	1,434,071	1,598,978	1,494,528
Commercial | SBA
Loans:
Individually evaluated for impairment	4,959		3,262	4,959	3,262
Collectively evaluated for impairment	305,825		77,667	305,825	77,667
Total	310,784		80,929	310,784	80,929	70,981
Commercial | Construction
Loans:
Individually evaluated for impairment	0		2,519	0	2,519
Collectively evaluated for impairment	212,979		206,510	212,979	206,510
Total	212,979		209,029	212,979	209,029	$ 231,350
Commercial | Lease Financing
Loans:
Individually evaluated for impairment			0		0
Collectively evaluated for impairment			0		0
Total			0		0
Consumer | Single Family Residential Mortgage
Loans:
Individually evaluated for impairment	32,999		21,021	32,999	21,021
Collectively evaluated for impairment	1,337,786		1,940,044	1,337,786	1,940,044
Total	1,370,785		1,961,065	1,370,785	1,961,065
Consumer | Other Consumer
Loans:
Individually evaluated for impairment	970		1,169	970	1,169
Collectively evaluated for impairment	38,423		60,196	38,423	60,196
Total	39,393		61,365	39,393	61,365
Allowance for Loan Losses
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	78,243	57,649	63,885	57,649	62,192
Charge-offs	0		(2,451)	(2,076)	(3,514)
Recoveries of loans previously charged off	608		76	958	320
Net (charge-offs) recoveries	608		(2,375)	(1,118)	(3,194)
Provision for (reversal of) credit losses	11,519		(1,987)	26,230	525
Balance at end of period	90,370	78,243	59,523	90,370	59,523
Individually evaluated for impairment	12,575		2,824	12,575	2,824
Collectively evaluated for impairment	77,795		56,699	77,795	56,699
Allowance for Loan Losses | Commercial real estate
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	78,243	57,649	63,885	57,649	62,192
Charge-offs	0		(2,451)	(2,076)	(3,514)
Recoveries of loans previously charged off	608		76	958	320
Net (charge-offs) recoveries	608		(2,375)	(1,118)	(3,194)
Provision for (reversal of) credit losses	11,519		(1,987)	26,230	525
Balance at end of period	90,370	78,243	59,523	90,370	59,523
Allowance for Loan Losses | Commercial | Commercial and industrial
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	23,573	22,353	18,893	22,353	18,191
Charge-offs	0		(2,022)	(1,164)	(2,115)
Recoveries of loans previously charged off	119		11	149	44
Net (charge-offs) recoveries	119		(2,011)	(1,015)	(2,071)
Provision for (reversal of) credit losses	2,926		4,647	4,618	5,409
Balance at end of period	26,618	23,573	21,529	26,618	21,529
Individually evaluated for impairment	9,697		1,239	9,697	1,239
Collectively evaluated for impairment	16,921		20,290	16,921	20,290
Allowance for Loan Losses | Commercial | Commercial real estate
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	13,620	5,941	6,838	5,941	6,674
Charge-offs	0		0	0	0
Recoveries of loans previously charged off	0		0	0	0
Net (charge-offs) recoveries	0		0	0	0
Provision for (reversal of) credit losses	3,752		39	6,584	203
Balance at end of period	17,372	13,620	6,877	17,372	6,877
Individually evaluated for impairment	0		0	0	0
Collectively evaluated for impairment	17,372		6,877	17,372	6,877
Allowance for Loan Losses | Commercial | Multifamily
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	20,072	11,405	18,898	11,405	17,970
Charge-offs	0		(6)	0	(6)
Recoveries of loans previously charged off	0		0	0	0
Net (charge-offs) recoveries	0		(6)	0	(6)
Provision for (reversal of) credit losses	5,033		(6,267)	11,891	(5,339)
Balance at end of period	25,105	20,072	12,625	25,105	12,625
Individually evaluated for impairment	0		0	0	0
Collectively evaluated for impairment	25,105		12,625	25,105	12,625
Allowance for Loan Losses | Commercial | SBA
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	3,652	3,120	3,057	3,120	1,827
Charge-offs	0		8	(356)	(348)
Recoveries of loans previously charged off	0		60	121	101
Net (charge-offs) recoveries	0		68	(235)	(247)
Provision for (reversal of) credit losses	532		(5)	911	1,540
Balance at end of period	4,184	3,652	3,120	4,184	3,120
Individually evaluated for impairment	2,878		1,563	2,878	1,563
Collectively evaluated for impairment	1,306		1,557	1,306	1,557
Allowance for Loan Losses | Commercial | Construction
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	7,052	3,906	3,453	3,906	3,461
Charge-offs	0		0	0	0
Recoveries of loans previously charged off	0		0	0	0
Net (charge-offs) recoveries	0		0	0	0
Provision for (reversal of) credit losses	(377)		262	2,666	254
Balance at end of period	6,675	7,052	3,715	6,675	3,715
Individually evaluated for impairment	0		0	0	0
Collectively evaluated for impairment	6,675		3,715	6,675	3,715
Allowance for Loan Losses | Commercial | Lease Financing
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period			0		0
Charge-offs			0		0
Recoveries of loans previously charged off			3		6
Net (charge-offs) recoveries			3		6
Provision for (reversal of) credit losses			(3)		(6)
Balance at end of period			0		0
Individually evaluated for impairment			0		0
Collectively evaluated for impairment			0		0
Allowance for Loan Losses | Consumer | Single Family Residential Mortgage
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	9,593	10,486	12,142	10,486	13,128
Charge-offs	0		(425)	(552)	(951)
Recoveries of loans previously charged off	488		0	639	150
Net (charge-offs) recoveries	488		(425)	87	(801)
Provision for (reversal of) credit losses	(416)		(645)	(488)	(1,255)
Balance at end of period	9,665	9,593	11,072	9,665	11,072
Individually evaluated for impairment	0		0	0	0
Collectively evaluated for impairment	9,665		11,072	9,665	11,072
Allowance for Loan Losses | Consumer | Other Consumer
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	681	438	604	438	941
Charge-offs	0		(6)	(4)	(94)
Recoveries of loans previously charged off	1		2	49	19
Net (charge-offs) recoveries	1		(4)	45	(75)
Provision for (reversal of) credit losses	69		(15)	48	(281)
Balance at end of period	751	681	585	751	585
Individually evaluated for impairment	0		22	0	22
Collectively evaluated for impairment	$ 751		$ 563	751	563
Impact of adopting ASU 2016-13 | Commercial real estate
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		6,383		6,383	0
Impact of adopting ASU 2016-13 | Allowance for Loan Losses
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		7,609		7,609
Impact of adopting ASU 2016-13 | Allowance for Loan Losses | Commercial real estate
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		7,609		7,609	$ 0
Impact of adopting ASU 2016-13 | Allowance for Loan Losses | Commercial | Commercial and industrial
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		662		662
Impact of adopting ASU 2016-13 | Allowance for Loan Losses | Commercial | Commercial real estate
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		4,847		4,847
Impact of adopting ASU 2016-13 | Allowance for Loan Losses | Commercial | Multifamily
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		1,809		1,809
Impact of adopting ASU 2016-13 | Allowance for Loan Losses | Commercial | SBA
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		388		388
Impact of adopting ASU 2016-13 | Allowance for Loan Losses | Commercial | Construction
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		103		103
Impact of adopting ASU 2016-13 | Allowance for Loan Losses | Consumer | Single Family Residential Mortgage
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		(420)		(420)
Impact of adopting ASU 2016-13 | Allowance for Loan Losses | Consumer | Other Consumer
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period		$ 220		$ 220

