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Loan Portfolio and Allowance for Credit Losses
 6 Months Ended
Jun. 30, 2022
Loan Portfolio and Allowance for Credit Losses [Abstract]  
Loan Portfolio and Allowance for Credit Losses
(5) Loan Portfolio and Allowance for Credit Losses

Upon adoption of CECL, management pooled loans with similar risk characteristics. The portfolio segment is defined as the level at which an entity develops and documents a systematic methodology to determine its allowance for credit losses on loans.

The Following table presents loans by portfolio segment:

 
  
June 30, 2022
  
(dollars in thousands)
  
New York and
other states*
    
Florida
    
Total
  
Commercial:
                  
Commercial real estate
  
$
151,978
      
27,646
      
179,624
  
Other
    
19,134
      
1,128
      
20,262
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
2,747,210
      
1,271,168
      
4,018,378
  
Home equity loans
    
45,428
      
12,851
      
58,279
  
Home equity lines of credit
    
180,720
      
73,038
      
253,758
  
Installment
    
8,175
      
2,083
      
10,258
  
Total loans, net
  
$
3,152,645
      
1,387,914
      
4,540,559
  
Less: Allowance for credit losses
                    
45,285
  
Net loans
                  
$
4,495,274
  

Prior to the adoption of CECL on January 1, 2022, the Company calculated allowance for loan losses using the incurred losses methodology.

 
  
December 31, 2021
  
(dollars in thousands)
  
New York and
other states*
    
Florida
    
Total
  
Commercial:
                  
Commercial real estate
  
$
147,063
      
21,653
      
168,716
  
Other
    
30,889
      
595
      
31,484
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
2,723,734
      
1,212,568
      
3,936,302
  
Home equity loans
    
48,190
      
13,695
      
61,885
  
Home equity lines of credit
    
175,134
      
55,842
      
230,976
  
Installment
    
7,368
      
2,048
      
9,416
  
Total loans, net
  
$
3,132,378
      
1,306,401
      
4,438,779
  
Less: Allowance for loan losses
                    
44,267
  
Net loans
                  
$
4,394,512
  

Included in commercial loans above are Paycheck Protection Program (“PPP”) loans totaling $1.5 million and $10.0 Million as of June 30, 2022 and December 31, 2021, respectively.

At June 30, 2022 and December 31, 2021, the Company had approximately $30.4 million and $37.3 million of real estate construction loans, respectively.  Of the $30.4 million in real estate construction loans at June 30, 2022, approximately $10.7 million are secured by first mortgages to residential borrowers while approximately $19.7 million were to commercial borrowers for residential construction projects.  Of the $37.3 million in real estate construction loans at December 31, 2021, approximately $17.9 million were secured by first mortgages to residential borrowers while approximately $19.4 million were to commercial borrowers for residential construction projects.  The vast majority of construction loans are in the Company’s New York market.

Allowance for credit losses on loans

The level of the ACLL is based on factors that influence management’s current estimate of expected credit losses including past events, current conditions. There were no changes in the Company’s methodology for the allowance for credit losses on loans for the period ended June 30, 2022 compared to adoption date. Consistent with adoption date, the Company has determined the stagflation forecast scenario to be appropriate for the June 30, 2022 ACLL calculation. The Company selected the stagflation economic forecast for credit losses as management expects that markets will experience a slight decline in economic conditions and a slight increase in the unemployment rate over the next two years.

The following table presents the impact of the January 1, 2022 adoption entry in the allowance for credit losses on loans by loan type:

(dollars in thousands)
 
December 31, 2021
Pre-Adoption
Balance
    
Impact of Adoption
    
January 1, 2022
Post CECL
Adoption
  
   
Total
          
Total
  
Commercial:
                  
Commercial real estate
  
$
3,121
    

(1,100
)
  

2,021
  
Other
    
14
      
114
      
128
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
37,249
      
1,703
      
38,952
  
Home equity loans
    
583
      
262
      
845
  
Home equity lines of credit
    
2,857
      
1,752
      
4,609
  
Installment
    
443
      
(378
)
    
65
  
Total Allowance
  
$
44,267
      
2,353
    

46,620
  

Activity in the allowance for credit losses on loans by portfolio segment is summarized as follows:


  
For the three months ended June 30, 2022
  
(dollars in thousands)
  
Commercial
    
Real Estate
Mortgage-
1 to 4 Family
    
Installment
    
Total
  
Balance at beginning of period   $
2,177       43,931       70       46,178  
Loans charged off:
                                
