Note 25 – Commitments, contingencies and indemnifications

Litigation

The Company may be subject to litigation and administrative proceedings arising in the ordinary course of its business.

The Company has entered into agreements, which provide for indemnifications against losses, costs, claims, and liabilities arising from the performance of individual obligations under such agreements. The Company has had no prior claims or payments pursuant to these agreements. The Company’s individual maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Company that have not yet occurred. However, based on history and experience, the Company expects the risk of loss to be remote.

Management is not aware of any other contingencies that would require accrual or disclosure in the unaudited interim consolidated financial statements.

Unfunded Loan Commitments

As of September 30, 2019 and December 31, 2018, unfunded loan commitments for SBC loans were as follows:


	September 30,		December 31,
(In Thousands)	2019		2018
Loans, net	$	227,092	$	161,746
Loans, held for sale at fair value	$	7,013	$	4,895

Commitments to Originate Loans

GMFS enters into IRLCs with customers who have applied for residential mortgage loans and meet certain credit and underwriting criteria. These commitments expose GMFS to market risk if interest rates change, and the loan is not economically hedged or committed to an investor. GMFS is also exposed to credit loss if the loan is originated and not sold to an investor and the borrower does not perform.

Commitments to originate loans do not necessarily reflect future cash requirements as some commitments are expected to expire without being drawn upon. As of September 30, 2019 and December 31, 2018, total commitments to originate loans were as follows:

September 30,

December 31,

(In Thousands)

Commitments to originate residential agency loans