(State or other jurisdiction of incorporation or organization) | (I.R.S. employer identification number) | |||||||
(Address of principal executive offices) | (Zip Code) |
Securities Registered Pursuant to Section 12(b) of the Act | ||||||||||||||
Title of Each Class | Trading Symbol | Name of Each Exchange on Which Registered | ||||||||||||
Large accelerated filer | o | ☒ | ||||||||||||
Non-accelerated filer | o | Smaller Reporting Company | ||||||||||||
Emerging Growth Company |
Page | ||||||||
PART I - FINANCIAL INFORMATION | ||||||||
Item 1. | ||||||||
Item 2. | ||||||||
Item 3. | ||||||||
Item 4. | ||||||||
PART II - OTHER INFORMATION | ||||||||
Item 1. | ||||||||
Item 1A. | ||||||||
Item 2. | ||||||||
Item 5. | ||||||||
Item 6. | ||||||||
March 31, 2021 (unaudited) | December 31, 2020 | ||||||||||
ASSETS | |||||||||||
Cash, cash equivalents and restricted cash | $ | $ | |||||||||
Available for sale debt securities, at fair value | |||||||||||
Held to maturity debt securities, at amortized cost (fair value of $ | |||||||||||
Equity securities, at fair value | |||||||||||
Loans receivable, net of allowance for loan losses of $ | |||||||||||
Accrued interest receivable | |||||||||||
Federal Home Loan Bank ("FHLB") stock, at cost | |||||||||||
Premises and equipment, net | |||||||||||
Goodwill | |||||||||||
Prepaid expenses and other assets | |||||||||||
Total assets | $ | $ | |||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
Liabilities: | |||||||||||
Deposits | $ | $ | |||||||||
FHLB advances | |||||||||||
Junior subordinated deferrable interest debentures | |||||||||||
Senior debt | |||||||||||
$ | |||||||||||
Accrued interest payable | |||||||||||
Other liabilities and accrued expenses | |||||||||||
Total liabilities | |||||||||||
Commitments and contingencies (Note 15) | |||||||||||
Stockholders' equity: | |||||||||||
Preferred stock, no par value; | |||||||||||
Common stock, no par value; | |||||||||||
Retained earnings | |||||||||||
Accumulated other comprehensive income, net of taxes | |||||||||||
Total stockholders' equity | |||||||||||
Total liabilities and stockholders' equity | $ | $ |
Three Months Ended March 31, | ||||||||||||||
2021 | 2020 | |||||||||||||
Interest and fee income: | ||||||||||||||
Loans | $ | $ | ||||||||||||
Investment securities | ||||||||||||||
Cash, cash equivalents and restricted cash | ||||||||||||||
Total interest and fee income | ||||||||||||||
Interest expense: | ||||||||||||||
Deposits | ||||||||||||||
FHLB advances | ||||||||||||||
Junior subordinated deferrable interest debentures | ||||||||||||||
Senior debt | ||||||||||||||
Total interest expense | ||||||||||||||
Net interest income before provision for loan losses | ||||||||||||||
(Reversal of) provision for loan losses | ( | |||||||||||||
Net interest income after provision for loan losses | ||||||||||||||
Noninterest income: | ||||||||||||||
FHLB dividends | ||||||||||||||
Other income | ( | |||||||||||||
Total noninterest income | ||||||||||||||
Noninterest expense: | ||||||||||||||
Compensation and related benefits | ||||||||||||||
Deposit insurance premium | ||||||||||||||
Professional and regulatory fees | ||||||||||||||
Occupancy | ||||||||||||||
Depreciation and amortization | ||||||||||||||
Data processing | ||||||||||||||
Marketing | ||||||||||||||
Other expenses | ||||||||||||||
Total noninterest expense | ||||||||||||||
Income before provision for income taxes | ||||||||||||||
Provision for income taxes | ||||||||||||||
Net income | $ | $ | ||||||||||||
Basic earnings per common share | $ | $ | ||||||||||||
Diluted earnings per common share | $ | $ | ||||||||||||
Dividends per common share | $ | $ | ||||||||||||
Three Months Ended March 31, | |||||||||||
2021 | 2020 | ||||||||||
Net income | $ | $ | |||||||||
Other comprehensive (loss) income: | |||||||||||
Unrealized (loss) gain on available for sale debt securities: | |||||||||||
Unrealized holding (loss) gain arising during the period | ( | ||||||||||
Tax effect | ( | ||||||||||
Total other comprehensive (loss) income, net of tax | ( | ||||||||||
Comprehensive income | $ | $ |
Accumulated Other Comprehensive Income (Loss) (Net of Taxes) | Total Stockholders' Equity | ||||||||||||||||||||||||||||
Common Stock | Retained Earnings | Available for Sale Securities | |||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||
Balance, December 31, 2019 | $ | $ | $ | $ | |||||||||||||||||||||||||
Comprehensive income: | |||||||||||||||||||||||||||||
Net income | — | — | — | ||||||||||||||||||||||||||
Other comprehensive income | — | — | — | ||||||||||||||||||||||||||
Issuance of restricted stock awards | — | — | — | — | |||||||||||||||||||||||||
Settled restricted stock units | — | — | — | — | |||||||||||||||||||||||||
Shares withheld to pay taxes on stock based compensation | ( | ( | — | — | ( | ||||||||||||||||||||||||
Restricted stock forfeitures | ( | ( | — | ( | |||||||||||||||||||||||||
Stock based compensation expense | — | — | — | ||||||||||||||||||||||||||
Shares repurchased | ( | ( | — | — | ( | ||||||||||||||||||||||||
Cash dividends ($ | — | — | ( | — | ( | ||||||||||||||||||||||||
Balance, March 31, 2020 | $ | $ | $ | $ | |||||||||||||||||||||||||
Balance, December 31, 2020 | $ | $ | $ | $ | |||||||||||||||||||||||||
Comprehensive income: | |||||||||||||||||||||||||||||
Net income | — | — | — | ||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | ( | ( | ||||||||||||||||||||||||
Issuance of restricted stock awards | — | — | — | — | |||||||||||||||||||||||||
Settled restricted stock units | — | — | — | — | |||||||||||||||||||||||||
Shares withheld to pay taxes on stock based compensation | ( | ( | — | — | ( | ||||||||||||||||||||||||
Restricted stock forfeitures | ( | ( | — | ( | |||||||||||||||||||||||||
Stock based compensation expense | — | — | — | ||||||||||||||||||||||||||
Shares repurchased | ( | ( | — | — | ( | ||||||||||||||||||||||||
Cash dividends ($ | — | — | ( | — | ( | ||||||||||||||||||||||||
Balance, March 31, 2021 | $ | $ | $ | $ | |||||||||||||||||||||||||
Three Months Ended March 31, | |||||||||||
2021 | 2020 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net income | $ | $ | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | |||||||||||
(Reversal of) provision for loan losses | ( | ||||||||||
Amortization of deferred loan costs, net | |||||||||||
Amortization of premiums on investment securities, net | |||||||||||
Stock based compensation expense, net of forfeitures | |||||||||||
Change in fair value of mortgage servicing rights | |||||||||||
Change in fair value of equity securities | ( | ||||||||||
Other items, net | ( | ||||||||||
Effect of changes in: | |||||||||||
Accrued interest receivable | ( | ( | |||||||||
Accrued interest payable | ( | ( | |||||||||
Prepaid expenses and other assets | ( | ||||||||||
Other liabilities and accrued expenses | ( | ||||||||||
Net cash provided by operating activities | |||||||||||
Cash flows from investing activities: | |||||||||||
Proceeds from maturities, paydowns and calls of available for sale debt securities | |||||||||||
Proceeds from maturities and paydowns of held to maturity debt securities | |||||||||||
Purchases of available for sale debt securities | ( | ( | |||||||||
Net decrease in loans receivable | |||||||||||
Purchase of loans | ( | ( | |||||||||
Redemption of FHLB stock, net | |||||||||||
Purchase of premises and equipment | ( | ( | |||||||||
Net cash (used in) provided by investing activities | ( | ||||||||||
Cash flows from financing activities: | |||||||||||
Net increase in deposits | |||||||||||
Proceeds from long-term FHLB advances | |||||||||||
Repayment of long-term FHLB advances | ( | ( | |||||||||
Net change in short-term FHLB advances | ( | ||||||||||
Shares withheld for taxes on vested restricted stock | ( | ( | |||||||||
Shares repurchased | ( | ( | |||||||||
Cash paid for dividends | ( | ( | |||||||||
Net cash provided by financing activities | |||||||||||
(Decrease) increase in cash, cash equivalents and restricted cash | ( | ||||||||||
Cash, cash equivalents and restricted cash, beginning of period | |||||||||||
Cash, cash equivalents and restricted cash, end of period | $ | $ | |||||||||
Supplemental disclosure of cash flow information: | |||||||||||
Cash paid during the period for: | |||||||||||
Interest | $ | $ | |||||||||
Income taxes | $ | $ | |||||||||
(Dollars in thousands, except share amounts) | Three Months Ended March 31, | |||||||||||||
2021 | 2020 | |||||||||||||
Net income | $ | $ | ||||||||||||
Weighted average basic common shares outstanding | ||||||||||||||
Add: Dilutive effects of assumed vesting of restricted stock | ||||||||||||||
Weighted average diluted common shares outstanding | ||||||||||||||
Income per common share: | ||||||||||||||
Basic EPS | $ | $ | ||||||||||||
Diluted EPS | $ | $ | ||||||||||||
Anti-dilutive shares not included in calculation of diluted earnings per share |
(Dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | |||||||||||||||||||
At March 31, 2021: | |||||||||||||||||||||||
Government and Government Sponsored Entities: | |||||||||||||||||||||||
Residential mortgage backed securities ("MBS") and collateralized mortgage obligations ("CMOs") | $ | $ | $ | ( | $ | ||||||||||||||||||
Commercial MBS and CMOs | ( | ||||||||||||||||||||||
Agency bonds | ( | ||||||||||||||||||||||
Other asset backed securities ("ABS") | ( | ||||||||||||||||||||||
Total available for sale debt securities | $ | $ | $ | ( | $ | ||||||||||||||||||
At December 31, 2020: | |||||||||||||||||||||||
Government and Government Sponsored Entities: | |||||||||||||||||||||||
Residential MBS and CMOs | $ | $ | $ | ( | $ | ||||||||||||||||||
Commercial MBS and CMOs | ( | ||||||||||||||||||||||
Agency bonds | ( | ||||||||||||||||||||||
Total available for sale debt securities | $ | $ | $ | ( | $ |
March 31, 2021 | |||||||||||||||||||||||||||||||||||
Less than 12 Months | 12 Months or More | Total | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||||||||||||
Government and Government Sponsored Entities: | |||||||||||||||||||||||||||||||||||
Residential MBS and CMOs | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||
Commercial MBS and CMOs | ( | ( | ( | ||||||||||||||||||||||||||||||||
Agency bonds | ( | ( | ( | ||||||||||||||||||||||||||||||||
Other ABS | ( | ( | |||||||||||||||||||||||||||||||||
Total available for sale debt securities | $ | $ | ( | $ | $ | ( | $ | $ | ( |
December 31, 2020 | |||||||||||||||||||||||||||||||||||
Less than 12 Months | 12 Months or More | Total | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||||||||||||
Government and Government Sponsored Entities: | |||||||||||||||||||||||||||||||||||
Residential MBS and CMOs | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||
Commercial MBS and CMOs | ( | ( | ( | ||||||||||||||||||||||||||||||||
Agency bonds | ( | ( | ( | ||||||||||||||||||||||||||||||||
Total available for sale debt securities | $ | $ | ( | $ | $ | ( | $ | $ | ( |
(Dollars in thousands) | Amortized Cost | Gross Unrecognized Gains | Gross Unrecognized Losses | Estimated Fair Value | |||||||||||||||||||
As of March 31, 2021: | |||||||||||||||||||||||
Government Sponsored Entities: | |||||||||||||||||||||||
Residential MBS | $ | $ | $ | $ | |||||||||||||||||||
Other investments | |||||||||||||||||||||||
Total held to maturity investment securities | $ | $ | $ | $ | |||||||||||||||||||
As of December 31, 2020: | |||||||||||||||||||||||
Government Sponsored Entities: | |||||||||||||||||||||||
Residential MBS | $ | $ | $ | $ | |||||||||||||||||||
Other investments | |||||||||||||||||||||||
Total held to maturity investment securities | $ | $ | $ | $ |
March 31, 2021 | |||||||||||
(Dollars in thousands) | Amortized Cost | Fair Value | |||||||||
Available for sale debt securities | |||||||||||
Five to ten years | $ | $ | |||||||||
Beyond ten years | |||||||||||
MBS, CMOs and other ABS | |||||||||||
Total available for sale debt securities | $ | $ | |||||||||
Held to maturity investments securities | |||||||||||
Beyond ten years | $ | $ | |||||||||
MBS | |||||||||||
Total held to maturity debt securities | $ | $ |
(Dollars in thousands) | March 31, 2021 | December 31, 2020 | |||||||||
Permanent mortgages on: | |||||||||||
Multifamily residential | $ | $ | |||||||||
Single family residential | |||||||||||
Commercial real estate | |||||||||||
Construction and land loans | |||||||||||
Non-Mortgage (‘‘NM’’) loans | |||||||||||
Total | |||||||||||
Allowance for loan losses | ( | ( | |||||||||
Loans held for investment, net | $ | $ |
(Dollars in thousands) | Multifamily Residential | Single Family Residential | Commercial Real Estate | Land, Construction and NM | Total | ||||||||||||||||||||||||
Three months ended March 31, 2021 | |||||||||||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||||
Beginning balance allocated to portfolio segments | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
(Reversal of) provision for loan losses | ( | ( | ( | ( | |||||||||||||||||||||||||
Charge-offs | |||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||
Ending balance allocated to portfolio segments | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Three months ended March 31, 2020 | |||||||||||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||||
Beginning balance allocated to portfolio segments | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Provision for (reversal of) loan losses | ( | ||||||||||||||||||||||||||||
Charge-offs | ( | ( | |||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||
Ending balance allocated to portfolio segments | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
(Dollars in thousands) | Multifamily Residential | Single Family Residential | Commercial Real Estate | Land, Construction and NM | Total | ||||||||||||||||||||||||
As of March 31, 2021: | |||||||||||||||||||||||||||||
Ending allowance balance allocated to: | |||||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Loans collectively evaluated for impairment | |||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||||
Ending balance: individually evaluated for impairment | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Ending balance: collectively evaluated for impairment | |||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