XML

LOANS AND ALLOWANCE FOR CREDIT LOSSES - Loans Individually Evaluated for Impairment by Class of Loans (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Unpaid Principal Balance
Total	$ 76,097		$ 76,097		$ 49,814
Recorded Investment
Total	75,225		75,225		49,708
Allowance for Loan and Lease Losses	12,575		12,575		5,990
Average Recorded Investment	75,814	$ 48,879	68,508	$ 40,519
Interest Income Recognized	75	321	156	386
Cash Basis Interest Recognized	56	309	128	365
Commercial | Commercial and industrial
Unpaid Principal Balance
With no related allowance recorded	11,455		11,455		1,471
With an allowance recorded	19,739		19,739		18,776
Recorded Investment
With no related allowance recorded	11,383		11,383		1,460
With an allowance recorded	19,746		19,746		18,776
Allowance for Loan and Lease Losses	9,697		9,697		3,367
Average Recorded Investment	29,992	20,794	26,452	12,921
Interest Income Recognized	16	255	37	255
Cash Basis Interest Recognized	18	254	39	254
Commercial | Commercial real estate
Unpaid Principal Balance
With no related allowance recorded	5,418		5,418		0
Recorded Investment
With no related allowance recorded	5,168		5,168		0
Average Recorded Investment	5,210	0	3,992	289
Interest Income Recognized	0	0	0	0
Cash Basis Interest Recognized	0	0	0	0
Commercial | SBA
Unpaid Principal Balance
With no related allowance recorded	1,474		1,474		1,439
With an allowance recorded	3,731		3,731		3,921
Recorded Investment
With no related allowance recorded	1,417		1,417		1,379
With an allowance recorded	3,542		3,542		3,757
Allowance for Loan and Lease Losses	2,878		2,878		2,045
Average Recorded Investment	5,172	3,297	5,293	3,571
Interest Income Recognized	3	4	6	8
Cash Basis Interest Recognized	4	4	7	8
Commercial | Construction
Recorded Investment
Average Recorded Investment		2,519		2,519
Interest Income Recognized		0		0
Cash Basis Interest Recognized		0		0
Consumer | Single family residential mortgage
Unpaid Principal Balance
With no related allowance recorded	32,849		32,849		19,319
With an allowance recorded	0		0		4,213
Recorded Investment
With no related allowance recorded	32,999		32,999		19,405
With an allowance recorded	0		0		4,252
Allowance for Loan and Lease Losses	0		0		574
Average Recorded Investment	33,356	21,092	31,420	20,208
Interest Income Recognized	56	58	110	116
Cash Basis Interest Recognized	34	48	79	97
Consumer | Other consumer
Unpaid Principal Balance
With no related allowance recorded	1,431		1,431		671
With an allowance recorded	0		0		4
Recorded Investment
With no related allowance recorded	970		970		675
With an allowance recorded	0		0		4
Allowance for Loan and Lease Losses	0		0		$ 4
Average Recorded Investment	2,084	1,177	1,351	1,011
Interest Income Recognized	0	4	3	7
Cash Basis Interest Recognized	$ 0	$ 3	$ 3	$ 6

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LOANS AND ALLOWANCE FOR CREDIT LOSSES - Components of Troubled Debt Restructured Loans and Leases (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	$ 25,872	$ 21,837
NTM Loans
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	2,628	2,932
Traditional Loans
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	23,244	18,905
Commercial | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	20,808	16,245
Commercial | SBA
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	266	266
Commercial | NTM Loans | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	0	0
Commercial | NTM Loans | SBA
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	0	0
Commercial | Traditional Loans | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	20,808	16,245
Commercial | Traditional Loans | SBA
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	266	266
Consumer | Single family residential mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	4,798	5,032
Consumer | Other consumer
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	0	294
Consumer | NTM Loans | Single family residential mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	2,628	2,638
Consumer | NTM Loans | Other consumer
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	0	294
Consumer | Traditional Loans | Single family residential mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	2,170	2,394
Consumer | Traditional Loans | Other consumer
Financing Receivable, Troubled Debt Restructuring [Line Items]
Troubled debt restructured loans and leases	$ 0	$ 0

