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Loans (Tables)

9 Months Ended

Sep. 30, 2023

The following table summarizes the Company’s loans held-for-investment (in thousands):


	September 30,		December 31,
	2023		2022
Real estate loans:
Multifamily	$	2,782,141	$	2,824,579
Commercial mortgage	932,987		899,249
One-to-four family residential mortgage	164,525		173,946
Home equity and lines of credit	160,798		152,555
Construction and land	32,290		24,932
Total real estate loans	4,072,741		4,075,261
Commercial and industrial loans (1)	144,788		154,700
Other loans	2,074		2,230
Total commercial and industrial and other loans	146,862		156,930

Loans held-for-investment (excluding purchased credit-deteriorated (“PCD”) loans)	4,219,603		4,232,191
PCD loans	10,371		11,502
Total loans held-for-investment	4,229,974		4,243,693
Allowance for credit losses	(38,480)		(42,617)
Net loans held-for-investment	$	4,191,494	$	4,201,076

(1) Included in commercial and industrial loans at September 30, 2023 and December 31, 2022 are Payment Protection Program ("PPP") loans totaling $325,000 and $5.1 million, respectively.

Schedule of Loans Held-for-Investment and Current Period Gross Charge-Offs, Excluding PCD Loans, Net of Deferred Fees and Costs

The following table presents the Company’s loans held-for-investment and current period gross charge-offs, excluding PCD loans, by loan class, credit risk ratings and year of origination, at September 30, 2023 (in thousands):


	September 30, 2023
	2023		2022		2021		2020		2019		Prior		Revolving Loans		Total
Real Estate:
Multifamily
Pass	$	86,526	$	617,861	$	652,903	$	470,913	$	250,844	$	693,124	$	601	$	2,772,772
Special mention	—		—		—		—		—		331		—		331
Substandard	—		—		—		—		—		9,038		—		9,038
Total multifamily	86,526		617,861		652,903		470,913		250,844		702,493		601		2,782,141

Commercial
Pass	84,267		209,944		156,104		66,719		88,529		310,461		2,143		918,167
Special mention	—		—		—		—		—		722		—		722
Substandard	—		2,851		—		—		—		10,947		300		14,098
Total commercial	84,267		212,795		156,104		66,719		88,529		322,130		2,443		932,987

One-to-four family residential
Pass	6,226		27,036		12,115		8,435		9,138		99,554		952		163,456
Special mention	—		—		—		—		—		352		—		352
Substandard	—		—		—		—		—		717		—		717
Total one-to-four family residential	6,226		27,036		12,115		8,435		9,138		100,623		952		164,525

Home equity and lines of credit
Pass	18,647		34,510		15,648		7,357		5,512		14,314		64,478		160,466
Special mention	—		—		—		—		—		68		—		68
Substandard	—		—		22		—		90		152		—		264
Total home equity and lines of credit	18,647		34,510		15,670		7,357		5,602		14,534		64,478		160,798

Construction and land
Pass	753		8,319		1,725		10,251		1,213		7,378		2,651		32,290


Total construction and land	753		8,319		1,725		10,251		1,213		7,378		2,651		32,290

Total real estate loans	196,419		900,521		838,517		563,675		355,326		1,147,158		71,125		4,072,741
Commercial and industrial
Pass	7,025		27,846		18,348		2,932		2,818		8,032		61,651		128,652
Special mention	—		250		—		61		—		106		—		417
Substandard	5		941		14,196		116		96		365		—		15,719
Total commercial and industrial	7,030		29,037		32,544		3,109		2,914		8,503		61,651		144,788
Current period gross charge-offs	1,488		2,164		1,101		437		12		113		—		5,315
Other
Pass	1,950		—		—		56		—		14		44		2,064

Substandard	—		—		—		—		—		—		10		10
Total other	1,950		—		—		56		—		14		54		2,074

Total loans held-for-investment	$	205,399	$	929,558	$	871,061	$	566,840	$	358,240	$	1,155,675	$	132,830	$	4,219,603
Total current-period gross charge-offs	$	1,488	$	2,164	$	1,101	$	437	$	12	$	113	$	—	$	5,315

The following table presents the Company’s loans held-for-investment, excluding PCD loans, by loan class, credit risk ratings and year of origination, at December 31, 2022 (in thousands):


	December 31, 2022
	2022		2021		2020		2019		2018		Prior		Revolving Loans		Total
Real Estate:
Multifamily
Pass	$	632,613	$	676,370	$	500,069	$	255,374	$	204,810	$	545,335	$	521	$	2,815,092