As of December 31, 2020: | |||||||||||||||||||||||||||||
Ending allowance balance allocated to: | |||||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Loans collectively evaluated for impairment | |||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||||
Ending balance: individually evaluated for impairment | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Ending balance: collectively evaluated for impairment | |||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ |
(Dollars in thousands) | Multifamily Residential | Single Family Residential | Commercial Real Estate | Land, Construction and NM | Total | ||||||||||||||||||||||||
As of March 31, 2021: | |||||||||||||||||||||||||||||
Grade: | |||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Watch | |||||||||||||||||||||||||||||
Special mention | |||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
As of December 31, 2020: | |||||||||||||||||||||||||||||
Grade: | |||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Watch | |||||||||||||||||||||||||||||
Special mention | |||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ |
(Dollars in thousands) | 30 Days | 60 Days | 90+ Days | Non-accrual | Current | Total | |||||||||||||||||||||||||||||
As of March 31, 2021: | |||||||||||||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||||
Multifamily residential | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Single family residential | |||||||||||||||||||||||||||||||||||
Commercial real estate | |||||||||||||||||||||||||||||||||||
Land, construction and NM | |||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
As of December 31, 2020: | |||||||||||||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||||
Multifamily residential | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Single family residential | |||||||||||||||||||||||||||||||||||
Commercial real estate | |||||||||||||||||||||||||||||||||||
Land, construction and NM | |||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ |
As of March 31, 2021 | As of December 31, 2020 | ||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Recorded Investment | Unpaid Principal Balance | Related Allowance | Recorded Investment | Unpaid Principal Balance | Related Allowance | |||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||||
Multifamily residential | $ | $ | $ | — | $ | $ | $ | — | |||||||||||||||||||||||||||
Single family residential | — | — | |||||||||||||||||||||||||||||||||
— | — | ||||||||||||||||||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||||
Single family residential | |||||||||||||||||||||||||||||||||||
Total: | |||||||||||||||||||||||||||||||||||
Multifamily residential | |||||||||||||||||||||||||||||||||||
Single family residential | |||||||||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ |
Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||
2021 | 2020 | ||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Average Recorded Investment | Interest Income | Cash Basis Interest | Average Recorded Investment | Interest Income | Cash Basis Interest | |||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||||
Multifamily residential | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Single family residential | |||||||||||||||||||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||||
Single family residential | |||||||||||||||||||||||||||||||||||
Total: | |||||||||||||||||||||||||||||||||||
Multifamily residential | |||||||||||||||||||||||||||||||||||
Single family residential | |||||||||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ |
(Dollars in thousands) | March 31, 2021 | December 31, 2020 | |||||||||
Troubled debt restructurings: | |||||||||||
Single family residential | $ | $ | |||||||||
(Dollars in thousands) | March 31, 2021 | December 31, 2020 | |||||||||
Non-accrual loans: | |||||||||||
Multifamily residential | $ | $ | |||||||||
Single family residential | |||||||||||
Total non-accrual loans | |||||||||||
Real estate owned | |||||||||||
Total nonperforming assets | $ | $ |
(Dollars in thousands) | March 31, 2021 | December 31, 2020 | |||||||||
Mortgage loans serviced for: | |||||||||||
Federal Home Loan Mortgage Corporation ("Freddie Mac") | $ | $ | |||||||||
Other financial institutions | |||||||||||
Total mortgage loans serviced for others | $ | $ |
Three Months Ended March 31, | |||||||||||
(Dollars in thousands) | 2021 | 2020 | |||||||||
Beginning balance | $ | $ | |||||||||
Additions | |||||||||||
Disposals | |||||||||||
Changes in fair value due to changes in assumptions | |||||||||||
Other changes in fair value | ( | ( | |||||||||
Ending balance | $ | $ |
(Dollars in thousands) | March 31, 2021 | December 31, 2020 | |||||||||
Time deposits | $ | $ | |||||||||
Money market savings | |||||||||||
Interest-bearing demand | |||||||||||
Money market checking | |||||||||||
Noninterest-bearing demand | |||||||||||
Total | $ | $ |
(Dollars in thousands) | |||||
April 1 - December 31, 2021 | $ | ||||
2022 | |||||
2023 | |||||
2024 | |||||
2025 | |||||
Thereafter | |||||
Total | $ |
Outstanding Balances | As of March 31, 2021 | ||||||||||||||||||||||||||||||||||
(Dollars in thousands) | March 31, 2021 | December 31, 2020 | Minimum Interest Rate | Maximum Interest Rate | Weighted Average Rate | Maturity Dates | |||||||||||||||||||||||||||||
Fixed rate short-term | $ | $ | % | % | % | April 2021 | |||||||||||||||||||||||||||||
Fixed rate long-term | % | % | % | May 2021 to March 2030 | |||||||||||||||||||||||||||||||
$ | $ |
(Dollars in thousands) | |||||
April 1 - December 31, 2021 | $ | ||||
2022 | |||||
2023 | |||||
2024 | |||||
2025 | |||||
Thereafter | |||||
$ |
March 31, 2021 | December 31, 2020 | Date | Maturity | Rate Index | ||||||||||||||||||||||||||||||||||||||||
Issuer | Amount | Rate | Amount | Rate | Issued | Date | (Quarterly Reset) | |||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||
Luther Burbank Statutory Trust I | $ | % | $ | % | 3/1/2006 | 6/15/2036 | 3 month LIBOR + | |||||||||||||||||||||||||||||||||||||
Luther Burbank Statutory Trust II | $ | % | $ | % | 3/1/2007 | 6/15/2037 | 3 month LIBOR + |
March 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Principal | Unamortized Debt Issuance Costs | Principal | Unamortized Debt Issuance Costs | Maturity Date | Fixed Interest Rate | ||||||||||||||||||||||||||||||||
Senior Unsecured Term Notes | $ | $ | $ | $ | 9/30/2024 | % |
For the Three Months Ended March 31, | |||||||||||
(Dollars in thousands) | 2021 | 2020 | |||||||||
Derivative - interest rate swaps: | |||||||||||
Interest income (loss) | $ | ( | $ | ( | |||||||
Hedged items - loans: | |||||||||||
Interest income (loss) | ( | ||||||||||
Net decrease in interest income | $ | ( | $ | ( |
Fair Values of Derivative Instruments | ||||||||||||||||||||
Asset Derivatives | Liability Derivatives | |||||||||||||||||||
(Dollars in thousands) | Notional Amount | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||||
Derivatives designated as hedging instruments: | ||||||||||||||||||||
As of March 31, 2021: | ||||||||||||||||||||
Interest Rate Swaps | $ | Prepaid Expenses and Other Assets | $ | Other Liabilities and Accrued Expenses | $ | |||||||||||||||
As of December 31, 2020: | ||||||||||||||||||||
Interest Rate Swaps | $ | Prepaid Expenses and Other Assets | $ | Other Liabilities and Accrued Expenses | $ |
Line Item in the Consolidated Statements of Financial Condition in Which the Hedged Items are Included | Carrying Amount of the Hedged Assets | Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets | ||||||||||||
(Dollars in thousands) | ||||||||||||||
As of March 31, 2021: | ||||||||||||||
Loans receivable, net (1) | $ | $ | ||||||||||||
As of December 31, 2020: | ||||||||||||||
Loans receivable, net (1) | $ | $ |
Three Months Ended March 31, | |||||||||||||||||||||||
2021 | 2020 | ||||||||||||||||||||||
Number of Shares | Weighted Average Grant Date Fair Value | Number of Shares | Weighted Average Grant Date Fair Value | ||||||||||||||||||||
Beginning of the period balance | $ | $ | |||||||||||||||||||||
Shares granted | |||||||||||||||||||||||
Shares settled | ( | ( | |||||||||||||||||||||
Shares forfeited | ( | ( | |||||||||||||||||||||
End of the period balance | $ | $ |
Fair Level Measurements Using | |||||||||||||||||||||||||||||
(Dollars in thousands) | Carrying Amount | Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||||
As of March 31, 2021: | |||||||||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||||||||
Cash, cash equivalents and restricted cash | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Debt securities: | |||||||||||||||||||||||||||||
Available for sale | |||||||||||||||||||||||||||||
Held to maturity | |||||||||||||||||||||||||||||
Equity securities | |||||||||||||||||||||||||||||
Loans receivable, net | |||||||||||||||||||||||||||||
Accrued interest receivable | |||||||||||||||||||||||||||||
FHLB stock | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||
Interest rate swap | |||||||||||||||||||||||||||||
Financial liabilities: | |||||||||||||||||||||||||||||
Deposits | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
FHLB advances | |||||||||||||||||||||||||||||
Junior subordinated deferrable interest debentures | |||||||||||||||||||||||||||||
Senior debt | |||||||||||||||||||||||||||||
Accrued interest payable | |||||||||||||||||||||||||||||
Interest rate swaps | |||||||||||||||||||||||||||||
As of December 31, 2020: | |||||||||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||||||||
Cash, cash equivalents and restricted cash | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Debt securities: | |||||||||||||||||||||||||||||
Available for sale | |||||||||||||||||||||||||||||
Held to maturity | |||||||||||||||||||||||||||||
Equity securities | |||||||||||||||||||||||||||||
Loans receivable, net | |||||||||||||||||||||||||||||
Accrued interest receivable | |||||||||||||||||||||||||||||
FHLB stock | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||
Financial liabilities: | |||||||||||||||||||||||||||||
Deposits | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
FHLB advances | |||||||||||||||||||||||||||||
Junior subordinated deferrable interest debentures | |||||||||||||||||||||||||||||
Senior debt | |||||||||||||||||||||||||||||
Accrued interest payable | |||||||||||||||||||||||||||||
Interest rate swaps |
(Dollars in thousands) | Fair Value | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
As of March 31, 2021: | |||||||||||||||||||||||
Financial Assets: | |||||||||||||||||||||||
Available for sale debt securities: | |||||||||||||||||||||||
Government and Government Sponsored Entities: | |||||||||||||||||||||||
Residential MBS and CMOs | $ | $ | $ | $ | |||||||||||||||||||
Commercial MBS and CMOs | |||||||||||||||||||||||
Agency bonds | |||||||||||||||||||||||
Other ABS | |||||||||||||||||||||||
Total available for sale debt securities | $ | $ | $ | $ | |||||||||||||||||||
Equity securities | $ | $ | $ | $ | |||||||||||||||||||
Mortgage servicing rights | |||||||||||||||||||||||
Interest rate swap | |||||||||||||||||||||||
Financial Liabilities: | |||||||||||||||||||||||
Interest rate swaps | |||||||||||||||||||||||
As of December 31, 2020: | |||||||||||||||||||||||
Financial Assets: | |||||||||||||||||||||||
Available for sale debt securities: | |||||||||||||||||||||||
Government and Government Sponsored Entities: | |||||||||||||||||||||||
Residential MBS and CMOs | $ | $ | $ | $ | |||||||||||||||||||
Commercial MBS and CMOs | |||||||||||||||||||||||
Agency bonds | |||||||||||||||||||||||
Total available for sale debt securities | $ | $ | $ | $ | |||||||||||||||||||
Equity securities | $ | $ | $ | $ | |||||||||||||||||||
Mortgage servicing rights | |||||||||||||||||||||||
Financial Liabilities: | |||||||||||||||||||||||
Interest rate swaps |
Three Months Ended March 31, | ||||||||||||||
(Dollars in thousands) | 2021 | 2020 | ||||||||||||
Proceeds from loan sales | $ | $ | ||||||||||||
Servicing fees |
(Dollars in thousands) | Single Family Residential | Multifamily Residential | |||||||||
As of March 31, 2021: | |||||||||||
Principal balance of loans | $ | $ | |||||||||
Loans 90+ days past due | |||||||||||
Charge-offs, net | |||||||||||
As of December 31, 2020: | |||||||||||
Principal balance of loans | $ | $ | |||||||||
Loans 90+ days past due | |||||||||||
Charge-offs, net |
(Dollars in thousands) | |||||
April 1 - December 31, 2021 | $ | ||||
2022 | |||||
2023 | |||||
2024 | |||||
2025 | |||||
Thereafter | |||||
Total | $ |
(Dollars in thousands, except per share data) | As of or For the Three Months Ended | |||||||||||||||||||
March 31, 2021 | December 31, 2020 | March 31, 2020 | ||||||||||||||||||
Statements of Income and Financial Condition Data | ||||||||||||||||||||
Net Income | $ | 18,411 | $ | 8,701 | $ | 7,576 | ||||||||||||||
Pre-tax, pre-provision net earnings (1) | $ | 23,624 | $ | 12,359 | $ | 16,054 | ||||||||||||||
Total assets | $ | 7,078,974 | $ | 6,906,104 | $ | 7,074,050 | ||||||||||||||
Per Common Share | ||||||||||||||||||||
Diluted earnings per share | $ | 0.35 | $ | 0.17 | $ | 0.14 | ||||||||||||||
Book value per share | $ | 11.95 | $ | 11.75 | $ | 11.11 | ||||||||||||||
Tangible book value per share (1) | $ | 11.88 | $ | 11.69 | $ | 11.05 | ||||||||||||||
Selected Ratios | ||||||||||||||||||||
Return on average: | ||||||||||||||||||||
Assets | 1.05 | % | 0.49 | % | 0.43 | % | ||||||||||||||
Stockholders' equity | 11.82 | % | 5.63 | % | 4.92 | % | ||||||||||||||
Dividend payout ratio | 16.34 | % | 34.64 | % | 42.77 | % | ||||||||||||||
Net interest margin | 2.23 | % | 2.13 | % | 1.84 | % | ||||||||||||||
Efficiency ratio (1) | 39.47 | % | 67.23 | % | 51.22 | % | ||||||||||||||
Noninterest expense to average assets | 0.88 | % | 1.44 | % | 0.96 | % | ||||||||||||||
Loan to deposit ratio | 116.31 | % | 114.92 | % | 117.65 | % | ||||||||||||||
Credit Quality Ratios | ||||||||||||||||||||
Allowance for loan losses to loans | 0.70 | % | 0.76 | % | 0.65 | % | ||||||||||||||
Allowance for loan losses to nonperforming loans | 650.99 | % | 732.04 | % | 729.54 | % | ||||||||||||||
Nonperforming assets to total assets | 0.09 | % | 0.09 | % | 0.08 | % | ||||||||||||||
Net (recoveries) charge-offs to average loans | (0.00) | % | (0.01) | % | 0.04 | % | ||||||||||||||