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LOANS AND ALLOWANCE FOR CREDIT LOSSES - Troubled Debt Restructurings Additional Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020 USD ($) loan	Jun. 30, 2019 loan	Jun. 30, 2020 USD ($) loan	Jun. 30, 2019 loan	Dec. 31, 2019 USD ($)
Receivables [Abstract]
Commitments to lend to customers with outstanding loans classified as TDRs	$ 135		$ 135		$ 135
Accruing TDRs	5,600		5,600		6,600
Nonaccruing TDRs	$ 20,300		$ 20,300		$ 15,200
Number of loans modified that had payments default during the period | loan	1	0	1	0

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LOANS AND ALLOWANCE FOR CREDIT LOSSES - Loans by Class Modified as Troubled Debt Restructurings (Detail) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020 USD ($) loan	Jun. 30, 2019 USD ($) loan	Jun. 30, 2020 USD ($) loan	Jun. 30, 2019 USD ($) loan
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan				12
Post-Modification Outstanding Recorded Investment				$ 17,889
Commercial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan	0	12	1	12
Pre- Modification Outstanding Recorded Investment	$ 0	$ 20,553	$ 5,000	$ 20,553
Post-Modification Outstanding Recorded Investment	$ 0	$ 17,889	$ 5,000	$ 17,889
Commercial | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan	0	10	1	10
Pre- Modification Outstanding Recorded Investment	$ 0	$ 17,339	$ 5,000	$ 17,339
Post-Modification Outstanding Recorded Investment	$ 0	$ 17,020	$ 5,000	$ 17,020
Commercial | SBA
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan		2		2
Pre- Modification Outstanding Recorded Investment		$ 3,214		$ 3,214
Post-Modification Outstanding Recorded Investment		$ 869		$ 869

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LOANS AND ALLOWANCE FOR CREDIT LOSSES - Summary of TDR Modification Type (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020 USD ($) loan	Jun. 30, 2019 USD ($) loan	Jun. 30, 2020 USD ($) loan	Jun. 30, 2019 USD ($) loan
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan				12
Post-Modification Outstanding Recorded Investment | $				$ 17,889
Change in Principal Payments and Interest Rates
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan				12
Post-Modification Outstanding Recorded Investment | $				$ 17,889
Change in Principal Payments
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan				0
Post-Modification Outstanding Recorded Investment | $				$ 0
Commercial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan	0	12	1	12
Post-Modification Outstanding Recorded Investment | $	$ 0	$ 17,889	$ 5,000	$ 17,889
Commercial | Change in Principal Payments and Interest Rates
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan	0	12	1
Post-Modification Outstanding Recorded Investment | $	$ 0	$ 17,889	$ 5,000
Commercial | Change in Principal Payments
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan	0	0	0
Post-Modification Outstanding Recorded Investment | $	$ 0	$ 0	$ 0
Commercial | Commercial and industrial
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan	0	10	1	10
Post-Modification Outstanding Recorded Investment | $	$ 0	$ 17,020	$ 5,000	$ 17,020
Commercial | Commercial and industrial | Change in Principal Payments and Interest Rates
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan	0	10	1	10
Post-Modification Outstanding Recorded Investment | $	$ 0	$ 17,020	$ 5,000	$ 17,020
Commercial | Commercial and industrial | Change in Principal Payments
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan	0	0	0	0
Post-Modification Outstanding Recorded Investment | $	$ 0	$ 0	$ 0	$ 0
Commercial | SBA
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan		2		2
Post-Modification Outstanding Recorded Investment | $		$ 869		$ 869
Commercial | SBA | Change in Principal Payments and Interest Rates
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan		2		2
Post-Modification Outstanding Recorded Investment | $		$ 869		$ 869
Commercial | SBA | Change in Principal Payments
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan		0		0
Post-Modification Outstanding Recorded Investment | $		$ 0		$ 0
Consumer | Single family residential mortgage
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan				0
Post-Modification Outstanding Recorded Investment | $				$ 0
Consumer | Single family residential mortgage | Change in Principal Payments and Interest Rates
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan				0
Post-Modification Outstanding Recorded Investment | $				$ 0
Consumer | Single family residential mortgage | Change in Principal Payments
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | loan				0
Post-Modification Outstanding Recorded Investment | $				$ 0

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LOANS AND ALLOWANCE FOR CREDIT LOSSES - Purchases, Sales, and Transfers (Details) - USD ($)	3 Months Ended			6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases of loans (excluding loans held-for-sale)	$ 25,800,000		$ 0	$ 25,800,000	$ 0
Transfers from Held-For-Sale			0		0
Transfers (to) Held-For-Sale			(883,975,000)		(1,127,339,000)
Gain (loss) on sale of loans	0	$ (27,000)	2,767,000	(27,000)	4,319,000
Commercial | Commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Transfers from Held-For-Sale			0		0
Transfers (to) Held-For-Sale			(573,000)		(573,000)
Commercial | Multifamily
Accounts, Notes, Loans and Financing Receivable [Line Items]
Transfers from Held-For-Sale			0		0
Transfers (to) Held-For-Sale			(752,087,000)		(752,087,000)
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Transfers from Held-For-Sale	0			0
Transfers (to) Held-For-Sale	0			0
Consumer | Single family residential mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Transfers from Held-For-Sale			0		0
Transfers (to) Held-For-Sale			(131,315,000)		(374,679,000)
Loans sold	$ 0		131,500,000	$ 0	374,700,000
Gain (loss) on sale of loans			$ 125,000		$ 1,800,000

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LOANS AND ALLOWANCE FOR CREDIT LOSSES - Non Traditional Mortgage Loans Additional Information (Details)	Jun. 30, 2020 portfolio_product
NTM Loans | Interest-only
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of interest-only products	3

