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Loans and Allowance for Credit Losses on Loans HFI
 12 Months Ended
Dec. 31, 2023
Receivables [Abstract]  
Loans and Allowance for Credit Losses on Loans HFI Loans and allowance for credit losses on loans HFI
Loans outstanding as of December 31, 2023 and 2022, by class of financing receivable are as follows:
December 31,
 2023 2022 
Commercial and industrial$1,720,733 $1,645,783 
Construction1,397,313 1,657,488 
Residential real estate:
1-to-4 family mortgage1,568,552 1,573,121 
Residential line of credit530,912 496,660 
Multi-family mortgage603,804 479,572 
Commercial real estate:
Owner-occupied1,232,071 1,114,580 
Non-owner occupied1,943,525 1,964,010 
Consumer and other411,873 366,998 
Gross loans9,408,783 9,298,212 
Less: Allowance for credit losses on loans HFI(150,326)(134,192)
Net loans$9,258,457 $9,164,020 
As of December 31, 2023 and 2022, $1,030,016 and $909,734, respectively, of qualifying residential mortgage loans (including loans held for sale) and $1,984,007 and $1,763,730, respectively, of qualifying commercial mortgage loans were pledged to the FHLB system securing advances against the Bank’s line of credit. Additionally, as of December 31, 2023 and 2022, qualifying commercial and industrial, construction and consumer loans, of $3,107,495 and $3,118,172, respectively, were pledged to the Federal Reserve under the Borrower-in-Custody program.
The amortized cost of loans HFI on the consolidated balance sheets exclude accrued interest receivable as the Company presents accrued interest receivable separately on the balance sheet. As of December 31, 2023 and 2022, accrued interest receivable on loans HFI amounted to $43,776 and $38,507, respectively.
Credit Quality - Commercial Type Loans
The Company categorizes commercial loan types 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. The Company analyzes loans that share similar risk characteristics collectively. Loans that do not share similar risk characteristics are evaluated individually.
The Company uses the following definitions for risk ratings:
Pass.
Loans rated Pass include those that are adequately collateralized performing loans which management believes do not have conditions that have occurred or may occur that would result in the loan being downgraded into an inferior category. The Pass category also includes commercial loans rated as Watch, which include those that management believes have conditions that have occurred, or may occur, which could result in the loan being downgraded to an inferior category.

Special Mention.
Loans rated Special Mention are those that have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution’s credit position at some future date. Management does not believe there will be a loss of principal or interest. These loans require intensive servicing and may possess more than normal credit risk.
Classified.
Loans included in the Classified category include loans rated as Substandard and Doubtful. Loans rated as Substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Substandard loans have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Also included in this category are loans classified as Doubtful, which have all the weaknesses inherent in those classified as Substandard, with the added characteristic that the weakness or weaknesses make collection or liquidation in full, based on currently existing facts, conditions, and values, highly questionable and improbable.
Risk ratings are updated on an ongoing basis and are subject to change by continuous loan monitoring processes.
The following tables present the credit quality of the Company's commercial type loan portfolio as of December 31, 2023 and 2022 and the gross charge-offs for the year ended December 31, 2023 by year of origination. Revolving loans are presented separately. Management considers the guidance in ASC 310-20 when determining whether a modification, extension, or renewal constitutes a current period origination. Generally, current period renewals of credit are reunderwritten at the point of renewal and considered current period originations for the purposes of the tables below.
Effective January 1, 2023, the Company adopted the accounting guidance in ASU 2022-02 which requires the presentation of gross charge-offs by year of origination. The Company prospectively adopted ASU 2022-02; therefore, prior period activity of gross charge-offs by year of origination are not included in the below tables.