New York and other states*
    
4
      
12
      
14
      
30
  
Florida
    
-
      
-
      
-
      
-
  
Total loan chargeoffs
    
4
      
12
      
14
      
30
  
                                 
Recoveries of loans previously charged off:
                                
New York and other states*
    
4
      
131
      
2
      
137
  
Florida
    
-
      
-
      
-
      
-
  
Total recoveries
    
4
      
131
      
2
      
137
  
Net loans (recoveries) charged off
   
-
      
(119
)
    
12
      
(107
)
(Credit) provision for credit losses
    
97
      
(1,170
)
    
73
      
(1,000
)
Balance at end of period
  
$
2,274
      
42,880
      
131
      
45,285
  

Activity in the allowance for loan losses by portfolio segment as of June 30, 2021 is summarized as follows:

   
For the three months ended June 30, 2021
  
(dollars in thousands)
  
Commercial
    
Real Estate
Mortgage-
1 to 4 Family
    
Installment
    
Total
  
Balance at beginning of period
  
$
4,052
      
45,507
      
432
      
49,991
  
Loans charged off:
                                
New York and other states*
    
-
      
20
      
1
      
21
  
Florida
    
-
      
-
      
-
      
-
  
Total loan chargeoffs
    
-
      
20
      
1
      
21
  
                                 
Recoveries of loans previously charged off:
                                
New York and other states*
    
-
      
156
      
28
      
184
  
Florida
    
-
      
1
      
-
      
1
  
Total recoveries
    
-
      
157
      
28
      
185
  
Net loan recoveries
    
-
      
(137
)
    
(27
)
    
(164
)
(Credit) provision for loan losses
    
54
      
(27
)
    
(27
)
    
-
  
Balance at end of period
  
$
4,106
      
45,617
      
432
      
50,155
  

* Includes New York, New Jersey, Vermont and Massachusetts.

Activity in the allowance for credit losses on loans by portfolio segment for the six months ended is summarized as follows:

   
For the six months ended June 30, 2022
  
   
Commercial
    
Real Estate
Mortgage-
1 to 4 Family
    
Installment
    
Total
  
Balance at beginning of period
  
$
3,135
     $
40,689
     $
443
     $
44,267
  
Impact of ASU 2016-13, Current Expected Credit Loss (CECL)
     (986 )     3,717       (378 )     2,353  
Balance as of January 1, 2022 as adjuste dfor ASU 2016-13
     2,149       44,406       65       46,620  
Loans charged off:
                                
New York and other states*
    
40
      
12
      
25
      
77
  
Florida
    
-
      
-
      
-
      
-
  
Total loan chargeoffs
    
40
      
12
      
25
      
77
  
                                 
Recoveries of loans previously charged off:
                                
New York and other states*
    
4
      
228
      
10
      
242
  
Florida
    
-
      
-
      
-
      
-
  
Total recoveries
    
4
      
228
      
10
      
242
  
Net loans (recoveries) charged off
    
36
      
(216
)
    
15
      
(165
)
(Credit) provision for credit losses
    
161
      
(1,742
)
    
81
      
(1,500
)
Balance at end of period
  
$
2,274
      
42,880
      
131
      
45,285
  

Activity in the allowance for loan losses by portfolio segment for the six months ended is summarized as follows:

   
For the six months ended June 30, 2021
  
   
Commercial
    
Real Estate
Mortgage-
1 to 4 Family
    
Installment
    
Total
  
Balance at beginning of period
  
$
4,140
      
44,950
      
505
      
49,595
  
Loans charged off:
                                
New York and other states*
    
-
      
106
      
8
      
114
  
Florida
    
-
      
-
      
2
      
2
  
Total loan chargeoffs
    
-
      
106
      
10
      
116
  
                                 
Recoveries of loans previously charged off:
                                
New York and other states*
    
32
      
244
      
49
      
325
  
Florida
    
-
      
1
      
-
      
1
  
Total recoveries
    
32
      
245
      
49
      
326
  
Net loan recoveries
    
(32
)
    
(139
)
    
(39
)
    
(210
)
(Credit) provision for loan losses
    
(66
)
    
528
      
(112
)
    
350
  
Balance at end of period
  
$
4,106
      
45,617
      
432
      
50,155
  

* Includes New York, New Jersey, Vermont and Massachusetts.

