XML 25 R12.htm IDEA: XBRL DOCUMENT v3.22.4
Loans and Leases and the Allowance for Credit Losses
 12 Months Ended
Dec. 31, 2022
Loans And Leases And Allowance For Loan And Lease Losses [Abstract]  
Loans and Leases and the Allowance for Credit Losses

Note 4.  Loans and Leases and the Allowance for Credit Losses

Loans and Leases

The Company’s loan and lease portfolio was comprised of the following as of December 31, 2022 and December 31, 2021:

 

 

 

December 31,

 

(dollars in thousands)

 

2022

 

 

2021

 

Commercial

 

 

 

 

 

 

 

 

Commercial and Industrial

 

$

1,389,066

 

 

$

1,361,921

 

Paycheck Protection Program

 

 

19,579

 

 

 

126,779

 

Commercial Mortgage

 

 

3,725,542

 

 

 

3,152,130

 

Construction

 

 

260,825

 

 

 

220,254

 

Lease Financing

 

 

69,491

 

 

 

105,108

 

Total Commercial

 

 

5,464,503

 

 

 

4,966,192

 

Consumer

 

 

 

 

 

 

 

 

Residential Mortgage

 

 

4,653,072

 

 

 

4,309,602

 

Home Equity

 

 

2,225,950

 

 

 

1,836,588

 

Automobile

 

 

870,396

 

 

 

736,565

 

Other 1

 

 

432,499

 

 

 

410,129

 

Total Consumer

 

 

8,181,917

 

 

 

7,292,884

 

Total Loans and Leases

 

$

13,646,420

 

 

$

12,259,076

 

 

1

Comprised of other revolving credit, installment, and lease financing.

The majority of the Company’s lending activity is with customers located in the State of Hawaii.  A substantial portion of the Company’s real estate loans are secured by real estate in Hawaii.

Net gains related to sales of residential mortgage loans, recorded as a component of mortgage banking income, were $0.2 million, $7.1 million, and $15.4 million for the years ended December 31, 2022, December 31, 2021, and December 31, 2020, respectively.  Net gains on sales of commercial loans were not material for the years ended December 31, 2022, December 31, 2021, and December 31, 2020.

The Company elected to exclude accrued interest receivable from the amortized cost basis of loans disclosed throughout this footnote.  As of December 31, 2022, and December 31, 2021, accrued interest receivable for loans totaled $40.1 million and $28.7 million, respectively, and is included in the “accrued interest receivable” line item on the Company’s consolidated statements of condition.

Allowance for Credit Losses (the “Allowance”)

The following presents by portfolio segment, the activity in the Allowance for the years ended December 31, 2022, December 31, 2021, and December 31, 2020.

 

(dollars in thousands)

 

Commercial

 

 

Consumer

 

 

Total

 

For the Year Ended December 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Credit Losses:

 

 

 

 

 

 

 

 

 

 

 

 

Balance at Beginning of Period

 

$

64,950

 

 

$

92,871

 

 

$

157,821

 

Loans and Leases Charged-Off

 

 

(925

)

 

 

(12,417

)

 

 

(13,342

)

Recoveries on Loans and Leases Previously Charged-Off

 

 

552

 

 

 

7,671

 

 

 

8,223

 

Net Loans and Leases Recovered (Charged-Off)

 

 

(373

)

 

 

(4,746

)

 

 

(5,119

)

Provision for Credit Losses

 

 

(677

)

 

 

(7,586

)

 

 

(8,263

)

Balance at End of Period

 

$

63,900

 

 

$

80,539

 

 

$

144,439

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Year Ended December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Credit Losses:

 

 

 

 

 

 

 

 

 

 

 

 

Balance at Beginning of Period

 

$

84,847

 

 

$

131,405

 

 

$

216,252

 

Loans and Leases Charged-Off

 

 

(1,117

)

 

 

(16,202

)

 

 

(17,319

)

Recoveries on Loans and Leases Previously Charged-Off

 

 

506

 

 

 

10,848

 

 

 

11,354

 

Net Loans and Leases Recovered (Charged-Off)

 

 

(611

)

 

 

(5,354

)

 

 

(5,965

)

Provision for Credit Losses

 

 

(19,286

)

 

 

(33,180

)

 

 

(52,466

)

Balance at End of Period

 

$

64,950

 

 

$

92,871

 

