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Loans And Allowance For Credit Losses
 3 Months Ended
Mar. 31, 2024
Receivables [Abstract]  
Financing Receivables Loans and Allowance for Credit Losses
Major classifications within the Company’s held for investment loan portfolio at March 31, 2024 and December 31, 2023 are as follows:

(In thousands)
March 31, 2024December 31, 2023
Commercial:
Business$5,994,974 $6,019,036 
Real estate – construction and land1,497,647 1,446,764 
Real estate – business3,711,602 3,719,306 
Personal Banking:
Real estate – personal3,039,885 3,026,041 
Consumer2,119,308 2,077,723 
Revolving home equity322,523 319,894 
Consumer credit card564,388 589,913 
Overdrafts48,513 6,802 
Total loans$17,298,840 $17,205,479 

Accrued interest receivable totaled $72.8 million and $71.9 million at March 31, 2024 and December 31, 2023, respectively, and was included within other assets on the consolidated balance sheets. For the three months ended March 31, 2024, the Company wrote-off accrued interest by reversing interest income of $94 thousand and $1.6 million in the Commercial and Personal Banking portfolios, respectively. Similarly, for the three months ended March 31, 2023, the Company reversed interest income of $34 thousand and $1.1 million in the Commercial and Personal Banking portfolios, respectively.

At March 31, 2024, loans of $3.6 billion were pledged at the Federal Home Loan Bank as collateral for borrowings and letters of credit obtained to secure public deposits. Additional loans of $2.9 billion were pledged at the Federal Reserve Bank as collateral for discount window borrowings.
Allowance for credit losses
The allowance for credit losses is measured using an average historical loss model which incorporates relevant information about past events (including historical credit loss experience on loans with similar risk characteristics), current conditions, and reasonable and supportable forecasts that affect the collectability of the remaining cash flows over the contractual term of the loans. The allowance for credit losses is measured on a collective (pool) basis. Loans are aggregated into pools based on similar risk characteristics including borrower type, collateral type and expected credit loss patterns. Loans that do not share similar risk characteristics, primarily large loans on non-accrual status, are evaluated on an individual basis.

For loans evaluated for credit losses on a collective basis, average historical loss rates are calculated for each pool using the Company’s historical net charge-offs (combined charge-offs and recoveries by observable historical reporting period) and outstanding loan balances during a lookback period. Lookback periods can be different based on the individual pool and represent management’s credit expectations for the pool of loans over the remaining contractual life. In certain loan pools, if the Company’s own historical loss rate is not reflective of the loss expectations, the historical loss rate is augmented by industry and peer data. The calculated average net charge-off rate is then adjusted for current conditions and reasonable and supportable forecasts. These adjustments increase or decrease the average historical loss rate to reflect expectations of future losses given a single path economic forecast of key macroeconomic variables including GDP, disposable income, various interest rates, unemployment rate, consumer price index (CPI) inflation rate, housing price index (HPI), commercial real estate price index (CREPI) and market volatility. The adjustments are based on results from various regression models projecting the impact of the macroeconomic variables to loss rates. The forecast is used for a reasonable and supportable period before reverting back to historical averages using a straight-line method. The forecast-adjusted loss rate is applied to the amortized cost of loans over the remaining contractual lives, adjusted for expected prepayments. The contractual term excludes expected extensions (except for contractual extensions at the option of the customer), renewals and modifications. Credit cards and certain similar consumer lines of credit do not have stated maturities and therefore, for these loan classes, remaining contractual lives are determined by estimating future cash flows expected to be received from customers until payments have been fully allocated to outstanding balances. Additionally, the allowance for credit losses considers other qualitative factors not included in historical loss rates or macroeconomic forecast such as changes in portfolio composition, underwriting practices, or significant unique events or conditions.
Key assumptions in the Company’s allowance for credit loss model include the economic forecast, the reasonable and supportable period, forecasted macro-economic variables, prepayment assumptions and qualitative factors applied for portfolio composition changes, underwriting practices, or significant unique events or conditions. The assumptions utilized in estimating the Company’s allowance for credit losses at March 31, 2024 and December 31, 2023 are discussed below.