The following tables present the balance in the allowance for credit losses on loans by portfolio segment and based on impairment evaluation as of June 30, 2022: :

   
June 30, 2022
  
(dollars in thousands)
  
Commercial
Loans
    
1-to-4 Family
Residential
Real Estate
    
Installment
Loans
    
Total
  
Allowance for loan losses:
                        
Ending allowance balance attributable to loans:
                        
Individually evaluated for impairment
  
$
-
      
-
      
-
      
-
  
Collectively evaluated for impairment
    
2,274
      
42,880
      
131
      
45,285
  
                                 
Total ending allowance balance
  
$
2,274
      
42,880
      
131
      
45,285
  
                                 
Loans:
                                
Individually evaluated for impairment
  
$
319
      
26,673
      
21
      
27,013
  
Collectively evaluated for impairment
    
199,567
      
4,303,742
      
10,237
      
4,513,546
  
                                 
Total ending loans balance
  
$
199,886
      
4,330,415
      
10,258
      
4,540,559
  

Prior to the adoption of CECL on January 1, 2022, the Company calculated allowance for loan losses using the incurred losses methodology. Activity in the allowance for loan losses by portfolio segment is summarized as follows:

   
December 31, 2021
  
(dollars in thousands)
  
Commercial
Loans
    
1-to-4 Family
Residential
Real Estate
    
Installment
Loans
    
Total
  
Allowance for loan losses:
                        
Ending allowance balance attributable to loans:
                        
Individually evaluated for impairment
  
$
-
      
-
      
-
      
-
  
Collectively evaluated for impairment
    
3,135
      
40,689
      
443
      
44,267
  
                                 
Total ending allowance balance
  

3,135
      
40,689
      
443
      
44,267
  
                                 
Loans:
                                
Individually evaluated for impairment
  
$
232
      
18,272
      
-
      
18,504
  
Collectively evaluated for impairment
    
199,968
      
4,210,891
      
9,416
      
4,420,275
  
                                 
Total ending loans balance
  
$
200,200
      
4,229,163
      
9,416
      
4,438,779
  

The Company’s allowance for credit losses on unfunded commitments is recognized as a liability (accrued expenses and other liabilities) with adjustments to the reserve recognized in (credit) provision for credit losses in the consolidated income statement.

The Company’s activity in the allowance for credit losses on unfunded commitments were as follows:

(In thousands)
  
For the three
months ended
June 30, 2022
  
Balance at March 31, 2022
  
$
2,653
  
Provision for credit losses
    
509
  
Balance at June 30, 2022
  
$
3,162
  

   
 
(In thousands)
  
For the six
months ended
June 30, 2022
  
Balance at January 1, 2022
  
$
18
  
Impact of Adopting CECL
    
2,335
  
Adjusted Balance at January 1, 2022
    
2,353
  
Provision for credit losses
    
809
  
Balance at June 30, 2022
  
$
3,162
  

Loan Credit Quality

The Company categorizes commercial loans 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. On at least an annual basis, the Company’s loan grading process analyzes non-homogeneous loans, such as commercial loans and commercial real estate loans, individually by grading the loans based on credit risk.  The Company’s internal loan review department in accordance with the Company’s internal loan review policy tests the loan grades assigned to all loan types.

The Company uses the following definitions for classified loans:

Special Mention: Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the Company’s credit position at some future date.

Substandard: Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as such have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those loans classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be “pass” rated loans.

For homogeneous loan pools, such as residential mortgages, home equity lines of credit, and installment loans, the Company uses payment status to identify the credit risk in these loan portfolios. Payment status is reviewed on a daily basis by the Bank’s collection area and on a monthly basis with respect to determining the adequacy of the allowance for credit losses on loans. The payment status of these homogeneous pools as of June 30, 2022 and December 31, 2021 is also included in the aging of the past due loans table. Nonperforming loans shown in the table below were loans on nonaccrual status and loans over 90 days past due and accruing.

As of June 30, 2022, and based on the most recent analysis performed, the risk category of loans by class of loans, and gross chargeoffs year to date for each loan type by origination year was as follows:
(in thousands)
   June 30, 2022  

 
Term Loans Amortized Cost Basis by Origination Year
  
   
2022
    
2021
    
2020
    
2019
    
2018
    
Prior
    
Revolving Loans
Amortized Cost
Basis
    
Revolving
Loan
Converted to Term
    
Total
  
Commercial :
                                                      
Risk rating
                                                      
Pass
  
$
24,830
    

32,586
    

24,467
    

24,684
    

20,201
    

43,368
    

7,682
    

-
    
$
177,818
  
Special Mention
    
-
      
-
      
69
      
-
      
251
      
-
      
-
      
-
      
320
  
Substandard
    
-
      
-
      
116
      
-
      
136
      
1,234
      
-
      
-
      
1,486
  
Total Commercial Loans
  
$
24,830
    

32,586
    

24,652
    

24,684
    

20,588
    

44,602
    

7,682
    

-
    
$
179,624
  
Commercial Loans:
                                                                        