 

$

157,821

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Year Ended December 31, 2020

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Credit Losses:

 

 

 

 

 

 

 

 

 

 

 

 

Balance at Beginning of Period

 

$

55,012

 

 

$

53,278

 

 

$

108,290

 

Loans and Leases Charged-Off

 

 

(1,697

)

 

 

(19,341

)

 

 

(21,038

)

Recoveries on Loans and Leases Previously Charged-Off

 

 

2,328

 

 

 

11,572

 

 

 

13,900

 

Net Loans and Leases Recovered (Charged-Off)

 

 

631

 

 

 

(7,769

)

 

 

(7,138

)

Provision for Credit Losses

 

 

29,204

 

 

 

85,896

 

 

 

115,100

 

Balance at End of Period

 

$

84,847

 

 

$

131,405

 

 

$

216,252

 

 

 

Credit Quality Indicators

The Company uses several credit quality indicators to manage credit risk in an ongoing manner.  The Company uses an internal credit risk rating system that categorizes loans and leases into pass, special mention, or classified categories.  Credit risk ratings are applied individually to those classes of loans and leases that have significant or unique credit characteristics that benefit from a case-by-case evaluation.  These are typically loans and leases to businesses or individuals in the classes which comprise the commercial portfolio segment.  Groups of loans and leases that are underwritten and structured using standardized criteria and characteristics, such as statistical models (e.g., credit scoring or payment performance), are typically risk-rated and monitored collectively.  These are typically loans and leases to individuals in the classes which comprise the consumer portfolio segment.

The following are the definitions of the Company’s credit quality indicators:

 

Pass:

Loans and leases in all classes within the commercial and consumer portfolio segments that are not adversely rated, are contractually current as to principal and interest, and are otherwise in compliance with the contractual terms of the loan or lease agreement.  Residential mortgage loans that are past due 90 days or more as to principal or interest may be considered Pass if the current loan-to-value ratio is 60% or less.  Home equity loans that are past due 90 days or more as to principal or interest may be considered Pass if: a) the home equity loan is in first lien position and the current loan-to-value ratio is 60% or less; or b) the first mortgage is with the Company and the current combined loan-to-value ratio is 60% or less.

 

Special Mention:

Loans and leases in all classes within the commercial portfolio segment that have potential weaknesses that deserve management’s close attention.  If not addressed, these potential weaknesses may result in deterioration of the repayment prospects for the loan or lease.  The Special Mention credit quality indicator is not used for the consumer portfolio segment.

 

Classified:

Loans and leases in the classes within the commercial portfolio segment that are inadequately protected by the sound worth and paying capacity of the borrower or of the collateral pledged, if any.  Classified loans and leases are also those in the classes within the consumer portfolio segment that are past due 90 days or more as to principal or interest.  Residential mortgage and home equity loans may be current as to principal and interest, but may be considered Classified for a period of generally up to six months following a loan modification.  Following a period of demonstrated performance in accordance with the modified contractual terms, the loan may be removed from Classified status.

 

 

For Pass rated credits in the commercial portfolio, most risk ratings are certified at a minimum annually.  For Special Mention or Classified Credits, risk ratings are reviewed for appropriateness on an ongoing basis, monthly, or at a minimum, quarterly.  The following presents by credit quality indicator, loan class, and year of origination, the amortized cost basis of the Company’s loans and leases as of December 31, 2022.

 

 

 

Term Loans by Origination Year

 

 

 

 

 

 

 

 

 

 

 

 

 

(dollars in thousands)

2022

 

 

2021

 

 

2020

 

 

2019

 

 

2018

 

 

Prior

 

 

Revolving

Loans

 

 

Revolving

Loans

Converted

to Term

Loans

 

 

Total Loans

and Leases

 

December 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and Industrial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

360,748

 

 

$

348,300

 

 

$

224,264

 

 

$

59,127

 

 

$

46,799

 

 

$

71,906

 

 

$

257,349

 

 

$

155

 

 

$

1,368,648

 

Special Mention

 

 

273

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

96

 

 

 

92

 

 

 

1,357

 

 

 

-

 

 

 

1,818

 

Classified

 

 

7,295

 

 

 

91

 

 

 

1,030

 

 

 

-

 

 

 

1,644

 

 

 

6,267

 

 

 

2,252

 

 

 

21

 

 

 

