Loans and Allowance for Credit Losses on Loans (Tables)

6 Months Ended

Jun. 30, 2022

Loans and Allowance for Credit Losses on Loans

Summary of loans

	June 30,		December 31,
	2022		2021
	(In thousands)
Mortgage warehouse lines of credit	$	900,585	$	781,437
Residential real estate		876,652		843,101
Multi-family financing(1)		3,236,917		2,702,042
Healthcare financing(1)		1,262,424		826,157
Commercial and commercial real estate		695,158		520,199
Agricultural production and real estate		90,070		97,060
Consumer and margin loans		8,871		12,667
		7,070,677		5,782,663
Less:
ACL-Loans		37,474		31,344
Loans Receivable	$	7,033,203	$	5,751,319

(1) In 2022, the Company started presenting these two loan types on separate lines for reporting purposes.

Schedule of allowance for credit loss on loan methodology by loan portfolio segment

Loan Portfolio Segment	ACL-Loans Methodology
Ag loans	Remaining Life Method
Ag real estate loans	Remaining Life Method
Commercial loans	Discounted Cash Flow
Commercial real estate loans	Discounted Cash Flow
Consumer and margin loans	Remaining Life Method
HELOC loans	Discounted Cash Flow
Multi-family healthcare loans	Discounted Cash Flow
Multi-family non-management loans	Discounted Cash Flow
Multi-family construction loans	Discounted Cash Flow
Multi-family loans	Discounted Cash Flow
Residential real estate loans	Discounted Cash Flow
SBA commercial loans	Discounted Cash Flow
SBA real estate commercial loans	Discounted Cash Flow
Single-family warehouse lines of credit	Remaining Life Method

Summary of the activity in the ACL-Loans by portfolio segment

	For the Three Months Ended June 30, 2022
	MTG WHLOC		RES RE		MF FIN		HC FIN		CML & CRE		AG & AGRE		CON & MAR		TOTAL
	(In thousands)
ACL-Loans
Balance, beginning of period	$	1,941	$	4,547	$	15,131	$	5,618	$	4,102	$	597	$	166	$	32,102
Provision for credit losses		481		363		1,233		2,318		474		(46)		(55)		4,768
Loans charged to the allowance		—		—		—		—		(32)		—		(15)		(47)
Recoveries of loans previously charged off		—		—		—		—		651		—		—		651
Balance, end of period	$	2,422	$	4,910	$	16,364	$	7,936	$	5,195	$	551	$	96	$	37,474

	For the Six Months Ended June 30, 2022
	MTG WHLOC		RES RE		MF FIN		HC FIN		CML & CRE		AG & AGRE		CON & MAR		TOTAL
	(In thousands)
ACL-Loans
Balance, beginning of period	$	1,955	$	4,170	$	14,084	$	4,461	$	5,879	$	657	$	138	$	31,344
Impact of adopting CECL		41		275		520		139		(1,277)		(18)		21		(299)
Provision for credit losses		426		465		1,760		3,336		905		(88)		(55)		6,749
Loans charged to the allowance		—		—		—		—		(963)		—		(15)		(978)
Recoveries of loans previously charged off		—		—		—		—		651		—		7		658
Balance, end of period	$	2,422	$	4,910	$	16,364	$	7,936	$	5,195	$	551	$	96	$	37,474

Summary of activity in the allowance for loan losses

	For the Three Months Ended June 30, 2021
	MTG WHLOC		RES RE		MF FIN		HC FIN		CML & CRE		AG & AGRE		CON & MAR		TOTAL
	(In thousands)
Allowance for loan losses
Balance, beginning of period	$	3,321	$	3,600	$	13,396	$	3,740	$	4,264	$	632	$	138	$	29,091
Provision for credit losses		(386)		371		(1,718)		364		1,059		(21)		16		(315)
Loans charged to the allowance		—		(2)		—		—		(84)		—		—		(86)
Recoveries of loans previously charged off		—		—		—		—		—		—		6		6
Balance, end of period	$	2,935	$	3,969	$	11,678	$	4,104	$	5,239	$	611	$	160	$	28,696

	For the Six Months Ended June 30, 2021
	MTG WHLOC		RES RE		MF FIN		HC FIN		CML & CRE		AG & AGRE		CON & MAR		TOTAL
	(In thousands)
Allowance for loan losses
Balance, beginning of period	$	4,018	$	3,334	$	12,041	$	2,690	$	4,641	$	636	$	140	$	27,500
Provision for credit losses		(1,083)		637		(363)		1,414		750		(25)		18		1,348
Loans charged to the allowance		—		(2)		—		—		(152)		—		(6)		(160)
Recoveries of loans previously charged off		—		—		—		—		—		—		8		8
Balance, end of period	$	2,935	$	3,969	$	11,678	$	4,104	$	5,239	$	611	$	160	$	28,696