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LOANS AND ALLOWANCE FOR CREDIT LOSSES - Non Traditional Mortgages Portfolio (Detail) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2020 USD ($) loan	Dec. 31, 2019 USD ($) loan
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	$ 5,627,696	$ 5,951,885
NTM Loans | Loan Portfolio Concentration Risk | Loan Portfolio
Accounts, Notes, Loans and Financing Receivable [Line Items]
Concentration risk percentage (percent)	9.10%	10.10%
Consumer | NTM Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Count | loan	403	461
Total loans	$ 511,203	$ 600,656
Consumer | NTM Loans | Loan Portfolio Concentration Risk | Nontraditional Mortgage Loans Portfolio
Accounts, Notes, Loans and Financing Receivable [Line Items]
Concentration risk percentage (percent)	100.00%	100.00%
Consumer | NTM Loans | Green Loans (HELOC) - first liens
Accounts, Notes, Loans and Financing Receivable [Line Items]
Count | loan	398	454
Total loans	$ 509,605	$ 598,357
Consumer | NTM Loans | Green Loans (HELOC) - first liens | Loan Portfolio Concentration Risk | Nontraditional Mortgage Loans Portfolio
Accounts, Notes, Loans and Financing Receivable [Line Items]
Concentration risk percentage (percent)	99.70%	99.60%
Consumer | NTM Loans | Green Loans (HELOC) - first liens | Green Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Count | loan	61	69
Total loans	$ 43,604	$ 49,959
Consumer | NTM Loans | Green Loans (HELOC) - first liens | Green Loans | Loan Portfolio Concentration Risk | Nontraditional Mortgage Loans Portfolio
Accounts, Notes, Loans and Financing Receivable [Line Items]
Concentration risk percentage (percent)	8.50%	8.30%
Consumer | NTM Loans | Green Loans (HELOC) - first liens | Interest Only Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Count | loan	329	376
Total loans	$ 463,666	$ 545,371
Consumer | NTM Loans | Green Loans (HELOC) - first liens | Interest Only Loans | Loan Portfolio Concentration Risk | Nontraditional Mortgage Loans Portfolio
Accounts, Notes, Loans and Financing Receivable [Line Items]
Concentration risk percentage (percent)	90.70%	90.80%
Consumer | NTM Loans | Green Loans (HELOC) - first liens | Negative amortization
Accounts, Notes, Loans and Financing Receivable [Line Items]
Count | loan	8	9
Total loans	$ 2,335	$ 3,027
Consumer | NTM Loans | Green Loans (HELOC) - first liens | Negative amortization | Loan Portfolio Concentration Risk | Nontraditional Mortgage Loans Portfolio
Accounts, Notes, Loans and Financing Receivable [Line Items]
Concentration risk percentage (percent)	0.50%	0.50%
Consumer | NTM Loans | Green Loans (HELOC) - second liens
Accounts, Notes, Loans and Financing Receivable [Line Items]
Count | loan	5	7
Total loans	$ 1,598	$ 2,299
Consumer | NTM Loans | Green Loans (HELOC) - second liens | Loan Portfolio Concentration Risk | Nontraditional Mortgage Loans Portfolio
Accounts, Notes, Loans and Financing Receivable [Line Items]
Concentration risk percentage (percent)	0.30%	0.40%
Consumer | NTM Loans | Green Loans (HELOC) - second liens | Green Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Count | loan	5	7
Total loans	$ 1,598	$ 2,299
Consumer | NTM Loans | Green Loans (HELOC) - second liens | Green Loans | Loan Portfolio Concentration Risk | Nontraditional Mortgage Loans Portfolio
Accounts, Notes, Loans and Financing Receivable [Line Items]
Concentration risk percentage (percent)	0.30%	0.40%

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GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Additional Information (Detail) - USD ($)		3 Months Ended			6 Months Ended
	Aug. 31, 2019	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]
Goodwill		$ 37,144,000			$ 37,144,000		$ 37,144,000
Goodwill impairment	$ 0				0
Amortization of intangible assets		$ 430,000	$ 429,000	$ 621,000	$ 859,000	$ 1,241,000
Core deposit intangibles
Finite-Lived Intangible Assets [Line Items]
Weighted average amortization period					4 years 3 months 18 days
Core deposit intangibles | Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization period of other intangible assets					4 years
Core deposit intangibles | Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization period of other intangible assets					10 years

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GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Other Intangible Assets (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]
Net Carrying Value	$ 3,292
Core deposit intangibles
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	30,904	$ 30,904
Accumulated Amortization	27,612	26,753
Net Carrying Value	$ 3,292	$ 4,151

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GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Estimated Future Amortization Expense (Detail) $ in Thousands	Jun. 30, 2020 USD ($)
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
Remainder of 2020	$ 659
2021	1,082
2022	799
2023	517
2024	235
Net Carrying Value	$ 3,292

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FEDERAL HOME LOAN BANK ADVANCES AND OTHER BORROWINGS - Summary of Advances from the FHLB (Details) - USD ($) $ in Thousands	Jun. 30, 2020	May 31, 2020	Dec. 31, 2019
Fixed rate:
Outstanding balance	$ 624,000		$ 730,000
Interest rate (percent)	2.02%	2.81%
Variable rate:
Outstanding balance	$ 0		$ 465,000
Weighted average interest rate (percent)	0.00%		1.66%
Unamortized debt issuance costs	$ 6,800
Advances Maturing November 27, 2020 and May 27, 2021
Fixed rate:
Outstanding balance	$ 10,000
Interest rate (percent)	0.00%
Advance Maturing November 27, 2020
Fixed rate:
Outstanding balance	$ 5,000
Advance Maturing May 27, 2021
Fixed rate:
Outstanding balance	$ 5,000
Minimum
Fixed rate:
Interest rate (percent)	0.00%		1.82%
Maximum
Fixed rate:
Interest rate (percent)	3.32%		3.32%
Weighted average (percent)
Fixed rate:
Interest rate (percent)	2.24%		2.66%