18,600

 

Total Commercial and

   Industrial

 

$

368,316

 

 

$

348,391

 

 

$

225,294

 

 

$

59,127

 

 

$

48,539

 

 

$

78,265

 

 

$

260,958

 

 

$

176

 

 

$

1,389,066

 

Paycheck Protection Program

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

-

 

 

$

5,359

 

 

$

14,220

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

19,579

 

Total Paycheck Protection Program

 

$

-

 

 

$

5,359

 

 

$

14,220

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

19,579

 

Commercial Mortgage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

1,182,831

 

 

$

771,375

 

 

$

691,054

 

 

$

283,553

 

 

$

131,055

 

 

$

494,924

 

 

$

48,771

 

 

$

-

 

 

$

3,603,563

 

Special Mention

 

 

29,707

 

 

 

37,657

 

 

 

28,105

 

 

 

-

 

 

 

1,482

 

 

 

5,014

 

 

 

-

 

 

 

-

 

 

 

101,965

 

Classified

 

 

182

 

 

 

1,964

 

 

 

8,545

 

 

 

624

 

 

 

-

 

 

 

8,699

 

 

 

-

 

 

 

-

 

 

 

20,014

 

Total Commercial

   Mortgage

 

$

1,212,720

 

 

$

810,996

 

 

$

727,704

 

 

$

284,177

 

 

$

132,537

 

 

$

508,637

 

 

$

48,771

 

 

$

-

 

 

$

3,725,542

 

Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

124,507

 

 

$

69,992

 

 

$

37,133

 

 

$

16,838

 

 

$

-

 

 

$

297

 

 

$

12,058

 

 

$

-

 

 

$

260,825

 

Total Construction

 

$

124,507

 

 

$

69,992

 

 

$

37,133

 

 

$

16,838

 

 

$

-

 

 

$

297

 

 

$

12,058

 

 

$

-

 

 

$

260,825

 

Lease Financing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

16,959

 

 

$

17,823

 

 

$

11,408

 

 

$

9,768

 

 

$

6,379

 

 

$

6,444

 

 

$

-

 

 

$

-

 

 

$

68,781

 

Classified

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

710

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

710

 

Total Lease

Financing

 

$

16,959

 

 

$

17,823

 

 

$

11,408

 

 

$

9,768

 

 

$

7,089

 

 

$

6,444

 

 

$

-

 

 

$

-

 

 

$

69,491

 

Total Commercial

 

$

1,722,502

 

 

$

1,252,561

 

 

$

1,015,759

 

 

$

369,910

 

 

$

188,165

 

 

$

593,643

 

 

$

321,787

 

 

$

176

 

 

$

5,464,503

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential Mortgage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

827,909

 

 

$

1,304,831

 

 

$

1,035,285

 

 

$

321,208

 

 

$

138,214

 

 

$

1,023,841

 

 

$

-

 

 

$

-

 

 

$

4,651,288

 

Classified

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

552

 

 

 

1,232

 

 

 

-

 

 

 

-

 

 

 

1,784

 

Total Residential

   Mortgage

 

$

827,909

 

 

$

1,304,831

 

 

$

1,035,285

 

 

$

321,208

 

 

$

138,766

 

 

$

1,025,073

 

 

$

-

 

 

$

-

 

 

$

4,653,072

 

Home Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

890

 

 

$

2,186,598

 

 

$

36,114

 

 

$

2,223,602

 

Classified

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

25

 

 

 

1,105

 

 

 

1,218

 

 

 

2,348

 

Total Home Equity

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

915

 

 

$

2,187,703

 

 

$

37,332

 

 

$

2,225,950

 

Automobile

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

405,440

 

 

$

216,039

 

 

$

100,608

 

 

$

84,052

 

 

$

45,301

 

 

$

18,366

 

 

$

-

 

 

$

-

 

 

$

869,806

 

Classified

 

 

121

 

 

 

260

 

 

 

23

 

 

 

43

 

 

 

92

 

 

 

51

 

 

 

-

 

 

 

-

 

 

 

590

 

Total Automobile

 

$

405,561

 

 

$

216,299

 

 

$

100,631

 

 

$

84,095

 

 

$

45,393

 

 

$

18,417

 

 

$

-

 

 

$

-

 

 

$

870,396

 

Other1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

185,347

 

 

$

124,759

 

 

$

31,343

 

