RELATED-PARTY TRANSACTIONS

9 Months Ended

Sep. 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 September 30, 2020, no related party loans were categorized as nonaccrual, 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”).

During the three and nine months ended September 30, 2020, indemnification costs paid by the Company included $298 thousand and $302 thousand incurred by the Company’s former Interim Chief Financial Officer and Chief Strategy Officer, J. Francisco A. Turner. Indemnification costs paid by the Company for the Company's former Chair, President, and Chief Executive Officer, Steven A. Sugarman were $198 thousand for the nine months ended September 30, 2020. Indemnification costs were also paid on behalf of certain current and former executive officers and directors in amounts less than $120 thousand for the three and nine months ended September 30, 2020.

During the three and nine months ended September 30, 2019, indemnification costs paid by the Company included $3.5 million and $10.5 million incurred by the Company’s former Chair, President, and Chief Executive Officer, Steven A. Sugarman; and $497 thousand and $646 thousand incurred by the Company's former General Counsel Emeritus John Grosvenor. Indemnification costs for 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 were $769 thousand, jointly incurred for the nine months ended September 30, 2019; and $180 thousand for the Bank’s former director, Cynthia Abercrombie for the nine months ended September 30, 2019. Indemnification costs were also paid on behalf of certain current and former executive officers and directors in amounts less than $120 thousand for the three and nine months ended September 30, 2019.