LOANS AND ALLOWANCE FOR CREDIT LOSSES

6 Months Ended

Jun. 30, 2025

LOANS AND ALLOWANCE FOR CREDIT LOSSES

LOANS AND ALLOWANCE FOR CREDIT LOSSES

NOTE 5 — LOANS AND ALLOWANCE FOR CREDIT LOSSES

Loans, net of deferred costs and fees, consist of the following (in thousands):

	At		At
	June 30,		December 31,
	2025		2024
Real estate
Commercial	$	4,849,152	$	4,317,361
Construction		251,693		206,960
Multi-family		414,248		376,737
One-to four-family		88,876		90,880
Total real estate loans		5,603,969		4,991,938
Commercial and industrial		1,016,056		1,046,146
Consumer		11,269		12,961
Total loans		6,631,294		6,051,045
Deferred fees, net of origination costs		(18,505)		(16,969)
Loans, net of deferred fees and costs		6,612,789		6,034,076
Allowance for credit losses		(74,071)		(63,273)
Net loans	$	6,538,718	$	5,970,803

At June 30, 2025, $3.5 billion of loans were pledged to support wholesale funding, of which $521.0 million were encumbered. At December 31, 2024, $3.3 billion of loans were pledged to support wholesale funding, of which $348.8 million were encumbered.

The following tables present the activity in the ACL for funded loans by segment. The portfolio segments represent the categories that the Company uses to determine its ACL (in thousands):

							Multi-		One-to four-
Three months ended June 30, 2025	CRE		C&I		Construction		family		family		Consumer		Total
Allowance for credit losses:
Beginning balance	$	44,647	$	12,433	$	2,518	$	7,259	$	602	$	344	$	67,803
Provision/(credit) for credit losses		5,808		166		(178)		412		(24)		70		6,254
Loans charged-off		—		—		—		—		—		(112)		(112)
Recoveries		—		125		—		—		—		1		126
Total ending allowance balance	$	50,455	$	12,724	$	2,340	$	7,671	$	578	$	303	$	74,071

							Multi-		One-to four-
Three months ended June 30, 2024	CRE		C&I		Construction		family		family		Consumer		Total
Allowance for credit losses:
Beginning balance	$	36,704	$	10,937	$	1,712	$	8,171	$	521	$	493	$	58,538
Provision/(credit) for credit losses		1,780		345		47		(344)		(390)		48		1,486
Loans charged-off		—		—		—		—		—		(16)		(16)
Recoveries		—		—		—		—		—		—		—
Total ending allowance balance	$	38,484	$	11,282	$	1,759	$	7,827	$	131	$	525	$	60,008

							Multi-		One-to four-
Six months ended June 30, 2025	CRE		C&I		Construction		family		family		Consumer		Total
Allowance for credit losses:
Beginning balance	$	42,070	$	10,991	$	1,962	$	7,290	$	577	$	383	$	63,273
Provision/(credit) for credit losses		8,385		1,428		378		381		1		150		10,723
Loans charged-off		—		—		—		—		—		(231)		(231)
Recoveries		—		305		—		—		—		1		306
Total ending allowance balance	$	50,455	$	12,724	$	2,340	$	7,671	$	578	$	303	$	74,071

							Multi-		One-to four-
Six months ended June 30, 2024	CRE		C&I		Construction		family		family		Consumer		Total
Allowance for credit losses:
Beginning balance	$	35,635	$	11,207	$	1,765	$	8,215	$	663	$	480	$	57,965
Provision/(credit) for credit losses		2,848		75		(6)		(388)		(532)		62		2,060
Loans charged-off		—		—		—		—		—		(18)		(18)
Recoveries		1		—		—		—		—		1		2
Total ending allowance balance	$	38,484	$	11,282	$	1,759	$	7,827	$	131	$	525	$	60,008

Net recoveries for the three and six months ended June 30, 2025 were $14,000 and $76,000, respectively. Net charge-offs for the three and six months ended June 30, 2024 were $16,000.