 

$

39,902

 

 

$

16,364

 

 

$

9,853

 

 

$

23,228

 

 

$

1,020

 

 

$

431,816

 

Classified

 

 

117

 

 

 

114

 

 

 

70

 

 

 

148

 

 

 

129

 

 

 

24

 

 

 

59

 

 

 

22

 

 

 

683

 

Total Other

 

$

185,464

 

 

$

124,873

 

 

$

31,413

 

 

$

40,050

 

 

$

16,493

 

 

$

9,877

 

 

$

23,287

 

 

$

1,042

 

 

$

432,499

 

Total Consumer

 

$

1,418,934

 

 

$

1,646,003

 

 

$

1,167,329

 

 

$

445,353

 

 

$

200,652

 

 

$

1,054,282

 

 

$

2,210,990

 

 

$

38,374

 

 

$

8,181,917

 

Total Loans and Leases

 

$

3,141,436

 

 

$

2,898,564

 

 

$

2,183,088

 

 

$

815,263

 

 

$

388,817

 

 

$

1,647,925

 

 

$

2,532,777

 

 

$

38,550

 

 

$

13,646,420

 

1

Comprised of other revolving credit, installment, and lease financing.

For the year ended December 31, 2022, $6.2 million in revolving loans were converted to term loans.

The following presents by credit quality indicator, loan class, and year of origination, the amortized cost basis of the Company’s loans and leases as of December 31, 2021.

 

 

 

Term Loans by Origination Year

 

 

 

 

 

 

 

 

 

 

 

 

 

(dollars in thousands)

2021

 

 

2020

 

 

2019

 

 

2018

 

 

2017

 

 

Prior

 

 

Revolving

Loans

 

 

Revolving

Loans

Converted

to Term

Loans

 

 

Total Loans

and Leases

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and Industrial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

455,984

 

 

$

301,646

 

 

$

79,826

 

 

$

68,026

 

 

$

27,246

 

 

$

75,321

 

 

$

256,240

 

 

$

471

 

 

$

1,264,760

 

Special Mention

 

 

1,966

 

 

 

32,667

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

101

 

 

 

27,031

 

 

 

-

 

 

 

61,765

 

Classified

 

 

10,851

 

 

 

1,919

 

 

 

87

 

 

 

1,990

 

 

 

505

 

 

 

17,481

 

 

 

2,509

 

 

 

54

 

 

 

35,396

 

Total Commercial and

   Industrial

 

$

468,801

 

 

$

336,232

 

 

$

79,913

 

 

$

70,016

 

 

$

27,751

 

 

$

92,903

 

 

$

285,780

 

 

$

525

 

 

$

1,361,921

 

PPP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

86,484

 

 

$

40,295

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

126,779

 

Total PPP

 

$

86,484

 

 

$

40,295

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

126,779

 

Commercial Mortgage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

958,719

 

 

$

736,155

 

 

$

338,160

 

 

$

261,991

 

 

$

178,436

 

 

$

459,337

 

 

$

53,386

 

 

$

-

 

 

$

2,986,184

 

Special Mention

 

 

68,768

 

 

 

39,773

 

 

 

-

 

 

 

30,000

 

 

 

-

 

 

 

6,069

 

 

 

-

 

 

 

-

 

 

 

144,610

 

Classified

 

 

3,740

 

 

 

7,815

 

 

 

640

 

 

 

-

 

 

 

-

 

 

 

9,141

 

 

 

-

 

 

 

-

 

 

 

21,336

 

Total Commercial

   Mortgage

 

$

1,031,227

 

 

$

783,743

 

 

$

338,800

 

 

$

291,991

 

 

$

178,436

 

 

$

474,547

 

 

$

53,386

 

 

$

-

 

 

$

3,152,130

 

Construction

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

67,069

 

 

$

94,878

 

 

$

40,051

 

 

$

-

 

 

$

596

 

 

$

-

 

 

$

17,660

 

 

$

-

 

 

$

220,254

 

Total Construction

 

$

67,069

 

 

$

94,878

 

 

$

40,051

 

 

$

-

 

 

$

596

 

 

$

-

 

 

$

17,660

 

 

$

-

 

 

$

220,254

 

Lease Financing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

21,637

 

 

$

15,075

 

 

$

15,697

 

 

$

9,902

 

 

$

2,004

 

 