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FEDERAL HOME LOAN BANK ADVANCES AND OTHER BORROWINGS - Additional Information (Detail)		1 Months Ended	6 Months Ended
	May 31, 2020	Jun. 30, 2020 USD ($) correspondent_bank	Jun. 30, 2020 USD ($) correspondent_bank	Jun. 30, 2019 USD ($)	Dec. 31, 2019 USD ($)
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Repayment of FHLB advances			$ 235,000,000	$ 0
Weighted average interest rate (percent)		0.00%	0.00%		1.66%
Interest rate (percent)	2.81%	2.02%	2.02%
Weighted average life	2 years 6 months 7 days	5 years 2 months 4 days
Overnight borrowings		$ 0	$ 0
Advances maturing within three months		58,000,000.0	58,000,000.0
Advances maturing beyond three months		$ 566,000,000.0	566,000,000.0
Weighted average life of advances maturing within three months and beyond three months		4 years 1 month 6 days
Weighted average interest rate advances maturing within three months and beyond three months (percent)		2.39%
Advances from FHLB collateralized		$ 2,660,000,000	2,660,000,000		$ 3,050,000,000.00
Securities sold under repurchase agreements		0	$ 0		0
FHLB Advance Repaid June 2020
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Repayment of FHLB advances		$ 100,000,000.0
Weighted average interest rate (percent)		2.07%	2.07%
Extinguishment fee		$ 2,500,000
FHLB Advance Refinanced June 2020
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
FHLB advances refinanced		111,000,000.0
Line of Credit | Unsecured Federal Funds Line of Credit
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Line of credit facility		185,000,000.0	$ 185,000,000.0
Other borrowings		$ 0	$ 0
Number of correspondent banks | correspondent_bank		5	5
Federal Reserve Bank Advances
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Line of credit facility		$ 370,400,000	$ 370,400,000
Other borrowings		0	0	$ 0
Federal Reserve Bank Advances | Collateralized loan obligations
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Advances from FHLB collateralized		870,100,000	870,100,000
Collateral on line of credit facility		23,000,000.0	23,000,000.0
Federal Home Loan Bank of San Francisco
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Amount of additional available borrowing		1,060,000,000.00	1,060,000,000.00
FHLB stock		$ 19,400,000	$ 19,400,000		$ 32,300,000

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LONG-TERM DEBT - Summary of Long-Term Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Par Value	$ 175,000	$ 175,000
Unamortized Debt Issuance Cost and Discount	$ (1,463)	$ (1,579)
Senior Notes | 5.25% Senior Notes Due April 15, 2025
Debt Instrument [Line Items]
Stated interest rate	5.25%	5.25%
Par Value	$ 175,000	$ 175,000
Unamortized Debt Issuance Cost and Discount	$ (1,463)	$ (1,579)

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LONG-TERM DEBT - Additional Information (Detail)	Jun. 30, 2020	Dec. 31, 2019
Senior Notes | 5.25% Senior Notes Due April 15, 2025
Debt Instrument [Line Items]
Stated interest rate	5.25%	5.25%

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INCOME TAXES - Additional Information (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Income tax expense (benefit)	$ (5,300,000)	$ 4,300,000	$ (7,500,000)	$ 7,000,000.0
Effective tax rate (percent)	22.30%	20.60%	23.00%	22.90%
Valuation allowance	$ 0		$ 0		$ 0
Net deferred tax asset	48,300,000		48,300,000		44,900,000
Valuation Allowance [Line Items]
Unrecognized tax benefits	1,000,000.0		1,000,000.0		977,000
Unrecognized tax benefits that would impact the effective tax rate	820,000		820,000
Accrued interest or penalties	$ 0		0		$ 0
Unrealized gain on securities available-for-sale
Valuation Allowance [Line Items]
Increase (decrease) in deferred tax asset			1,500,000
Change in expected credit loss estimate
Valuation Allowance [Line Items]
Increase (decrease) in deferred tax asset			$ 1,900,000

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DERIVATIVE INSTRUMENTS - Amount and Market Value of Mortgage Banking Derivatives (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Derivatives, Fair Value [Line Items]
Gain (loss) on derivatives			$ (288)	$ (9,583)
Notional Amount Assets	$ 72,923		72,923		$ 75,317
Derivatives asset, fair values	8,735		8,735		3,583
Notional Amount Liability	72,923		72,923		75,317
Derivatives liability, fair values	9,293		9,293		3,853
Interest rate swaps, Caps on loans, and Foreign exchange contracts
Derivatives, Fair Value [Line Items]
Gain (loss) on derivatives	(107)	$ (9,700)	(288)	$ (9,800)
Interest rate swaps and caps on loans
Derivatives, Fair Value [Line Items]
Notional Amount Assets	69,266		69,266		70,674
Derivatives asset, fair values	8,598		8,598		3,445
Notional Amount Liability	69,266		69,266		70,674
Derivatives liability, fair values	9,239		9,239		3,717
Foreign exchange contracts
Derivatives, Fair Value [Line Items]
Notional Amount Assets	3,657		3,657		4,643
Derivatives asset, fair values	137		137		138
Notional Amount Liability	3,657		3,657		4,643
Derivatives liability, fair values	$ 54		$ 54		$ 136

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EMPLOYEE STOCK COMPENSATION - Additional Information (Detail) - shares		6 Months Ended
	Aug. 21, 2012	Jun. 30, 2020	May 31, 2018
Stock option awards | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period		3 years
Award expiration period		7 years
Stock option awards | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period		5 years
Award expiration period		10 years
Restricted stock awards and restricted stock units | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period		1 year
Restricted stock awards and restricted stock units | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period		5 years
Stock appreciation rights
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award expiration period	10 years
2018 Omnibus Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum number of shares authorized for grant			4,417,882
Common stock available under new plan (in shares)		3,359,922