Key AssumptionMarch 31, 2024December 31, 2023
Overall economic forecast
•Economic strength is visible in the strong labor market
•Fiscal policy is forecasted to be a modest drag on GDP
•There are expectations that the Federal Reserve will start cutting rates in 2nd quarter 2024

•The US economy is projected to slow at the start of 2024, but not enter a recession
•Impacts of tighter monetary and fiscal policy creates uncertainty
•Consumer spending is expected to decrease
Reasonable and supportable period and related reversion period
•Reasonable and supportable period of one year
•Reversion to historical average loss rates within two quarters using a straight-line method
•Reasonable and supportable period of one year
•Reversion to historical average loss rates within two quarters using a straight-line method
Forecasted macro-economic variables
•Unemployment rate ranges from 3.9% to 4.1% during the reasonable and supportable forecast period
•Real GDP growth ranges from 1.5% to 3.0%
•BBB corporate yield from 4.7% to 5.1%
•Housing Price Index from 312.1 to 316.6
•Unemployment rate ranges from 4.1% to 4.5% during the reasonable and supportable forecast period
•Real GDP growth ranges from .46% to 2.1%
•BBB corporate yield from 5.3% to 5.9%
•Housing Price Index from 305.4 to 307.4
Prepayment assumptions
Commercial loans
•pools ranging from 0% to 5%
Personal banking loans
•Ranging from 6.2% to 21.6% for most loan pools
•Consumer credit cards 66.6%
Commercial loans
•5% for most loan pools
Personal banking loans
•Ranging from 6.5% to 23.5% for most loan pools
•Consumer credit cards 66.9%
Qualitative factors
Added qualitative factors related to:
•Changes in the composition of the loan portfolios
•Certain stressed industries within the portfolio
•Certain portfolios sensitive to unusually high rate of inflation and supply chain issues
•Loans downgraded to special mention, substandard, or non-accrual status
•Certain portfolios where the model assumptions do not capture all identified loss risk
Added qualitative factors related to:
•Changes in the composition of the loan portfolios
•Certain stressed industries within the portfolio
•Certain portfolios sensitive to unusually high rate of inflation and supply chain issues
•Loans downgraded to special mention, substandard, or non-accrual status

The liability for unfunded lending commitments utilizes the same model as the allowance for credit losses on loans, however, the liability for unfunded lending commitments incorporates an assumption for the portion of unfunded commitments that are expected to be funded.

Sensitivity in the Allowance for Credit Loss model
The allowance for credit losses is an estimate that requires significant judgment including projections of the macro-economic environment. The forecasted macro-economic environment continuously changes which can cause fluctuations in the estimate of expected credit losses.

The current forecast projects low unemployment and positive GDP. It is expected the Federal Reserve will start cutting rates in the 2nd quarter of 2024.

Updated information on inflation and labor market trends could impact the Federal Reserve's decision on the timing and degree of rate reductions. The market's response to these events along with other economic, political, and social developments regionally, nationally, and even globally could significantly modify economic projections used in the estimation of the allowance for credit losses.
Potential changes in any one economic variable may or may not affect the overall allowance because a variety of economic variables and inputs are considered in estimating the allowance, and changes in those variables and inputs may not occur at the same rate, may not be consistent across product types, and may have offsetting impacts to other changing variables and inputs.

A summary of the activity in the allowance for credit losses on loans and the liability for unfunded lending commitments for the three months ended March 31, 2024 and 2023, respectively, follows:

For the Three Months Ended March 31, 2024
(In thousands)CommercialPersonal Banking

Total
ALLOWANCE FOR CREDIT LOSSES ON LOANS
Balance at beginning of period$108,201 $54,194 $162,395 
Provision for credit losses on loans(2,855)9,802 6,947 
Deductions:
   Loans charged off316 10,849 11,165 
   Less recoveries on loans434 1,854 2,288 
Net loan charge-offs (recoveries)(118)8,995 8,877 
Balance March 31, 2024$105,464 $55,001 $160,465 
LIABILITY FOR UNFUNDED LENDING COMMITMENTS
Balance at beginning of period$23,909 $1,337 $25,246 
Provision for credit losses on unfunded lending commitments(2,273)113 (2,160)
Balance March 31, 2024$21,636 $1,450 $23,086 
ALLOWANCE FOR CREDIT LOSSES ON LOANS AND LIABILITY FOR UNFUNDED LENDING COMMITMENTS$127,100 $56,451 $183,551 

For the Three Months Ended March 31, 2023
(In thousands)CommercialPersonal Banking

Total
ALLOWANCE FOR CREDIT LOSSES ON LOANS
Balance at beginning of period$103,293 $46,843 $150,136 
Provision for credit losses on loans5,548 10,400 15,948 
Deductions:
   Loans charged off292 8,756 9,048 
   Less recoveries on loans66 2,215 2,281 
Net loan charge-offs (recoveries)226 6,541 6,767 
Balance March 31, 2023$108,615 $50,702 $159,317 
LIABILITY FOR UNFUNDED LENDING COMMITMENTS
Balance at beginning of period$31,743 $1,377 $33,120 
Provision for credit losses on unfunded lending commitments(4,638)146 (4,492)
Balance March 31, 2023$27,105 $1,523 $28,628 
ALLOWANCE FOR CREDIT LOSSES ON LOANS AND LIABILITY FOR UNFUNDED LENDING COMMITMENTS$135,720 $52,225 $187,945 
Delinquent and non-accrual loans
The Company considers loans past due on the day following the contractual repayment date, if the contractual repayment was not received by the Company as of the end of the business day. The following table provides aging information on the Company’s past due and accruing loans, in addition to the balances of loans on non-accrual status, at March 31, 2024 and December 31, 2023.