$

39,937

 

 

$

-

 

 

$

-

 

 

$

104,252

 

Classified

 

 

-

 

 

 

-

 

 

 

-

 

 

 

856

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

856

 

Total Lease

Financing

 

$

21,637

 

 

$

15,075

 

 

$

15,697

 

 

$

10,758

 

 

$

2,004

 

 

$

39,937

 

 

$

-

 

 

$

-

 

 

$

105,108

 

Total Commercial

 

$

1,675,218

 

 

$

1,270,223

 

 

$

474,461

 

 

$

372,765

 

 

$

208,787

 

 

$

607,387

 

 

$

356,826

 

 

$

525

 

 

$

4,966,192

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential Mortgage2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

1,392,337

 

 

$

1,131,330

 

 

$

367,525

 

 

$

177,215

 

 

$

256,825

 

 

$

982,759

 

 

$

-

 

 

$

-

 

 

$

4,307,991

 

Classified

 

 

-

 

 

 

-

 

 

 

294

 

 

 

-

 

 

 

905

 

 

 

412

 

 

 

-

 

 

 

-

 

 

 

1,611

 

Total Residential

   Mortgage

 

$

1,392,337

 

 

$

1,131,330

 

 

$

367,819

 

 

$

177,215

 

 

$

257,730

 

 

$

983,171

 

 

$

-

 

 

$

-

 

 

$

4,309,602

 

Home Equity2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

2,986

 

 

$

1,795,107

 

 

$

35,427

 

 

$

1,833,520

 

Classified

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

58

 

 

 

2,649

 

 

 

361

 

 

 

3,068

 

Total Home Equity

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

3,044

 

 

$

1,797,756

 

 

$

35,788

 

 

$

1,836,588

 

Automobile

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

301,285

 

 

$

152,022

 

 

$

138,887

 

 

$

91,411

 

 

$

33,268

 

 

$

18,963

 

 

$

-

 

 

$

-

 

 

$

735,836

 

Classified

 

 

165

 

 

 

85

 

 

 

134

 

 

 

137

 

 

 

120

 

 

 

88

 

 

 

-

 

 

 

-

 

 

 

729

 

Total Automobile

 

$

301,450

 

 

$

152,107

 

 

$

139,021

 

 

$

91,548

 

 

$

33,388

 

 

$

19,051

 

 

$

-

 

 

$

-

 

 

$

736,565

 

Other1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

172,735

 

 

$

49,769

 

 

$

92,983

 

 

$

44,489

 

 

$

16,218

 

 

$

6,444

 

 

$

25,622

 

 

$

1,444

 

 

$

409,704

 

Classified

 

 

39

 

 

 

90

 

 

 

183

 

 

 

47

 

 

 

27

 

 

 

17

 

 

 

22

 

 

 

-

 

 

 

425

 

Total Other

 

$

172,774

 

 

$

49,859

 

 

$

93,166

 

 

$

44,536

 

 

$

16,245

 

 

$

6,461

 

 

$

25,644

 

 

$

1,444

 

 

$

410,129

 

Total Consumer

 

$

1,866,561

 

 

$

1,333,296

 

 

$

600,006

 

 

$

313,299

 

 

$

307,363

 

 

$

1,011,727

 

 

$

1,823,400

 

 

$

37,232

 

 

$

7,292,884

 

Total Loans and Leases

 

$

3,541,779

 

 

$

2,603,519

 

 

$

1,074,467

 

 

$

686,064

 

 

$

516,150

 

 

$

1,619,114

 

 

$

2,180,226

 

 

$

37,757

 

 

$

12,259,076

 

 

1

Comprised of other revolving credit, installment, and lease financing.

2

Certain prior period information has been reclassified to conform to current presentations.

 

 

For the year ended December 31, 2021, $4.1 million in revolving loans were converted to term loans.

 

 

Aging Analysis

Loans and leases are considered to be past due once becoming 30 days delinquent.  For the consumer portfolio, this generally represents two missed monthly payments.  The following presents by class, an aging analysis of the Company’s loan and lease portfolio as of December 31, 2022, and December 31, 2021.