Substandard	—		—		—		—		3,525		5,962		—		9,487
Total multifamily	632,613		676,370		500,069		255,374		208,335		551,297		521		2,824,579
Commercial
Pass	213,621		147,419		68,215		90,644		72,512		275,606		1,664		869,681
Special mention	—		—		—		—		—		4,852		—		4,852
Substandard	2,889		10,574		—		—		—		11,253		—		24,716
Total commercial	216,510		157,993		68,215		90,644		72,512		291,711		1,664		899,249
One-to-four family residential
Pass	26,432		12,340		8,623		10,057		7,227		105,787		1,006		171,472
Special mention	—		—		—		—		—		1,716		—		1,716
Substandard	—		—		—		—		—		758		—		758
Total one-to-four family residential	26,432		12,340		8,623		10,057		7,227		108,261		1,006		173,946
Home equity and lines of credit
Pass	36,513		16,053		8,198		5,948		4,484		11,315		69,539		152,050
Special mention	—		—		—		—		—		70		—		70
Substandard	—		—		—		92		48		295		—		435
Total home equity and lines of credit	36,513		16,053		8,198		6,040		4,532		11,680		69,539		152,555
Construction and land
Pass	8,121		1,145		6,335		1,276		1,427		3,905		653		22,862

Substandard	—		—		—		—		2,070		—		—		2,070
Total construction and land	8,121		1,145		6,335		1,276		3,497		3,905		653		24,932
Total real estate loans	920,189		863,901		591,440		363,391		296,103		966,854		73,383		4,075,261
Commercial and industrial
Pass	16,941		14,805		7,754		3,754		1,460		8,172		98,969		151,855
Special mention	—		—		48		—		—		124		214		386
Substandard	291		482		96		50		200		217		1,123		2,459
Total commercial and industrial	17,232		15,287		7,898		3,804		1,660		8,513		100,306		154,700
Other
Pass	2,010		—		114		5		6		21		74		2,230


Total other	2,010		—		114		5		6		21		74		2,230
Total loans held-for-investment	$	939,431	$	879,188	$	599,452	$	367,200	$	297,769	$	975,388	$	173,763	$	4,232,191

Estimated Expected Future Cash Flows of Each PCI Loan Pool

The following tables set forth the detail, and delinquency status, of non-performing loans (non-accrual loans and loans past due 90 days or more and still accruing), net of deferred fees and costs, at September 30, 2023, and December 31, 2022, excluding PCD loans (in thousands):


	September 30, 2023
	Total Non-Performing Loans
	Non-Accruing Loans
	Current		30-89 Days Past Due		90 Days or More Past Due		Total		90 Days or More Past Due and Accruing		Total Non-Performing Loans
Loans held-for-investment:
Real estate loans:
Multifamily


Substandard	$	2,248	$	—	$	825	$	3,073	$	209	$	3,282
Total multifamily	2,248		—		825		3,073		209		3,282
Commercial


Substandard	2,875		—		2,560		5,435		114		5,549
Total commercial	2,875		—		2,560		5,435		114		5,549
One-to-four family residential


Substandard	79		—		27		106		139		245
Total one-to-four family residential	79		—		27		106		139		245





Home equity and lines of credit
Pass	—		—		—		—		39		39

Substandard	22		—		76		98		76		174
Total home equity and lines of credit	22		—		76		98		115		213
Total real estate	5,224		—		3,488		8,712		577		9,289
Commercial and industrial loans
Pass	—		—		—		—		15		15

Substandard	97		—		751		848		—		848
Total commercial and industrial loans	97		—		751		848		15		863
Other loans
Substandard	—		—		10		10		—		10
Total other	—		—		10		10		—		10
Total non-performing loans	$	5,321	$	—	$	4,249	$	9,570	$	592	$	10,162


	December 31, 2022
	Total Non-Performing Loans
	Non-Accruing Loans
	Current		30-89 Days Past Due		90 Days or More Past Due		Total		90 Days or More Past Due and Accruing		Total Non-Performing Loans
Loans held-for-investment:
Real estate loans:
Multifamily


Substandard	$	1,923	$	—	$	1,362	$	3,285	$	233	$	3,518
Total multifamily	1,923		—		1,362		3,285		233		3,518
Commercial


Substandard	2,806		431		1,947		5,184		8		5,192
Total commercial	2,806		431		1,947		5,184		8		5,192
One-to-four family residential


Substandard	—		—		118		118		155		273
Total one-to-four family residential	—		—		118		118		155		273
Home equity and lines of credit


