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Loan Portfolio and Allowance for Credit Losses
 9 Months Ended
Sep. 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:

 
  
September 30, 2022
  
(dollars in thousands)  
New York and
              

 
other states*
    
Florida
    
Total
  
Commercial:
                  
Commercial real estate
  
$
165,888
      
31,270
      
197,158
  
Other
    
19,089
      
873
      
19,962
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
2,762,616
      
1,312,097
      
4,074,713
  
Home equity loans
    
45,115
      
12,537
      
57,652
  
Home equity lines of credit
    
186,146
      
83,195
      
269,341
  
Installment
    
8,183
      
2,482
      
10,665
  
Total loans, net
  
$
3,187,037
      
1,442,454
      
4,629,491
  
Less: Allowance for credit losses
                    
45,517
  
Net loans
                  
$
4,583,974
  

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

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
  

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

Included in commercial loans above are Paycheck Protection Program (“PPP”) loans totaling $1.4 million and $10.0 million as of September 30, 2022 and December 31, 2021, respectively.

At September 30, 2022 and December 31, 2021, the Company had approximately $36.6 million and $37.3 million, respectively, of real estate construction loans.  Of the $36.6 million in real estate construction loans at September 30, 2022, approximately $14.1 million are secured by first mortgages to residential borrowers while approximately $22.5 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 and current conditions. There were no changes in the Company’s methodology for the allowance for credit losses on loans for the period ended September 30, 2022 compared to the adoption date.  Consistent with the adoption date, the Company has determined the Stagflation forecast scenario to be appropriate for the September 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:

   
December 31, 2021
          
January 1, 2022
  
(dollars in thousands)
 
Pre-Adoption
Balance
    
Impact of Adoption
    
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 for the three months ended September 30, 2022 is summarized as follows:


  
For the three months ended September 30, 2022
  
(dollars in thousands)        
Real Estate
              
         
Mortgage-
              

 
Commercial
    
1 to 4 Family
    
Installment
    
Total
  
Balance at beginning of period   $ 2,274       42,880       131       45,285  
Loans charged off:
                                
New York and other states*
    
-
      
13
      
34
      
47
  
Florida
    
-
      
-
      
-
      
-
  
Total loan chargeoffs
    
-
      
13
      
34
      
47
  
                                 
Recoveries of loans previously charged off:
                                
New York and other states*
    
-
      
177
      
-
   
177
  
Florida
    
-
      
-
      
2
      
2
  
Total recoveries
    
-
      
177
      
2
   
179
  
Net loans (recoveries) charged off
   
-
      
(164
)
    
32
      
(132
)
(Credit) provision for credit losses
    
155
      
(100
)
    
45
      
100
  
Balance at end of period
  
$
2,429
      
42,944
      
144
      
45,517
  

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

Activity in the allowance for loan losses by portfolio segment for the three months ended September 30, 2021 is summarized as follows:

   
For the three months ended September 30, 2021
  
(dollars in thousands)        
Real Estate
              
         
Mortgage-
              

 
Commercial
    
1 to 4 Family
    
Installment
    
Total
  
Balance at beginning of period
  
$
4,106
      
45,617
      
432
      
50,155
  
Loans charged off:
                                
New York and other states*
    
30
      
72
      
17
      
119
  
Florida
    
-
      
1
      
-
      
1
  
Total loan chargeoffs
    
30
      
73
      
17
      
120
  
                                 
Recoveries of loans previously charged off:
                                
New York and other states*
    
-
      
111
      
3
      
114
  
Florida
    
-
      
1
      
-
      
1
  
Total recoveries
    
-
      
112
      
3
      
115
  
Net loan recoveries
    
30
      
(39
)
    
14
      
5
  
(Credit) provision for loan losses
    
(823
)
    
(2,003
)
    
26
      
(2,800
)
Balance at end of period
  
$
3,253
      
43,653
      
444
      
47,350
  

* Includes New York, New Jersey, Vermont and Massachusetts.
Activity in the allowance for credit losses on loans by portfolio segment for the nine months ended September 30, 2022 is summarized as follows:

   
For the nine months ended September 30, 2022
  
(dollars in thousands)
        
Real Estate
              
         
Mortgage-
              
   
Commercial
    
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 adjusted for ASU 2016-13
     2,149       44,406       65       46,620  
Loans charged off:
                                