Capital Ratios | ||||||||||||||||||||
Tier 1 leverage ratio | 9.71 | % | 9.45 | % | 9.39 | % | ||||||||||||||
Total risk-based capital ratio | 18.55 | % | 18.60 | % | 17.47 | % | ||||||||||||||
(1) Considered a non-GAAP financial measure. See Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations - ‘‘Non-GAAP Financial Measures’’ for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure. Pre-tax, pre-provision net earnings is defined as net income before taxes and provision for loan losses. Tangible book value is defined as total assets less goodwill and total liabilities. Efficiency ratio is defined as the ratio of noninterest expense to net interest income plus noninterest income. |
As of or For the Three Months Ended | |||||||||||||||||
(Dollars in thousands, except per share data) | March 31, 2021 | December 31, 2020 | March 31, 2020 | ||||||||||||||
Pre-tax, Pre-provision Net Earnings | |||||||||||||||||
Income before taxes | $ | 26,124 | $ | 12,359 | $ | 10,754 | |||||||||||
Plus: (Reversal of) provision for loan losses | (2,500) | — | 5,300 | ||||||||||||||
Pre-tax, pre-provision net earnings | $ | 23,624 | $ | 12,359 | $ | 16,054 | |||||||||||
Efficiency Ratio | |||||||||||||||||
Noninterest expense (numerator) | $ | 15,404 | $ | 25,353 | $ | 16,859 | |||||||||||
Net interest income | $ | 38,719 | $ | 37,248 | $ | 32,115 | |||||||||||
Noninterest income | 309 | 464 | 798 | ||||||||||||||
Operating revenue (denominator) | $ | 39,028 | $ | 37,712 | $ | 32,913 | |||||||||||
Efficiency ratio | 39.47 | % | 67.23 | % | 51.22 | % | |||||||||||
Pro Forma Efficiency Ratio | |||||||||||||||||
Noninterest expense | $ | 25,353 | |||||||||||||||
Less: Non-recurring noninterest expense item, before income taxes | (10,443) | ||||||||||||||||
Pro forma noninterest expense (numerator) | $ | 14,910 | |||||||||||||||
Operating revenue (denominator) | $ | 37,712 | |||||||||||||||
Pro forma efficiency ratio | 39.54 | % | |||||||||||||||
Pro Forma Net Income | |||||||||||||||||
Net income | $ | 8,701 | |||||||||||||||
Add: Non-recurring noninterest expense item, net of income taxes | 7,352 | ||||||||||||||||
Pro forma net income | $ | 16,053 | |||||||||||||||
Tangible Book Value Per Share | |||||||||||||||||
Total assets | $ | 7,078,974 | $ | 6,906,104 | $ | 7,074,050 | |||||||||||
Less: Goodwill | (3,297) | (3,297) | (3,297) | ||||||||||||||
Tangible assets | 7,075,677 | 6,902,807 | 7,070,753 | ||||||||||||||
Less: Total liabilities | (6,455,005) | (6,292,413) | (6,470,710) | ||||||||||||||
Tangible stockholders' equity (numerator) | $ | 620,672 | $ | 610,394 | $ | 600,043 | |||||||||||
Period end shares outstanding (denominator) | 52,231,912 | 52,220,266 | 54,286,465 | ||||||||||||||
Tangible book value per share | $ | 11.88 | $ | 11.69 | $ | 11.05 |
For the Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||||||
2021 | 2020 | ||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Average Balance | Interest Inc/Exp | Yield/Rate | Average Balance | Interest Inc/Exp | Yield/Rate | |||||||||||||||||||||||||||||||||||
Interest-Earning Assets | |||||||||||||||||||||||||||||||||||||||||
Multifamily residential | $ | 4,122,614 | $ | 37,555 | 3.64 | % | $ | 4,009,477 | $ | 40,594 | 4.05 | % | |||||||||||||||||||||||||||||
Single family residential | 1,823,869 | 13,858 | 3.04 | % | 1,979,005 | 17,390 | 3.51 | % | |||||||||||||||||||||||||||||||||
Commercial real estate | 202,798 | 2,315 | 4.57 | % | 204,118 | 2,355 | 4.61 | % | |||||||||||||||||||||||||||||||||
Construction, land and NM | 22,154 | 330 | 6.04 | % | 21,334 | 366 | 6.90 | % | |||||||||||||||||||||||||||||||||
Total loans (1) | 6,171,435 | 54,058 | 3.50 | % | 6,213,934 | 60,705 | 3.91 | % | |||||||||||||||||||||||||||||||||
Investment securities | 614,500 | 1,982 | 1.29 | % | 641,556 | 3,303 | 2.06 | % | |||||||||||||||||||||||||||||||||
Cash, cash equivalents and restricted cash | 152,974 | 51 | 0.14 | % | 113,196 | 317 | 1.13 | % | |||||||||||||||||||||||||||||||||
Total interest-earning assets | 6,938,909 | 56,091 | 3.23 | % | 6,968,686 | 64,325 | 3.69 | % | |||||||||||||||||||||||||||||||||
Noninterest-earning assets (2) | 59,043 | 66,756 | |||||||||||||||||||||||||||||||||||||||
Total assets | $ | 6,997,952 | $ | 7,035,442 | |||||||||||||||||||||||||||||||||||||
Interest-Bearing Liabilities | |||||||||||||||||||||||||||||||||||||||||
Transaction accounts | $ | 345,500 | 343 | 0.40 | % | $ | 226,879 | 572 | 1.00 | % | |||||||||||||||||||||||||||||||
Money market demand accounts | 1,837,366 | 2,687 | 0.58 | % | 1,358,219 | 4,139 | 1.21 | % | |||||||||||||||||||||||||||||||||
Time deposits | 3,042,619 | 8,576 | 1.13 | % | 3,569,897 | 19,870 | 2.21 | % | |||||||||||||||||||||||||||||||||
Total deposits | 5,225,485 | 11,606 | 0.89 | % | 5,154,995 | 24,581 | 1.89 | % | |||||||||||||||||||||||||||||||||
FHLB advances | 838,851 | 3,933 | 1.90 | % | 993,890 | 5,558 | 2.25 | % | |||||||||||||||||||||||||||||||||
Junior subordinated debentures | 61,857 | 258 | 1.69 | % | 61,857 | 493 | 3.21 | % | |||||||||||||||||||||||||||||||||
Senior debt | 94,550 | 1,575 | 6.66 | % | 94,427 | 1,578 | 6.68 | % | |||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | 6,220,743 | 17,372 | 1.12 | % | 6,305,169 | 32,210 | 2.03 | % | |||||||||||||||||||||||||||||||||
Noninterest-bearing deposit accounts | 89,626 | 46,315 | |||||||||||||||||||||||||||||||||||||||
Other noninterest-bearing liabilities | 64,669 | 67,827 | |||||||||||||||||||||||||||||||||||||||
Total liabilities | 6,375,038 | 6,419,311 | |||||||||||||||||||||||||||||||||||||||
Total stockholders' equity | 622,914 | 616,131 | |||||||||||||||||||||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 6,997,952 | $ | 7,035,442 | |||||||||||||||||||||||||||||||||||||
Net interest spread (3) | 2.11 | % | 1.66 | % | |||||||||||||||||||||||||||||||||||||
Net interest income/margin (4) | $ | 38,719 | 2.23 | % | $ | 32,115 | 1.84 | % |
Three Months Ended March 31, 2021 vs 2020 | |||||||||||||||||
Variance Due To | |||||||||||||||||
(Dollars in thousands) | Volume | Yield/Rate | Total | ||||||||||||||
Interest-Earning Assets | |||||||||||||||||
Multifamily residential | $ | 1,130 | $ | (4,169) | $ | (3,039) | |||||||||||
Single family residential | (1,304) | (2,228) | (3,532) | ||||||||||||||
Commercial real estate | (17) | (23) | (40) | ||||||||||||||
Construction, land and NM | 13 | (49) | (36) | ||||||||||||||
Total loans | (178) | (6,469) | (6,647) | ||||||||||||||
Investment securities | (134) | (1,187) | (1,321) | ||||||||||||||
Cash, cash equivalents and restricted cash | 84 | (350) | (266) | ||||||||||||||
Total interest-earning assets | (228) | (8,006) | (8,234) | ||||||||||||||
Interest-Bearing Liabilities | |||||||||||||||||
Transaction accounts | 210 | (439) | (229) | ||||||||||||||
Money market demand accounts | 1,141 | (2,593) | (1,452) | ||||||||||||||
Time deposits | (2,621) | (8,673) | (11,294) | ||||||||||||||
Total deposits | (1,270) | (11,705) | (12,975) | ||||||||||||||
FHLB advances | (813) | (812) | (1,625) | ||||||||||||||
Junior subordinated debentures | — | (235) | (235) | ||||||||||||||
Senior debt | 2 | (5) | (3) | ||||||||||||||
Total interest-bearing liabilities | (2,081) | (12,757) | (14,838) | ||||||||||||||
Net Interest Income | $ | 1,853 | $ | 4,751 | $ | 6,604 |
For the Three Months Ended March 31, | |||||||||||||||||||||||
(Dollars in thousands) | 2021 | 2020 | $ Increase (Decrease) | % Increase (Decrease) | |||||||||||||||||||
Noninterest Income | |||||||||||||||||||||||
FHLB dividends | $ | 367 | $ | 535 | (168) | (31.4) | % | ||||||||||||||||
Fee income | 85 | (38) | 123 | (323.7) | % | ||||||||||||||||||
Other | (143) | 301 | (444) | (147.5) | % | ||||||||||||||||||
Total noninterest income | $ | 309 | $ | 798 | $ | (489) | (61.3) | % |
For the Three Months Ended March 31, | |||||||||||||||||||||||
(Dollars in thousands) | 2021 | 2020 | $ Increase (Decrease) | % Increase (Decrease) | |||||||||||||||||||
Noninterest Expense | |||||||||||||||||||||||
Compensation and related benefits | $ | 10,380 | $ | 11,205 | $ | (825) | (7.4) | % | |||||||||||||||
Deposit insurance premium | 472 | 476 | (4) | (0.8) | % | ||||||||||||||||||
Professional and regulatory fees | 484 | 431 | 53 | 12.3 | % | ||||||||||||||||||
Occupancy | 1,215 | 1,140 | 75 | 6.6 | % | ||||||||||||||||||
Depreciation and amortization | 655 | 669 | (14) | (2.1) | % | ||||||||||||||||||
Data processing | 973 | 967 | 6 | 0.6 | % | ||||||||||||||||||
Marketing | 292 | 875 | (583) | (66.6) | % | ||||||||||||||||||
Other expenses | 933 | 1,096 | (163) | (14.9) | % | ||||||||||||||||||
Total noninterest expense | $ | 15,404 | $ | 16,859 | $ | (1,455) | (8.6) | % |
As of March 31, 2021 | As of December 31, 2020 | |||||||||||||||||||||||||
(Dollars in thousands) | Amount | % of total | Amount | % of total | ||||||||||||||||||||||
Real estate loans | ||||||||||||||||||||||||||
Multifamily residential | $ | 4,084,645 | 65.6 | % | $ | 4,075,893 | 67.9 | % | ||||||||||||||||||
Single family residential | 1,917,454 | 30.8 | % | 1,700,119 | 28.3 | % | ||||||||||||||||||||
Commercial real estate | 198,845 | 3.2 | % | 202,189 | 3.4 | % | ||||||||||||||||||||
Construction and land | 22,441 | 0.4 | % | 22,141 | 0.4 | % | ||||||||||||||||||||
Non-mortgage | 100 | 0.0 | % | 100 | 0.0 | % | ||||||||||||||||||||
Total loans before deferred items | 6,223,485 | 100.0 | % | 6,000,442 | 100.0 | % | ||||||||||||||||||||
Deferred loan costs, net | 47,871 | 49,374 | ||||||||||||||||||||||||
Total loans | $ | 6,271,356 | $ | 6,049,816 | ||||||||||||||||||||||
Three Months Ended March 31, | |||||||||||
(Dollars in thousands) | 2021 | 2020 | |||||||||
Loan Inflows: | |||||||||||
Multifamily residential | $ | 248,604 | $ | 185,056 | |||||||
Single family residential | 138,064 | 115,591 | |||||||||
Commercial real estate | 2,000 | 4,940 | |||||||||
Construction and land | 2,351 | 7,154 | |||||||||
Purchases | 287,751 | 20,380 | |||||||||
Total loans originated and purchased | 678,770 | 333,121 | |||||||||
Loan Outflows: | |||||||||||
Loan principal reductions and payoffs | (451,537) | (360,333) | |||||||||
Portfolio loan sales | — | — | |||||||||
Other (1) | (5,693) | 14,549 | |||||||||
Total loan outflows | (457,230) | (345,784) | |||||||||
Net change in total loan portfolio | $ | 221,540 | $ | (12,663) | |||||||
(1) Other changes in loan balances primarily represent the net change in disbursements on unfunded commitments, deferred loan costs, fair value adjustments and, to the extent applicable, may include foreclosures, charge-offs, negative amortization and interest capitalized as a result of COVID-19 modifications. |
(Dollars in thousands) | Due in 1 year or less | Due after 1 year through 5 years | Due after 5 years | Total | ||||||||||||||||
As of March 31, 2021: | ||||||||||||||||||||
Loans | ||||||||||||||||||||
Real estate mortgage loans: | ||||||||||||||||||||
Multifamily residential | $ | 21 | $ | 4,891 | $ | 4,079,733 | $ | 4,084,645 | ||||||||||||
Single family residential | 23 | 834 | 1,916,597 | 1,917,454 | ||||||||||||||||
Commercial real estate | — | 2,759 | 196,086 | 198,845 | ||||||||||||||||
Construction and land | 22,380 | 61 | — | 22,441 | ||||||||||||||||
Non-mortgage | — | — | 100 | 100 | ||||||||||||||||
Total loans | $ | 22,424 | $ | 8,545 | $ | 6,192,516 | $ | 6,223,485 | ||||||||||||
Fixed interest rates | $ | — | $ | 213 | $ | 307,556 | $ | 307,769 | ||||||||||||
Floating or hybrid adjustable rates | 22,424 | 8,332 | 5,884,960 | 5,915,716 | ||||||||||||||||
Total loans | $ | 22,424 | $ | 8,545 | $ | 6,192,516 | $ | 6,223,485 | ||||||||||||
As of December 31, 2020: | ||||||||||||||||||||
Loans | ||||||||||||||||||||
Real estate mortgage loans: | ||||||||||||||||||||
Multifamily residential | $ | 9 | $ | 6,336 | $ | 4,069,548 | $ | 4,075,893 | ||||||||||||
Single family residential | 35 | 1,143 | 1,698,941 | 1,700,119 | ||||||||||||||||
Commercial real estate | — | 4,451 | 197,738 | 202,189 | ||||||||||||||||
Construction and land | 18,930 | 3,211 | — | 22,141 | ||||||||||||||||
Non-mortgage | — | — | 100 | 100 | ||||||||||||||||
Total loans | $ | 18,974 | $ | 15,141 | $ | 5,966,327 | $ | 6,000,442 | ||||||||||||
Fixed interest rates | $ | — | $ | 11 | $ | 24,846 | $ | 24,857 | ||||||||||||
Floating or hybrid adjustable rates | 18,974 | 15,130 | 5,941,481 | 5,975,585 | ||||||||||||||||
Total loans | $ | 18,974 | $ | 15,141 | $ | 5,966,327 | $ | 6,000,442 |
(Dollars in thousands) | March 31, 2021 | December 31, 2020 | |||||||||||||||
Non-accrual loans | |||||||||||||||||
Multifamily residential portfolio | $ | 2,087 | $ | 522 | |||||||||||||
Single family residential portfolio | 4,636 | 5,791 | |||||||||||||||
Total non-accrual loans | 6,723 | 6,313 | |||||||||||||||
Real estate owned | — | — | |||||||||||||||
Total nonperforming assets | $ | 6,723 | $ | 6,313 | |||||||||||||
Performing TDRs | $ | 1,247 | $ | 1,260 | |||||||||||||
Allowance for loan losses to period end nonperforming loans | 650.99 | % | 732.04 | % | |||||||||||||
Nonperforming loans to period end loans | 0.11 | % | 0.10 | % | |||||||||||||
Nonperforming assets to total assets | 0.09 | % | 0.09 | % | |||||||||||||
Nonperforming loans plus performing TDRs to total loans | 0.13 | % | 0.13 | % |
Three Months Ended March 31, | ||||||||||||||
(Dollars in thousands) | 2021 | 2020 | ||||||||||||
Allowance for loan losses at beginning of period | $ | 46,214 | $ | 36,001 | ||||||||||
Charge-offs: | ||||||||||||||
Single family residential | — | (722) | ||||||||||||
Total charge-offs | — | (722) | ||||||||||||
Recoveries: | ||||||||||||||
Single family residential | 2 | 3 | ||||||||||||
Construction and land | 50 | 75 | ||||||||||||
Total recoveries | 52 | 78 | ||||||||||||
Net recoveries (charge-offs) | 52 | (644) | ||||||||||||
(Reversal of) provision for loan losses | (2,500) | 5,300 | ||||||||||||
Allowance for loan losses at period end | $ | 43,766 | $ | 40,657 | ||||||||||
Allowance for loan losses to period end loans held for investment | 0.70 | % | 0.65 | % | ||||||||||
Annualized net (recoveries) charge-offs to average loans | (0.00) | % | 0.04 | % |
March 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||
(Dollars in thousands) | Book Value | % of Total | Book Value | % of Total | ||||||||||||||||||||||
Available for sale debt securities: | ||||||||||||||||||||||||||