(In thousands)
Current or Less Than 30 Days Past Due

30 – 89
Days Past Due
90 Days Past Due and Still AccruingNon-accrual



Total
March 31, 2024
Commercial:
Business$5,991,756 $1,644 $536 $1,038 $5,994,974 
Real estate – construction and land1,497,325 322 — — 1,497,647 
Real estate – business3,710,321 35 — 1,246 3,711,602 
Personal Banking:
Real estate – personal 3,015,760 13,911 8,691 1,523 3,039,885 
Consumer2,094,997 21,409 2,902 — 2,119,308 
Revolving home equity318,682 1,432 432 1,977 322,523 
Consumer credit card549,407 7,261 7,720 — 564,388 
Overdrafts48,282 231 — — 48,513 
Total $17,226,530 $46,245 $20,281 $5,784 $17,298,840 
December 31, 2023
Commercial:
Business$5,985,713 $29,087 $614 $3,622 $6,019,036 
Real estate – construction and land1,446,764 — — — 1,446,764 
Real estate – business3,714,579 4,582 85 60 3,719,306 
Personal Banking:
Real estate – personal 2,999,988 14,841 9,559 1,653 3,026,041 
Consumer2,036,353 38,217 3,153 — 2,077,723 
Revolving home equity315,483 1,564 870 1,977 319,894 
Consumer credit card574,805 7,525 7,583 — 589,913 
Overdrafts6,553 249 — — 6,802 
Total $17,080,238 $96,065 $21,864 $7,312 $17,205,479 

At March 31, 2024, the Company had $3.7 million in non-accrual loans that had no allowance for credit loss, compared to $4.3 million in non-accrual loans that had no allowance for credit loss at December 31, 2023. The Company did not record any interest income on non-accrual loans during the three months ended March 31, 2024 and 2023, respectively.

Credit quality indicators
The following table provides information about the credit quality of the Commercial loan portfolio. The Company utilizes an internal risk rating system comprised of a series of grades to categorize loans according to perceived risk associated with the expectation of debt repayment based on borrower specific information including, but not limited to, current financial information, historical payment experience, industry information, collateral levels and collateral types. The “pass” category consists of a range of loan grades that reflect increasing, though still acceptable, risk. A loan is assigned the risk rating at origination and then monitored throughout the contractual term for possible risk rating changes. Movement of risk through the various grade levels in the “pass” category is monitored for early identification of credit deterioration. The “special mention” rating is applied to loans where the borrower exhibits negative financial trends due to borrower specific or systemic conditions that, if left uncorrected, threaten its capacity to meet its debt obligations. The borrower is believed to have sufficient financial flexibility to react to and resolve its negative financial situation. It is a transitional grade that is closely monitored for improvement or deterioration. The “substandard” rating is applied to loans where the borrower exhibits well-defined weaknesses that jeopardize its continued performance and are of a severity that the distinct possibility of default exists. Loans are placed on “non-accrual” when management does not expect to collect payments consistent with acceptable and agreed upon terms of repayment.

All loans are analyzed for risk rating updates annually. For larger loans, rating assessments may be more frequent if relevant information is obtained earlier through debt covenant monitoring or overall relationship management. Smaller loans are monitored as identified by the loan officer based on the risk profile of the individual borrower or if the loan becomes past
due related to credit issues. Loans rated Special Mention, Substandard or Non-accrual are subject to quarterly review and monitoring processes. In addition to the regular monitoring performed by the lending personnel and credit committees, loans are subject to review by a credit review department which verifies the appropriateness of the risk ratings for the loans chosen as part of its risk-based review plan.