Current-period Gross writeoffs
  
$
-
    

-
    

-
    

-
    

-
    

40
    

-
    

-
    
$
40
  
   
$
-
    

-
    

-
    

-
    

-
    

40
    

-
    

-
    
$
40
  
Commercial Other:
                                                                        
Risk rating
                                                                        
Pass
  
$
1,325
    

3,623
    

3,028
    

722
    

823
    

2,535
    

7,729
    

-
    
$
19,785
  
Special mention
    
-
      
316
      
-
      
-
      
-
      
-
      
40
      
-
      
356
  
Substandard
    
-
      
23
      
-
      
-
      
-
      
-
      
98
      
-
      
121
  
Total Commercial Real Estate Loans
  
$
1,325
    

3,962
    

3,028
    

722
    

823
    

2,535
    

7,867
    

-
    
$
20,262
  
                                                                         
Other Commercial Loans:
                                                                        
Current-period Gross writeoffs
  
$
-
    

-
    

-
    

-
    

-
    

-
    

-
    

-
      
-
  
   
$
-
    

-
    

-
    

-
    

-
    

-
    

-
    

-
    
$
-
  
                                                                         
Residential First Mortgage:
                                                                        
Risk rating
                                                                        
Performing
  
$
280,214
    

965,157
    

815,540
    

382,448
    

268,833
    

1,289,409
    

1,114
    

-
    
$
4,002,715
  
Nonperforming
    
-
      
173
      
83
      
671
      
773
      
13,963
      
-
      
-
      
15,663
  
Total First Mortgage:
  
$
280,214
    

965,330
    

815,623
    

383,119
    

269,606
    

1,303,372
    

1,114
    

-
    
$
4,018,378
  
                                                                         
Residential First Mortgage Loans:
                                                                        
Current-period Gross writeoffs
  
$
-
    

-
    

-
    

-
    

-
    

-
    

-
    

-
      
-
  
   
$
-
    

-
    

-
    

-
    

-
    

-
    

-
    

-
    
$
-
  
                                                                         
Home Equity Lines:
                                                                        
Risk rating
                                                                        
Performing
  
$
3,335
    

10,166
    

7,031
    

8,108
    

5,718
    

23,751
    

-
    

-
    
$
58,109
  
Nonperforming
    
-
      
-
      
-
      
-
      
-
      
170
      
-
      
-
      
170
  
Total Home Equity Lines:
  
$
3,335
    

10,166
    

7,031
    

8,108
    

5,718
    

23,921
    

-
    

-
    
$
58,279
  
                                                                         
Home Equity Loans:
                                                                        
Current-period Gross writeoffs
  
$
-
    

-
    

-
    

-
    

-
    

-
    

-
    

-
     $
-
  
   
$
-
    

-
    

-
    

-
    

-
    

-
    

-
    

-
    
$
-
  
Home Equity Lines of Credit:
                                                                        
Risk rating
                                                                        
Performing
  
$
660
    

847
    

414
    

70
    

94
    

19,266
    

229,789
    

-
    
$
251,140
  
Nonperforming
    
-
      
-
      
-
      
-
      
-
      
2,553
      
65
      
-
      
2,618
  
Total Home Equity Credit Lines:
  
$
660
    

847
    

414
    

70
    

94
    

21,819
    

229,854
    

-
    
$
253,758
  
                                                                         
Home Equity Lines of Credit:
                                                                        
Current-period Gross writeoffs
  
$
-
    

-
    

-
    

-
    

-
    

12
    

-
    

-
      
12
  
   
$
-
    

-
    

-
    

-
    

-
    

12
    

-
    

-
    
$
12
  
Installments:
                                                                        
Risk rating
                                                                        
Performing
  
$
2,503
    

3,047
    

1,099
    

1,200
    

581
    

690
    

1,093
    

-
    
$
10,213
  
Nonperforming
    
-
      
-
      
-
      
21
      
-
      
1
      
23
      
-
      
45
  
Total Installments
  
$
2,503
    

3,047
    

1,099
    

1,221
    

581
    

691
    

1,116
    

-
    
$
10,258
  
                                                                         
Installments Loans:
                                                                        
Current-period Gross writeoffs
  
$
-
    

13
    

5
    

6
    

-
    

1
    

-
    

-
      
25
  
   
$
-
    

13
    

5
    

6
    

-
    

1
    

-
    

-
    
$
25
  
 
The following tables present the aging of the amortized cost in past due loans by loan class and by region as of June 30, 2022:

   
June 30, 2022
  
New York and other states*:
                                    