The following tables present the activity in the ACL for unfunded loan commitments (in thousands):

	Three months ended June 30,				Six months ended June 30,
	2025		2024		2025		2024
Balance at the beginning of period	$	2,046	$	1,136	$	2,008	$	1,181
Provision/(credit) for credit losses		124		52		162		7
Total ending allowance balance	$	2,170	$	1,188	$	2,170	$	1,188

The following tables present the recorded investment in non-accrual loans and loans past due 90 days and greater and still accruing, by class of loans (in thousands):

					Loans Past Due
			Non-accrual		90 Days and
			Without an		Greater and
At June 30, 2025	Non-accrual		ACL		Still Accruing
Commercial real estate	$	25,926	$	1,926	$	—
Commercial & industrial		8,989		6,989		—
Multi-family		2,554		2,554		—
One-to-four family		2,469		2,469		—
Consumer		—		—		—
Total	$	39,938	$	13,938	$	—

					Loans Past Due
			Non-accrual		90 Days and
			Without an		Greater and
At December 31, 2024	Non-accrual		ACL		Still Accruing
Commercial real estate	$	25,087	$	25,087	$	—
Commercial & industrial		6,989		6,989		—
One-to-four family		452		452		—
Consumer		—		—		72
Total	$	32,528	$	32,528	$	72

Interest income on non-accrual loans recognized on a cash basis for the three and six months ended June 30, 2025 and 2024 was immaterial.

The following tables present the aging of the recorded investment in past due loans by class of loans (in thousands):

					Non-accrual or		Total Past
	30-59		60-89		90 Days and		Due or		Current
At June 30, 2025	Days		Days		Greater		Non-accrual		Loans		Total
Commercial real estate	$	—	$	15,448	$	25,926	$	41,374	$	4,807,778	$	4,849,152
Commercial & industrial		—		—		8,989		8,989		1,007,067		1,016,056
Construction		—		—		—		—		251,693		251,693
Multi-family		—		—		2,554		2,554		411,694		414,248
One-to four-family		—		—		2,469		2,469		86,407		88,876
Consumer		38		32		—		70		11,199		11,269
Total	$	38	$	15,480	$	39,938	$	55,456	$	6,575,838	$	6,631,294

					Non-accrual or		Total Past
	30-59		60-89		90 Days and		Due or		Current
At December 31, 2024	Days		Days		Greater		Non-accrual		Loans		Total
Commercial real estate	$	7,115	$	—	$	25,087	$	32,202	$	4,285,159	$	4,317,361
Commercial & industrial		—		—		6,989		6,989		1,039,157		1,046,146
Construction		—		—		—		—		206,960		206,960
Multi-family		—		—		—		—		376,737		376,737
One-to four-family		2,049		—		452		2,501		88,379		90,880
Consumer		124		22		72		218		12,743		12,961
Total	$	9,288	$	22	$	32,600	$	41,910	$	6,009,135	$	6,051,045

Credit Quality Indicators

The Company aggregates loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. Except for one-to four-family loans and consumer loans, the Company analyzes loans individually by classifying the loans as to credit risk ratings at least annually. For one-to four-family loans and consumer loans, the Company evaluates credit quality based on the aging status of the loan. An analysis is performed on a quarterly basis for loans classified as special mention, substandard or doubtful. The Company uses the following definitions for risk ratings. Loans not meeting these definitions are considered to be pass-rated loans.

