Loans and Allowance for Credit Losses on Loans (Tables)

3 Months Ended

Mar. 31, 2023

Loans and Allowance for Credit Losses on Loans

Summary of loans

	March 31,		December 31,
	2023		2022
	(In thousands)
Mortgage warehouse lines of credit	$	604,445	$	464,785
Residential real estate		1,215,252		1,178,401
Multi-family financing		3,566,530		3,135,535
Healthcare financing		1,941,204		1,604,341
Commercial and commercial real estate(1)(2)		1,194,320		978,661
Agricultural production and real estate		89,516		95,651
Consumer and margin loans		15,781		13,498
		8,627,048		7,470,872
Less:
ACL-Loans		51,838		44,014
Loans Receivable	$	8,575,210	$	7,426,858

(1) Includes $672.9 million and $497.0 million of revolving lines of credit collateralized primarily by single-family mortgage servicing rights as of March 31, 2023 and December 31, 2022, respectively.

(2) Includes only $9.1 million of non-owner occupied commercial real estate as of March 31, 2023 and included only $12.8 million as of December 31, 2022.

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

Loan Portfolio Segment	ACL-Loans Methodology
Mortgage warehouse lines of credit	Remaining Life Method
Residential real estate	Discounted Cash Flow
Multi-family financing	Discounted Cash Flow
Healthcare financing	Discounted Cash Flow
Commercial and commercial real estate	Discounted Cash Flow
Agricultural production and real estate	Remaining Life Method
Consumer and margin loans	Remaining Life Method

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

	For the Three Months Ended March 31, 2023
	MTG WHLOC		RES RE		MF FIN		HC FIN		CML & CRE		AG & AGRE		CON & MAR		TOTAL
	(In thousands)
ACL-Loans
Balance, beginning of period	$	1,249	$	7,029	$	16,781	$	9,882	$	8,326	$	565	$	182	$	44,014
Provision for credit losses		415		349		3,070		1,871		2,149		(22)		(15)		7,817
Loans charged to the allowance		—		—		—		—		—		—		—		—
Recoveries of loans previously charged off		—		—		—		—		7		—		—		7
Balance, end of period	$	1,664	$	7,378	$	19,851	$	11,753	$	10,482	$	543	$	167	$	51,838

	For the Three Months Ended March 31, 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		(55)		102		527		1,018		431		(42)		—		1,981
Loans charged to the allowance		—		—		—		—		(931)		—		—		(931)
Recoveries of loans previously charged off		—		—		—		—		—		—		7		7
Balance, end of period	$	1,941	$	4,547	$	15,131	$	5,618	$	4,102	$	597	$	166	$	32,102

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

	December 31, 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		(747)		2,588		2,177		5,282		4,216		(74)		31		13,473
Loans charged to the allowance		—		(4)		—		—		(1,238)		—		(15)		(1,257)
Recoveries of loans previously charged off		—		—		—		—		746		—		7		753
Balance, end of period	$	1,249	$	7,029	$	16,781	$	9,882	$	8,326	$	565	$	182	$	44,014

Schedule of allowance for credit loss allocated to collateral dependent loans

The below table presents the amortized cost basis and ACL-Loans allocated for collateral dependent loans, which are individually evaluated to determine expected credit losses:

	March 31, 2023
	Real Estate		Accounts Receivable / Equipment		Other		Total		ACL-Loans Allocation
	(In thousands)
RES RE	$	231	$	—	$	9	$	240	$	38
MF FIN		36,760		—		—		36,760		184
HC FIN		21,783		—		—		21,783		132
CML & CRE		—		4,986		1,493		6,479		1,381
AG & AGRE		147		—		—		147		1
CON & MAR		—		—		5		5		—
Total collateral dependent loans	$	58,921	$	4,986	$	1,507	$	65,414	$	1,736

Schedule of credit risk profile of loan portfolio

The following tables present the credit risk profile of the Company’s loan portfolio based on internal risk rating category as of March 31, 2023 and December 31, 2022:

	As of March 31, 2023
	2023		2022		2021		2020		2019		Prior		Revolving Loans		TOTAL
	(In thousands)
MTG WHLOC
Pass	$	—	$	—	$	—	$	—	$	—	$	—	$	604,445	$	604,445
Total	$	—	$	—	$	—	$	—	$	—	$	—	$	604,445	$	604,445
RES RE
Pass		3,207		13,097		8,339		24,856		3,475		12,867		1,148,709		1,214,550
Special Mention (Watch)		—		—		—		—		60		402		—		462
Substandard		—		—		—		—		—		240		—		240
Total	$	3,207	$	13,097	$	8,339	$	24,856	$	3,535	$	13,509	$	1,148,709	$	1,215,252
MF FIN
Pass		382,298		1,221,448		494,235		156,813		32,201		11,347		1,159,249		3,457,591
Special Mention (Watch)		—		32,807		16,379		8,000		—		—		14,993		72,179
Substandard		—		36,760		—		—		—		—		—		36,760
Total	$	382,298	$	1,291,015	$	510,614	$	164,813	$	32,201	$	11,347	$	1,174,242	$	3,566,530
HC FIN
Pass		93,837		1,176,484		265,032		79,805		13,682		—		207,521		1,836,361
Special Mention (Watch)		22,709		22,437		29,014		—		—		—		8,900		83,060
Substandard		—		—		21,783		—		—		—		—		21,783
Total	$	116,546	$	1,198,921	$	315,829	$	79,805	$	13,682	$	—	$	216,421	$	1,941,204
CML & CRE
Pass		23,150		130,905		85,065		22,411		22,109		19,553		881,494		1,184,687
Special Mention (Watch)		17		41		473		1,103		116		323		1,081		3,154
Substandard		—		496		2,057		586		70		632		2,638		6,479
Total	$	23,167	$	131,442	$	87,595	$	24,100	$	22,295	$	20,508	$	885,213	$	1,194,320
AG & AGRE
Pass		4,439		11,116		7,163		15,049		5,675		20,352		24,124		87,918
Special Mention (Watch)		—		14		54		462		344		551		26		1,451
Substandard		—		—		—		—		—		147		—		147
Total	$	4,439	$	11,130	$	7,217	$	15,511	$	6,019	$	21,050	$	24,150	$	89,516
CON & MAR
Pass		137		4,570		403		220		62		4,502		5,861		15,755
Special Mention (Watch)		—		—		—		19		—		2		—		21
Substandard		—		—		—		—		—		5		—		5
Total	$	137	$	4,570	$	403	$	239	$	62	$	4,509	$	5,861	$	15,781
Total Pass	$	507,068	$	2,557,620	$	860,237	$	299,154	$	77,204	$	68,621	$	4,031,403	$	8,401,307
Total Special Mention (Watch)	$	22,726	$	55,299	$	45,920	$	9,584	$	520	$	1,278	$	25,000	$	160,327
Total Substandard	$	—	$	37,256	$	23,840	$	586	$	70	$	1,024	$	2,638	$	65,414
Total Loans	$	529,794	$	2,650,175	$	929,997	$	309,324	$	77,794	$	70,923	$	4,059,041	$	8,627,048
Total Charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