As of and for the year
    ended December 31, 2023
20232022202120202019PriorRevolving Loans Amortized Cost BasisTotal
Commercial and industrial
Pass$225,734 $255,921 $151,492 $39,897 $70,302 $73,415 $839,918 $1,656,679 
Special Mention— 17,947 3,083 — 151 108 7,549 28,838 
Classified457 4,253 3,075 3,027 254 6,129 18,021 35,216 
Total226,191 278,121 157,650 42,924 70,707 79,652 865,488 1,720,733 
            Current-period gross
               charge-offs		14 7 201 22 — 87 131 462 
Construction
Pass179,929 677,387 148,312 46,697 39,140 49,954 208,491 1,349,910 
Special Mention1 4,659 2,943 1,202 — 690 12,000 21,495 
Classified— 2,349 1,484 6,620 — — 15,455 25,908 
Total179,930 684,395 152,739 54,519 39,140 50,644 235,946 1,397,313 
            Current-period gross
               charge-offs		— — — — — — — — 
Residential real estate:
Multi-family mortgage
Pass29,982 151,495 223,889 92,745 29,933 43,479 31,209 602,732 
Special Mention— — — — — — — — 
Classified— — — — — 1,072 — 1,072 
Total29,982 151,495 223,889 92,745 29,933 44,551 31,209 603,804 
             Current-period gross
                charge-offs		— — — — — — — — 
Commercial real estate:
Owner occupied
Pass118,030 261,196 231,241 115,397 151,146 281,253 53,970 1,212,233 
Special Mention— 1,297 1,827 — 154 2,617 — 5,895 
Classified— 6,305 16 — 760 5,789 1,073 13,943 
Total118,030 268,798 233,084 115,397 152,060 289,659 55,043 1,232,071 
            Current-period gross
              charge-offs		— — 144 — — — — 144 
Non-owner occupied
Pass47,026 474,560 478,878 117,429 178,448 580,168 43,577 1,920,086 
Special Mention— — 3,975 — — 10,435 — 14,410 
Classified— — 1,001 — 381 7,647 — 9,029 
Total47,026 474,560 483,854 117,429 178,829 598,250 43,577 1,943,525 
             Current-period gross
                charge-offs		— — — — — — — — 
Total commercial loan types
Pass600,701 1,820,559 1,233,812 412,165 468,969 1,028,269 1,177,165 6,741,640 
Special Mention1 23,903 11,828 1,202 305 13,850 19,549 70,638 
Classified457 12,907 5,576 9,647 1,395 20,637 34,549 85,168 
Total$601,159 $1,857,369 $1,251,216 $423,014 $470,669 $1,062,756 $1,231,263 $6,897,446 
            Current-period gross
                charge-offs		$14 $7 $345 $22 $— $87 $131 $606 
As of December 31, 2022
20222021202020192018PriorRevolving Loans Amortized Cost BasisTotal
Commercial and industrial
Pass$396,643 $204,000 $67,231 $90,894 $39,780 $62,816 $762,717 $1,624,081 
Special Mention125 7 — 160 143 771 2,520 3,726 
Classified65 823 1,916 1,651 273 6,913 6,335 17,976 
Total396,833 204,830 69,147 92,705 40,196 70,500 771,572 1,645,783 
Construction
Pass682,885 495,723 142,233 84,599 17,360 44,326 188,906 1,656,032 
Special Mention— — 15 — — 707 — 722 
Classified80 309 — — — 345 — 734 
Total682,965 496,032 142,248 84,599 17,360 45,378 188,906 1,657,488 
Residential real estate:
Multi-family mortgage
Pass142,912 147,168 96,819 33,547 6,971 37,385 13,604 478,406 
Special Mention— — — — — — — — 
Classified— — — — — 1,166 — 1,166 
Total142,912 147,168 96,819 33,547 6,971 38,551 13,604 479,572 
Commercial real estate:
Owner occupied
Pass237,862 223,883 110,748 148,405 66,101 246,414 57,220 1,090,633 
Special Mention101 683 — 168 2,225 1,258 5,000 9,435 
Classified— 1,293 224 4,589 1,276 7,018 112 14,512 
Total237,963 225,859 110,972 153,162 69,602 254,690 62,332 1,114,580 
Non-owner occupied
Pass467,360 440,319 131,497 159,205 210,752 473,60760,908 1,943,648 
Special Mention— — — — 82 2,459— 2,541 
Classified— 2,258 — 146 3,270 12,147— 17,821 
Total467,360 442,577 131,497 159,351 214,104 488,213 60,908 1,964,010 
Total commercial loan types
Pass1,927,662 1,511,093 548,528 516,650 340,964 864,548 1,083,355 6,792,800 
Special Mention226 690 15 328 2,450 5,195 7,520 16,424 
Classified145 4,683 2,140 6,386 4,819 27,589 6,447 52,209 
Total$1,928,033 $1,516,466 $550,683 $523,364 $348,233 $897,332 $1,097,322 $6,861,433 
Credit Quality - Consumer Type Loans
For consumer and residential loan classes, the Company primarily evaluates credit quality based on delinquency and accrual status of the loan, credit documentation and by payment activity. The performing or nonperforming status is updated on an on-going basis dependent upon improvement and deterioration in credit quality.