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

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

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

The following table presents loan balances by credit quality indicator and year of origination at June 30, 2025 and charge-offs for the six months ended June 30, 2025 (in thousands):

											2020
	2025		2024		2023		2022		2021		& Prior		Revolving		Total
CRE
Pass	$	1,373,024	$	1,283,281	$	944,522	$	727,284	$	210,968	$	178,070	$	50,220	$	4,767,369
Special Mention		18,400		33,953		—		—		—		—		—		52,353
Substandard		1,800		1,087		—		24,000		839		1,704		—		29,430
Total	$	1,393,224	$	1,318,321	$	944,522	$	751,284	$	211,807	$	179,774	$	50,220	$	4,849,152
Construction
Pass	$	76,160	$	49,283	$	86,910	$	9,419	$	—	$	—	$	29,921	$	251,693
Total	$	76,160	$	49,283	$	86,910	$	9,419	$	—	$	—	$	29,921	$	251,693
Multi-family
Pass	$	127,155	$	39,155	$	37,723	$	69,073	$	61,356	$	23,239	$	2,754	$	360,455
Substandard		—		2,554		—		30,300		20,939		—		—		53,793
Total	$	127,155	$	41,709	$	37,723	$	99,373	$	82,295	$	23,239	$	2,754	$	414,248
One-to four-family
Current	$	—	$	—	$	45,000	$	3,246	$	—	$	38,161	$	—	$	86,407
Past Due		—		—		—		—		—		2,469		—		2,469
Total	$	—	$	—	$	45,000	$	3,246	$	—	$	40,630	$	—	$	88,876
C&I
Pass	$	84,596	$	180,934	$	80,630	$	93,630	$	57,497	$	11,597	$	447,935	$	956,819
Substandard		—		—		9,095		30,760		4,197		—		15,185		59,237
Total	$	84,596	$	180,934	$	89,725	$	124,390	$	61,694	$	11,597	$	463,120	$	1,016,056
Consumer
Current	$	—	$	—	$	—	$	—	$	—	$	11,199	$	—	$	11,199
Past due		—		—		—		—		—		70		—		70
Total	$	—	$	—	$	—	$	—	$	—	$	11,269	$	—	$	11,269
Total
Pass/Current	$	1,660,935	$	1,552,653	$	1,194,785	$	902,652	$	329,821	$	262,266	$	530,830	$	6,433,942
Special Mention		18,400		33,953		—		—		—		—		—		52,353
Substandard/Past due		1,800		3,641		9,095		85,060		25,975		4,243		15,185		144,999
Total	$	1,681,135	$	1,590,247	$	1,203,880	$	987,712	$	355,796	$	266,509	$	546,015	$	6,631,294
Charge-offs
Consumer	$	—	$	—	$	—	$	—	$	—	$	230	$	—	$	230

At June 30, 2025, there were $29.4 million, $53.8 million and $2.5 million of CRE, Multi-family and one-to four-family substandard classified collateral dependent loans, respectively.

The following table presents loan balances by credit quality indicator and year of origination at December 31, 2024 and charge-offs for the year ended December 31, 2024 (in thousands):

											2019
	2024		2023		2022		2021		2020		& Prior		Revolving		Total
CRE
Pass	$	1,613,785	$	1,114,212	$	927,851	$	241,340	$	125,676	$	149,727	$	26,569	$	4,199,160
Special Mention		73,859		—		5,000		14,255		—		—		—		93,114
Substandard		1,087		—		24,000		—		—		—		—		25,087
Total	$	1,688,731	$	1,114,212	$	956,851	$	255,595	$	125,676	$	149,727	$	26,569	$	4,317,361
Construction
Pass	$	104,503	$	65,231	$	8,693	$	—	$	—	$	—	$	28,533	$	206,960
Total	$	104,503	$	65,231	$	8,693	$	—	$	—	$	—	$	28,533	$	206,960
Multi-family
Pass	$	110,440	$	38,143	$	74,120	$	63,086	$	23,005	$	13,480	$	3,224	$	325,498
Substandard		—		—		30,300		20,939		—		—		—		51,239
Total	$	110,440	$	38,143	$	104,420	$	84,025	$	23,005	$	13,480	$	3,224	$	376,737
One-to four-family
Current	$	—	$	45,000	$	3,469	$	—	$	9,531	$	30,379	$	—	$	88,379
Past Due		—		—		—		—		—		2,501		—		2,501
Total	$	—	$	45,000	$	3,469	$	—	$	9,531	$	32,880	$	—	$	90,880
C&I
Pass	$	238,850	$	96,201	$	119,601	$	62,865	$	14,987	$	1,929	$	452,477	$	986,910
Special Mention		—		1,497		10,246		—		—		—		1,000		12,743
Substandard		—		7,643		20,968		4,697		—		—		13,185		46,493
Total	$	238,850	$	105,341	$	150,815	$	67,562	$	14,987	$	1,929	$	466,662	$	1,046,146
Consumer
Current	$	—	$	—	$	—	$	—	$	—	$	12,743	$	—	$	12,743
Past due		—		—		—		—		—		218		—		218
Total	$	—	$	—	$	—	$	—	$	—	$	12,961	$	—	$	12,961
Total
Pass/Current	$	2,067,578	$	1,358,787	$	1,133,734	$	367,291	$	173,199	$	208,258	$	510,803	$	5,819,650
Special Mention		73,859		1,497		15,246		14,255		—		—		1,000		105,857
Substandard/Past due		1,087		7,643		75,268		25,636		—		2,719		13,185		125,538
Total	$	2,142,524	$	1,367,927	$	1,224,248	$	407,182	$	173,199	$	210,977	$	524,988	$	6,051,045
Charge-offs
Consumer	$	—	$	—	$	—	$	—	$	—	$	247	$	—	$	247