The risk category of loans in the Commercial portfolio as of March 31, 2024 and December 31, 2023 are as follows:

Term Loans Amortized Cost Basis by Origination Year
(In thousands)20242023202220212020PriorRevolving Loans Amortized Cost BasisTotal
March 31, 2024
Business
    Risk Rating:
       Pass$344,128 $1,385,556 $790,788 $506,163 $219,920 $443,229 $2,088,966 $5,778,750 
       Special mention4,215 8,618 3,448 33,270 531 2,494 34,499 87,075 
       Substandard35 16,793 15,722 8,131 20,194 10,792 56,444 128,111 
       Non-accrual— 48 108 27 — 855 — 1,038 
   Total Business:$348,378 $1,411,015 $810,066 $547,591 $240,645 $457,370 $2,179,909 $5,994,974 
Gross write-offs for the three months ended March 31, 2024
$— $— $— $— $— $— $316 $316 
Real estate-construction
    Risk Rating:
       Pass$148,846 $421,041 $578,146 $248,045 $44,049 $3,224 $36,498 $1,479,849 
       Special mention582 — — — — — — 582 
       Substandard— — 17,216 — — — — 17,216 
    Total Real estate-construction:$149,428 $421,041 $595,362 $248,045 $44,049 $3,224 $36,498 $1,497,647 
Gross write-offs for the three months ended March 31, 2024
$— $— $— $— $— $— $— $— 
Real estate-business
    Risk Rating:
       Pass$125,646 $731,463 $1,007,351 $495,444 $436,286 $582,000 $120,880 $3,499,070 
       Special mention1,000 35,879 27,599 14,696 1,094 10,356 — 90,624 
       Substandard— 4,744 15,342 15,088 16,161 69,327 — 120,662 
       Non-accrual— — 1,204 — — 42 — 1,246 
   Total Real estate-business:$126,646 $772,086 $1,051,496 $525,228 $453,541 $661,725 $120,880 $3,711,602 
Gross write-offs for the three months ended March 31, 2024
$— $— $— $— $— $— $— $— 
Commercial loans
    Risk Rating:
       Pass$618,620 $2,538,060 $2,376,285 $1,249,652 $700,255 $1,028,453 $2,246,344 $10,757,669 
       Special mention5,797 44,497 31,047 47,966 1,625 12,850 34,499 178,281 
       Substandard35 21,537 48,280 23,219 36,355 80,119 56,444 265,989 
       Non-accrual— 48 1,312 27 — 897 — 2,284 
   Total Commercial loans:$624,452 $2,604,142 $2,456,924 $1,320,864 $738,235 $1,122,319 $2,337,287 $11,204,223 
Gross write-offs for the three months ended March 31, 2024
$— $— $— $— $— $— $316 $316 
Term Loans Amortized Cost Basis by Origination Year
(In thousands)20232022202120202019PriorRevolving Loans Amortized Cost BasisTotal
December 31, 2023
Business
    Risk Rating:
       Pass$1,609,685 $839,511 $555,991 $273,138 $215,988 $257,177 $2,096,108 $5,847,598 
       Special mention19,639 3,412 19,489 643 412 2,485 43,054 89,134 
       Substandard5,256 8,666 6,891 20,854 1,422 10,235 25,358 78,682 
       Non-accrual— 130 1,184 — — 2,308 — 3,622 
   Total Business:$1,634,580 $851,719 $583,555 $294,635 $217,822 $272,205 $2,164,520 $6,019,036 
Gross write-offs for the year ended December 31, 2023$— $2,260 $57 $41 $— $— $1,393 $3,751 
Real estate-construction
    Risk Rating:
       Pass$476,489 $579,933 $295,841 $41,418 $498 $2,834 $31,670 $1,428,683 
       Special mention3,068 15,013 — — — — — 18,081 
    Total Real estate-construction:$479,557 $594,946 $295,841 $41,418 $498 $2,834 $31,670 $1,446,764 
Gross write-offs for the year ended December 31, 2023$— $— $— $— $— $— $— $— 
Real estate- business
    Risk Rating:
       Pass$807,631 $1,063,189 $510,397 $433,030 $311,457 $325,738 $94,432 $3,545,874 
       Special mention16,650 8,619 451 884 9,253 733 — 36,590 
       Substandard2,952 18,463 27,914 17,430 11,636 58,387 — 136,782 
       Non-accrual— — — — — 60 — 60 
   Total Real-estate business:$827,233 $1,090,271 $538,762 $451,344 $332,346 $384,918 $94,432 $3,719,306 
Gross write-offs for the year ended December 31, 2023$— $— $— $— $— $134 $— $134 
Commercial loans
    Risk Rating:
       Pass$2,893,805 $2,482,633 $1,362,229 $747,586 $527,943 $585,749 $2,222,210 $10,822,155 
       Special mention39,357 27,044 19,940 1,527 9,665 3,218 43,054 143,805 
       Substandard8,208 27,129 34,805 38,284 13,058 68,622 25,358 215,464 
       Non-accrual— 130 1,184 — — 2,368 — 3,682 
   Total Commercial loans:$2,941,370 $2,536,936 $1,418,158 $787,397 $550,666 $659,957 $2,290,622 $11,185,106 
Gross write-offs for the year ended December 31, 2023$— $2,260 $57 $41 $— $134 $1,393 $3,885 
The credit quality of Personal Banking loans is monitored primarily on the basis of aging/delinquency, and this information is provided as of March 31, 2024 and December 31, 2023 below.