The following tables present the credit quality by classification (performing or nonperforming) of the Company's consumer type loan portfolio as of December 31, 2023 and 2022 and the gross charge-offs for the year ended December 31, 2023 by year of origination. Revolving loans are presented separately. Management considers the guidance in ASC 310-20 when determining whether a modification, extension, or renewal constitutes a current period origination. Generally, current period renewals of credit are reunderwritten at the point of renewal and considered current period originations for the purposes of the tables below.
Effective January 1, 2023, the Company adopted the accounting guidance in ASU 2022-02 which requires the presentation of gross charge-offs by year of origination. The Company prospectively adopted ASU 2022-02; therefore, prior period balances for gross charge-offs by year of origination are not included in the below tables.
As of and for the year
     ended December 31, 2023
20232022202120202019PriorRevolving Loans Amortized Cost BasisTotal
Residential real estate:
1-to-4 family mortgage
Performing$198,537 $500,628 $399,338 $145,484 $81,905 $226,587 $— $1,552,479 
Nonperforming76 2,565 4,026 3,846 690 4,870 — 16,073 
Total198,613 503,193 403,364 149,330 82,595 231,457 — 1,568,552 
          Current-period gross
             charge-offs		— 18 — 4 — 24 — 46 
Residential line of credit
Performing— — — — — — 528,439 528,439 
Nonperforming— — — — — — 2,473 2,473 
Total— — — — — — 530,912 530,912 
          Current-period gross
             charge-offs		— — — — — — — — 
Consumer and other
Performing104,399 91,557 45,187 34,928 24,040 93,833 6,890 400,834 
Nonperforming528 1,025 2,562 1,819 1,264 3,841 — 11,039 
       Total104,927 92,582 47,749 36,747 25,304 97,674 6,890 411,873 
           Current-period gross
             charge-offs		1,463 564 139 201 110 372 2 2,851 
Total consumer type loans
Performing302,936 592,185 444,525 180,412 105,945 320,420 535,329 2,481,752 
Nonperforming604 3,590 6,588 5,665 1,954 8,711 2,473 29,585 
        Total$303,540 $595,775 $451,113 $186,077 $107,899 $329,131 $537,802 $2,511,337 
            Current-period gross
             charge-offs		$1,463 $582 $139 $205 $110 $396 $2 $2,897 
As of December 31, 2022
20222021202020192018PriorRevolving Loans Amortized Cost BasisTotal
Residential real estate:
1-to-4 family mortgage
Performing$568,210 $448,401 $160,715 $93,548 $68,113 $211,019 $— $1,550,006 
Nonperforming1,227 5,163 5,472 1,778 2,044 7,431 — 23,115 
Total569,437 453,564 166,187 95,326 70,157 218,450 — 1,573,121 
Residential line of credit
Performing— — — — — — 495,129 495,129 
Nonperforming— — — — — — 1,531 1,531 
Total— — — — — — 496,660 496,660 
Consumer and other
Performing118,637 56,779 41,008 29,139 26,982 82,318 4,175 359,038 
Nonperforming166 1,396 1,460 906 1,507 2,525 — 7,960 
       Total118,803 58,175 42,468 30,045 28,489 84,843 4,175 366,998 
Total consumer type loans
Performing686,847 505,180 201,723 122,687 95,095 293,337 499,304 2,404,173 
Nonperforming1,393 6,559 6,932 2,684 3,551 9,956 1,531 32,606 
       Total$688,240 $511,739 $208,655 $125,371 $98,646 $303,293 $500,835 $2,436,779 
Nonaccrual and Past Due Loans
Nonperforming loans include loans that are no longer accruing interest (nonaccrual loans) and loans past due ninety or more days and still accruing interest.