 

(dollars in thousands)

 

30 - 59

Days

Past

Due

 

 

60 - 89

Days

Past

Due

 

 

Past Due

90 Days

or More

 

 

Non-

Accrual

 

 

Total

Past

Due

and

Non-

Accrual

 

 

Current

 

 

Total Loans

and

Leases

 

 

Non-

Accrual

Loans

and

Leases

that

are

Current 2

 

As of December 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and Industrial

 

$

252

 

 

$

9

 

 

$

—

 

 

$

37

 

 

$

298

 

 

$

1,388,768

 

 

$

1,389,066

 

 

$

37

 

Paycheck Protection Program

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

19,579

 

 

 

19,579

 

 

 

—

 

Commercial Mortgage

 

 

—

 

 

 

—

 

 

 

—

 

 

 

3,309

 

 

 

3,309

 

 

 

3,722,233

 

 

 

3,725,542

 

 

 

3,309

 

Construction

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

260,825

 

 

 

260,825

 

 

 

—

 

Lease Financing

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

69,491

 

 

 

69,491

 

 

 

—

 

Total Commercial

 

 

252

 

 

 

9

 

 

 

—

 

 

 

3,346

 

 

 

3,607

 

 

 

5,460,896

 

 

 

5,464,503

 

 

 

3,346

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential Mortgage

 

 

3,016

 

 

 

721

 

 

 

2,429

 

 

 

4,239

 

 

 

10,405

 

 

 

4,642,667

 

 

 

4,653,072

 

 

 

1,729

 

Home Equity

 

 

1,639

 

 

 

960

 

 

 

1,673

 

 

 

4,022

 

 

 

8,294

 

 

 

2,217,656

 

 

 

2,225,950

 

 

 

664

 

Automobile

 

 

13,293

 

 

 

1,988

 

 

 

589

 

 

 

—

 

 

 

15,870

 

 

 

854,526

 

 

 

870,396

 

 

 

—

 

Other 1

 

 

2,318

 

 

 

1,302

 

 

 

683

 

 

 

—

 

 

 

4,303

 

 

 

428,196

 

 

 

432,499

 

 

 

—

 

Total Consumer

 

 

20,266

 

 

 

4,971

 

 

 

5,374

 

 

 

8,261

 

 

 

38,872

 

 

 

8,143,045

 

 

 

8,181,917

 

 

 

2,393

 

Total

 

$

20,518

 

 

$

4,980

 

 

$

5,374

 

 

$

11,607

 

 

$

42,479

 

 

$

13,603,941

 

 

$

13,646,420

 

 

$

5,739

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and Industrial

 

$

2,006

 

 

$

14

 

 

$

—

 

 

$

243

 

 

$

2,263

 

 

$

1,359,658

 

 

$

1,361,921

 

 

$

151

 

PPP

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

126,779

 

 

 

126,779

 

 

 

—

 

Commercial Mortgage

 

 

—

 

 

 

—

 

 

 

—

 

 

 

8,205

 

 

 

8,205

 

 

 

3,143,925

 

 

 

3,152,130

 

 

 

8,205

 

Construction

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

220,254

 

 

 

220,254

 

 

 

—

 

Lease Financing

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

105,108

 

 

 

105,108

 

 

 

—

 

Total Commercial

 

 

2,006

 

 

 

14

 

 

 

—

 

 

 

8,448

 

 

 

10,468

 

 

 

4,955,724

 

 

 

4,966,192

 

 

 

8,356

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential Mortgage

 

 

2,046

 

 

 

1,263

 

 

 

3,159

 

 

 

3,305

 

 

 

9,773

 

 

 

4,299,829

 

 

 

4,309,602

 

 

 

—

 

Home Equity

 

 

1,791

 

 

 

748

 

 

 

3,456

 

 

 

4,881

 

 

 

10,876

 

 

 

1,825,712

 

 

 

1,836,588

 

 

 

1,544

 

Automobile

 

 

7,804

 

 

 

1,495

 

 

 

729

 

 

 

—

 

 

 

10,028

 

 

 

726,537

 

 

 

736,565

 

 

 

—

 

Other 1

 

 

2,686

 

 

 

904

 

 

 

426

 

 

 

—

 

 

 

4,016

 

 

 

406,113

 

 

 

410,129

 

 

 

—

 

Total Consumer

 

 

14,327

 

 

 

4,410

 

 

 

7,770

 

 

 

8,186

 

 

 

34,693

 

 

 

7,258,191

 

 

 

7,292,884

 

 

 

1,544

 

Total

 

$

16,333

 

 

$

4,424

 

 

$

7,770

 

 

$

16,634

 

 

$

45,161

 

 

$

12,213,915

 

 

$

12,259,076

 

 

$

9,900

 

1

Comprised of other revolving credit, installment, and lease financing.