At December 31, 2024, there were $24.0 million and $51.2 million of CRE and Multi-family substandard classified collateral dependent loans, respectively.

The following tables show the amortized cost basis of modified loans to borrowers experiencing financial difficulty during the periods indicated (in thousands):

							Modifications
			Interest Rate				as a % of
Three months ended June 30, 2025	Extension		Reduction		Total		Loan Class
Multi-family	$	—	$	—	$	—	0.0	%
Total	$	—	$	—	$	—
							Modifications
			Interest Rate				as a % of
Six months ended June 30, 2025	Extension		Reduction		Total		Loan Class
Multi-family	$	51,239	$	—	$	51,239	12.4	%
Total	$	51,239	$	—	$	51,239

							Modifications
				Interest Rate			as a % of
Three months ended June 30, 2024	Extension			Reduction	Total		Loan Class
Commercial & industrial	$	4,747	$	—	$	4,747	0.4	%
Multi-family		48,224		3,015		51,239	11.6	%
Total	$	52,971	$	3,015	$	55,986
							Modifications
				Interest Rate			as a % of
Six months ended June 30, 2024	Extension			Reduction	Total		Loan Class
Commercial & industrial	$	11,736	$	—	$	11,736	1.1	%
Multi-family		48,224		3,015		51,239	11.6	%
Total	$	59,960	$	3,015	$	62,975

The following tables describe the types of modifications made to borrowers experiencing financial difficulty:

	Types of Modifications
		Weighted
		Average
		Interest
	Term	Rate
	Extension	Reduction
Three months ended June 30, 2025
Multi-family	—	0.0%
	Types of Modifications
		Weighted
		Average
		Interest
	Term	Rate
	Extension	Reduction
Six months ended June 30, 2025
Multi-family	6-12 months	0.0%

	Types of Modifications
		Weighted
		Average
		Interest
	Term	Rate
	Extension	Reduction
Three months ended June 30, 2024
Commercial & industrial	11-12 months	3.8%
Multi-family	6-12 months	—
	Types of Modifications
		Weighted
		Average
		Interest
	Term	Rate
	Extension	Reduction
Six months ended June 30, 2024
Commercial & industrial	11-12 months	2.9%
Multi-family	6-12 months	4.1%

There were $7.0 million of loans that had a payment default during the three and six months ended June 30, 2025 that were  modified in the prior 12 months before default to borrowers experiencing financial difficulty. At June 30, 2025, there were no additional commitments to lend to borrowers experiencing financial difficulty whose loans have been modified. All loans to borrowers experiencing financial difficulty that have been modified during the three and six months ended June 30, 2024, were in compliance with their modified terms.