New York and other states*
    
40
      
25
      
53
      
118
  
Florida
    
-
      
-
      
-
      
-
  
Total loan chargeoffs
   $
40
     $
25
     $
53
     $
118
  
                                 
Recoveries of loans previously charged off:
                                
New York and other states*
    
4
      
405
      
4
      
414
  
Florida
    
-
      
-
      
2
      
2
  
Total recoveries
    
4
      
405
      
6
      
416
  
Net loans charged off
    
36
      
(380
)
    
47
      
(297
)
Credit for loan losses
    
316
      
(1,842
)
    
126
      
(1,400
)
Balance at end of period
  
$
2,429
      
42,944
      
144
      
45,517
  

Activity in the allowance for loan losses by portfolio segment for the nine months ended September 30, 2021 is summarized as follows:

   
For the nine months ended September 30, 2021
  
(dollars in thousands)
        
Real Estate
              
         
Mortgage-
              
   
Commercial
    
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*
    
30
      
178
      
25
      
233
  
Florida
    
-
      
1
      
2
      
3
  
Total loan chargeoffs
    
30
      
179
      
27
      
236
  
                                 
Recoveries of loans previously charged off:
                                
New York and other states*
    
32
      
355
      
52
      
439
  
Florida
    
-
      
2
      
-
      
2
  
Total recoveries
    
32
      
357
      
52
      
441
  
Net loan recoveries
    
(2
)
    
(178
)
    
(25
)
    
(205
)
(Credit) provision for loan losses
    
(889
)
    
(1,475
)
    
(86
)
    
(2,450
)
Balance at end of period
  
$
3,253
      
43,653
      
444
      
47,350
  

* 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 September 30, 2022:

   
September 30, 2022
  
(dollars in thousands)        
1-to-4 Family
              
   
Commercial
      Residential      Installment        

 
Loans
    
Real Estate
    
Loans
    
Total
  
Allowance for loan losses:
                        
Ending allowance balance attributable to loans:
                        
Individually evaluated for impairment
  
$
-
      
-
      
-
      
-
  
Collectively evaluated for impairment
    
2,429
      
42,944
      
144
      
45,517
  
                                 
Total ending allowance balance
  
$
2,429
      
42,944
      
144
      
45,517
  
                                 
Loans:
                                
Individually evaluated for impairment
  
$
294
      
26,157
      
16
      
26,467
  
Collectively evaluated for impairment
    
216,826
      
4,375,549
      
10,649
      
4,603,024
  
                                 
Total ending loans balance
  
$
217,120
      
4,401,706
      
10,665
      
4,629,491
  

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

   
December 31, 2021
  
(dollars in thousands)        
1-to-4 Family
              
     Commercial      Residential      Installment        

 
Loans
    
Real Estate
    
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
September 30, 2022
  
Balance at June 30, 2022
  
$
3,162
  
Provision for credit losses
    
200
  
Balance at September 30, 2022
  
$
3,362
  

   
 
(In thousands)
  
For the nine
months ended
September 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
    
1,009
  
Balance at September 30, 2022
  
$
3,362
  

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 September 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 non-accrual status and loans over 90 days past due and accruing.

As of September 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:

Loan Credit Quality
(in thousands)
     September 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
  
$
58,331
    

30,325
    

18,803
    

23,713
    

17,058
    

38,102
    

9,089
    

-
    
$
195,421
  
Special Mention
    
-
      
-
      
65
      
-
      
247
      
-
      
-
      
-
      
312
  
Substandard
    
-
      
-
      
115
      
-
      
132
      
1,178
      
-
      
-
      
1,425
  
Total Commercial Loans
  
$
58,331
    

30,325
    

18,983
    

23,713
    

17,437
    

39,280
    

9,089
    

-
    
$
197,158
  
Commercial Loans:
                                                                        
Current-period Gross writeoffs
  
$
-
    

-
    

-
    

-
    

-
    

40
    

-
    

-
    
$
40
  
   
$
-
    

-
    

-
    

-
    

-
    

40
    

-
    

-
    
$
40
  
Commercial Other:
                                                                        