The following tables represent an analysis of the aging by class of financing receivable as of December 31, 2023 and 2022:
December 31, 202330-89 days
past due and accruing
interest		90 days or 
more and accruing
interest 		Nonaccrual
loans		Loans current
on payments
and accruing
interest 		Total
Commercial and industrial$732 $— $21,730 $1,698,271 $1,720,733 
Construction6,579 165 2,872 1,387,697 1,397,313 
Residential real estate:
1-to-4 family mortgage21,768 9,355 6,718 1,530,711 1,568,552 
Residential line of credit2,464 1,337 1,136 525,975 530,912 
Multi-family mortgage— — 32 603,772 603,804 
Commercial real estate:
Owner occupied480 — 3,188 1,228,403 1,232,071 
Non-owner occupied4,059 — 3,351 1,936,115 1,943,525 
Consumer and other10,961 1,836 9,203 389,873 411,873 
Total$47,043 $12,693 $48,230 $9,300,817 $9,408,783 
 
December 31, 202230-89 days
past due and accruing
interest		90 days or 
more and accruing
interest 		Nonaccrual
loans		Loans current on payments and accruing interest Total
Commercial and industrial$1,650 $136 $1,307 $1,642,690 $1,645,783 
Construction1,246 — 389 1,655,853 1,657,488 
Residential real estate:
1-to-4 family mortgage15,470 16,639 6,476 1,534,536 1,573,121 
Residential line of credit772 131 1,400 494,357 496,660 
Multi-family mortgage— — 42 479,530 479,572 
Commercial real estate:
Owner occupied1,948 — 5,410 1,107,222 1,114,580 
Non-owner occupied102 — 5,956 1,957,952 1,964,010 
Consumer and other10,108 1,509 6,451 348,930 366,998 
Total$31,296 $18,415 $27,431 $9,221,070 $9,298,212 
The following tables provide the amortized cost basis of loans on nonaccrual status, as well as any related allowance and interest income as of and for the years ended December 31, 2023 and 2022 by class of financing receivable.
December 31, 2023Nonaccrual
with no
related
allowance		Nonaccrual
with
related
allowance		Related
allowance		Year to date Interest Income
Commercial and industrial$3,678 $18,052 $5,011 $2,451 
Construction2,267 605 59 335 
Residential real estate:
1-to-4 family mortgage1,444 5,274 103 410 
Residential line of credit685 451 8 141 
Multi-family mortgage— 32 1 3 
Commercial real estate:
Owner occupied2,920 268 15 514 
Non-owner occupied3,316 35 1 1,221 
Consumer and other— 9,203 498 1,053 
Total$14,310 $33,920 $5,696 $6,128 
December 31, 2022
Nonaccrual
with no
related
allowance		Nonaccrual
with
related
allowance		Related
allowance		Year to date Interest Income
Commercial and industrial$790 $517 $10 $181 
Construction— 389 7 28 
Residential real estate:
1-to-4 family mortgage2,834 3,642 78 274 
Residential line of credit1,134 266 4 136 
Multi-family mortgage1 41 1 3 
Commercial real estate:
Owner occupied5,200 210 1 232 
Non-owner occupied5,755 201 5 332 
Consumer and other— 6,451 327 358 
Total$15,714 $11,717 $433 $1,544 
Accrued interest receivable written off as an adjustment to interest income amounted to $1,094, $1,089, and $804 for the years ended December 31, 2023, 2022, and 2021, respectively.