(dollars in thousands)
  
30-59
Days
Past Due
    
60-89
Days
Past Due
    
90 +
Days
Past Due
    
Total
30+ days
Past Due
    
Current
    
Total
Loans
  
                                     
Commercial:
                                    
Commercial real estate
  
$
-
      
-
      
123
      
123
      
151,855
      
151,978
  
Other
    
35
      
6
      
-
      
41
      
19,093
      
19,134
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
1,554
      
1,359
      
9,183
      
12,096
      
2,735,114
      
2,747,210
  
Home equity loans
    
26
      
50
      
55
      
131
      
45,297
      
45,428
  
Home equity lines of credit
    
264
      
264
      
857
      
1,385
      
179,335
      
180,720
  
Installment
    
18
      
8
      
23
      
49
      
8,126
      
8,175
  
                                                 
Total
  
$
1,897
      
1,687
      
10,241
      
13,825
      
3,138,820
      
3,152,645
  

Florida:
                                    
(dollars in thousands)
  
30-59
Days
Past Due
    
60-89
Days
Past Due
    
90 +
Days
Past Due
    
Total
30+ days
Past Due
    
Current
    
Total
Loans
  
                                     
Commercial:
                                    
Commercial real estate
  
$
-
      
-
      
-
      
-
      
27,646
      
27,646
  
Other
    
-
      
-
      
-
      
-
      
1,128
      
1,128
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
78
      
292
      
1,552
      
1,922
      
1,269,246
      
1,271,168
  
Home equity loans
    
43
      
-
      
-
      
43
      
12,808
      
12,851
  
Home equity lines of credit
    
-
      
89
      
-
      
89
      
72,949
      
73,038
  
Installment
    
18
      
46
      
-
      
64
      
2,019
      
2,083
  
                                                 
Total
  
$
139
      
427
      
1,552
      
2,118
      
1,385,796
      
1,387,914
  

Total:
                                    
(dollars in thousands)
  
30-59
Days
Past Due
    
60-89
Days
Past Due
    
90 +
Days
Past Due
    
Total
30+ days
Past Due
    
Current
    
Total
Loans
  
                                     
Commercial:
                                    
Commercial real estate
  
$
-
      
-
      
123
      
123
      
179,501
      
179,624
  
Other
    
35
      
6
      
-
      
41
      
20,221
      
20,262
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
1,632
      
1,651
      
10,735
      
14,018
      
4,004,360
      
4,018,378
  
Home equity loans
    
69
      
50
      
55
      
174
      
58,105
      
58,279
  
Home equity lines of credit
    
264
      
353
      
857
      
1,474
      
252,284
      
253,758
  
Installment
    
36
      
54
      
23
      
113
      
10,145
      
10,258
  
                                                 
Total
  
$
2,036
      
2,114
      
11,793
      
15,943
      
4,524,616
      
4,540,559
  

* Includes New York, New Jersey, Vermont and Massachusetts.

The following tables present the aging of the recorded investment in past due loans by loan class and by region as of December 31, 2021:

   
December 31, 2021
  
New York and other states*:
                                    
(dollars in thousands)
  
30-59
Days
Past Due
    
60-89
Days
Past Due
    
90 +
Days
Past Due
    
Total
30+ days
Past Due
    
Current
    
Total
Loans
  
                                     
Commercial:
                                    
Commercial real estate
  
$
-
      
233
      
45
      
278
      
146,785
      
147,063
  
Other
    
-
      
-
      
-
      
-
      
30,889
      
30,889
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
1,303
      
239
      
9,867
      
11,409
      
2,712,325
      
2,723,734
  
Home equity loans
    
136
      
-
      
224
      
360
      
47,830
      
48,190
  
Home equity lines of credit
    
355
      
458
      
911
      
1,724
      
173,410
      
175,134
  
Installment
    
27
      
5
      
4
      
36
      
7,332
      
7,368
  
                                                 
Total
  
$
1,821
      
935
      
11,051
      
13,807
      
3,118,571
      
3,132,378
  

Florida:
                                    
(dollars in thousands)
  
30-59
Days
Past Due
    
60-89
Days
Past Due
    
90 +
Days
Past Due
    
Total
30+ days
Past Due
    
Current
    
Total
Loans
  
                                     
Commercial:
                                    