Substandard	186		—		76		262		—		262
Total home equity and lines of credit	186		—		76		262		—		262





Total real estate	4,915		431		3,503		8,849		396		9,245
Commercial and industrial loans


Substandard	—		26		938		964		24		988
Total commercial and industrial loans	—		26		938		964		24		988
Other loans
Pass	—		—		—		—		5		5
Total other	—		—		—		—		5		5
Total non-performing loans	$	4,915	$	457	$	4,441	$	9,813	$	425	$	10,238

Detail and Delinquency Status of Originated Loans Held-for-Investment, Net of Deferred Fees and Costs, by Performing and Non-Performing Loans

The following tables set forth the detail and delinquency status of loans held-for-investment, excluding PCD loans, net of deferred fees and costs, at September 30, 2023, and December 31, 2022 (in thousands):


	September 30, 2023
			Past Due Loans
	30-89 Days Past Due		90 Days or More Past Due		90 Days or More Past Due and Accruing		Total Past Due		Current		Total Loans Receivable, net
Loans held-for-investment:
Real estate loans:
Multifamily
Pass	$	178	$	—	$	—	$	178	$	2,772,594	$	2,772,772
Special mention	—		—		—		—		331		331
Substandard	—		825		209		1,034		8,004		9,038
Total multifamily	178		825		209		1,212		2,780,929		2,782,141
Commercial
Pass	716		—		—		716		917,451		918,167
Special mention	—		—		—		—		722		722
Substandard	1,176		2,560		114		3,850		10,248		14,098
Total commercial	1,892		2,560		114		4,566		928,421		932,987
One-to-four family residential
Pass	2,643		—		—		2,643		160,813		163,456
Special mention	65		—		—		65		287		352
Substandard	—		27		139		166		551		717
Total one-to-four family residential	2,708		27		139		2,874		161,651		164,525
Home equity and lines of credit
Pass	1,116		—		39		1,155		159,311		160,466
Special mention	—		—		—		—		68		68
Substandard	90		76		76		242		22		264
Total home equity and lines of credit	1,206		76		115		1,397		159,401		160,798
Construction and land
Pass	—		—		—		—		32,290		32,290


Total construction and land	—		—		—		—		32,290		32,290
Total real estate	5,984		3,488		577		10,049		4,062,692		4,072,741
Commercial and industrial
Pass	1,574		—		15		1,589		127,063		128,652
Special mention	293		—		—		293		124		417
Substandard	250		751		—		1,001		14,718		15,719
Total commercial and industrial	2,117		751		15		2,883		141,905		144,788
Other loans
Pass	4		—		—		4		2,060		2,064

Substandard	—		10		—		10		—		10
Total other loans	4		10		—		14		2,060		2,074
Total loans held-for-investment	$	8,105	$	4,249	$	592	$	12,946	$	4,206,657	$	4,219,603


	December 31, 2022
	Past Due Loans
	30-89 Days Past Due		90 Days or More Past Due		90 Days or More Past Due and Accruing		Total Past Due		Current		Total Loans Receivable, net
Loans held-for-investment:
Real estate loans:
Multifamily
Pass	$	189	$	—	$	—	$	189	$	2,814,903	$	2,815,092

Substandard	—		1,362		233		1,595		7,892		9,487
Total multifamily	189		1,362		233		1,784		2,822,795		2,824,579
Commercial
Pass	726		—		—		726		868,955		869,681
Special mention	—		—		—		—		4,852		4,852
Substandard	605		1,947		8		2,560		22,156		24,716
Total commercial	1,331		1,947		8		3,286		895,963		899,249
One-to-four family residential
Pass	603		—		—		603		170,869		171,472
Special mention	69		—		—		69		1,647		1,716
Substandard	—		118		155		273		485		758
Total one-to-four family residential	672		118		155		945		173,001		173,946
Home equity and lines of credit
Pass	657		—		—		657		151,393		152,050
Special mention	—		—		—		—		70		70
Substandard	173		76		—		249		186		435
Total home equity and lines of credit	830		76		—		906		151,649		152,555
Construction and land
Pass	—		—		—		—		22,862		22,862

Substandard	—		—		—		—		2,070		2,070
Total construction and land	—		—		—		—		24,932		24,932
Total real estate	3,022		3,503		396		6,921		4,068,340		4,075,261
Commercial and industrial
Pass	573		—		—		573		151,282		151,855
Special mention	—		—		—		—		386		386
Substandard	498		938		24		1,460		999		2,459
Total commercial and industrial	1,071		938		24		2,033		152,667		154,700
Other loans
Pass	5		—		5		10		2,220		2,230