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EMPLOYEE STOCK COMPENSATION - Share Based Compensation Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	$ 1,470	$ 1,497	$ 3,046	$ 2,350
Related tax benefits	433	440	897	691
Unrecognized Expense	9,530		$ 9,530
Weighted-Average Remaining Expected Recognition Period			2 years 3 months 18 days
Stock option awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	2	(24)	$ 4	(16)
Restricted stock awards and restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	1,468	$ 1,521	3,042	$ 2,366
Unrecognized Expense	$ 9,530		$ 9,530
Weighted-Average Remaining Expected Recognition Period			2 years 3 months 18 days

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EMPLOYEE STOCK COMPENSATION - Option Activity (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended	12 Months Ended
	Jun. 30, 2020	Mar. 31, 2019	Jun. 30, 2020	Dec. 31, 2019
Number of Shares
Outstanding at beginning of period (in shares)	55,069		62,521
Exercised (shares)			(7,452)
Outstanding at end of period (in shares)	55,069		55,069	62,521
Exercisable at end of period (in shares)	52,821		52,821
Weighted-Average Exercise Price Per Share
Outstanding at beginning of period (in dollars per share)	$ 13.96		$ 13.85
Exercised (in dollars per share)			13.05
Outstanding at end of period (in dollars per share)	13.96		13.96	$ 13.85
Exercisable at end of period (in dollars per share)	$ 13.97		$ 13.97
Weighted-Average Remaining Contract Term
Outstanding	3 years 8 months 12 days	4 years	3 years 8 months 12 days	4 years 3 months 18 days
Exercised			5 years 2 months 12 days
Exercisable at end of period	3 years 7 months 6 days		3 years 7 months 6 days
Aggregated Intrinsic Value
Outstanding	$ (194)		$ (194)
Exercisable at end of period	$ (187)		$ (187)

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EMPLOYEE STOCK COMPENSATION - Nonvested Stock Option Activity (Detail) - $ / shares	3 Months Ended	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2020
Number of Shares
Non-vested outstanding at beginning of period (in shares)	2,248	2,248
Vested (in shares)	0	0
Forfeited (in shares)	0	0
Non-vested outstanding at end of period (in shares)	2,248	2,248
Weighted- Average Exercise Price per Share
Non-vested outstanding at beginning of period (in dollars per share)	$ 13.75	$ 13.75
Vested (in dollars per share)	0	0
Forfeited (in dollars per share)	0	0
Non-vested outstanding at end of period (in dollars per share)	$ 13.75	$ 13.75

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EMPLOYEE STOCK COMPENSATION - Nonvested Restricted Stock Awards and Restricted Stock Units (Detail) - $ / shares	3 Months Ended	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2020
Restricted stock awards and restricted stock units
Number of Shares
Outstanding at beginning of period (in shares)	1,083,107	923,482
Granted (in shares)	84,998	354,136
Vested (in shares)	(231,362)	(293,695)
Forfeited (in shares)	(24,073)	(71,253)
Outstanding at end of period (in shares)	912,670	912,670
Weighted Average Grant Date Fair Value Per Share
Outstanding at beginning of period (in dollars per share)	$ 15.65	$ 15.74
Granted (in dollars per share)	8.76	13.79
Vested (in dollars per share)	16.09	15.95
Forfeited (in dollars per share)	18.20	16.85
Outstanding at end of period (in dollars per share)	$ 14.91	$ 14.91
Performance shares
Number of Shares
Granted (in shares)	0	78,771
Vested (in shares)	(13,074)	(18,473)
Forfeited (in shares)	(1,782)	(17,404)

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EMPLOYEE STOCK COMPENSATION - Summary of SARs Activity (Details) - Stock appreciation rights - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended	12 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2020	Dec. 31, 2019
Number of Shares
Outstanding at beginning of period (in shares)	1,559,012	1,559,012	1,559,012
Outstanding at end of period (in shares)	1,559,012	1,559,012	1,559,012	1,559,012
Exercisable at end of period (in shares)	1,559,012		1,559,012
Weighted-Average Exercise Price Per Share
Outstanding at beginning of period (in dollars per share)	$ 11.60	$ 11.60	$ 11.60
Outstanding at end of period (in dollars per share)	11.60	$ 11.60	11.60	$ 11.60
Exercisable at end of period (in dollars per share)	$ 11.60		$ 11.60
Weighted-Average Remaining Contract Term
Outstanding	2 years 1 month 6 days	2 years 4 months 24 days	2 years 1 month 6 days	2 years 7 months 6 days
Exercisable at end of period	2 years 1 month 6 days		2 years 1 month 6 days
Aggregated Intrinsic Value
Outstanding	$ (1,812)	$ (5,616)	$ (1,812)	$ 8,508
Exercisable at end of period	$ (1,812)		$ (1,812)

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STOCKHOLDERS' EQUITY - Preferred Stock (Details) - Preferred Stock $ / shares in Units, $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2020 USD ($) $ / shares shares	Jun. 30, 2020 USD ($) $ / shares shares
Class of Stock [Line Items]
Preferred stock, authorized (in shares)	50,000,000	50,000,000
Preferred stock, par value (in dollars per share) | $ / shares	$ 0.01	$ 0.01
Preferred stock, liquidation preference per share (in dollars per share) | $ / shares	$ 1,000	$ 1,000
Series D Depository Shares
Class of Stock [Line Items]
Interest in shares (percent)	2.50%
Shares redeemed (in shares)	53,006	134,310
Payment for redemption of shares | $	$ 1,200	$ 2,700
Series D Preferred Stock
Class of Stock [Line Items]
Preferred stock, liquidation preference per share (in dollars per share) | $ / shares	$ 1,000	$ 1,000
Shares redeemed (in shares)	1,325	3,357
Deferred issuance costs reclassified to retained earnings | $	$ 40	$ 541
Series E Depository Shares
Class of Stock [Line Items]
Interest in shares (percent)	2.50%
Shares redeemed (in shares)	57,065	64,465
Payment for redemption of shares | $	$ 1,400	$ 1,500
Series E Preferred Stock
Class of Stock [Line Items]
Preferred stock, liquidation preference per share (in dollars per share) | $ / shares	$ 1,000	$ 1,000
Shares redeemed (in shares)	1,427	1,612
Deferred issuance costs reclassified to retained earnings | $	$ 9	$ 34