Government and Government Sponsored Entities: | ||||||||||||||||||||||||||
Residential mortgage backed securities ("MBS") and collateralized mortgage obligations ("CMOs") | $ | 189,588 | 28.85 | % | $ | 216,724 | 35.34 | % | ||||||||||||||||||
Commercial MBS and CMOs | 406,529 | 61.86 | % | 361,988 | 59.03 | % | ||||||||||||||||||||
Agency bonds | 13,264 | 2.02 | % | 15,022 | 2.45 | % | ||||||||||||||||||||
Other asset backed securities | 30,301 | 4.61 | % | — | — | % | ||||||||||||||||||||
Total available for sale debt securities | 639,682 | 97.34 | % | 593,734 | 96.82 | % | ||||||||||||||||||||
Held to maturity: | ||||||||||||||||||||||||||
Government Sponsored Entities: | ||||||||||||||||||||||||||
Residential MBS | 5,610 | 0.85 | % | 7,391 | 1.21 | % | ||||||||||||||||||||
Other investments | 74 | 0.01 | % | 76 | 0.01 | % | ||||||||||||||||||||
Total held to maturity debt securities | 5,684 | 0.86 | % | 7,467 | 1.22 | % | ||||||||||||||||||||
Equity securities | 11,826 | 1.80 | % | 12,037 | 1.96 | % | ||||||||||||||||||||
Total investment securities | $ | 657,192 | 100.00 | % | $ | 613,238 | 100.00 | % |
Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||
2021 | 2020 | ||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Average Amount | Weighted average rate paid | Percent of total deposits | Average Amount | Weighted average rate paid | Percent of total deposits | |||||||||||||||||||||||||||||
Noninterest-bearing deposit accounts | $ | 89,626 | — | % | 1.6 | % | $ | 46,315 | — | % | 0.9 | % | |||||||||||||||||||||||
Interest-bearing transaction accounts | 345,500 | 0.40 | % | 6.5 | % | 226,879 | 1.00 | % | 4.4 | % | |||||||||||||||||||||||||
Money market demand accounts | 1,837,366 | 0.58 | % | 34.6 | % | 1,358,219 | 1.21 | % | 26.1 | % | |||||||||||||||||||||||||
Time deposits | 3,042,619 | 1.13 | % | 57.3 | % | 3,569,897 | 2.21 | % | 68.6 | % | |||||||||||||||||||||||||
Total | $ | 5,315,111 | 0.87 | % | 100.0 | % | $ | 5,201,310 | 1.89 | % | 100.0 | % |
(Dollars in thousands except for column headings) | Under $100,000 | $100,000 and greater | ||||||||||||
Remaining maturity: | ||||||||||||||
Three months or less | $ | 186,389 | $ | 894,158 | ||||||||||
Over three through six months | 145,667 | 896,768 | ||||||||||||
Over six through twelve months | 130,534 | 717,190 | ||||||||||||
Over twelve months | 13,214 | 38,366 | ||||||||||||
Total | $ | 475,804 | $ | 2,546,482 | ||||||||||
Percent of total deposits | 8.82 | % | 47.23 | % |
March 31, 2021 | December 31, 2020 | Date | Maturity | Rate Index | ||||||||||||||||||||||||||||||||||||||||
Issuer | Amount | Rate | Amount | Rate | Issued | Date | (Quarterly Reset) | |||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||
Luther Burbank Statutory Trust I | $ | 41,238 | 1.56 | % | $ | 41,238 | 1.60 | % | 3/1/2006 | 6/15/2036 | 3 month LIBOR + 1.38% | |||||||||||||||||||||||||||||||||
Luther Burbank Statutory Trust II | $ | 20,619 | 1.80 | % | $ | 20,619 | 1.84 | % | 3/1/2007 | 6/15/2037 | 3 month LIBOR + 1.62% |
Three Months Ended March 31, | ||||||||||||||
(Dollars in thousands) | 2021 | 2020 | ||||||||||||
FHLB advances | ||||||||||||||
Average amount outstanding during the period | $ | 838,851 | $ | 993,890 | ||||||||||
Maximum amount outstanding at any month-end during the period | 897,147 | 1,040,199 | ||||||||||||
Balance outstanding at end of period | 840,947 | 953,694 | ||||||||||||
Weighted average maturity (in years) | 1.4 | 2.6 | ||||||||||||
Weighted average interest rate at end of period | 1.82 | % | 2.23 | % | ||||||||||
Weighted average interest rate during the period | 1.90 | % | 2.25 | % | ||||||||||
Junior subordinated deferrable interest debentures | ||||||||||||||
Balance outstanding at end of period | $ | 61,857 | $ | 61,857 | ||||||||||
Weighted average maturity (in years) | 15.8 | 16.8 | ||||||||||||
Weighted average interest rate at end of period | 1.64 | % | 2.20 | % | ||||||||||
Weighted average interest rate during the period | 1.69 | % | 3.21 | % | ||||||||||
Senior unsecured term notes | ||||||||||||||
Balance outstanding at end of period | $ | 94,570 | $ | 94,447 | ||||||||||
Weighted average maturity (in years) | 3.6 | 4.6 | ||||||||||||
Weighted average interest rate at end of period | 6.66 | % | 6.68 | % | ||||||||||
Weighted average interest rate during the period | 6.66 | % | 6.68 | % |
Three Months Ended March 31, | ||||||||||||||
(Dollars in thousands) | 2021 | 2020 | ||||||||||||
Outstanding at period end | $ | 134,200 | $ | — | ||||||||||
Average amount outstanding | 88,771 | 23,753 | ||||||||||||
Maximum amount outstanding at any month end | 190,400 | 63,000 | ||||||||||||
Weighted average interest rate: | ||||||||||||||
During period | 0.14 | % | 1.66 | % | ||||||||||
End of period | 0.14 | % | — | % |
(Dollars in thousands) | March 31, 2021 | December 31, 2020 | ||||||||||||
Commitments to fund loans and lines of credit | $ | 141,780 | $ | 116,944 |
Payments Due by Period | |||||||||||||||||||||||||||||
Less than 1 Year | 1 to 3 Years | 3 to 5 Years | More than 5 Years | ||||||||||||||||||||||||||
(Dollars in thousands) | Total | ||||||||||||||||||||||||||||
Contractual Cash Obligations | |||||||||||||||||||||||||||||
Time deposits (1) | $ | 3,022,286 | $ | 2,970,706 | $ | 38,529 | $ | 13,051 | $ | — | |||||||||||||||||||
FHLB advances (1) | 840,947 | 489,300 | 250,000 | 101,500 | 147 | ||||||||||||||||||||||||
Senior debt (1) | 95,000 | — | — | 95,000 | — | ||||||||||||||||||||||||
Junior subordinated debentures (1) | 61,857 | — | — | — | 61,857 | ||||||||||||||||||||||||
Operating leases | 13,580 | 4,377 | 5,510 | 2,217 | 1,476 | ||||||||||||||||||||||||
Significant contract (2) | 8,591 | 1,682 | 3,364 | 3,364 | 181 | ||||||||||||||||||||||||
Total | $ | 4,042,261 | $ | 3,466,065 | $ | 297,403 | $ | 215,132 | $ | 63,661 | |||||||||||||||||||
(1) Amounts exclude interest | |||||||||||||||||||||||||||||
(2) We have one significant, long-term contract for core processing services which expires May 9, 2026. The actual obligation is unknown and dependent on certain factors including volume and activities. For purposes of this disclosure, future obligations are estimated using our year-to-date 2021 average monthly expense extrapolated over the remaining life of the contract. |
Minimum Required | |||||||||||||||||||||||||||||||||||
Actual | For Capital Adequacy Purposes | Plus Capital Conservation Buffer | For Well- Capitalized Institution | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Amount | Ratio | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||||||||||
Luther Burbank Corporation | |||||||||||||||||||||||||||||||||||
As of March 31, 2021 | |||||||||||||||||||||||||||||||||||
Tier 1 Leverage Ratio | $ | 678,498 | 9.71 | % | $ | 279,459 | 4.00 | % | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Common Equity Tier 1 Risk-Based Ratio | 616,641 | 15.81 | % | 175,486 | 4.50 | % | $ | 272,978 | 7.00 | % | N/A | N/A | |||||||||||||||||||||||
Tier 1 Risk-Based Capital Ratio | 678,498 | 17.40 | % | 233,981 | 6.00 | % | 331,474 | 8.50 | % | N/A | N/A | ||||||||||||||||||||||||
Total Risk-Based Capital Ratio | 723,360 | 18.55 | % | 311,975 | 8.00 | % | 409,468 | 10.50 | % | N/A | N/A | ||||||||||||||||||||||||
As of December 31, 2020 | |||||||||||||||||||||||||||||||||||
Tier 1 Leverage Ratio | $ | 665,514 | 9.45 | % | $ | 281,564 | 4.00 | % | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Common Equity Tier 1 Risk-Based Ratio | 603,657 | 15.75 | % | 172,420 | 4.50 | % | $ | 268,209 | 7.00 | % | N/A | N/A | |||||||||||||||||||||||
Tier 1 Risk-Based Capital Ratio | 665,514 | 17.37 | % | 229,893 | 6.00 | % | 325,682 | 8.50 | % | N/A | N/A | ||||||||||||||||||||||||
Total Risk-Based Capital Ratio | 712,837 | 18.60 | % | 306,524 | 8.00 | % | 402,313 | 10.50 | % | N/A | N/A | ||||||||||||||||||||||||
Luther Burbank Savings | |||||||||||||||||||||||||||||||||||
As of March 31, 2021 | |||||||||||||||||||||||||||||||||||
Tier 1 Leverage Ratio | $ | 748,808 | 10.72 | % | $ | 279,319 | 4.00 | % | N/A | N/A | $ | 349,149 | 5.00 | % | |||||||||||||||||||||
Common Equity Tier 1 Risk-Based Ratio | 748,808 | 19.21 | % | 175,396 | 4.50 | % | $ | 272,838 | 7.00 | % | 253,349 | 6.50 | % | ||||||||||||||||||||||
Tier 1 Risk-Based Capital Ratio | 748,808 | 19.21 | % | 233,861 | 6.00 | % | 331,303 | 8.50 | % | 311,815 | 8.00 | % | |||||||||||||||||||||||
Total Risk-Based Capital Ratio | 793,670 | 20.36 | % | 311,815 | 8.00 | % | 409,257 | 10.50 | % | 389,768 | 10.00 | % | |||||||||||||||||||||||
As of December 31, 2020 | |||||||||||||||||||||||||||||||||||
Tier 1 Leverage Ratio | $ | 729,054 | 10.36 | % | $ | 281,453 | 4.00 | % | N/A | N/A | $ | 351,816 | 5.00 | % | |||||||||||||||||||||
Common Equity Tier 1 Risk-Based Ratio | 729,054 | 19.04 | % | 172,340 | 4.50 | % | $ | 268,085 | 7.00 | % | 248,936 | 6.50 | % | ||||||||||||||||||||||
Tier 1 Risk-Based Capital Ratio | 729,054 | 19.04 | % | 229,787 | 6.00 | % | 325,532 | 8.50 | % | 306,383 | 8.00 | % | |||||||||||||||||||||||
Total Risk-Based Capital Ratio | 776,377 | 20.27 | % | 306,383 | 8.00 | % | 402,128 | 10.50 | % | 382,979 | 10.00 | % |
Interest Rate Risk to Earnings (NII) | ||||||||
March 31, 2021 | ||||||||
(Dollars in millions) | ||||||||
Change in Interest Rates (basis points) | $ Change NII | % Change NII | ||||||
+400 BP | $(8.2) | (4.8)% | ||||||
+300 BP | (4.5) | (2.7)% | ||||||
+200 BP | (2.0) | (1.2)% | ||||||
+100 BP | (0.9) | (0.5)% | ||||||
-100 BP | 5.6 | 3.3% |
Interest Rate Risk to Capital (EVE) | ||||||||
March 31, 2021 | ||||||||
(Dollars in millions) | ||||||||
Change in Interest Rates (basis points) | $ Change EVE | % Change EVE | ||||||
+400 BP | $(278.6) | (44.5)% | ||||||
+300 BP | (187.8) | (30.0)% | ||||||
+200 BP | (114.9) | (18.4)% | ||||||
+100 BP | (55.7) | (8.9)% | ||||||
-100 BP | 50.7 | 8.1% |
(Dollars in thousands) | Fair Value | |||||||||||||||||||||||||
Hedging Instrument | Hedge Accounting Type | Months to Maturity | Notional | Other Assets | Other Liabilities | |||||||||||||||||||||
Interest rate swap | Fair value hedge | 3 | $ | 500,000 | $ | — | $ | 1,686 | ||||||||||||||||||
Interest rate swap | Fair value hedge | 5 | 500,000 | — | 2,186 | |||||||||||||||||||||
Interest rate swap | Fair value hedge | 23 | 350,000 | 127 | — | |||||||||||||||||||||
$ | 1,350,000 | $ | 127 | $ | 3,872 |
Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Program (1) | ||||||||||||||||||||||
(Dollars in thousands, except per share data) | ||||||||||||||||||||||||||
January 1 - 31, 2021 | 19,843 | $ | 9.70 | 19,843 | $ | 18,386 | ||||||||||||||||||||
February 1 - 28, 2021 | 147,939 | 10.41 | 147,939 | 16,846 | ||||||||||||||||||||||
March 1 - 31, 2021 | 33,900 | 10.84 | 33,900 | 16,478 | ||||||||||||||||||||||
Total | 201,682 | $ | 10.42 | 201,682 | $ | 16,478 |
Incorporated by Reference | ||||||||||||||||||||||||||||||||||||||
Exhibit Number | Description | Filed Herewith | Form | File No. | Exhibit | Filing Date | ||||||||||||||||||||||||||||||||
3.1 | S-1 | 333-221455 | 3.1 | 11/9/2017 | ||||||||||||||||||||||||||||||||||
3.2 | S-1 | 333-221455 | 3.2 | 11/9/2017 | ||||||||||||||||||||||||||||||||||
4.1 | S-1 | 333-221455 | 4.1 | 11/9/2017 | ||||||||||||||||||||||||||||||||||
Pursuant to Item 601(b) (4) (iii) (A) of Regulation S-K, copies of instruments defining the rights of holders of long-term debt and preferred securities are not filed. The Company agrees to furnish a copy thereof to the SEC upon request. | ||||||||||||||||||||||||||||||||||||||
31.1 | X | |||||||||||||||||||||||||||||||||||||
31.2 | X | |||||||||||||||||||||||||||||||||||||
32.1 | X | |||||||||||||||||||||||||||||||||||||
32.2 | X | |||||||||||||||||||||||||||||||||||||
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | X | ||||||||||||||||||||||||||||||||||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document | X | ||||||||||||||||||||||||||||||||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | X | ||||||||||||||||||||||||||||||||||||
101.DEF | Inline XBRL Taxonomy Extension Definitions Linkbase Document | X | ||||||||||||||||||||||||||||||||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | X | ||||||||||||||||||||||||||||||||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | X | ||||||||||||||||||||||||||||||||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | X | ||||||||||||||||||||||||||||||||||||
LUTHER BURBANK CORPORATION | |||||||||||
DATED: | MAY 7, 2021 | By: /s/ Simone Lagomarsino | |||||||||
Simone Lagomarsino | |||||||||||
President and Chief Executive Officer | |||||||||||
DATED: | MAY 7, 2021 | By: /s/ Laura Tarantino | |||||||||
Laura Tarantino | |||||||||||
Executive Vice President and Chief Financial Officer | |||||||||||
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Parenthetical) - USD ($) |
Mar. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Fair value of held-to-maturity securities | $ 5,991,000 | $ 7,870,000 |
Allowance for loan losses | $ 43,766,000 | $ 46,214,000 |
Debt Instrument [Line Items] | ||
Preferred stock shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock shares issued (in shares) | 0 | 0 |
Preferred stock shares outstanding (in shares) | 0 | 0 |
Common stock shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock shares issued (in shares) | 52,231,912 | 52,220,266 |
Common stock shares outstanding (in shares) | 52,231,912 | 52,220,266 |
Senior Unsecured Term Notes, September 2014 | Senior Unsecured Term Notes | ||
Debt Instrument [Line Items] | ||
Principal | $ 95,000,000 | $ 95,000,000 |
Debt interest rate | 6.50% | |
Unamortized debt issuance costs | $ 430,000 | $ 461,000 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2021 |
Mar. 31, 2020 |
|
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 18,411 | $ 7,576 |
Unrealized (loss) gain on available for sale debt securities: | ||
Unrealized holding (loss) gain arising during the period | (3,815) | 1,051 |
Tax effect | 1,109 | (305) |
Total other comprehensive (loss) income, net of tax | (2,706) | 746 |
Comprehensive income | $ 15,705 | $ 8,322 |
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED) (Parenthetical) - $ / shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2021 |
Mar. 31, 2020 |
|
Statement of Stockholders' Equity [Abstract] | ||