Term Loans Amortized Cost Basis by Origination Year
(In thousands)20242023202220212020PriorRevolving Loans Amortized Cost BasisTotal
March 31, 2024
Real estate-personal
       Current to 90 days past due$91,591 $438,966 $443,124 $526,377 $695,433 $825,842 $8,338 $3,029,671 
       Over 90 days past due2,129 353 1,263 1,394 1,387 2,165 — 8,691 
       Non-accrual— — 227 167 — 1,129 — 1,523 
   Total Real estate-personal:$93,720 $439,319 $444,614 $527,938 $696,820 $829,136 $8,338 $3,039,885 
Gross write-offs for the three months ended March 31, 2024
$— $— $33 $— $— $3 $— $36 
Consumer
       Current to 90 days past due$134,876 $478,401 $310,901 $231,786 $110,884 $91,872 $757,686 $2,116,406 
       Over 90 days past due— 255 410 196 79 647 1,315 2,902 
    Total Consumer:$134,876 $478,656 $311,311 $231,982 $110,963 $92,519 $759,001 $2,119,308 
Gross write-offs for the three months ended March 31, 2024
$— $563 $521 $438 $135 $126 $695 $2,478 
Revolving home equity
       Current to 90 days past due$— $— $— $— $— $— $320,114 $320,114 
       Over 90 days past due— — — — — — 432 432 
       Non-accrual— — — — — — 1,977 $1,977 
   Total Revolving home equity:$— $— $— $— $— $— $322,523 $322,523 
Gross write-offs for the three months ended March 31, 2024
$— $— $— $— $— $— $— $— 
Consumer credit card
       Current to 90 days past due$— $— $— $— $— $— $556,668 $556,668 
       Over 90 days past due— — — — — — 7,720 7,720 
   Total Consumer credit card:$— $— $— $— $— $— $564,388 $564,388 
Gross write-offs for the three months ended March 31, 2024
$— $— $— $— $— $— $7,596 $7,596 
Overdrafts
       Current to 90 days past due$48,513 $— $— $— $— $— $— $48,513 
    Total Overdrafts:$48,513 $— $— $— $— $— $— $48,513 
Gross write-offs for the three months ended March 31, 2024
$739 $— $— $— $— $— $— $739 
Personal banking loans
       Current to 90 days past due$274,980 $917,367 $754,025 $758,163 $806,317 $917,714 $1,642,806 $6,071,372 
       Over 90 days past due2,129 608 1,673 1,590 1,466 2,812 9,467 19,745 
       Non-accrual— — 227 167 — 1,129 1,977 3,500 
   Total Personal banking loans:$277,109 $917,975 $755,925 $759,920 $807,783 $921,655 $1,654,250 $6,094,617 
Gross write-offs for the three months ended March 31, 2024
$739 $563 $554 $438 $135 $129 $8,291 $10,849 
Term Loans Amortized Cost Basis by Origination Year
(In thousands)20232022202120202019PriorRevolving Loans Amortized Cost BasisTotal
December 31, 2023
Real estate-personal
       Current to 90 days past due$455,703 $452,153 $533,313 $711,442 $257,159 $596,439 $8,620 $3,014,829 
       Over 90 days past due3,319 1,650 2,222 834 44 1,490 — 9,559 
       Non-accrual— 261 167 — 157 1,068 — 1,653 
   Total Real estate-personal:$459,022 $454,064 $535,702 $712,276 $257,360 $598,997 $8,620 $3,026,041 
Gross write-offs for the year ended December 31, 2023$— $18 $— $— $— $23 $— $41 
Consumer
       Current to 90 days past due$518,619 $340,104 $258,348 $127,208 $56,394 $51,302 $722,595 $2,074,570 
       Over 90 days past due391 210 194 24 54 421 1,859 3,153 
    Total Consumer:$519,010 $340,314 $258,542 $127,232 $56,448 $51,723 $724,454 $2,077,723 
Gross write-offs for the year ended December 31, 2023$926 $2,891 $1,939 $770 $376 $370 $1,051 $8,323 
Revolving home equity
       Current to 90 days past due$— $— $— $— $— $— $317,047 $317,047 
       Over 90 days past due— — — — — — 870 870 
       Non-accrual— — — — — — 1,977 $1,977 
   Total Revolving home equity:$— $— $— $— $— $— $319,894 $319,894 
Gross write-offs for the year ended December 31, 2023$— $— $— $— $— $— $11 $11 
Consumer credit card
       Current to 90 days past due$— $— $— $— $— $— $582,330 $582,330 
       Over 90 days past due— — — — — — 7,583 7,583 
   Total Consumer credit card:$— $— $— $— $— $— $589,913 $589,913 
Gross write-offs for the year ended December 31, 2023$— $— $— $— $— $— $24,105 $24,105 
Overdrafts
       Current to 90 days past due$6,802 $— $— $— $— $— $— $6,802 
    Total Overdrafts:$6,802 $— $— $— $— $— $— $6,802 
Gross write-offs for the year ended December 31, 2023$3,803 $— $— $— $— $— $— $3,803 
Personal banking loans
       Current to 90 days past due$981,124 $792,257 $791,661 $838,650 $313,553 $647,741 $1,630,592 $5,995,578 
       Over 90 days past due3,710 1,860 2,416 858 98 1,911 10,312 21,165 
       Non-accrual— 261 167 — 157 1,068 1,977 3,630 
   Total Personal banking loans:$984,834 $794,378 $794,244 $839,508 $313,808 $650,720 $1,642,881 $6,020,373 
Gross write-offs for the year ended December 31, 2023$4,729 $2,909 $1,939 $770 $376 $393 $25,167 $36,283 