Commercial real estate
  
$
-
      
-
      
-
      
-
      
21,653
      
21,653
  
Other
    
-
      
-
      
-
      
-
      
595
      
595
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
869
      
180
      
1,146
      
2,195
      
1,210,373
      
1,212,568
  
Home equity loans
    
-
      
45
      
-
      
45
      
13,650
      
13,695
  
Home equity lines of credit
    
-
      
89
      
-
      
89
      
55,753
      
55,842
  
Installment
    
18
      
-
      
5
      
23
      
2,025
      
2,048
  
                                                 
Total
  
$
887
      
314
      
1,151
      
2,352
      
1,304,049
      
1,306,401
  

Total:
                                    
(dollars in thousands)
  
30-59
Days
Past Due
    
60-89
Days
Past Due
    
90 +
Days
Past Due
    
Total
30+ days
Past Due
    
Current
    
Total
Loans
  
                                     
Commercial:
                                    
Commercial real estate
  
$
-
      
233
      
45
      
278
      
168,438
      
168,716
  
Other
    
-
      
-
      
-
      
-
      
31,484
      
31,484
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
2,172
      
419
      
11,013
      
13,604
      
3,922,698
      
3,936,302
  
Home equity loans
    
136
      
45
      
224
      
405
      
61,480
      
61,885
  
Home equity lines of credit
    
355
      
547
      
911
      
1,813
      
229,163
      
230,976
  
Installment
    
45
      
5
      
9
      
59
      
9,357
      
9,416
  
                                                 
Total
  
$
2,708
      
1,249
      
12,202
      
16,159
      
4,422,620
      
4,438,779
  

* Includes New York, New Jersey, Vermont and Massachusetts.

At June 30, 2022 and December 31, 2021, there were no loans that were 90 days past due and still accruing interest.  As a result, non-accrual loans include all loans 90 days or more past due as well as certain loans less than 90 days past due that were placed on non-accrual status for reasons other than delinquent status.  There are no commitments to extend further credit on non-accrual or restructured loans.

The Company transfers loans to other real estate owned, at fair value less cost to sell, in the period the Company obtains physical possession of the property (through legal title or through a deed in lieu).  Other real estate owned is included in Other assets on the Balance Sheet.  As of June 30,2022 other real estate owned included $ 644 thousand of residential foreclosed properties.  In addition, non-accrual residential mortgage loans that are in the process of foreclosure had an amortized cost of $10.3 million as of June 30, 2022. As of December 31, 2021, other real estate owned included $362 thousand of residential foreclosed properties.  In addition, non-accrual residential mortgage loans that are in the process of foreclosure had a recorded investment of $9.7 million as of December 31, 2021.

Loans individually evaluated for impairment are non-accrual loans delinquent greater than 180 days, non-accrual commercial loans, as well as loans classified as troubled debt restructurings. As of June 30, 2022, there was no allowance for credit losses based on the loan individually evaluated for impairment. Residential and installment non-accrual loans which are not TDRs or greater than 180 days delinquent are collectively evaluated to determine the allowance for credit loss.

The following table presents the amortized cost basis in non-accrual loans by portfolio segment:

   
June 30, 2022
  
(dollars in thousands)
  
New York and
other states*
    
Florida
    
Total
  
Loans in non-accrual status:
                  
Commercial:
                  
Commercial real estate
  
$
176
      
-
      
176
  
Other
    
27
      
-
      
27
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
13,684
      
1,979
      
15,663
  
Home equity loans
    
127
      
43
      
170
  
Home equity lines of credit
    
2,448
      
170
      
2,618
  
Installment
    
40
      
5
      
45
  
Total non-accrual loans
    
16,502
      
2,197
      
18,699
  
Restructured real estate mortgages - 1 to 4 family
    
14
      
-
      
14
  
Total nonperforming loans
  
$
16,516
      
2,197
      
18,713
  

For homogeneous loan pools, such as residential mortgages, home equity lines of credit, and installment loans, the Company uses payment status to identify the credit risk in these loan portfolios. Payment status is reviewed on a daily basis by the Bank’s collection area and on a monthly basis with respect to determining the adequacy of the allowance for loan losses. The total nonperforming portion of these homogeneous loan pools as of December 31, 2021 is presented in the non-accrual loans table below.

   
December 31, 2021
  
(dollars in thousands)
  
New York and
other states*
    
Florida
    
Total
  
Loans in non-accrual status:
                  
Commercial:
                  
Commercial real estate
  
$
67
      
-
      
67
  
Other
    
45
      
-
      
45
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
13,990
      
1,797
      
15,787
  
Home equity loans
    
247
      
45
      
292
  
Home equity lines of credit
    
2,337
      
174
      
2,511
  
Installment
    
23
      
14
      
37
  
Total non-accrual loans
    
16,709
      
2,030
      
18,739
  
Restructured real estate mortgages - 1 to 4 family
    
17
      
-
      
17
  
Total nonperforming loans
  
$
16,726
      
2,030
      
18,756
  

* Includes New York, New Jersey, Vermont and Massachusetts.