Cash dividends (in usd per share) | $ 0.06 | $ 0.06 |
NATURE OF OPERATIONS |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NATURE OF OPERATIONS | NATURE OF OPERATIONS Organization Luther Burbank Corporation (the ‘‘Company’’), a California corporation headquartered in Santa Rosa, is the bank holding company for its wholly-owned subsidiary, Luther Burbank Savings (the "Bank"), and its wholly-owned subsidiary, Burbank Investor Services. The Company also owns Burbank Financial Inc., a real estate investment company, and all the common interests in Luther Burbank Statutory Trusts I and II, entities created to issue trust preferred securities. The Bank conducts its business from its headquarters in Gardena, California. It has ten full service branches in California located in Sonoma, Marin, Santa Clara, and Los Angeles Counties and one full service branch in Washington located in King County. Additionally, there are seven loan production offices located throughout California, as well as a loan production office in Clackamas County, Oregon. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not include all footnotes as would be necessary for a fair presentation of financial position, results of operations and comprehensive income, changes in stockholders’ equity and cash flows in conformity with accounting principles generally accepted in the United States of America (“GAAP”). However, these interim unaudited consolidated financial statements reflect all adjustments (consisting solely of normal recurring adjustments and accruals) which, in the opinion of management, are necessary for a fair presentation of financial position, results of operations and comprehensive income, changes in stockholders’ equity and cash flows for the interim periods presented. These unaudited consolidated financial statements have been prepared on a basis consistent with, and should be read in conjunction with, the audited consolidated financial statements as of and for the year ended December 31, 2020, and the notes thereto, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the Securities and Exchange Commission (the “SEC”), under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”). The unaudited consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the results of operations that may be expected for any other interim period or for the year ending December 31, 2021. The Company’s accounting and reporting policies conform to GAAP and to general practices within the banking industry. Use of Estimates Management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates and assumptions affect the amounts reported in the unaudited consolidated financial statements and the disclosures provided, and actual results could differ. Earnings Per Share ("EPS") Basic earnings per common share represents the amount of earnings for the period available to each share of common stock outstanding during the reporting period. Basic EPS is computed based upon net income divided by the weighted average number of common shares outstanding during the period. In determining the weighted average number of shares outstanding, vested restricted stock units are included. Diluted EPS represents the amount of earnings for the period available to each share of common stock outstanding including common stock that would have been outstanding assuming the issuance of common shares for all dilutive potential common shares outstanding during each reporting period. Diluted EPS is computed based upon net income divided by the weighted average number of common shares outstanding during each period, adjusted for the effect of dilutive potential common shares, such as restricted stock awards and units, calculated using the treasury stock method.
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INVESTMENT SECURITIES |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES | INVESTMENT SECURITIES Available for Sale The following table summarizes the amortized cost and the estimated fair value of available for sale debt securities as of the dates indicated:
Net unrealized gains on available for sale investment securities are recorded as accumulated other comprehensive income within stockholders’ equity and totaled $4.0 million and $6.7 million, net of $1.6 million and $2.8 million in tax liabilities, at March 31, 2021 and December 31, 2020, respectively. There were no sales or transfers of available for sale investment securities and no realized gains or losses on these securities during the three months ended March 31, 2021 or 2020. The following tables summarize the gross unrealized losses and fair value of available for sale debt securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:
At March 31, 2021, the Company held 86 residential MBS and CMOs of which ten were in a loss position and six had been in a loss position for twelve months or more. The Company held 50 commercial MBS and CMOs of which 14 were in a loss position and five had been in a loss position for twelve months or more. The Company held three agency bonds of which two were in a loss position and one had been in a loss position for twelve months or more. The Company held three other ABS of which one was in a loss position and none had been in a loss position for twelve months or more.
At December 31, 2020, the Company held 86 residential MBS and CMOs of which 11 were in a loss position and six had been in a loss position for twelve months or more. The Company held 46 commercial MBS and CMOs of which ten were in a loss position and six had been in a loss position for twelve months or more. The Company held three agency bonds of which two were in a loss position and one had been in a loss position for twelve months or more. The unrealized losses on the Company’s investments were caused by interest rate changes. In addition, the contractual cash flows of these investments are guaranteed by the U.S. government or agencies sponsored by the U.S. government. Accordingly, it is expected that the securities will not be settled at a price less than amortized cost. Because the decline in market value is attributable to changes in interest rates but not credit quality, and because the Company has the ability and intent to hold those investments until a recovery of fair value, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired at March 31, 2021 or December 31, 2020. As of March 31, 2021 and December 31, 2020, there were no holdings of securities of any one issuer in an amount greater than 10% of stockholders' equity, other than the U.S. government and its agencies. Held to Maturity The following table summarizes the amortized cost and estimated fair value of held to maturity investment securities as of the dates indicated:
At both March 31, 2021 and December 31, 2020, the Company held seven held to maturity residential MBS of which none were in a loss position. The following table summarizes the scheduled maturities of available for sale and held to maturity investment securities as of March 31, 2021:
The amortized cost and fair value of debt securities are shown by contractual maturity. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. As such, mortgage backed securities, collateralized mortgage obligations and other asset backed securities are not included in the maturity categories above and instead are shown separately. No securities were pledged as of March 31, 2021 or December 31, 2020. Equity Securities Equity securities consist of investments in a qualified community reinvestment fund. At March 31, 2021 and December 31, 2020, the fair value of equity securities totaled $11.8 million and $12.0 million, respectively. Changes in fair value are recognized in other noninterest income. During the three months ended March 31, 2021, the fair value of these investments decreased $211 thousand compared to an increase in fair value of $188 thousand during the three months ended March 31, 2020. There were no sales of equity securities during the three months ended March 31, 2021 or 2020.
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LOANS |
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOANS | LOANS Loans consist of the following:
Certain loans have been pledged to secure borrowing arrangements (see Note 7). During the three months ended March 31, 2021, the Company purchased a pool of performing, fixed rate single family residential loans. The pool had an aggregate principal balance of $287.8 million and contained loans with a weighted average interest rate and maturity of 2.31% and 26.4 years, respectively. The following table summarizes activity in and the allocation of the allowance for loan losses by portfolio segment:
The following table summarizes the allocation of the allowance for loan losses by impairment methodology:
The Company assigns a risk rating to all loans and periodically performs detailed reviews of all loans to identify credit risks and to assess the overall collectability of the portfolio. During these internal reviews, management monitors and analyzes the financial condition of borrowers and guarantors, as well as the financial performance and/or other characteristics of loan collateral. These credit quality indicators are used to assign a risk rating to each individual loan. The risk ratings can be grouped into six major categories, defined as follows: Pass assets are those which are performing according to contract and have no existing or known weaknesses deserving of management’s close attention. The basic underwriting criteria used to approve the loans are still valid, and all payments have essentially been made as planned. Watch assets are expected to have an event occurring in the next 90 to 120 days that will lead to a change in risk rating with the change being either favorable or unfavorable. These assets require heightened monitoring of the event by management. Special mention assets have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the Company’s credit position at some future date. Special mention assets are not adversely classified and do not expose the Company to sufficient risk to warrant adverse classification. Substandard assets are inadequately protected by the current net worth and/or paying capacity of the obligor or by the collateral pledged. These assets have well-defined weaknesses: the primary source of repayment is gone or severely impaired (i.e., bankruptcy or loss of employment) and/or there has been a deterioration in collateral value. In addition, there is the distinct possibility that the Company will sustain some loss, either directly or indirectly (i.e., the cost of monitoring), if the deficiencies are not corrected. A deterioration in collateral value alone does not mandate that an asset be adversely classified if such factor does not indicate that the primary source of repayment is in jeopardy. Doubtful assets have the weaknesses of those classified substandard with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable based on current facts, conditions and values. Loss assets are considered uncollectible and of such little value that their continuance as assets, without establishment of a specific valuation allowance or charge-off, is not warranted. This classification does not necessarily mean that an asset has absolutely no recovery or salvage value; but rather, it is not practical or desirable to defer writing off a basically worthless asset (or portion thereof) even though partial recovery may be affected in the future. The following table summarizes the loan portfolio allocated by management’s internal risk ratings at March 31, 2021 and December 31, 2020. The decrease in Watch, Special Mention and Substandard risk rated loans during the three months ended March 31, 2021 was primarily attributable to the diminishing impact of the COVID-19 pandemic on the performance of loans. As of March 31, 2021, only one loan, with a principal balance of $1.7 million, remained on payment deferral under the Company's loan modification program implemented in response to the pandemic.
The following table summarizes an aging analysis of the loan portfolio by the time past due at March 31, 2021 and December 31, 2020:
The following table summarizes information related to impaired loans at March 31, 2021 and December 31, 2020:
The following table summarizes information related to impaired loans for the three months ended March 31, 2021 and 2020:
The following table summarizes the recorded investment related to troubled debt restructurings ("TDRs") at March 31, 2021 and December 31, 2020:
The Company has allocated $25 thousand of its allowance for loan losses for loans modified in TDRs at both March 31, 2021 and December 31, 2020. The Company does not have commitments to lend additional funds to borrowers with loans whose terms have been modified in TDRs. There were no new TDRs during the three months ended March 31, 2021 or 2020. The Company had no TDRs with a subsequent payment default within twelve months following the modification during the three months ended March 31, 2021 and 2020. A loan is considered to be in payment default once it is 90 days contractually past due under the modified terms.
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NONPERFORMING ASSETS |
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NONPERFORMING ASSETS | NONPERFORMING ASSETS Nonperforming assets include nonperforming loans plus real estate owned. The Company’s nonperforming assets at March 31, 2021 and December 31, 2020 are indicated below:
Interest income on non-accrual loans is subsequently recognized on a cash basis as long as the remaining unpaid principal amount of the loans are deemed to be fully collectible. If there is doubt regarding the collectability of the loan, then any interest payments received are applied to principal. Interest income was recognized on a cash basis on non-accrual loans during the three months ended March 31, 2021 and 2020 totaling $62 thousand and $22 thousand, respectively. Contractual interest not recorded on nonperforming loans during the three months ended March 31, 2021 and 2020 totaled $16 thousand and $71 thousand, respectively. Generally, nonperforming loans are considered impaired because the repayment of the loan will not be made in accordance with the original contractual agreement.