Collateral-dependent loans
The Company's collateral-dependent loans are comprised of large loans on non-accrual status. The Company requires that collateral-dependent loans are either over-collateralized or carry collateral equal to the amortized cost of the loan. The following table presents the amortized cost basis of collateral-dependent loans as of March 31, 2024 and December 31, 2023.
(In thousands)Business AssetsReal EstateOil & Gas AssetsTotal
March 31, 2024
Commercial:
  Real estate - business$— $1,203 $— $1,203 
Personal Banking:
  Revolving home equity— 1,977 — 1,977 
Total$— $3,180 $— $3,180 
December 31, 2023
Commercial:
Business$1,183 $— $1,238 $2,421 
Personal Banking:
Revolving home equity— 1,977 — 1,977 
Total$1,183 $1,977 $1,238 $4,398 

Other Personal Banking loan information
As noted above, the credit quality of Personal Banking loans is monitored primarily on the basis of aging/delinquency, and this information is provided in the table in the above section on "Credit quality indicators." In addition, FICO scores are obtained and updated on a quarterly basis for most of the loans in the Personal Banking portfolio. This is a published credit score designed to measure the risk of default by taking into account various factors from a borrower's financial history and is considered supplementary information utilized by the Company, as management does not consider this information in evaluating the allowance for credit losses on loans. The Bank normally obtains a FICO score at the loan's origination and renewal dates, and updates are obtained on a quarterly basis. Excluded from the table below are certain personal real estate loans for which FICO scores are not obtained because the loans generally pertain to commercial customer activities and are often underwritten with other collateral considerations. These loans totaled $168.8 million at March 31, 2024 and $168.9 million at December 31, 2023. The table also excludes consumer loans related to the Company's patient healthcare loan program, which totaled $210.4 million at March 31, 2024 and $211.3 million at December 31, 2023. As the healthcare loans are guaranteed by the hospital, customer FICO scores are not obtained for these loans. The personal real estate loans and consumer loans excluded below totaled less than 7% of the Personal Banking portfolio. For the remainder of loans in the Personal Banking portfolio, the table below shows the percentage of balances outstanding at March 31, 2024 and December 31, 2023 by FICO score.

   Personal Banking Loans
% of Loan Category
Real Estate - PersonalConsumerRevolving Home EquityConsumer Credit Card
March 31, 2024
FICO score:
Under 6002.0 %2.8 %2.0 %5.0 %
600 - 6592.5 4.1 3.3 12.2 
660 - 7198.5 13.0 11.7 30.4 
720 - 77921.6 24.2 22.2 27.0 
780 and over65.4 55.9 60.8 25.4 
Total100.0 %100.0 %100.0 %100.0 %
December 31, 2023
FICO score:
Under 6002.0 %2.5 %1.9 %4.7 %
600 - 6592.3 4.3 3.3 12.1 
660 - 7198.5 12.9 10.9 29.2 
720 - 77921.9 28.2 22.4 27.0 
780 and over65.3 52.1 61.5 27.0 
Total100.0 %100.0 %100.0 %100.0 %

Modifications for borrowers experiencing financial difficulty
When borrowers are experiencing financial difficulty, the Company may agree to modify the contractual terms of a loan to a borrower in order to assist the borrower in repaying principal and interest owed to the Company.
The Company's modifications of loans to borrowers experiencing financial difficulty are generally in the form of term extensions, repayment plans, payment deferrals, forbearance agreements, interest rate reductions, forgiveness of interest and/or fees, or any combination thereof. Commercial loans modified to borrowers experiencing financial difficulty are primarily loans that are substandard or non-accrual, where the maturity date was extended. Modifications on personal real estate loans are primarily those placed on forbearance plans, repayment plans, or deferral plans where monthly payments are suspended for a period of time or past due amounts are paid off over a certain period of time in the future or set up as a balloon payment at maturity. Modifications to certain credit card and other small consumer loans are often modified under debt counseling programs that can reduce the contractual rate or, in certain instances, forgive certain fees and interest charges. Other consumer loans modified to borrowers experiencing financial difficulty consist of various other workout arrangements with consumer customers.