The following table presents the amortized cost basis of loans on non-accrual status and loans past due over 89 days still accruing:

   
June 30, 2022
 
(dollars in thousands)
  
Non-accrual With
No Allowance for
Credit Loss
    
Non-accrual With
Allowance for
Credit Loss
    
Loans Past Due
Over 89 Days
Still Accruing
  
Commercial:
                  
Commercial real estate
  
$
176
    
$
-
    
$
-
  
Other
    
-
      
27
      
-
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
14,477
      
1,186
      
-
  
Home equity loans
    
152
      
18
      
-
  
Home equity lines of credit
    
2,497
      
121
      
-
  
Installment
    
21
      
23
      
-
  
Total loans, net
  
$
17,324
    
$
1,375
    
$
-
  

The non-accrual balance of $1.4 million disclosed above was collectively evaluated and the associated allowance for credit losses on loans was not material as of June 30, 2022.

A financial asset is considered collateral-dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. Expected Credit losses for the collateral dependent loans are based on the fair value of the collateral at the reporting date, adjusted for selling costs as appropriate. The following table presents the amortized cost basis of individually analyzed collateral dependent loans by portfolio segment as of June 30, 2022:

   
Type of Collateral
  
(dollars in thousands)        

       

 
Real Estate
    
Investment
Securities/Cash
    
Other
  
Commercial:
                  
Commercial real estate
  
$
292
      
-
      
-
  
Other
    
27
      
-
      
-
  
Real estate mortgage - 1 to 4 family:
             -
      -
 
First mortgages
    
22,902
      
-
      
-
  
Home equity loans
    
272
      
-
      
-
  
Home equity lines of credit
    
3,499
      
-
      
-
  
Installment
    
21
      
-
      
-
  
Total Allowance
  
$
27,013
      
-
      
-
  

Troubled Debt Restructuring Loans

The Company has not committed to lend additional amounts to customers with outstanding loans that are classified as TDRs. Interest income recognized on loans that are individually evaluated was not material during the three and six months ended June 30, 2022 and 2021.

A loan for which the terms have been modified, and for which a borrower is experiencing financial difficulties, is considered a TDR and is classified as individually evaluated. TDR’s at June 30, 2022 are measured at the amortized cost using the loan’s effective rate at inception or fair value of the underlying collateral if the loan is considered collateral dependent.

As of June 30, 2022 loans individually evaluated included approximately $9.5 million of loans in accruing status that were identified as TDR’s.

The following table presents, by class, loans that were modified as TDR’s:

 
Three months ended June 30, 2022
    
Three months ended June 30, 2021
  
                                     
New York and other states*


(dollars in thousands)
  
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
    
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
  
                                     
Commercial:
                                    
Commercial real estate
    
-
    
$
-
      
-
      
-
    
$
-
      
-
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
1
      
73
      
73
      
2
      
368
      
368
  
Home equity loans
    
-
      
-
      
-
      
1
      
2
      
2
  
Home equity lines of credit
    
-
      
-
      
-
      
2
      
59
      
59
  
                                                 
Total
    
1
    
$
73
      
73
      
5
    
$
429
      
429
  

Florida:
 
 
(dollars in thousands)
  
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
    
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
  
                                     
Commercial:
                                    
Commercial real estate
    
-
    
$
-
      
-
      
-
    
$
-
      
-
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
-
      
-
      
-
      
1
      
78
      
78
  
Home equity loans
    
-
      
-
      
-
      
-
      
-
      
-
  
Home equity lines of credit
    
-
      
-
      
-
      
-
      
-
      
-
  
                                                 
Total
    
-
    
$
-
      
-
      
1
    
$
78
      
78
  

* Includes New York, New Jersey, Vermont and Massachusetts.

 
Six months ended June 30, 2022
    
Six months ended June 30, 2021
  
New York and other states*:


(dollars in thousands)
  
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
    
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
  
                                     
Commercial:
                                    
Commercial real estate
    
-
    
$
-
    
-
      
-
    
$
-
    
-
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
4
      
443
      
443
      
2
      
368
      
368
  
Home equity loans
    
-
      
-
      
-
      
1
      
2
      
2
  
Home equity lines of credit
    
-
      
-
      
-
      
2
      
59
      
59
  
                                                 
Total
    
4
    
$
443
    
443
      
5
    
$
429
    
429
  

Florida:
 
 
(dollars in thousands)
  
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
    
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
  
                                     
Commercial:
                                    
Commercial real estate
    
-
    
$
-
    
-
      
-
    
$
-
    
-
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
-
      
-
      
-
      
1
      
78
      
78
  
Home equity loans
    
-
      
-
      
-
      
-
      
-
      
-
  
Home equity lines of credit
    
-
      
-
      
-
      
-
      
-
      
-
  
                                                 
Total
    
-
    
$
-
    
-
      
1
    
$
78
    
78
  

* Includes New York, New Jersey, Vermont and Massachusetts.