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MORTGAGE SERVICING RIGHTS |
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Transfers and Servicing [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
MORTGAGE SERVICING RIGHTS | MORTGAGE SERVICING RIGHTS Servicing loans for others generally consists of collecting mortgage payments, maintaining escrow accounts, disbursing payments to investors, and conducting foreclosure proceedings. Loan servicing income is recorded on the accrual basis and includes servicing fees from investors and certain charges collected from borrowers. Mortgage loans serviced for others are not reported as assets. The principal balances of these loans are as follows:
Custodial account balances maintained in connection with serviced loans totaled $8.9 million and $10.9 million at March 31, 2021 and December 31, 2020, respectively. The Company measures servicing rights at fair value at each reporting date and reports changes in the fair value of servicing assets in earnings in the period in which the changes occur. Fair value is based on a valuation model that calculates the present value of estimated future net servicing income. Activities for mortgage servicing rights are as follows:
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DEPOSITS |
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Deposits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DEPOSITS | DEPOSITS A summary of deposits at March 31, 2021 and December 31, 2020 is as follows:
The Company had time deposits with a denomination of $100 thousand or more totaling $2.5 billion and $2.6 billion at March 31, 2021 and December 31, 2020, respectively. The Company had time deposits that met or exceeded the FDIC insurance limit of $250 thousand of $1.4 billion at both March 31, 2021 and December 31, 2020. The Company utilizes brokered deposits as an additional source of funding. The Company had brokered deposits of $50.0 million at both March 31, 2021 and December 31, 2020. Maturities of the Company’s time deposits at March 31, 2021 are summarized as follows:
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FEDERAL HOME LOAN BANK AND FEDERAL RESERVE BANK ADVANCES |
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Advances from Federal Home Loan Banks [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FEDERAL HOME LOAN BANK AND FEDERAL RESERVE BANK ADVANCES | FEDERAL HOME LOAN BANK AND FEDERAL RESERVE BANK ADVANCES The Bank may borrow from the FHLB, on either a short-term or long-term basis, up to 40% of its assets provided that adequate collateral has been pledged. As of both March 31, 2021 and December 31, 2020, the Bank had pledged various mortgage loans totaling approximately $2.4 billion, as well as the FHLB stock held by the Bank to secure these borrowing arrangements. The Bank has access to the Loan and Discount Window of the Federal Reserve Bank of San Francisco ("FRB"). Advances under this window are subject to the Bank providing qualifying collateral. Various mortgage loans totaling approximately $557.3 million and $467.8 million as of March 31, 2021 and December 31, 2020, respectively, secure this borrowing arrangement. There were no borrowings outstanding with the FRB as of March 31, 2021 or December 31, 2020. The following table discloses the Bank’s outstanding advances from the FHLB of San Francisco:
The Bank's available borrowing capacity based on pledged loans to the FRB and the FHLB totaled $1.1 billion at both March 31, 2021 and December 31, 2020. As of March 31, 2021 and December 31, 2020, the Bank had aggregate loan balances of $2.4 billion and $1.8 billion, respectively, available to pledge to the FRB and FHLB to increase its borrowing capacity. As of March 31, 2021 and December 31, 2020, the Bank pledged as collateral a $62.6 million FHLB letter of credit to Freddie Mac related to our multifamily securitization reimbursement obligation. Short-term borrowings are borrowings with original maturities of 90 days or less. During the three months ended March 31, 2021, there was a maximum amount of short-term borrowings outstanding of $203.6 million and an average amount outstanding of $88.8 million, with a weighted average interest rate of 0.14%. During the three months ended March 31, 2020, there was a maximum amount of short-term borrowings outstanding of $77.8 million and an average amount outstanding of $23.8 million with a weighted average interest rate of 1.66%. The following table summarizes scheduled principal payments on FHLB advances over the next five years as of March 31, 2021:
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JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES | JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES The Company formed two wholly-owned trust companies (the ‘‘Trusts’’) which issued guaranteed preferred beneficial interests (the "Trust Securities") in the Company’s junior subordinated deferrable interest debentures (the "Notes"). The Company is not considered the primary beneficiary of the Trusts and therefore, the Trusts are not consolidated in the Company’s financial statements, but rather the junior subordinated debentures are shown as a liability. The Company’s investment in the common securities of the Trusts, totaling $1.9 million, is included in other assets in the consolidated statements of financial condition. The sole asset of the Trusts are the Notes that they hold. The Trusts have invested the proceeds of such Trust Securities in the Notes. Each of the Notes has an interest rate equal to the corresponding Trust Securities distribution rate. The Company has the right to defer payment of interest on the Notes at any time or from time to time for a period not exceeding five years provided that no extension period may extend beyond the stated maturity of the relevant Notes. During any such extension period, distributions on the Trust Securities will also be deferred, and the Company’s ability to pay dividends on its common stock will be restricted. The Company has entered into contractual arrangements which, taken collectively, fully and unconditionally guarantee payment of: (i) accrued and unpaid distributions required to be paid on the Trust Securities; (ii) the redemption price with respect to any Trust Securities called for redemption by the Trusts; and (iii) payments due upon a voluntary or involuntary dissolution, winding up or liquidation of the Trusts. The Trust Securities are mandatorily redeemable upon maturity of the Notes, or upon earlier redemption as provided in the indenture. The Company has the right to redeem the Notes purchased by the Trusts, in whole or in part, on or after the redemption date. As specified in the indenture, if the Notes are redeemed prior to maturity, the redemption price will be the principal amount and any accrued but unpaid interest. The following table is a summary of the outstanding Trust Securities and Notes at March 31, 2021 and December 31, 2020:
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SENIOR DEBT |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SENIOR DEBT | SENIOR DEBTIn September 2014, the Company issued $95 million in senior unsecured term notes to qualified institutional investors. The following table summarizes information on these notes as of March 31, 2021 and December 31, 2020:
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DERIVATIVES AND HEDGING ACTIVITIES |
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DERIVATIVES AND HEDGING ACTIVITIES | DERIVATIVES AND HEDGING ACTIVITIES From time to time, the Company utilizes interest rate swaps and other derivative financial instruments as part of its asset liability management strategy to manage interest rate risk positions. Fair Value Hedges of Interest Rate Risk During the three months ended March 31, 2021, the Company entered into a two-year interest rate swap with a notional amount of $350.0 million primarily to hedge the incremental interest rate risk related to the purchase of a single family loan pool having a longer fixed rate term than other loans typically in our portfolio. Refer to Note 3 for further discussion regarding this loan purchase. During the year ended December 31, 2019, the Company entered into two, two-year interest rate swaps with a total notional amount of $1.0 billion, maturing in June and August 2021, that hedge the interest rate risk related to certain hybrid multifamily loans which were in their fixed rate period. These three swaps are designated as fair value hedges and involve the payment of a fixed rate amount to a counterparty in exchange for the Company receiving a variable rate payment over the life of the swaps without the exchange of the underlying notional amount. The gain or loss on the derivatives, as well as the offsetting loss or gain on the hedged items attributable to the hedged risk are recognized in interest income on loans. For the three months ended March 31, 2021 and 2020, the floating rate amounts recognized related to the net settlement of the interest rate swaps were less than the fixed rate amounts recognized. The following table presents the effect of the Company’s interest rate swaps on the unaudited consolidated statements of income for the three months ended March 31, 2021 and 2020:
The following table presents the fair value of the Company’s interest rate swaps, as well as its classification in the consolidated statements of financial condition as of March 31, 2021 and December 31, 2020:
As of March 31, 2021 and December 31, 2020, the following amounts were recorded in the consolidated statements of financial condition related to cumulative basis adjustments for its fair value hedges:
(1) These amounts include the amortized cost basis of closed portfolio loans used to designate hedging relationships in which the hedged items are the last layer expected to be remaining at the end of the hedging relationship. At March 31, 2021 and December 31, 2020, the amortized cost basis of the closed portfolio loans used in these hedging relationships were $2.6 billion and $2.0 billion, respectively; the cumulative basis adjustments associated with these hedging relationships were $3.8 million and $7.3 million, respectively, and the amount of the designated hedged items were $1.4 billion and $1.0 billion, respectively. As of March 31, 2021 and December 31, 2020, the Company had posted $4.9 million and $8.9 million, respectively, in cash collateral in connection with its interest rate swaps. Cash collateral is included in restricted cash in the consolidated statements of financial condition.
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STOCK BASED COMPENSATION |
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Share-based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCK BASED COMPENSATION | STOCK BASED COMPENSATION The Company’s stock based compensation consists of restricted stock awards ("RSAs") and restricted stock units ("RSUs") granted under the Luther Burbank Corporation Omnibus Equity and Incentive Compensation Plan ("Omnibus Plan"). In connection with its initial public offering ("IPO") in December 2017, the Company granted RSAs to employees and nonemployee directors which all vested ratably over three years. At the same time, the Company granted RSUs in exchange for unvested phantom stock awards held by employees and all vested and unvested phantom stock awards held by nonemployee directors on a per share basis. The RSUs were subjected to the same vesting schedule and deferral elections that existed for the original phantom stock awards. The Company has made additional RSA grants annually. Awards granted subsequent to the IPO vest ratably over one year for nonemployee directors and ratably over to four years for employees. All RSAs and RSUs were granted at the fair value of the common stock at the time of the award. The RSAs and RSUs are considered fixed awards as the number of shares and fair value are known at the date of grant and the fair value at the grant date is amortized over the vesting and/or service period. Non-cash stock compensation expense recognized for RSAs and RSUs for the three months ended March 31, 2021 totaled $584 thousand compared with $903 thousand for the three months ended March 31, 2020. The fair value of RSAs and RSUs that vested during the three months ended March 31, 2021 and 2020 totaled $2.4 million and $2.5 million, respectively. As of March 31, 2021 and December 31, 2020, there was $4.4 million and $2.7 million, respectively, of unrecognized compensation expense related to 479,055 and 464,919 unvested RSAs and/or RSUs, respectively, which amounts are expected to be expensed over a weighted average period of 2.09 years and 1.76 years, respectively. As of March 31, 2021 and December 31, 2020, 91,486 and 140,997 shares, respectively, of RSUs were vested and remain unsettled per the original deferral elections. The following table summarizes share information about RSAs and RSUs:
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FAIR VALUE MEASUREMENTS |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Fair Value Hierarchy The Company groups its assets and liabilities measured at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. Valuations within these levels are based upon: Level 1 - Quoted market prices for identical instruments traded in active exchange markets. Level 2 - Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable or can be corroborated by observable market data. Level 3 - Model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect the Company’s estimates of assumptions that market participants would use on pricing the asset or liability. Valuation techniques include management judgment and estimation which may be significant. Because broadly traded markets do not exist for most of the Company’s financial instruments, the fair value calculations attempt to incorporate the effect of current market conditions at a specific time. These determinations are subjective in nature, involve uncertainties and matters of significant judgment and do not include tax ramifications; therefore, the results cannot be determined with precision, substantiated by comparison to independent markets and may not be realized in an actual sale or immediate settlement of the instruments. 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. For all of these reasons, the aggregation of the fair value calculations presented herein do not represent, and should not be construed to represent, the underlying value of the Company. Management monitors the availability of observable market data to assess the appropriate classification of assets and liabilities within the fair value hierarchy. Changes in economic conditions or model-based valuation techniques may require the transfer of financial instruments from one fair value level to another. In such instances, the transfer is reported at the beginning of the reporting period. Management evaluates the significance of transfers between levels based upon the nature of the financial instrument and size of the transfer relative to total assets, total liabilities, or total earnings. The following methods and assumptions were used to estimate the fair value of financial instruments: For cash, cash equivalents and restricted cash, accrued interest receivable and payable, demand deposits and short-term borrowings, the carrying amount was estimated to be fair value. The fair value of accrued interest receivable/payable balances were determined using inputs and fair value measurements commensurate with the asset or liability from which the accrued interest is generated. Fair values for available for sale and held to maturity debt securities, which include primarily debt securities issued by U.S. government sponsored agencies, were based on quoted market prices for similar securities. Fair values for equity securities, which consist of investments in a qualified community reinvestment fund, were based on quoted market prices. Loans were valued using the exit price notion. The fair value was estimated using market quotes for similar assets or the present value of future cash flows, discounted using a market rate for similar products and giving consideration to estimated prepayment risk and credit risk. The fair value of loans was determined utilizing estimates resulting in a Level 3 classification. Impaired loans were measured for impairment based on the present value of expected future cash flows discounted at the loans' effective interest rate, except that as a practical expedient, the Company may measure impairment based on a loan’s observable market price, or the fair value of the collateral (net of estimated costs to sell) if the loan is collateral dependent. The fair value of impaired loans was determined utilizing estimates resulting in a Level 3 classification. It was not practicable to determine the fair value of FHLB stock due to restrictions placed on its transferability. The fair value of servicing rights was determined using a valuation model that utilizes interest rate, prepayment speed, and default rate assumptions that market participants would use in estimating future net servicing income and that can be validated against available market data. The fair values of derivatives were based on valuation models using observable market data as of the measurement date. Fair values for fixed-rate time deposits were estimated using discounted cash flow analyses using interest rates offered at each reporting date by the Company for time deposits with similar remaining maturities. For deposits with no contractual maturity, the fair value was assumed to equal the carrying value. The fair value of FHLB advances was estimated based on discounting the future cash flows using the market rate currently offered for similar terms. The fair value of subordinated debentures was based on an indication of value provided by a third-party broker. For senior debt, the fair value was based on an indication of value provided by a third-party broker. Fair Value of Financial Instruments The carrying and estimated fair values of the Company’s financial instruments were as follows:
These estimates do not reflect any premium or discount that could result from offering the Company’s entire holdings of a particular financial instrument for sale at one time, nor do they attempt to estimate the value of anticipated future business related to the instruments. In addition, the tax ramifications related to the realization of unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in any of these estimates. Assets and Liabilities Recorded at Fair Value The following table presents information about the Company’s assets and liabilities measured at fair value on a recurring and nonrecurring basis as of March 31, 2021 and December 31, 2020. Recurring Basis The Company is required or permitted to record the following assets and liabilities at fair value on a recurring basis:
There were no transfers between Level 1 and Level 2 during the three months ended March 31, 2021 or 2020. Non-recurring Basis The Company may be required, from time to time, to measure certain assets and liabilities at fair value on a non-recurring basis. These include assets that are measured at the lower of cost or market value that were recognized at fair value which was below cost at the reporting date. At both March 31, 2021 and December 31, 2020, there were no assets or liabilities measured at fair value on a non-recurring basis and no other real estate owned
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VARIABLE INTEREST ENTITIES (VIE) |
3 Months Ended |
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Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
VARIABLE INTEREST ENTITIES (VIE) | VARIABLE INTEREST ENTITIES ("VIE")The Company is involved with VIEs through its loan securitization activities. The Company evaluated its association with VIEs for consolidation purposes. Specifically, a VIE is to be consolidated by its primary beneficiary, the entity that has both the power to direct the activities that most significantly impact the VIE, and a variable interest that could potentially be significant to the VIE. A variable interest is a contractual, ownership or other interest whose value fluctuates with the changes in the value of the VIE's assets and liabilities. The assessment includes an evaluation of the Company's continuing involvement with the VIE and the nature and significance of its variable interests. Multifamily loan securitization With respect to the securitization transaction with Freddie Mac which settled September 27, 2017, the Company's variable interests reside with a reimbursement agreement entered into with Freddie Mac that obligates the Company to reimburse Freddie Mac for defaulted contractual principal and interest payments identified after the ultimate resolution of any defaulted loans. Such reimbursement obligations are not to exceed 10% of the original principal amount of the loans comprising the securitization pool. As part of the securitization transaction, the Company released all servicing obligations and rights to Freddie Mac who was designated as the Master Servicer. As Master Servicer, Freddie Mac appointed the Company with sub-servicing obligations, which include obligations to collect and remit payments of principal and interest, manage payments of taxes and insurance, and otherwise administer the underlying loans. The servicing of defaulted loans and foreclosed loans was assigned to a separate third party entity, independent of the Company and Freddie Mac. Freddie Mac, in its capacity as Master Servicer, can terminate the Company in its role as sub-servicer and direct such responsibilities accordingly. In evaluating the variable interests and continuing involvement in the VIE, the Company determined that it does not have the power to make significant decisions or direct the activities that most significantly impact the economic performance of the VIE's assets and liabilities. As sub-servicer of the loans, the Company does not have the authority to make significant decisions that influence the value of the VIE's net assets and therefore, is not the primary beneficiary of the VIE. Hence, the Company determined that the VIE associated with the multifamily securitization should not be included in the consolidated financial statements of the Company. The Company believes its maximum exposure to loss as a result of involvement with the VIE associated with the securitization under the reimbursement agreement executed with Freddie Mac is 10% of the original principal amount of the loans comprising the securitization pool, or $62.6 million. The reserve for estimated losses with respect to the reimbursement obligation totaled $959 thousand as of both March 31, 2021 and December 31, 2020 based upon an analysis of quantitative and qualitative data of the underlying loans included in the securitization pool. No disbursements have been made in connection with the reimbursement obligation.