Risk rating
                                                                        
Pass
  
$
2,302
    

3,313
    

2,757
    

706
    

752
    

2,472
    

7,182
    

-
    
$
19,484
  
Special mention
    
-
      
124
      
-
      
-
      
-
      
-
      
40
      
-
      
164
  
Substandard
    
-
      
216
      
-
      
-
      
-
      
-
      
98
      
-
      
314
  
Total Commercial Real Estate Loans
  
$
2,302
    

3,653
    

2,757
    

706
    

752
    

2,472
    

7,320
    

-
    
$
19,962
  
                                                                         
Other Commercial Loans:
                                                                        
Current-period Gross writeoffs
  
$
-
    

-
    

-
    

-
    

-
    

-
    

-
    

-
      
-
  
   
$
-
    

-
    

-
    

-
    

-
    

-
    

-
    

-
    
$
-
  
                                                                         
Residential First Mortgage:
                                                                        
Risk rating
                                                                        
Performing
  
$
417,902
    

950,363
    

799,953
    

374,430
    

262,084
    

1,252,690
    

1,479
    

-
    
$
4,058,901
  
Nonperforming
    
-
      
700
      
83
      
846
      
773
      
13,410
      
-
      
-
      
15,812
  
Total First Mortgage:
  
$
417,902
    

951,063
    

800,036
    

375,276
    

262,857
    

1,266,100
    

1,479
    

-
    
$
4,074,713
  
                                                                         
Residential First Mortgage Loans:
                                                                        
Current-period Gross writeoffs
  
$
-
    

-
    

-
    

-
    

-
    

5
    

-
    

-
     $
5
  
   
$
-
    

-
    

-
    

-
    

-
    

5
    

-
    

-
    
$
5
  
                                                                         
Home Equity Lines:
                                                                        
Risk rating
                                                                        
Performing
  
$
5,222
    

9,748
    

6,535
    

7,782
    

5,468
    

22,729
    

-
    

-
    
$
57,484
  
Nonperforming
    
-
      
-
      
-
      
-
      
-
      
168
      
-
      
-
      
168
  
Total Home Equity Lines:
  
$
5,222
    

9,748
    

6,535
    

7,782
    

5,468
    

22,897
    

-
    

-
    
$
57,652
  
                                                                         
Home Equity Loans:
                                                                        
Current-period Gross writeoffs
  
$
-
    

-
    

-
    

-
    

-
    

-
    

-
    

-
     $
-
  
   
$
-
    

-
    

-
    

-
    

-
    

-
    

-
    

-
    
$
-
  
Home Equity Lines of Credit:
                                                                        
Risk rating
                                                                        
Performing
  
$
698
    

859
    

335
    

56
    

101
    

18,826
    

246,047
    

-
    
$
266,922
  
Nonperforming
    
-
      
7
      
-
      
-
      
-
      
2,207
      
205
      
-
      
2,419
  
Total Home Equity Credit Lines:
  
$
698
    

866
    

335
    

56
    

101
    

21,033
    

246,252
    

-
    
$
269,341
  
                                                                         
Home Equity Lines of Credit:
                                                                        
Current-period Gross writeoffs
  
$
-
    

-
    

-
    

-
    

-
    

20
    

-
    

-
      
20
  
   
$
-
    

-
    

-
    

-
    

-
    

20
    

-
    

-
    
$
20
  
Installments:
                                                                        
Risk rating
                                                                        
Performing
  
$
4,068
    

2,758
    

943
    

918
    

469
    

293
    

1,122
    

-
    
$
10,571
  
Nonperforming
    
-
      
25
      
-
      
67
      
-
      
-
      
2
      
-
      
94
  
Total Installments
  
$
4,068
    

2,783
    

943
    

985
    

469
    

293
    

1,124
    

-
    
$
10,665
  
                                                                         
Installments Loans:
                                                                        
Current-period Gross writeoffs
  
$
-
    

36
    

6
    

6
    

2
    

3
    

-
    

-
      
53
  
   
$
-
    

36
    

6
    

6
    

2
    

3
    

-
    

-
    
$
53
  
 
The following tables present the aging of the amortized cost in past due loans by loan class and by region as of September 30,2022:

   
September 30, 2022
  
New York and other states*:
                                    
   
30-59
    
60-89
    
90 +
      Total              
     Days      Days      Days    
30+ days
            Total  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
Loans
  
