Loans Receivable, Including Loans Held For Sale

3 Months Ended

Mar. 31, 2020

Receivables [Abstract]

Loans Receivable, Including Loans Held For Sale

LOANS RECEIVABLE, INCLUDING LOANS HELD FOR SALE

Major classifications of loans receivable, including loans held for sale, held by WebBank, as of March 31, 2020 and December 31, 2019 are as follows:

	Total										Current						Non-current
	March 31, 2020			%		December 31, 2019			%		March 31, 2020			December 31, 2019			March 31, 2020		December 31, 2019
Loans held for sale	$	68,756				$	225,013				$	68,756		$	225,013		$	—	$	—
Commercial real estate loans	$	663		—	%	$	659		—	%	—			—			663		659
Commercial and industrial	273,035			49	%	251,349			45	%	258,689			233,510			14,346		17,839
Consumer loans	280,145			51	%	302,714			55	%	105,887			125,067			174,258		177,647
Total loans	553,843			100	%	554,722			100	%	364,576			358,577			189,267		196,145
Less:
Allowance for loan losses	(52,423		)			(36,682		)			(52,423		)	(36,682		)	—		—
Total loans receivable, net	$	501,420				$	518,040				312,153			321,895			189,267		196,145
Loans receivable, including loans held for sale (a)											$	380,909		$	546,908		$	189,267	$	196,145

(a) The carrying value is considered to be representative of fair value because the rates of interest are not significantly different from market interest rates for instruments with similar maturities.

Loans with a carrying value of approximately $7,760 and $15,737 were pledged as collateral for potential borrowings as of March 31, 2020 and December 31, 2019, respectively. WebBank serviced $2,892 and $2,898 in loans for others as of March 31, 2020 and December 31, 2019, respectively.

WebBank sold loans classified as loans held for sale of $5,124,275 and $5,232,586 during the three months ended March 31, 2020 and 2019, respectively. The sold loans were derecognized from the consolidated balance sheets. Loans classified as loans held for sale primarily consist of consumer and small business loans. Amounts added to loans held for sale during the three months ended March 31, 2020 and 2019 were $4,969,689 and $5,214,272, respectively. The reduction in volume of loans held for sale as of March 31, 2020 reflects the impact of reduced lending by WebBank's partners, beginning in March 2020, due to the economic impact of COVID-19. Such factors include WebBank's partners experiencing reduced sales volume, as well as tightening their credit policies due to the increase in the U.S. unemployment rate and other factors. This in turn has reduced the volume of loans being initiated by, and then sold by, WebBank.

The ALLL represents an estimate of probable and estimable losses inherent in the loan portfolio as of the balance sheet date. The amount of the ALLL is established by analyzing the portfolio at least quarterly, and a provision for or reduction of loan losses is recorded so that the ALLL is at an appropriate level at the balance sheet date. WebBank's ALLL increased $15,741, or 43%, during the first quarter of 2020, primarily driven by the impact of COVID-19. WebBank is observing and anticipating significant economic disruption and loan performance deterioration associated with the COVID-19 pandemic. WebBank believes this will have a broad negative impact on the macro-economy and will cause estimated credit losses to materially differ from historical loss experience.