The following tables present the amortized cost at March 31, 2024 of loans that were modified during the three months ended March 31, 2024 and the amortized cost of at March 31, 2023 of loans that were modified during the three months ended March 31, 2023.

For the Three Months Ended March 31, 2024



(Dollars in thousands)
Term ExtensionPayment DelayInterest Rate ReductionInterest/Fees Forgiven
Other
Total% of Total Loan Category
March 31, 2024
Commercial:
Business$11,648 $— $— $— $— $11,648 0.2 %
Real estate – business17,004 — — — — 17,004 0.5 
Personal Banking:
Real estate – personal 526 2,706 — — — 3,232 0.1 
Consumer— — 31 — — 31 — 
Consumer credit card— — 945 — — 945 0.2 
Total $29,178 $2,706 $976 $— $— $32,860 0.2 %


For the Three Months Ended March 31, 2023



(Dollars in thousands)
Term ExtensionPayment DelayInterest Rate ReductionInterest/Fees Forgiven
Other
Total% of Total Loan Category
March 31, 2023
Commercial:
Business$3,104 $— $— $— $— $3,104 0.1 %
Real estate – business23,039 — — — — 23,039 0.7 
Personal Banking:
Real estate – personal— 1,666 — — — 1,666 0.1 
Consumer— 58 16 — 55 129 — 
Consumer credit card— — 618 275 — 893 0.2 
Total$26,143 $1,724 $634 $275 $55 $28,831 0.2 %

The estimate of lifetime expected losses utilized in the allowance for credit losses model is developed using average historical experience on loans with similar risk characteristics, which includes losses from modifications of loans to borrowers experiencing financial difficulty. As a result, a change to the allowance for credit losses is generally not recorded upon modification. For modifications to loans made to borrowers experiencing financial difficulty that are placed on non-accrual status, the Company determines the allowance for credit losses on an individual evaluation, using the same process that it utilizes for other loans on non-accrual status. Modifications made to commercial loans which are not on non-accrual status for borrowers experiencing financial difficulty are collectively evaluated based on internal risk rating, loan type, delinquency, historical experience, and current economic factors. Modifications made to borrowers experiencing financial difficulty for personal banking loans which are not on non-accrual status are collectively evaluated based on loan type, delinquency, historical experience, and current economic factors.

If a loan to a borrower experiencing financial difficulty is modified and subsequently deemed uncollectible, the allowance for credit losses continues to be based on individual evaluation, if that loan is already on non-accrual status. For those loans, the allowance for credit losses is estimated using discounted expected cash flows or the fair value of collateral. If an accruing
loan made to a borrower experiencing financial difficulty is modified and subsequently deemed uncollectible, the loan's risk rating is downgraded to non-accrual status and the loan's related allowance for credit losses is determined based on individual evaluation, or if necessary, the loan is charged off and collection efforts begin.

The following tables summarize the financial impact of loan modifications and payment deferrals during the three months ended March 31, 2024 and March 31, 2023.

Term Extension
Three Months Ended March 31, 2024Three Months Ended March 31, 2023
Commercial:
Business
Extended maturity by a weighted average of 6 months.
Extended maturity by a weighted average of 12 months.
Real estate – business
Extended maturity by a weighted average of 8 months.
Extended maturity by a weighted average of 17 months.
Personal Banking:
Real estate – personal
Extended maturity by a weighted average of 6 months.


Payment Delay
Three Months Ended March 31, 2024Three Months Ended March 31, 2023
Personal Banking:
Real estate – personal
Deferred certain payments by a weighted average of 8 years.
Deferred past due monthly payments to maturity as a balloon payment. Deferral delayed payments a weighted average of 27 years.
Consumer
Deferred past due monthly payments to maturity as a balloon payment. Deferral delayed payments a weighted average of 11 years

Interest Rate Reduction
Three Months Ended March 31, 2024Three Months Ended March 31, 2023
Personal Banking:
ConsumerReduced weighted-average contractual interest rate from average 23% to 6%.Reduced weighted-average contractual interest rate from 20% to 6%.
Consumer credit cardReduced weighted-average contractual interest rate from average 23% to 6%.Reduced weighted-average contractual interest rate from 20% to 6%.