The addition of these TDR’s did not have a significant impact on the allowance for credit losses on loans. The nature of the modifications that resulted in them being classified as a TDR was the borrower filing for bankruptcy protection.

In situations where the Bank considers a loan modification, management determines whether the borrower is experiencing financial difficulty by performing an evaluation of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification.  This evaluation is performed under the Company’s underwriting policy. In situations involving a borrower filing for Chapter 13 bankruptcy protection, a loan is considered to be in payment default once it is 30 days contractually past due, consistent with the treatment by the bankruptcy court.

Prior to the adoption of CECL on January 1, 2022, the Company calculated allowance for loan losses using the incurred losses methodology. The following tables are the disclosures related to loans in prior periods.

The following table presents impaired loans by loan class as of December 31, 2021:

   
December 31, 2021
  

                       
New York and other states*:

(dollars in thousands)
  
Recorded
Investment
    
Unpaid
Principal
Balance
    
Related
Allowance
    
YTD Avg
Recorded
Investment
  
                         
Commercial:
                        
Commercial real estate
  
$
187
      
279
      
-
      
1,154
  
Other
    
45
      
45
      
-
      
107
  
Real estate mortgage - 1 to 4 family:
                                
First mortgages
    
13,687
      
13,875
      
-
      
14,072
  
Home equity loans
    
161
      
161
      
-
      
235
  
Home equity lines of credit
    
1,852
      
1,939
      
-
      
2,256
  
                                 
Total
  
$
15,932
      
16,299
      
-
      
17,824
  

Florida:

(dollars in thousands)
  
Recorded
Investment
    
Unpaid
Principal
Balance
    
Related
Allowance
    
YTD Avg
Recorded
Investment
  
                         
Commercial:
                        
Commercial real estate
  
$
-
      
-
      
-
      
105
  
Other
    
-
      
-
      
-
      
-
  
Real estate mortgage - 1 to 4 family:
                                
First mortgages
    
2,368
      
2,368
      
-
      
2,562
  
Home equity loans
    
-
      
-
      
-
      
16
  
Home equity lines of credit
    
204
      
204
      
-
      
246
  
                                 
Total
  
$
2,572
      
2,572
      
-
      
2,929
  

Total:

(dollars in thousands)
  
Recorded
Investment
    
Unpaid
Principal
Balance
    
Related
Allowance
    
YTD Avg
Recorded
Investment
  
                         
Commercial:
                        
Commercial real estate
  
$
187
      
279
      
-
      
1,259
  
Other
    
45
      
45
      
-
      
107
  
Real estate mortgage - 1 to 4 family:
                                
First mortgages
    
16,055
      
16,243
      
-
      
16,634
  
Home equity loans
    
161
      
161
      
-
      
251
  
Home equity lines of credit
    
2,056
      
2,143
      
-
      
2,502
  
                                 
Total
  
$
18,504
      
18,871
      
-
      
20,753
  

* Includes New York, New Jersey, Vermont and Massachusetts.

As of December 31, 2021 the risk category of loans by class of loans is as follows:

   
December 31, 2021
  
New York and other states:
                  
(dollars in thousands)
  
Pass
    
Classified
    
Total
  
                   
Commercial:
                  
Commercial real estate
  
$
145,500
      
1,563
      
147,063
  
Other
    
30,726
      
163
      
30,889
  
   
$
176,226
      
1,726
      
177,952
  

Florida:
                  
(dollars in thousands)
  
Pass
    
Classified
    
Total
  
Commercial:
                  
Commercial real estate
  
$
21,113
      
540
      
21,653
  
Other
    
595
      
-
      
595
  
   
$
21,708
      
540
      
22,248
  

Total:
                  
(dollars in thousands)
  
Pass
    
Classified
    
Total
  
Commercial:
                  
Commercial real estate
  
$
166,613
      
2,103
      
168,716
  
Other
    
31,321
      
163
      
31,484
  
   
$
197,934
      
2,266
      
200,200
  

* Includes New York, New Jersey and Massachusetts.

Included in classified loans in the above tables are impaired loans of $226 thousand at December 31, 2021.