	December 31, 2022
	2022		2021		2020		2019		2018		Prior		Revolving Loans		TOTAL
	(In thousands)
MTG WHLOC
Pass	$	—	$	—	$	—	$	—	$	—	$	—	$	464,785	$	464,785
Total	$	—	$	—	$	—	$	—	$	—	$	—	$	464,785	$	464,785
RES RE
Pass		13,344		8,192		24,708		3,498		1,722		11,166		1,114,705		1,177,335
Special Mention (Watch)		—		—		—		61		—		668		91		820
Substandard		—		—		—		—		74		172		—		246
Total	$	13,344	$	8,192	$	24,708	$	3,559	$	1,796	$	12,006	$	1,114,796	$	1,178,401
MF FIN
Pass		1,212,008		544,823		200,829		32,349		4,416		7,229		1,042,024		3,043,678
Special Mention (Watch)		32,919		—		8,000		—		—		—		14,178		55,097
Substandard		36,760		—		—		—		—		—		—		36,760
Total	$	1,281,687	$	544,823	$	208,829	$	32,349	$	4,416	$	7,229	$	1,056,202	$	3,135,535
HC FIN
Pass		987,676		301,103		78,792		13,770		—		—		123,888		1,505,229
Special Mention (Watch)		52,022		25,307		—		—		—		—		—		77,329
Substandard		—		21,783		—		—		—		—		—		21,783
Total	$	1,039,698	$	348,193	$	78,792	$	13,770	$	—	$	—	$	123,888	$	1,604,341
CML & CRE
Pass		123,757		86,282		23,803		24,730		12,335		8,765		690,114		969,786
Special Mention (Watch)		43		164		963		119		99		228		1,376		2,992
Substandard		—		2,017		591		72		—		666		2,537		5,883
Total	$	123,800	$	88,463	$	25,357	$	24,921	$	12,434	$	9,659	$	694,027	$	978,661
AG & AGRE
Pass		12,112		7,485		15,660		5,808		3,137		20,176		29,566		93,944
Special Mention (Watch)		14		55		462		421		163		389		56		1,560
Substandard		—		—		—		—		—		147		—		147
Total	$	12,126	$	7,540	$	16,122	$	6,229	$	3,300	$	20,712	$	29,622	$	95,651
CON & MAR
Pass		4,673		463		307		101		4,589		9		3,328		13,470
Special Mention (Watch)		—		—		20		—		—		2		—		22
Substandard		—		—		—		—		—		6		—		6
Total	$	4,673	$	463	$	327	$	101	$	4,589	$	17	$	3,328	$	13,498
Total Pass	$	2,353,570	$	948,348	$	344,099	$	80,256	$	26,199	$	47,345	$	3,468,410	$	7,268,227
Total Special Mention (Watch)	$	84,998	$	25,526	$	9,445	$	601	$	262	$	1,287	$	15,701	$	137,820
Total Substandard	$	36,760	$	23,800	$	591	$	72	$	74	$	991	$	2,537	$	64,825
Total Loans	$	2,475,328	$	997,674	$	354,135	$	80,929	$	26,535	$	49,623	$	3,486,648	$	7,470,872

Schedule of aging analysis of the recorded investment in loans

	March 31, 2023
	30-59 Days		60-89 Days		Greater Than		Total				Total
	Past Due		Past Due		90 Days		Past Due		Current		Loans
	(In thousands)
MTG WHLOC	$	—	$	—	$	—	$	—	$	604,445	$	604,445
RES RE		2,573		2,409		918		5,900		1,209,352		1,215,252
MF FIN		—		12,975		36,760		49,735		3,516,795		3,566,530
HC FIN		—		—		21,783		21,783		1,919,421		1,941,204
CML & CRE		209		495		3,778		4,482		1,189,838		1,194,320
AG & AGRE		236		43		1,242		1,521		87,995		89,516
CON & MAR		47		1		22		70		15,711		15,781
	$	3,065	$	15,923	$	64,503	$	83,491	$	8,543,557	$	8,627,048

	December 31, 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	$	—	$	—	$	—	$	—	$	464,785	$	464,785
RES RE		4,053		152		272		4,477		1,173,924		1,178,401
MF FIN		—		—		—		—		3,135,535		3,135,535
HC FIN		—		—		21,783		21,783		1,582,558		1,604,341
CML & CRE		4,759		—		3,778		8,537		970,124		978,661
AG & AGRE		4,903		—		—		4,903		90,748		95,651
CON & MAR		6		24		22		52		13,446		13,498
	$	13,721	$	176	$	25,855	$	39,752	$	7,431,120	$	7,470,872

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

	March 31,				December 31,
	2023				2022
			Total Loans >				Total Loans >
			90 Days &				90 Days &
	Nonaccrual		Accruing		Nonaccrual		Accruing
	(In thousands)
RES RE	$	240	$	741	$	245	$	96
MF FIN		36,760		—		—		—
HC FIN		21,783		—		21,783		—
CML & CRE		4,357		—		4,390		—
AG & AGRE		147		1,242		147		—
CON & MAR		5		17		6		16
	$	63,292	$	2,000	$	26,571	$	112

Schedule of Company's modified loans

	For the Three Months Ended March 31, 2023
	Principal Forgiveness		Payment Delay		Term Extension		Interest Rate Reduction		Combination Term Extension and Principal Forgiveness		Combination Term Extension Interest Rate Reduction		Total Class of Financing Receivable
	(In thousands)
Commercial and commercial real estate	$	—	$	4,357	$	—	$	—	$	—	$	—		—	%
Total	$	—	$	4,357	$	—	$	—	$	—	$	—		—	%