Summary of activity in the allowance for loans and recorded investment by loan portfolio

	December 31, 2021
	MTG WHLOC		RES RE		MF FIN		HC FIN		CML & CRE		AG & AGRE		CON & MAR		TOTAL
	(In thousands)
Allowance for loan losses
Balance, December 31, 2021	$	1,955	$	4,170	$	14,084	$	4,461	$	5,879	$	657	$	138	$	31,344
Ending balance: individually evaluated for impairment	$	—	$	16	$	—	$	—	$	867	$	—	$	7	$	890
Ending balance: collectively evaluated for impairment	$	1,955	$	4,154	$	14,084	$	4,461	$	5,012	$	657	$	131	$	30,454
Loans
Balance, December 31, 2021	$	781,437	$	843,101	$	2,702,042	$	826,157	$	520,199	$	97,060	$	12,667	$	5,782,663
Ending balance individually evaluated for impairment	$	—	$	419	$	36,760	$	—	$	6,055	$	158	$	13	$	43,405
Ending balance collectively evaluated for impairment	$	781,437	$	842,682	$	2,665,282	$	826,157	$	514,144	$	96,902	$	12,654	$	5,739,258

Schedule of allowance for credit loss allocated to collateral dependent loans

	June 30, 2022
	Real Estate		Accounts Receivable / Equipment		Other		Total		ACL-Loans Allocation
	(In thousands)
RES RE	$	353	$	—	$	6	$	359	$	29
MF FIN		36,760		—		—		36,760		187
CML & CRE		134		4,935		236		5,305		92
AG & AGRE		158		—		—		158		1
CON & MAR		—		—		3		3		—
Total collateral dependent loans	$	37,405	$	4,935	$	245	$	42,585	$	309

Schedule of credit risk profile of loan portfolio

	2022		2021		2020		2019		2018		Prior		Revolving Loans		TOTAL
	(In thousands)
MTG WHLOC
Acceptable and Above	$	—	$	—	$	—	$	—	$	—	$	—	$	900,585	$	900,585
Total	$	—	$	—	$	—	$	—	$	—	$	—	$	900,585	$	900,585
RES RE
Acceptable and Above		10,316		36,482		49,380		3,327		865		10,439		764,571		875,380
Special Mention (Watch)		—		—		—		61		74		779		—		914
Substandard		—		—		—		—		—		358		—		358
Total	$	10,316	$	36,482	$	49,380	$	3,388	$	939	$	11,576	$	764,571	$	876,652
MF FIN
Acceptable and Above		874,093		1,049,580		305,633		71,513		12,245		7,739		852,442		3,173,245
Special Mention (Watch)		14,614		12,298		—		—		—		—		—		26,912
Substandard		36,760		—		—		—		—		—		—		36,760
Total	$	925,467	$	1,061,878	$	305,633	$	71,513	$	12,245	$	7,739	$	852,442	$	3,236,917
HC FIN
Acceptable and Above		486,989		331,862		183,035		17,186		—		—		144,812		1,163,884
Special Mention (Watch)		—		29,462		62,373		6,705		—		—		—		98,540
Total	$	486,989	$	361,324	$	245,408	$	23,891	$	—	$	—	$	144,812	$	1,262,424
CML & CRE
Acceptable and Above		66,173		85,267		31,966		49,946		13,850		15,489		424,308		686,999
Special Mention (Watch)		48		21		1,448		129		—		234		973		2,853
Substandard		—		2,000		—		107		175		282		2,742		5,306
Total	$	66,221	$	87,288	$	33,414	$	50,182	$	14,025	$	16,005	$	428,023	$	695,158
AG & AGRE
Acceptable and Above		8,358		7,984		15,952		6,291		3,457		21,141		24,779		87,962
Special Mention (Watch)		14		64		719		431		288		390		44		1,950
Substandard		—		—		—		—		—		158		—		158
Total	$	8,372	$	8,048	$	16,671	$	6,722	$	3,745	$	21,689	$	24,823	$	90,070
CON & MAR
Acceptable and Above		240		674		394		140		4,743		20		2,638		8,849
Special Mention (Watch)		—		—		16		—		—		3		—		19
Substandard		—		—		—		—		—		3		—		3
Total	$	240	$	674	$	410	$	140	$	4,743	$	26	$	2,638	$	8,871
Total Acceptable and Above	$	1,446,169	$	1,511,849	$	586,360	$	148,403	$	35,160	$	54,828	$	3,114,135	$	6,896,904
Total Special Mention (Watch)	$	14,676	$	41,845	$	64,556	$	7,326	$	362	$	1,406	$	1,017	$	131,188
Total Substandard	$	36,760	$	2,000	$	—	$	107	$	175	$	801	$	2,742	$	42,585
Total Loans	$	1,497,605	$	1,555,694	$	650,916	$	155,836	$	35,697	$	57,035	$	3,117,894	$	7,070,677