Loan Modifications to Borrowers Experiencing Financial Difficulty
Occasionally, the Company may make certain modifications of loans to borrowers experiencing financial difficulty. These modifications may be in the form of an interest rate reduction, a term extension or a combination thereof. Upon the Company's determination that a modified loan has subsequently been deemed uncollectible, the portion of the loan deemed uncollectible is charged off against the allowance for credit losses on loans HFI. The Company closely monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts.
During the year ended December 31, 2023, the Company modified three residential mortgage loans with balances totaling $160 and one commercial and industrial loan with a balance of $181 in the form of term extensions for borrowers experiencing financial difficulties.
Troubled Debt Restructurings
The following disclosure is presented in accordance with GAAP in effect prior to the adoption of ASU 2022-02. The Company has included this disclosure as of December 31, 2022 or for the years ended December 31, 2022 and 2021.
Prior to the Company's adoption, the Company accounted for a modification to the contractual terms of a loan that resulted in granting a concession to a borrower experiencing financial difficulties as a TDR. The standard eliminated TDR accounting prospectively for all restructurings occurring on or after January 1, 2023. Loans that were restructured in a TDR prior to the Company's adoption will continue to be accounted for under the historical TDR accounting until the loan is paid off, liquidated or subsequently modified. See Note 1, “Basis of presentation” for more information on the Company's adoption of ASU 2022-02.
The following table presents the financial effect of TDRs recorded during the periods indicated:
Year Ended December 31, 2022Number of loansPre-modification outstanding recorded investment Post-modification outstanding recorded investment Charge offs and specific reserves
Commercial and industrial3 $612 $522 $— 
Commercial real estate:
Residential real estate:
1-to-4 family mortgage3 391 707 — 
Residential line of credit1 49 49 — 
Consumer and other2 23 23 — 
Total9 $1,075 $1,301 $— 
Year Ended December 31, 2021Number of loansPre-modification outstanding recorded investmentPost-modification outstanding recorded investmentCharge offs and specific reserves
Commercial and industrial8 $15,430 $15,430 $446 
Construction— — — — 
Commercial real estate:
Owner occupied7 5,209 5,209 — 
Non-owner occupied1 11,997 11,997 — 
Residential real estate:
1-to-4 family mortgage3 945 945 — 
Residential line of credit3 485 485 — 
Multi-family mortgage1 49 49 — 
Total23 $34,115 $34,115 $446 
Troubled debt restructurings for which there was a payment default within twelve months following the modification totaled $304 during both the years ended December 31, 2022 and 2021. A loan is considered to be in payment default once it is 90 days contractually past due under the modified terms.
Collateral-Dependent Loans
For loans for which the repayment (based on the Company's assessment) is expected to be provided substantially through the operation or sale of collateral and the borrower is experiencing financial difficulty, the following tables present the loans and the corresponding individually assessed allowance for credit losses by class of financing receivable. Significant changes in individually assessed reserves are due to changes in the valuation of the underlying collateral in addition to changes in accrual and past due status.
December 31, 2023
Type of Collateral
Real EstateFarmlandBusiness AssetsTotalIndividually assessed allowance for credit loss
Commercial and industrial$— $363 $20,599 $20,962 $4,946 
Construction8,224 — — 8,224 30 
Residential real estate:
1-to-4 family mortgage5,317 — — 5,317 129 
Residential line of credit1,245 — — 1,245 10 
Commercial real estate:
Owner occupied1,975 1,160 — 3,135 — 
Non-owner occupied3,316 — — 3,316 — 
Consumer and other112 — — 112 21 
Total$20,189 $1,523 $20,599 $42,311 $5,136 
December 31, 2022
Type of Collateral
Real EstateBusiness AssetsTotalIndividually assessed allowance for credit loss
Commercial and industrial$2,596 $— $2,596 $— 
Residential real estate:
1-to-4 family mortgage4,467 — 4,467 194 
Residential line of credit1,135 — 1,135 — 
Commercial real estate:
Owner occupied5,424 — 5,424 — 
Non-owner occupied5,755 — 5,755 — 
Consumer and other134 — 134 — 
Total$19,511 $— $19,511 $194