Forgiveness of Interest/Fees
Three Months Ended March 31, 2024Three Months Ended March 31, 2023
Personal Banking:
Consumer credit cardApproximately $14 thousand of interest and fees forgiven.

The Company had commitments of $2.4 million and $28.4 million at March 31, 2024 and December 31, 2023, respectively, to lend additional funds to borrowers experiencing financial difficulty and for whom the Company has modified the terms of loans in the form of an interest rate reduction; an other-than-insignificant payment delay; forgiveness of principal, interest, or fees; or a term extension during the current reporting period.

The following tables provide the amortized cost basis at March 31, 2024 of loans to borrowers experiencing financial difficulty that had a payment default during the three months ended March 31, 2024 and were modified within the 12 months preceding the payment default, as well as the amortized cost basis at March 31, 2023 of loans to borrowers experiencing financial difficulty that had a payment default during the three months ended March 31, 2023 and had been modified on or after January 1, 2023 (the date we adopted ASU 2022-02). For purposes of this disclosure, the Company considers "default" to mean 90 days or more past due as to interest or principal.
For the Three Months Ended March 31, 2024


(Dollars in thousands)		Payment DelayInterest Rate ReductionInterest/Fees ForgivenTotal
March 31, 2024
Personal Banking:
Real estate – personal $1,138 $— $— $1,138 
Consumer— 14 — 14 
Consumer credit card— 260 61 321 
Total $1,138 $274 $61 $1,473 
For the Three Months Ended March 31, 2023


(Dollars in thousands)
Payment DelayInterest Rate ReductionInterest/Fees ForgivenTotal
March 31, 2023
Personal Banking:
Consumer$— $8 $— $8 
Consumer credit card— 63 12 75 
Total $— $71 $12 $83 


The following tables present the amortized cost basis at March 31, 2024 of loans to borrowers experiencing financial difficulty that had been modified within the previous 12 months as well as the amortized cost basis at March 31, 2023 of loans to borrowers experiencing financial difficulty that had been modified on or after January 1, 2023 (the date we adopted ASU 2022-02) through March 31, 2023.



(In thousands)
Current
30-89 Days Past Due
90 Days Past DueTotal
March 31, 2024
Commercial:
Business$25,544 $— $— $25,544 
Real estate – business93,924 — — 93,924 
Personal Banking:
Real estate – personal 3,556 1,136 1,761 6,453 
Consumer150 17 14 181 
Consumer credit card2,107 513 296 2,916 
Total $125,281 $1,666 $2,071 $129,018 



(In thousands)
Current
30-89 Days Past Due
90 Days Past DueTotal
March 31, 2023
Commercial:
Business$3,104 $— $— $3,104 
Real estate – business23,039 — — 23,039 
Personal Banking:
Real estate – personal 1,061 605 — 1,666 
Consumer75 46 8 129 
Consumer credit card645 173 75 893 
Total $27,924 $824 $83 $28,831 
Loans held for sale
The Company designates certain long-term fixed rate personal real estate loans as held for sale, and the Company has elected the fair value option for these loans. The election of the fair value option aligns the accounting for these loans with the related economic hedges discussed in Note 11. The loans are primarily sold to Federal Home Loan Mortgage Corporation (FHLMC) and Federal National Mortgage Association (FNMA). At March 31, 2024, the fair value of these loans was $1.2 million, and the unpaid principal balance was $1.1 million.

The Company also designates certain student loan originations as held for sale. The borrowers are credit-worthy students who are attending colleges and universities. The loans are intended to be sold in the secondary market, and the Company maintains contracts with Sallie Mae to sell the loans within 210 days after the last disbursement to the student. These loans are carried at lower of cost or fair value, which at March 31, 2024 totaled $763 thousand.

At March 31, 2024, none of the loans held for sale were on non-accrual status or 90 days past due and still accruing interest.
Foreclosed real estate/repossessed assets
The Company’s holdings of foreclosed real estate totaled $206 thousand and $270 thousand at March 31, 2024 and December 31, 2023, respectively, and included in those amounts were $206 thousand and $270 thousand at March 31, 2024 and December 31, 2023, respectively, of foreclosed residential real estate properties held as a result of obtaining physical possession. Personal property acquired in repossession, generally autos, totaled $2.0 million and $1.8 million at March 31, 2024 and December 31, 2023. Upon acquisition, these assets are recorded at fair value less estimated selling costs at the date of foreclosure, establishing a new cost basis. They are subsequently carried at the lower of this cost basis or fair value less estimated selling costs.