	December 31, 2021
	MTG WHLOC		RES RE		MF FIN		HC FIN		CML & CRE		AG & AGRE		CON & MAR		TOTAL
	(In thousands)
Special Mention (Watch)	$	—	$	946	$	27,155	$	66,406	$	2,483	$	3,820	$	21	$	100,831
Substandard		—		419		36,760		—		6,055		158		13		43,405
Acceptable and Above		781,437		841,736		2,638,127		759,751		511,661		93,082		12,633		5,638,427
Total	$	781,437	$	843,101	$	2,702,042	$	826,157	$	520,199	$	97,060	$	12,667	$	5,782,663

Schedule of aging analysis of the recorded investment in loans

	June 30, 2022
	30-59 Days		60-89 Days		Greater Than		Total				Total
	Past Due		Past Due		90 Days		Past Due		Current		Loans
	(In thousands)
MTG WHLOC	$	—	$	—	$	—	$	—	$	900,585	$	900,585
RES RE		307		216		176		699		875,953		876,652
MF FIN		—		—		—		—		3,236,917		3,236,917
HC FIN		—		—		—		—		1,262,424		1,262,424
CML & CRE		—		—		4,083		4,083		691,075		695,158
AG & AGRE		—		—		—		—		90,070		90,070
CON & MAR		39		42		3		84		8,787		8,871
	$	346	$	258	$	4,262	$	4,866	$	7,065,811	$	7,070,677

	December 31, 2021
	30-59 Days		60-89 Days		Greater Than		Total				Total
	Past Due		Past Due		90 Days		Past Due		Current		Loans
	(In thousands)
MTG WHLOC	$	—	$	—	$	—	$	—	$	781,437	$	781,437
RES RE		1,252		287		186		1,725		841,376		843,101
MF FIN		—		—		—		—		2,702,042		2,702,042
HC FIN		—		—		—		—		826,157		826,157
CML & CRE		591		8		149		748		519,451		520,199
AG & AGRE		37		21		—		58		97,002		97,060
CON & MAR		43		5		40		88		12,579		12,667
	$	1,923	$	321	$	375	$	2,619	$	5,780,044	$	5,782,663

Schedule of components of impaired loans and specific valuation allowance

	December 31, 2021
	MTG WHLOC		RES RE		MF FIN		HC FIN		CML & CRE		AG & AGRE		CON & MAR		TOTAL
	(In thousands)
Impaired loans without a specific allowance:
Recorded investment	$	—	$	372	$	36,760	$	—	$	3,912	$	158	$	4	$	41,206
Unpaid principal balance		—		372		36,760		—		3,912		158		4		41,206
Impaired loans with a specific allowance:		—						—
Recorded investment		—		47		—		—		2,143		—		9		2,199
Unpaid principal balance		—		47		—		—		2,143		—		9		2,199
Specific allowance		—		16		—		—		867		—		7		890
Total impaired loans:
Recorded investment		—		419		36,760		—		6,055		158		13		43,405
Unpaid principal balance		—		419		36,760		—		6,055		158		13		43,405
Specific allowance		—		16		—		—		867		—		7		890

Schedule of average recorded investment and interest income recognized in impaired loans

	For the Three Months Ended June 30, 2021
	MTG WHLOC	RES RE		MF FIN		HC FIN		CML & CRE		AG & AGRE		CON & MAR		TOTAL
Average recorded investment in impaired loans	—	$	2,201	$	—	$	—	$	6,113	$	175	$	6	$	8,495
Interest income recognized	—		16		—		—		55		—		—		71

	For the Six Months Ended June 30, 2021
								CML &			AG &	CON &
		RES RE		MF RE				CRE			AGRE	MAR		TOTAL
Average recorded investment in impaired loans	—	$	2,442	$	—	$	—	$	7,254	$	1,000	$	7	$	10,703
Interest income recognized	—		27		—		—		259		—		—		286

Schedule of nonaccrual loans and loans past due 90 days or more and still accruing

	June 30,				December 31,
	2022				2021
			Total Loans >				Total Loans >
			90 Days &				90 Days &
	Nonaccrual		Accruing		Nonaccrual		Accruing
	(In thousands)
RES RE	$	347	$	—	$	362	$	22
CML & CRE		4,305		—		—		149
AG & AGRE		158		—		158		30
CON & MAR		3		—		4		36
	$	4,813	$	—	$	524	$	237