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STOCKHOLDERS' EQUITY - Summary of Preferred Stock (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
Class of Stock [Line Items]
Carrying Value	$ 185,037	$ 189,825
Preferred Stock
Class of Stock [Line Items]
Preferred stock, outstanding (in shares)	192,137	197,106
Liquidation Preference	$ 192,137	$ 197,106
Carrying Value	$ 185,037	$ 189,825
Preferred Stock | Series D 7.375% non-cumulative perpetual
Class of Stock [Line Items]
Non cumulative preferred stock, dividend rate (percent)	7.375%
Preferred stock, outstanding (in shares)	93,272	96,629
Liquidation Preference	$ 93,272	$ 96,629
Carrying Value	$ 89,924	$ 93,162
Preferred Stock | Series E 7.00% non-cumulative perpetual
Class of Stock [Line Items]
Non cumulative preferred stock, dividend rate (percent)	7.00%
Preferred stock, outstanding (in shares)	98,865	100,477
Liquidation Preference	$ 98,865	$ 100,477
Carrying Value	$ 95,113	$ 96,663

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STOCKHOLDERS' EQUITY - Stock Repurchase Program (Details) - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2020	Feb. 10, 2020
Equity, Class of Treasury Stock [Line Items]
Shares repurchased (shares)		827,584
Aggregate repurchases		$ 12,041,000
February 10, 2020 Share Repurchase Program
Equity, Class of Treasury Stock [Line Items]
Authorized repurchase amount			$ 45,000,000
Shares repurchased (shares)	0	827,584
Weighted average price (in usd per share)		$ 14.50
Aggregate repurchases		$ 12,000,000.0

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STOCKHOLDERS' EQUITY - Changes to Accumulated Other Comprehensive (Loss) Income by Components (Detail) - Gain (loss) on securities available-for-sale - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at beginning of period	$ (54,148)	$ (18,091)	$ (11,900)	$ (24,117)
Unrealized gain (loss) arising during the period	56,701	7,678	(3,182)	16,422
Reclassification adjustment from other comprehensive income	(2,011)	0	(2,011)	(208)
Tax effect of current period changes	(16,107)	(2,255)	1,528	(4,765)
Total changes, net of taxes	38,583	5,423	(3,665)	11,449
Balance at end of period	$ (15,565)	$ (12,668)	$ (15,565)	$ (12,668)

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VARIABLE INTEREST ENTITIES - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2020	Sep. 30, 2019	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Variable Interest Entity [Line Items]
Total assets	$ 7,770,138			$ 7,770,138		$ 7,828,410
Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Funding transferred	0		$ 235	3,631	$ 235
Total assets	254,670			254,670		259,445
Maximum loss exposure	26,967			26,967		32,525
Variable Interest Entity, Not Primary Beneficiary | Other Assets
Variable Interest Entity [Line Items]
Total assets	$ 27,000			$ 27,000		$ 29,300
Variable Interest Entity, Not Primary Beneficiary | Multifamily
Variable Interest Entity [Line Items]
Funding transferred		$ 573,500
Credit losses guaranteed (percent)	12.00%			12.00%
Repurchase liability recognized	$ 3,500			$ 3,500
Maximum loss exposure	$ 68,800			$ 68,800

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VARIABLE INTEREST ENTITIES - Information Regarding Activity in Alternative Energy Partnerships (Details) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Variable Interest Entity [Line Items]
Gain (loss) on investments in alternative energy partnerships	$ 167	$ (1,905)	$ 355	$ (1,738)	$ (1,595)
Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Funding transferred	0		235	3,631	235
Cash distribution from investment	547		535	1,001	995
Gain (loss) on investments in alternative energy partnerships	167		355	(1,738)	(1,595)
Income tax credits recognized	0		1,723	0	1,723
Tax (expense) benefit recognized from HLBV application	$ (38)		$ 380	$ 398	$ 380

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VARIABLE INTEREST ENTITIES - Summary of Unconsolidated VIEs (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Variable Interest Entity [Line Items]
Equipment, net of depreciation	$ 125,247	$ 128,021
Other assets	185,863	185,946
Total assets	7,770,138	7,828,410
Total unconsolidated liabilities	6,923,179	6,921,165
Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Cash	2,958	4,224
Equipment, net of depreciation	244,961	248,920
Other assets	6,751	6,301
Total assets	254,670	259,445
Total unconsolidated liabilities	6,326	7,143
Maximum loss exposure	$ 26,967	$ 32,525

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VARIABLE INTEREST ENTITIES - Balances and Activity in Affordable Housing Partnerships (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Variable Interest Entity [Line Items]
Funding of equity investment			$ 14,201	$ 1,501
Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Maximum loss exposure			32,525
Maximum loss exposure	$ 26,967		26,967
Income tax credits recognized	(38)	$ 380	398	380
Affordable Housing Fund Investment
Variable Interest Entity [Line Items]
Alternative investments unfunded investment commitments	20,500		20,500
Funding of equity investment	9,312	0	13,871	454
Proportional amortization recognized	1,148	553	2,295	1,190
Affordable Housing Fund Investment | Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Maximum loss exposure			36,462
Aggregate funding commitment	61,278		61,278		$ 49,278
Total amount funded	40,776		40,776		26,905
Alternative investments unfunded investment commitments	20,502		20,502		$ 22,373
Maximum loss exposure	46,167		46,167
Income tax credits recognized	$ 1,152	$ 554	$ 2,208	$ 1,109