                                     
Commercial:
                                    
Commercial real estate
  
$
39
      
-
      
123
      
162
      
165,726
      
165,888
  
Other
    
-
      
-
      
6
      
6
      
19,083
      
19,089
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
1,994
      
2,469
      
8,128
      
12,591
      
2,750,025
      
2,762,616
  
Home equity loans
    
46
      
66
      
55
      
167
      
44,948
      
45,115
  
Home equity lines of credit
    
359
      
150
      
730
      
1,239
      
184,907
      
186,146
  
Installment
    
3
      
25
      
16
      
44
      
8,139
      
8,183
  
                                                 
Total
  
$
2,441
      
2,710
      
9,058
      
14,209
      
3,172,828
      
3,187,037
  

Florida:
                                    
   
30-59
    
60-89
    
90 +
      Total              
    Days     Days     Days    
30+ days
           Total  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
Loans
  
                                     
Commercial:
                                    
Commercial real estate
  
$
-
      
-
      
-
      
-
      
31,270
      
31,270
  
Other
    
124
      
-
      
-
      
124
      
749
      
873
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
81
      
245
      
1,608
      
1,934
      
1,310,163
      
1,312,097
  
Home equity loans
    
7
      
-
      
-
      
7
      
12,530
      
12,537
  
Home equity lines of credit
    
31
      
-
      
-
      
31
      
83,164
      
83,195
  
Installment
    
-
      
-
      
62
      
62
      
2,420
      
2,482
  
                                                 
Total
  
$
243
      
245
      
1,670
      
2,158
      
1,440,296
      
1,442,454
  

Total:
                                    
   
30-59
    
60-89
    
90 +
      Total              
    Days     Days     Days    
30+ days
           Total  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
Loans
  
                                     
Commercial:
                                    
Commercial real estate
  
$
39
      
-
      
123
      
162
      
196,996
      
197,158
  
Other
    
124
      
-
      
6
      
130
      
19,832
      
19,962
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
2,075
      
2,714
      
9,736
      
14,525
      
4,060,188
      
4,074,713
  
Home equity loans
    
53
      
66
      
55
      
174
      
57,478
      
57,652
  
Home equity lines of credit
    
390
      
150
      
730
      
1,270
      
268,071
      
269,341
  
Installment
    
3
      
25
      
78
      
106
      
10,559
      
10,665
  
                                                 
Total
  
$
2,684
      
2,955
      
10,728
      
16,367
      
4,613,124
      
4,629,491
  

* 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*:
                                    
   
30-59
    
60-89
    
90 +
      Total              
    Days     Days     Days    
30+ days
           Total  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
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:
                                    
   
30-59
    
60-89
    
90 +
      Total              
    Days     Days     Days    
30+ days
            Total  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
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:
                                    
   
30-59
    
60-89
    
90 +
      Total              
    Days     Days     Days    
30+ days
           Total  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
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 September 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 September 30,2022 other real estate owned included $682 thousand of residential foreclosed properties.  In addition, non-accrual residential mortgage loans that are in the process of foreclosure had an amortized cost of $9.6 million as of September 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 were 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 September 30, 2022 , there was no allowance for credit losses based on loans 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:

   
September 30, 2022
  
(dollars in thousands)  
New York and
              

 
other states*
    
Florida
    
Total
  
Loans in non-accrual status:
                  
Commercial:
                  
Commercial real estate
  
$
168
      
-
      
168
  
Other
    
11
      
-
      
11
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
13,869
      
1,943
      
15,812
  
Home equity loans
    
126
      
42
      
168
  
Home equity lines of credit
    
2,301
      
118
      
2,419
  
Installment
    
29
      
65
      
94
  
Total non-accrual loans
    
16,504
      
2,168
      
18,672
  
Restructured real estate mortgages - 1 to 4 family
    
12
      
-
      
12
  
Total nonperforming loans
  
$
16,516
     $
2,168
     $
18,684
  

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:

   
September 30, 2022
 
(dollars in thousands)  
Non-accrual With
      Non-accrual With      Loans Past Due  
   
No Allowance for
    
Allowance for
    
Over 89 Days
  

 
Credit Loss
    
Credit Loss
   
Still Accruing
  
Commercial:
                  