Total other loans	5		—		5		10		2,220		2,230
Total loans held-for-investment	$	4,098	$	4,441	$	425	$	8,964	$	4,223,227	$	4,232,191

Schedule of Non-accrual Loans, Excluding PCD Loans

The following tables summarize information on non-accrual loans, excluding PCD loans, as of September 30, 2023 and December 31, 2022 (in thousands):


	September 30, 2023
	Recorded Investment		Unpaid Principal Balance		With No Related Allowance
Real estate loans:
Multifamily	$	3,073	$	3,360	$	1,917
Commercial	5,435		5,890		3,019
One-to-four family residential	106		106		—
Home equity and lines of credit	98		348		—

Commercial and industrial	848		4,468		80
Other	10		9		—
Total non-accrual loans	$	9,570	$	14,181	$	5,016


	December 31, 2022
	Recorded Investment		Unpaid Principal Balance		With No Related Allowance
Real estate loans:
Multifamily	$	3,285	$	3,294	$	2,050
Commercial	5,184		5,639		3,069
One-to-four family residential	118		118		—
Home equity and lines of credit	262		512		—

Commercial and industrial	964		1,288		67

Total non-accrual loans	$	9,813	$	10,851	$	5,186

The following table summarizes interest income on non-accrual loans, excluding PCD loans, during the three and nine months ended September 30, 2023 and September 30, 2022 (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Real estate loans:
Multifamily	$	41	$	25	$	144	$	73
Commercial	63		26		183		108
One-to-four family residential	1		—		6		10
Home equity and lines of credit	—		5		1		16

Commercial and industrial	48		6		77		14

Total interest income on non-accrual loans	$	153	$	62	$	411	$	221

Schedule of Loan Modifications

The following tables present the amortized cost basis at September 30, 2023 of loan modifications made to borrowers experiencing financial difficulty that were modified during the three and nine months ended September 30, 2023 by class and by type of modification (dollars in thousands):


	Three Months Ended September 30, 2023
	Payment Delay		Term Extension(1)		Payment Delay and Interest Rate Reduction		Payment Delay, Term Extension, and Interest Rate Reductions		Total		Percentage of Total Class of Financing Receivable
Commercial mortgage	$	171	$	—	$	—	$	—	$	171	0.02	%
Commercial and industrial	96		13,379		—		390		13,865		9.58	%
Total loans	$	267	$	13,379	$	—	$	390	$	14,036


	Nine Months Ended September 30, 2023
	Payment Delay		Term Extension(1)		Payment Delay and Interest Rate Reduction		Payment Delay, Term Extension, and Interest Rate Reductions		Total		Percentage of Total Class of Financing Receivable
Commercial mortgage	$	236	$	—	$	—	$	—	$	236	0.03	%
Commercial and industrial	96		13,379		208		636		14,319		9.89	%
Total loans	$	332	$	13,379	$	208	$	636	$	14,555

(1) Represents one loan that was risk rated substandard and was modified during the three months ended September 30, 2023, to receive a maturity extension of 90-days through November 1, 2023. This loan previously had multiple extensions. The loan was originally downgraded to substandard due to operating losses, however the current debt service coverage ratio is 1.84x and the loan is adequately secured by receivables in excess of $18 million. The loan is current as of September 30, 2023.

The following table presents the financial effect of loan modifications made to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2023 (in thousands):


	Weighted-Average Term Extension (in months)	Weighted-Average Interest Rate Reduction
Three Months Ended September 30, 2023
Commercial and industrial	3.4	2.87	%
Nine Months Ended September 30, 2023
Commercial and industrial	3.5	3.75	%

The following tables present the aging analysis of loan modifications made to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2023 (in thousands):


	Three Months Ended September 30, 2023
	Current		30-89 Days Past Due		90 Days or More Past Due		Non-Accrual		Total
Commercial mortgage	$	—	$	—	$	—	$	171	$	171
Commercial and industrial	13,865		—		—		—		13,865
Total loans	$	13,865	$	—	$	—	$	171	$	14,036


	Nine Months Ended September 30, 2023
	Current		30-89 Days Past Due		90 Days or More Past Due		Non-Accrual		Total
Commercial mortgage	$	—	$	65	$	—	$	171	$	236
Commercial and industrial	14,319		—		—		—		14,319
Total loans	$	14,319	$	65	$	—	$	171	$	14,555