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(LOSS) EARNINGS PER COMMON SHARE - Computations for Basic and Diluted Earnings/(Loss) (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Schedule of Earnings Per Share [Line Items]
Income allocated to participating securities	$ 0	$ 0	$ (271)	$ 0	$ (153)
Less: participating securities dividends	(94)	(94)	(94)	(188)	(295)
Less: preferred stock dividends	(3,442)	(3,533)	(4,308)	(6,975)	(8,616)
Less: preferred stock redemption	49	$ 526	0	575	0
Voting
Schedule of Earnings Per Share [Line Items]
Loss from operations	(18,273)		16,426	(24,804)	23,397
Income allocated to participating securities			(268)		(152)
Less: participating securities dividends	(93)		(93)	(186)	(292)
Less: preferred stock dividends	(3,409)		(4,268)	(6,909)	(8,535)
Less: preferred stock redemption	49			570
Net income available to common stockholders	$ (21,726)		$ 11,797	$ (31,329)	$ 14,418
Weighted average common shares outstanding (in shares)	49,553,598		50,379,816	49,770,527	50,290,107
Average shares and dilutive common shares (in shares)	49,553,598		50,487,635	49,770,527	50,417,869
Basic loss per common share
Basic earnings (loss) per common share (in usd per share)	$ (0.44)	$ (0.19)	$ 0.23	$ (0.63)	$ 0.29
Diluted loss per common share
Diluted earnings (loss) per common share (in usd per share)	$ (0.44)	(0.19)	$ 0.23	$ (0.63)	$ 0.29
Voting | Restricted shares / units
Schedule of Earnings Per Share [Line Items]
Dilutive effects of stock units and stock options (in shares)	0		103,677	0	119,967
Voting | Stock Option
Schedule of Earnings Per Share [Line Items]
Dilutive effects of stock units and stock options (in shares)	0		4,142	0	7,795
Class B Common Stock
Schedule of Earnings Per Share [Line Items]
Loss from operations	$ (176)		$ 156	$ (238)	$ 222
Income allocated to participating securities			(3)		(1)
Less: participating securities dividends	(1)		(1)	(2)	(3)
Less: preferred stock dividends	(33)		(40)	(66)	(81)
Less: preferred stock redemption	0			5
Net income available to common stockholders	$ (210)		$ 112	$ (301)	$ 137
Weighted average common shares outstanding (in shares)	477,321		477,321	477,321	477,321
Average shares and dilutive common shares (in shares)	477,321		477,321	477,321	477,321
Basic loss per common share
Basic earnings (loss) per common share (in usd per share)	$ (0.44)	(0.19)	$ 0.23	$ (0.63)	$ 0.29
Diluted loss per common share
Diluted earnings (loss) per common share (in usd per share)	$ (0.44)	$ (0.19)	$ 0.23	$ (0.63)	$ 0.29
Class B Common Stock | Restricted shares / units
Schedule of Earnings Per Share [Line Items]
Dilutive effects of stock units and stock options (in shares)	0		0	0	0
Class B Common Stock | Stock Option
Schedule of Earnings Per Share [Line Items]
Dilutive effects of stock units and stock options (in shares)	0		0	0	0

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(LOSS) EARNINGS PER COMMON SHARE - Additional Information (Detail) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Restricted shares / units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Stock excluded from computation of earnings per share (in shares)	960,090	517,833	960,883	484,163
Stock Option
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Stock excluded from computation of earnings per share (in shares)	55,069	58,859	55,438	33,013

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LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES - Contractual Amount of Financial Instruments with Off-Balance-Sheet Risk (Detail) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
Affordable Housing Fund Investment
Other Commitments [Line Items]
Alternative investments unfunded investment commitments	$ 20,500
Small Business Investment Companies
Other Commitments [Line Items]
Alternative investments unfunded investment commitments	7,100
Other Investments
Other Commitments [Line Items]
Alternative investments unfunded investment commitments	501
Commitments to extend credit
Other Commitments [Line Items]
Fixed Rate	6,249	$ 473
Variable Rate	73,844	129,495
Unused lines of credit
Other Commitments [Line Items]
Fixed Rate	590	703
Variable Rate	1,391,625	1,049,632
Letters of credit
Other Commitments [Line Items]
Fixed Rate	336	134
Variable Rate	$ 3,243	$ 5,316

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REVENUE RECOGNITION - Summary of Noninterest Income (Details) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Disaggregation of Revenue [Line Items]
Noninterest income (in-scope of Topic 606)	$ 859		$ 1,122	$ 1,624	$ 2,288
Noninterest income (out-of-scope of Topic 606)	4,669		(3,412)	5,965	1,717
Total noninterest income (loss)	5,528	$ 2,061	(2,290)	7,589	4,005
Deposit service fees
Disaggregation of Revenue [Line Items]
Noninterest income (in-scope of Topic 606)	420		575	959	1,242
Debit card fees
Disaggregation of Revenue [Line Items]
Noninterest income (in-scope of Topic 606)	380		178	557	291
Investment commissions
Disaggregation of Revenue [Line Items]
Noninterest income (in-scope of Topic 606)	0		260	0	539
Other
Disaggregation of Revenue [Line Items]
Noninterest income (in-scope of Topic 606)	$ 59		$ 109	$ 108	$ 216

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RELATED-PARTY TRANSACTIONS - Narrative (Details) - Special Committee Investigation Indemnification - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Executive Officers and Directors
Related Party Transaction [Line Items]
Expenses from transactions with related parties	$ 120		$ 120
Former President And Chief Executive Officer
Related Party Transaction [Line Items]
Expenses from transactions with related parties		$ 4,700		$ 6,900
Former Interim Chief Financial Officer and Chief Strategy Officer
Related Party Transaction [Line Items]
Expenses from transactions with related parties		186		741
Former Director
Related Party Transaction [Line Items]
Expenses from transactions with related parties		$ 139		142
Former General Counsel
Related Party Transaction [Line Items]
Expenses from transactions with related parties				$ 149