Commercial real estate
  
$
168
    

-
    

-
  
Other
    
11
      
-
      
-
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
14,640
      
1,171
      
-
  
Home equity loans
    
168
      
-
      
-
  
Home equity lines of credit
    
2,133
      
287
      
-
  
Installment
    
16
      
78
      
-
  
Total loans, net
  
$
17,136
    

1,536
    

-
  

The non-accrual balance of $1.5 million disclosed above was collectively evaluated and the associated allowance for credit losses on loans was not material as of September 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 September 30, 2022:

   
Type of Collateral
  
(dollars in thousands)        

       

 
Real Estate
    
Investment
Securities/Cash
    
Other
  
Commercial:
                  
Commercial real estate
  
$
283
      
-
      
-
  
Other
    
11
      
-
      
-
  
Real estate mortgage - 1 to 4 family:
              
        
  
First mortgages
    
22,720
      
-
      
-
  
Home equity loans
    
286
      
-
      
-
  
Home equity lines of credit
    
3,151
      
-
      
-
  
Installment
    
16
      
-
      
-
  
Total Allowance
  
$
26,467
      
-
      
-
  

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 or nine months ended September 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. TDRs at September 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 September 30, 2022  loans individually evaluated included approximately $9.3 million of loans in accruing status that were identified as TDRs.

The following table presents, by class, loans that were modified as TDRs:

 
Three months ended September 30, 2022
    
Three months ended September 30, 2021
  

                                   
 New York and other states*:        
Pre-Modification
    
Post-Modification
          
Pre-Modification
    
Post-Modification
  
           Outstanding      Outstanding            Outstanding      Outstanding  
   
Number of
     Recorded     Recorded    
Number of
      Recorded      Recorded  
(dollars in thousands)
  
Contracts
    
Investment
    
Investment
    
Contracts
    
Investment
    
Investment
  
                                     
Commercial:
                                    
Commercial real estate
    
-
    
$
-
      
-
      
-
    
$
-
      
-
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
3
      
282
      
282
      
2
      
557
      
557
  
Home equity loans
    
-
      
-
      
-
      
-
      
-
      
-
  
Home equity lines of credit
    
-
      
-
      
-
      
1
      
31
      
31
  
                                                 
Total
    
3
    
$
282
      
282
      
3
    
$
588
      
588
  

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

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

 
Nine months ended September 30, 2022
    
Nine months ended September 30, 2021
  
New York and other states*:
        
Pre-Modification
    
Post-Modification
          
Pre-Modification
    
Post-Modification
  
           Outstanding      Outstanding            Outstanding      Outstanding  
   
Number of
     Recorded     Recorded    
Number of
      Recorded      Recorded  
(dollars in thousands)
  
Contracts
    
Investment
    
Investment
    
Contracts
    
Investment
    
Investment
  
                                     
Commercial:
                                    
Commercial real estate
    
-
    
$
-
    
-
      
-
    
$
-
    
-
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
7
      
719
      
719
      
4
      
923
      
923
  
Home equity loans
    
-
      
-
      
-
      
1
      
2
      
2
  
Home equity lines of credit
    
-
      
-
      
-
      
3
      
88
      
88
  
                                                 
Total
    
7
    
$
719
    
719
      
8
    
$
1,013
    
1,013
  

Florida:
        
Pre-Modification
    
Post-Modification
          
Pre-Modification
    
Post-Modification
  
         
Outstanding
      Outstanding            Outstanding      Outstanding  
   
Number of
     Recorded     Recorded    
Number of
      Recorded      Recorded  
(dollars in thousands)
  
Contracts
    
Investment
    
Investment
    
Contracts
    
Investment
    
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
  

The addition of these TDRs 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*:         Unpaid          
YTD Avg
  
     Recorded      Principal      Related      Recorded  
(dollars in thousands)
  
Investment
    
Balance
    
Allowance
    
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:         Unpaid          
YTD Avg
  
     Recorded      Principal      Related      Recorded  
(dollars in thousands)
  
Investment
    
Balance
    
Allowance
    
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:         Unpaid          
YTD Avg
  
     Recorded      Principal      Related      Recorded  
(dollars in thousands)
  
Investment
    
Balance
    
Allowance
    
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.