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LOAN SALE AND SECURITIZATION ACTIVITIES |
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Transfers and Servicing [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOAN SALE AND SECURITIZATION ACTIVITIES | LOAN SALE AND SECURITIZATION ACTIVITIES The Company periodically sells loans as part of its business operations and overall management of liquidity, assets and liabilities, and financial performance. The transfer of loans is executed in securitization or sale transactions. With respect to sale transactions, the Company's continuing involvement may or may not include ongoing servicing responsibilities and general representations and warranties. With respect to securitization sales, the Company executed its first and only transaction to date on September 27, 2017 with Freddie Mac. The transaction involved the sale of $626.0 million in originated multifamily loans through a Freddie Mac sponsored transaction. The Company's continuing involvement includes sub-servicing responsibilities, general representations and warranties, and a limited reimbursement obligation. As sub-servicer for Freddie Mac, the Bank is required to maintain a minimum net worth in accordance with GAAP of not less than $2.0 million. If the Bank's capital were to fall below this threshold, Freddie Mac would have the authority to terminate and assume the Bank’s sub-servicing duties. At March 31, 2021, the Bank’s net worth was $756.1 million which equates to its Tier 1 capital of $748.8 million plus goodwill of $3.3 million and accumulated other comprehensive income related to net unrealized gains on available for sale securities of $4.0 million. General representations and warranties associated with loan sales and the securitization transaction require the Company to uphold various assertions that pertain to the underlying loans at the time of the transaction, including, but not limited to, compliance with relevant laws and regulations, absence of fraud, enforcement of liens, no environmental damages, and maintenance of relevant environmental insurance. Such representations and warranties are limited to those that do not meet the quality represented at the transaction date and do not pertain to a decline in value or future payment defaults. In circumstances where the Company breaches its representations and warranties, the Company would generally be required to cure such instances through a repurchase or substitution of the subject loan(s). With respect to the securitization transaction, the Company also has continuing involvement through a reimbursement agreement executed with Freddie Mac. To the extent the ultimate resolution of defaulted loans results in contractual principal and interest payments that are deficient, the Company is obligated to reimburse Freddie Mac for such amounts, not to exceed 10% of the original principal amount of the loans comprising the securitization pool at the closing date of September 27, 2017. The following table provides cash flows associated with the Company's loan sale activities:
The following table provides information about the loans transferred through sales or securitization and not recorded in the consolidated statements of financial condition, for which the Company's continuing involvement includes sub-servicing or servicing responsibilities and/or reimbursement obligations:
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COMMITMENTS AND CONTINGENCIES |
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Financial Instruments With Off-Balance Sheet Risk The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments represent commitments to originate fixed and variable rate loans and loans in process, and involve, to varying degrees, credit risk and interest rate risk in excess of the amount recognized in the Company’s consolidated statements of financial condition. The Company’s exposure to credit loss in the event of nonperformance by the other party for commitments to extend credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments to originate loans and lines of credit as it does for on-balance sheet instruments. As it relates to interest rate risk, the Company's exposure is generally limited to increases in interest rates that may result during the short period of time between the commitment and funding of fixed rate credit facilities and adjustable rate credit facilities with initial fixed rate periods. The limited timing risk associated with these credit facilities are considered within the Company's asset liability management process. Commitments to fund loans and lines of credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have expiration dates or other termination clauses. In addition, external market forces may impact the probability of commitments being exercised; therefore, total commitments outstanding do not necessarily represent future cash requirements. At March 31, 2021 and December 31, 2020, the Company had outstanding commitments of approximately $141.8 million and $116.9 million, respectively, for loans and lines of credit. Unfunded commitment reserves totaled $60 thousand and $59 thousand at March 31, 2021 and December 31, 2020, respectively. Operating Leases The Company leases various office premises under long-term operating lease agreements. These leases expire between 2021 and 2030, with certain leases containing either , or ten year renewal options. At March 31, 2021, minimum commitments under these non-cancellable leases, before considering renewal options, were:
Rent expense under operating leases was $1.2 million and $1.1 million for the three months ended March 31, 2021 and 2020, respectively. Sublease income earned was $207 thousand and $191 thousand for the three months ended March 31, 2021 and 2020, respectively. Contingencies At present, there are no pending or threatened proceedings against the Company which, if determined adversely, would have a material effect on the Company’s business, financial position, results of operations, cash flows or stock price. In the ordinary course of operations, the Company may be party to various legal proceedings. Correspondent Banking Agreements The Company maintains funds on deposit with other federally insured financial institutions under correspondent banking agreements. Insured portions of these balances are limited to $250 thousand per institution based on FDIC insurance limits. At March 31, 2021 and December 31, 2020, the Company had $26.6 million and $26.0 million, respectively, in uninsured available cash balances. Additionally, the Company had $4.9 million and $8.9 million in restricted cash as collateral for its interest rate swap agreements at a correspondent bank as of March 31, 2021 and December 31, 2020, respectively. The Company periodically monitors the financial condition and capital adequacy of these correspondent banks.
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NATURE OF OPERATIONS (Policies) |
3 Months Ended |
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Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Accounting | Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not include all footnotes as would be necessary for a fair presentation of financial position, results of operations and comprehensive income, changes in stockholders’ equity and cash flows in conformity with accounting principles generally accepted in the United States of America (“GAAP”). However, these interim unaudited consolidated financial statements reflect all adjustments (consisting solely of normal recurring adjustments and accruals) which, in the opinion of management, are necessary for a fair presentation of financial position, results of operations and comprehensive income, changes in stockholders’ equity and cash flows for the interim periods presented. These unaudited consolidated financial statements have been prepared on a basis consistent with, and should be read in conjunction with, the audited consolidated financial statements as of and for the year ended December 31, 2020, and the notes thereto, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the Securities and Exchange Commission (the “SEC”), under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”). The unaudited consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the results of operations that may be expected for any other interim period or for the year ending December 31, 2021. The Company’s accounting and reporting policies conform to GAAP and to general practices within the banking industry.
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Use of Estimates | Use of EstimatesManagement is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates and assumptions affect the amounts reported in the unaudited consolidated financial statements and the disclosures provided, and actual results could differ. |
Earnings Per Share | Earnings Per Share ("EPS") Basic earnings per common share represents the amount of earnings for the period available to each share of common stock outstanding during the reporting period. Basic EPS is computed based upon net income divided by the weighted average number of common shares outstanding during the period. In determining the weighted average number of shares outstanding, vested restricted stock units are included. Diluted EPS represents the amount of earnings for the period available to each share of common stock outstanding including common stock that would have been outstanding assuming the issuance of common shares for all dilutive potential common shares outstanding during each reporting period. Diluted EPS is computed based upon net income divided by the weighted average number of common shares outstanding during each period, adjusted for the effect of dilutive potential common shares, such as restricted stock awards and units, calculated using the treasury stock method.
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Fair Value Measurements | Fair Value Hierarchy The Company groups its assets and liabilities measured at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. Valuations within these levels are based upon: Level 1 - Quoted market prices for identical instruments traded in active exchange markets. Level 2 - Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable or can be corroborated by observable market data. Level 3 - Model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect the Company’s estimates of assumptions that market participants would use on pricing the asset or liability. Valuation techniques include management judgment and estimation which may be significant. Because broadly traded markets do not exist for most of the Company’s financial instruments, the fair value calculations attempt to incorporate the effect of current market conditions at a specific time. These determinations are subjective in nature, involve uncertainties and matters of significant judgment and do not include tax ramifications; therefore, the results cannot be determined with precision, substantiated by comparison to independent markets and may not be realized in an actual sale or immediate settlement of the instruments. 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. For all of these reasons, the aggregation of the fair value calculations presented herein do not represent, and should not be construed to represent, the underlying value of the Company. Management monitors the availability of observable market data to assess the appropriate classification of assets and liabilities within the fair value hierarchy. Changes in economic conditions or model-based valuation techniques may require the transfer of financial instruments from one fair value level to another. In such instances, the transfer is reported at the beginning of the reporting period. Management evaluates the significance of transfers between levels based upon the nature of the financial instrument and size of the transfer relative to total assets, total liabilities, or total earnings. The following methods and assumptions were used to estimate the fair value of financial instruments: For cash, cash equivalents and restricted cash, accrued interest receivable and payable, demand deposits and short-term borrowings, the carrying amount was estimated to be fair value. The fair value of accrued interest receivable/payable balances were determined using inputs and fair value measurements commensurate with the asset or liability from which the accrued interest is generated. Fair values for available for sale and held to maturity debt securities, which include primarily debt securities issued by U.S. government sponsored agencies, were based on quoted market prices for similar securities. Fair values for equity securities, which consist of investments in a qualified community reinvestment fund, were based on quoted market prices. Loans were valued using the exit price notion. The fair value was estimated using market quotes for similar assets or the present value of future cash flows, discounted using a market rate for similar products and giving consideration to estimated prepayment risk and credit risk. The fair value of loans was determined utilizing estimates resulting in a Level 3 classification. Impaired loans were measured for impairment based on the present value of expected future cash flows discounted at the loans' effective interest rate, except that as a practical expedient, the Company may measure impairment based on a loan’s observable market price, or the fair value of the collateral (net of estimated costs to sell) if the loan is collateral dependent. The fair value of impaired loans was determined utilizing estimates resulting in a Level 3 classification. It was not practicable to determine the fair value of FHLB stock due to restrictions placed on its transferability. The fair value of servicing rights was determined using a valuation model that utilizes interest rate, prepayment speed, and default rate assumptions that market participants would use in estimating future net servicing income and that can be validated against available market data. The fair values of derivatives were based on valuation models using observable market data as of the measurement date. Fair values for fixed-rate time deposits were estimated using discounted cash flow analyses using interest rates offered at each reporting date by the Company for time deposits with similar remaining maturities. For deposits with no contractual maturity, the fair value was assumed to equal the carrying value. The fair value of FHLB advances was estimated based on discounting the future cash flows using the market rate currently offered for similar terms. The fair value of subordinated debentures was based on an indication of value provided by a third-party broker. For senior debt, the fair value was based on an indication of value provided by a third-party broker.
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Derivatives | The gain or loss on the derivatives, as well as the offsetting loss or gain on the hedged items attributable to the hedged risk are recognized in interest income on loans. |
NATURE OF OPERATIONS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted |
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INVESTMENT SECURITIES (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt Securities, Available-for-sale | The following table summarizes the amortized cost and the estimated fair value of available for sale debt securities as of the dates indicated:
The following tables summarize the gross unrealized losses and fair value of available for sale debt securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:
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Schedule of Held-to-maturity Securities | The following table summarizes the amortized cost and estimated fair value of held to maturity investment securities as of the dates indicated:
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Schedule of Debt Maturities of Available-for-sale and Held-to-maturity Securities | The following table summarizes the scheduled maturities of available for sale and held to maturity investment securities as of March 31, 2021:
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LOANS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans Receivable | Loans consist of the following:
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Schedule Allowance for Loan Losses | The following table summarizes activity in and the allocation of the allowance for loan losses by portfolio segment:
The following table summarizes the allocation of the allowance for loan losses by impairment methodology:
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Schedule of Loan Portfolio by Internal Risk Indicators | The following table summarizes the loan portfolio allocated by management’s internal risk ratings at March 31, 2021 and December 31, 2020. The decrease in Watch, Special Mention and Substandard risk rated loans during the three months ended March 31, 2021 was primarily attributable to the diminishing impact of the COVID-19 pandemic on the performance of loans. As of March 31, 2021, only one loan, with a principal balance of $1.7 million, remained on payment deferral under the Company's loan modification program implemented in response to the pandemic.
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Schedule or Past Due Loans Receivable | The following table summarizes an aging analysis of the loan portfolio by the time past due at March 31, 2021 and December 31, 2020:
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Schedule of Impaired Loans Receivables | The following table summarizes information related to impaired loans at March 31, 2021 and December 31, 2020:
The following table summarizes information related to impaired loans for the three months ended March 31, 2021 and 2020:
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Schedule of Troubled Debt Restructurings | The following table summarizes the recorded investment related to troubled debt restructurings ("TDRs") at March 31, 2021 and December 31, 2020:
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NONPERFORMING ASSETS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Nonperforming Assets | The Company’s nonperforming assets at March 31, 2021 and December 31, 2020 are indicated below:
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MORTGAGE SERVICING RIGHTS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transfers and Servicing [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Mortgage Loans Serviced for Others | The principal balances of these loans are as follows:
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Schedule of Changes in Servicing Assets | Activities for mortgage servicing rights are as follows:
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DEPOSITS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Deposits | A summary of deposits at March 31, 2021 and December 31, 2020 is as follows:
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Schedule of Certificate Account Maturities | Maturities of the Company’s time deposits at March 31, 2021 are summarized as follows:
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FEDERAL HOME LOAN BANK AND FEDERAL RESERVE BANK ADVANCES (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Advances from Federal Home Loan Banks [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of FHLB Advances | The following table discloses the Bank’s outstanding advances from the FHLB of San Francisco:
The following table summarizes scheduled principal payments on FHLB advances over the next five years as of March 31, 2021:
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JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Outstanding Trust Securities | The following table is a summary of the outstanding Trust Securities and Notes at March 31, 2021 and December 31, 2020:
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SENIOR DEBT (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | The following table summarizes information on these notes as of March 31, 2021 and December 31, 2020:
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DERIVATIVES AND HEDGING ACTIVITIES (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Interest Rate Swap on the Consolidated Statements of Income | The following table presents the effect of the Company’s interest rate swaps on the unaudited consolidated statements of income for the three months ended March 31, 2021 and 2020:
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Schedule of Interest Rate Swap on Consolidated Balance Sheet | The following table presents the fair value of the Company’s interest rate swaps, as well as its classification in the consolidated statements of financial condition as of March 31, 2021 and December 31, 2020:
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Schedule of Amounts Recorded on the Balance Sheet Related to Cumulative Adjustments on Fair Value Hedges | As of March 31, 2021 and December 31, 2020, the following amounts were recorded in the consolidated statements of financial condition related to cumulative basis adjustments for its fair value hedges:
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STOCK BASED COMPENSATION (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restricted Stock Activity | The following table summarizes share information about RSAs and RSUs:
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FAIR VALUE MEASUREMENTS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value of Assets and Liabilities | The carrying and estimated fair values of the Company’s financial instruments were as follows:
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||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value of Assets Measured on a Recurring Basis | The Company is required or permitted to record the following assets and liabilities at fair value on a recurring basis:
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Schedule of Fair Value of Liabilities Measured on a Recurring Basis | The Company is required or permitted to record the following assets and liabilities at fair value on a recurring basis:
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Schedule of Fair Value of Assets Measured on a Nonrecurring Basis | These include assets that are measured at the lower of cost or market value that were recognized at fair value which was below cost at the reporting date. |
LOAN SALE AND SECURITIZATION ACTIVITIES (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transfers and Servicing [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Cash Flows From Loan Sale Activities | The following table provides cash flows associated with the Company's loan sale activities:
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Schedule of Loans Transfered Through Sale or Securitization | The following table provides information about the loans transferred through sales or securitization and not recorded in the consolidated statements of financial condition, for which the Company's continuing involvement includes sub-servicing or servicing responsibilities and/or reimbursement obligations:
|
COMMITMENTS AND CONTINGENCIES (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Operating Lease Maturities | At March 31, 2021, minimum commitments under these non-cancellable leases, before considering renewal options, were:
|
NATURE OF OPERATIONS - Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2021 |
Mar. 31, 2020 |
|
Accounting Policies [Abstract] | ||
Net income | $ 18,411 | $ 7,576 |
Weighted average common shares outstanding - basic (in shares) | 51,982,731 | 55,611,827 |
Add: Dilutive effects of assumed vesting of restricted stock (in shares) | 115,507 | 113,271 |
Weighted average common shares outstanding - diluted (in shares) | 52,098,238 | 55,725,098 |
Basic earnings per common share (in usd per share) | $ 0.35 | $ 0.14 |
Diluted earnings per common share (in usd per share) | $ 0.35 | $ 0.14 |
Anti-dilutive shares not included in calculation of diluted earnings per share (in shares) | 3,695 | 17,313 |
INVESTMENT SECURITIES - Held-to-maturity Securities (Details) - USD ($) $ in Thousands |
Mar. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | $ 5,684 | $ 7,467 |
Gross Unrecognized Gains | 307 | 403 |
Gross Unrecognized Losses | 0 | 0 |
Estimated Fair Value | 5,991 | 7,870 |
Residential MBS | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | 5,610 | 7,391 |
Gross Unrecognized Gains | 307 | 403 |
Gross Unrecognized Losses | 0 | 0 |
Estimated Fair Value | 5,917 | 7,794 |
Other investments | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | 74 | 76 |
Gross Unrecognized Gains | 0 | 0 |
Gross Unrecognized Losses | 0 | 0 |
Estimated Fair Value | $ 74 | $ 76 |
INVESTMENT SECURITIES - Schedule of Investment Securities Maturities (Details) - USD ($) $ in Thousands |
Mar. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Amortized Cost | ||
Five to ten years | $ 10,239 | |
Beyond ten years | 3,000 | |
Amortized Cost | 634,003 | $ 584,240 |
Fair Value | ||
Five to ten years | 10,196 | |
Beyond ten years | 3,068 | |
Fair Value | 639,682 | 593,734 |
Amortized Cost | ||
Held-to-maturity investment securities beyond ten years | 74 | |
Amortized Cost | 5,684 | 7,467 |
Fair Value | ||
Beyond ten years | 74 | |
Total held to maturity debt securities | 5,991 | $ 7,870 |
MBS, CMOs and other ABS | ||
Amortized Cost | ||
MBS, CMOs and other ABS | 620,764 | |
Fair Value | ||
MBS, CMOs and other ABS | 626,418 | |
MBS | ||
Amortized Cost | ||
MBS | 5,610 | |
Fair Value | ||
MBS | $ 5,917 |
LOANS - Troubled Debt Restructurings (Details) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2021
USD ($)
loan
|
Mar. 31, 2020
loan
|
Dec. 31, 2020
USD ($)
|
|
Financing Receivable, Troubled Debt Restructuring [Line Items] | |||
Financing Receivable, Modifications, Number of Contracts | loan | 0 | 0 | |
Subsequent default, number of loans | loan | 0 | 0 | |
Single family residential | |||
Financing Receivable, Troubled Debt Restructuring [Line Items] | |||
Recorded investment | $ | $ 3,932 | $ 3,967 | |
Related allowance | $ | $ 25 | $ 25 |
NONPERFORMING ASSETS (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2021 |
Mar. 31, 2020 |
Dec. 31, 2020 |
|
Financing Receivable, Past Due [Line Items] | |||
Total non-accrual loans | $ 6,723 | $ 6,313 | |
Real estate owned | 0 | 0 | |
Total nonperforming assets | 6,723 | 6,313 | |
Interest income recognized on non-accrual loans | 62 | $ 22 | |
Contractual interest not accrued during the quarter | 16 | $ 71 | |
Multifamily residential | |||
Financing Receivable, Past Due [Line Items] | |||
Total non-accrual loans | 2,087 | 522 | |
Single family residential | |||
Financing Receivable, Past Due [Line Items] | |||
Total non-accrual loans | $ 4,636 | $ 5,791 |
MORTGAGE SERVICING RIGHTS - Mortgage Loans Serviced for Others (Details) - USD ($) $ in Thousands |
Mar. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Schedule of Loans Serviced for Others [Line Items] | ||
Total mortgage loans serviced for others | $ 275,404 | $ 319,756 |
Federal Home Loan Mortgage Corporation ("Freddie Mac") | ||
Schedule of Loans Serviced for Others [Line Items] | ||
Total mortgage loans serviced for others | 184,161 | 216,431 |
Other financial institutions | ||
Schedule of Loans Serviced for Others [Line Items] | ||
Total mortgage loans serviced for others | $ 91,243 | $ 103,325 |
MORTGAGE SERVICING RIGHTS - Mortgage Servicing Rights Activity (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2021 |
Mar. 31, 2020 |
|
Servicing Asset at Fair Value, Amount [Roll Forward] | ||
Beginning balance | $ 1,599 | $ 2,657 |
Additions | 0 | 0 |
Disposals | 0 | 0 |
Changes in fair value due to changes in assumptions | 0 | 0 |
Other changes in fair value | (171) | (395) |
Ending balance | $ 1,428 | $ 2,262 |
DEPOSITS - Deposits (Details) - USD ($) $ in Thousands |
Mar. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Deposits, by Type [Abstract] | ||
Time deposits | $ 3,022,286 | $ 3,057,197 |
Money market savings | 1,839,902 | 1,678,942 |
Interest-bearing demand | 157,620 | 341,895 |
Money market checking | 273,965 | 92,956 |
Noninterest-bearing demand | 98,135 | 93,339 |
Deposits | $ 5,391,908 | $ 5,264,329 |
DEPOSITS - Narrative (Details) - USD ($) $ in Millions |
Mar. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Deposits [Abstract] | ||
Certificates of deposit with a denomination of $100,000 or More | $ 2,500.0 | $ 2,600.0 |
Certificates of deposit that meet or exceed FDIC insurance limit | 1,400.0 | 1,400.0 |
Brokered deposits | $ 50.0 | $ 50.0 |
DEPOSITS - Maturities (Details) $ in Thousands |
Mar. 31, 2021
USD ($)
|
---|---|
Maturities of Time Deposits, Twelve months ending March 31, | |
April 1 - December 31, 2021 | $ 2,544,258 |
2022 | 451,384 |
2023 | 12,762 |
2024 | 6,078 |
2025 | 7,429 |
Thereafter | 375 |
Time Deposits | $ 3,022,286 |
FEDERAL HOME LOAN BANK AND FEDERAL RESERVE BANK ADVANCES - Narrative (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2021 |
Mar. 31, 2020 |
Dec. 31, 2020 |
|
Short-term Debt [Line Items] | |||
FHLB advances, maximum percentage of assets | 40.00% | ||
Borrowing capacity based on pledged loans to the FRB and FHLB | $ 1,100,000,000 | $ 1,100,000,000 | |
Loans available to be pledged as collateral | 2,400,000,000 | 1,800,000,000 | |
Maximum short-term debt outstanding during period | 203,600,000 | $ 77,800,000 | |
Average short-term debt outstanding during period | $ 88,800,000 | $ 23,800,000 | |
Weighted average interest rate | 0.14% | 1.66% | |
FHLB Advances | |||
Short-term Debt [Line Items] | |||
Mortgage loans pledged as collateral | $ 2,400,000,000 | 2,400,000,000 | |
Letters of credit pledged as collateral | 62,600,000 | 62,600,000 | |
FRB Advances | |||
Short-term Debt [Line Items] | |||
Mortgage loans pledged as collateral | 557,300,000 | 467,800,000 | |
Borrowings outstanding | $ 0 | $ 0 |
FEDERAL HOME LOAN BANK AND FEDERAL RESERVE BANK ADVANCES - Schedule of Maturities (Details) - USD ($) $ in Thousands |
Mar. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Federal Home Loan Bank, Advances, Fiscal Year Maturity [Abstract] | ||
Outstanding advances from FHLB | $ 840,947 | $ 806,747 |
FHLB of San Francisco | ||
Federal Home Loan Bank, Advances, Fiscal Year Maturity [Abstract] | ||
April 1 - December 31, 2021 | 389,300 | |
2022 | 100,000 | |
2023 | 250,000 | |
2024 | 0 | |
2025 | 101,500 | |
Thereafter | 147 | |
Outstanding advances from FHLB | $ 840,947 | $ 806,747 |
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES - Narrative (Details) $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2021
USD ($)
trust
| |
Investment Holdings [Line Items] | |
Number of wholly-owned trust companies | trust | 2 |
Trusts | |
Investment Holdings [Line Items] | |
Investment in common securities | $ | $ 1.9 |
Trust Preferred Securities Subject to Mandatory Redemption | Trusts | |
Investment Holdings [Line Items] | |
Interest deferment period (not exceeding) | 5 years |
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES - Schedule of Trusts (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2021 |
Dec. 31, 2020 |
|
Debt Instrument [Line Items] | ||
Amount | $ 61,857 | $ 61,857 |
Trust Preferred Securities Subject to Mandatory Redemption | Luther Burbank Statutory Trust I | Trusts | ||
Debt Instrument [Line Items] | ||
Amount | $ 41,238 | $ 41,238 |
Rate | 1.56% | 1.60% |
Trust Preferred Securities Subject to Mandatory Redemption | Luther Burbank Statutory Trust I | Trusts | LIBOR | ||
Debt Instrument [Line Items] | ||
Rate Index (Quarterly Reset) | 1.38% | |
Trust Preferred Securities Subject to Mandatory Redemption | Luther Burbank Statutory Trust II | Trusts | ||
Debt Instrument [Line Items] | ||
Amount | $ 20,619 | $ 20,619 |
Rate | 1.80% | 1.84% |
Trust Preferred Securities Subject to Mandatory Redemption | Luther Burbank Statutory Trust II | Trusts | LIBOR | ||
Debt Instrument [Line Items] | ||
Rate Index (Quarterly Reset) | 1.62% |
SENIOR DEBT - Narrative (Details) - USD ($) |
Mar. 31, 2021 |
Dec. 31, 2020 |
Sep. 30, 2014 |
---|---|---|---|
Senior Unsecured Term Notes, September 2014 | Senior Unsecured Term Notes | |||
Debt Instrument [Line Items] | |||
Principal | $ 95,000,000 | $ 95,000,000 | $ 95,000,000 |
SENIOR DEBT - Schedule of Debt (Details) - Senior Unsecured Term Notes, September 2014 - Senior Unsecured Term Notes - USD ($) |
Mar. 31, 2021 |
Dec. 31, 2020 |
Sep. 30, 2014 |
---|---|---|---|
Debt Instrument [Line Items] | |||
Principal | $ 95,000,000 | $ 95,000,000 | $ 95,000,000 |
Unamortized Debt Issuance Costs | $ 430,000 | $ 461,000 | |
Fixed Interest Rate | 6.50% |
DERIVATIVES AND HEDGING ACTIVITIES - Schedule of Interest Rate Swap on Consolidated Statement of Income (Details) - Interest Rate Swap - Designated as Hedging Instrument - Fair Value Hedging - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2021 |
Mar. 31, 2020 |
|
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Net decrease in interest income | $ (3,431) | $ (390) |
Interest Income on Loans | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative - interest rate swap, interest income | (3,416) | (461) |
Hedged items - loans, interest income | $ (15) | $ 71 |
DERIVATIVES AND HEDGING ACTIVITIES - Schedule of Interest Rate Swap on Consolidated Balance Sheet (Details) - Interest Rate Swap - Designated as Hedging Instrument - Fair Value Hedging - USD ($) |
Mar. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|---|
Derivatives, Fair Value [Line Items] | |||
Notional Amount | $ 1,350,000,000 | $ 1,000,000,000 | $ 1,000,000,000.0 |
Prepaid Expenses and Other Current Assets | |||
Derivatives, Fair Value [Line Items] | |||
Asset Derivatives, Fair Value | 127,000 | 0 | |
Other Liabilities and Accrued Expenses | |||
Derivatives, Fair Value [Line Items] | |||
Liability Derivatives, Fair Value | $ 3,872,000 | $ 7,258,000 |
DERIVATIVES AND HEDGING ACTIVITIES - Schedule of Amounts Recorded on the Balance Sheet Related to Cumulative Adjustments on Fair Value Hedges (Details) - USD ($) $ in Thousands |
Mar. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Carrying Amount of the Hedged Assets | $ 1,400,000 | $ 1,000,000 |
Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets | 3,800 | 7,300 |
Interest Rate Swap | Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets | 3,760 | 7,288 |
Interest Rate Swap | Designated as Hedging Instrument | Fair Value Hedging | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Carrying Amount of the Hedged Assets | $ 1,353,760 | $ 1,007,288 |
STOCK BASED COMPENSATION - Awards Activity (Details) - RSUs and RSAs - $ / shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2021 |
Mar. 31, 2020 |
|
Number of Shares | ||
Beginning of the period balance (in shares) | 605,916 | 717,999 |
Shares granted (in shares) | 283,078 | 250,118 |
Shares settled (in shares) | (265,655) | (203,169) |
Shares forfeited (in shares) | (52,798) | (18,876) |
End of the period balance (in shares) | 570,541 | 746,072 |
Weighted Average Grant Date Fair Value | ||
Beginning of the period balance (in usd per share) | $ 10.93 | $ 10.53 |
Shares granted (in usd per share) | 10.07 | 11.72 |
Shares settled (in usd per share) | 11.02 | 10.53 |
Shares forfeited (in usd per share) | 10.26 | 10.73 |
End of the period balance (in usd per share) | $ 10.52 | $ 10.92 |
VARIABLE INTEREST ENTITIES (VIE) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2021 |
Dec. 31, 2020 |
|
Variable Interest Entity [Line Items] | ||
Liabilities | $ 6,455,005 | $ 6,292,413 |
Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Maximum loss exposure as a percentage of original principal amount | 10.00% | |
Maximum loss exposure | $ 62,600 | |
Liabilities | $ 959 |
LOAN SALE AND SECURITIZATION ACTIVITIES - Cash Flow from Sale of Loans (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2021 |
Mar. 31, 2020 |
|
Transfers and Servicing [Abstract] | ||
Proceeds from loan sales | $ 0 | $ 0 |
Servicing fees | $ 171 | $ 270 |
LOAN SALE AND SECURITIZATION ACTIVITIES - Loans Transferred Through Loans or Securitization (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2021 |
Dec. 31, 2020 |
|
Single family residential | ||
Derecognized Assets, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | ||
Principal balance of loans | $ 15,800 | $ 17,423 |
Loans 90+ days past due | 0 | 0 |
Charge-offs, net | 0 | 0 |
Multifamily residential | ||
Derecognized Assets, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | ||
Principal balance of loans | 259,604 | 302,333 |
Loans 90+ days past due | 0 | 0 |
Charge-offs, net | $ 0 | $ 0 |
COMMITMENTS AND CONTINGENCIES - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2021 |
Mar. 31, 2020 |
Dec. 31, 2020 |
|
Operating Leased Assets [Line Items] | |||
Rent expense for operating leases | $ 1,200 | $ 1,100 | |
Sublease income | 207 | $ 191 | |
Cash balances held at other institutions that exceed FDIC insured limits | 26,600 | $ 26,000 | |
Restricted cash | $ 4,900 | 8,900 | |
Operating Lease Arrangement Type One | |||
Operating Leased Assets [Line Items] | |||
Renewal term | 3 years | ||
Operating Lease Arrangement Type Two | |||
Operating Leased Assets [Line Items] | |||
Renewal term | 5 years | ||
Operating Lease Arrangement Type Three | |||
Operating Leased Assets [Line Items] | |||
Renewal term | 10 years | ||
Commitments to Extend Credit | |||
Operating Leased Assets [Line Items] | |||
Real estate loan funding commitments | $ 141,800 | 116,900 | |
Unfunded Loan Commitment | |||
Operating Leased Assets [Line Items] | |||
Reserve recorded on real estate loan funding commitments | $ 60 | $ 59 |
COMMITMENTS AND CONTINGENCIES - Operating Lease Maturities (Details) $ in Thousands |
Mar. 31, 2021
USD ($)
|
---|---|
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |
April 1 - December 31, 2021 | $ 3,379 |
2022 | 3,666 |
2023 | 2,427 |
2024 | 1,453 |
2025 | 994 |
Thereafter | 1,661 |
Total | $ 13,580 |
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