2

Represents non-accrual loans that are not past due 30 days or more; however, full payment of principal and interest as originally structured is still not expected.

 

 

 

Non-Accrual Loans and Leases

 

The following presents the non-accrual loans and leases as of December 31, 2022, and December 31, 2021.

 

 

December 31, 2022

 

 

December 31, 2021

 

(dollars in thousands)

 

Non-accrual loans with a related ACL

 

 

Non-accrual loans without a related ACL

 

 

Total Non-accrual loans

 

 

Total Non-accrual loans

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and Industrial

 

$

37

 

 

$

—

 

 

$

37

 

 

$

243

 

Commercial Mortgage

 

 

—

 

 

 

3,309

 

 

 

3,309

 

 

 

8,205

 

Total Commercial

 

 

37

 

 

 

3,309

 

 

 

3,346

 

 

 

8,448

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential Mortgage

 

 

4,239

 

 

 

—

 

 

 

4,239

 

 

 

3,305

 

Home Equity

 

 

4,022

 

 

 

—

 

 

 

4,022

 

 

 

4,881

 

Total Consumer

 

 

8,261

 

 

 

—

 

 

 

8,261

 

 

 

8,186

 

Total

 

$

8,298

 

 

$

3,309

 

 

$

11,607

 

 

$

16,634

 

 

All payments received while on non-accrual status are applied against the principal balance of the loan or lease. The Company does not recognize interest income while loans or leases are on non-accrual status.

Modifications

A modification of a loan constitutes a troubled debt restructuring (“TDR”) when the Company for economic or legal reasons related to a borrower’s financial difficulties grants a concession to the borrower that it would not otherwise consider.  Loans modified in a TDR were $47.3 million and $70.0 million as of December 31, 2022, and December 31, 2021, respectively.  As of December 31, 2022, and December 31, 2021, there were $0.2 million in commitments to lend additional funds on loans modified in a TDR.

Loans modified in a TDR may already be on non-accrual status and partial charge-offs have in some cases already been taken against the outstanding loan balance.  As a result, loans modified in a TDR may have the financial effect of reducing the specific Allowance associated with the loan because the potential loss has been recognized.  An Allowance for impaired commercial and consumer loans that have been modified in a TDR is measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price, or the estimated fair value of the collateral, less any selling costs, if the loan is collateral dependent.  Management exercises significant judgment in developing these estimates.

The following presents by class, information related to loans modified in a TDR during the years ended December 31, 2022, and December 31, 2021.

 

 

 

Loans Modified as a TDR for the

Year Ended December 31, 2022

 

 

Loans Modified as a TDR for the

Year Ended December 31, 2021

 

Troubled Debt Restructurings

(dollars in thousands)

 

Number of

Contracts

 

 

Recorded

Investment

(as of period end) 1

 

 

Increase in

Allowance

(as of period end)

 

 

Number of

Contracts

 

 

Recorded

Investment

(as of period end) 1

 

 

Increase in

Allowance

(as of period end)

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and Industrial

 

 

2

 

 

$

210

 

 

$

15

 

 

 

7

 

 

$

251

 

 

$

4

 

Total Commercial

 

 

2

 

 

 

210

 

 

 

15

 

 

 

7

 

 

 

251

 

 

 

4

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential Mortgage

 

 

6

 

 

 

1,441

 

 

 

71

 

 

 

15

 

 

 

5,889

 

 

 

612

 

Home Equity

 

 

3

 

 

 

276

 

 

 

5

 

 

 

11

 

 

 

1,793

 

 

 

85

 

Automobile

 

 

152

 

 

 

2,860

 

 

 

39

 

 

 

341

 

 

 

7,130

 

 

 

95

 

Other 2

 

 

49

 

 

 

310

 

 

 

12

 

 

 

132

 

 

 

1,160

 

 

 

42

 

Total Consumer

 

 

210

 

 

 

4,887

 

 

 

127

 

 

 

499

 

 

 

15,972

 

 

 

834

 

Total

 

 

212

 

 

$

5,097

 

 

$

142

 

 

 

506

 

 

$

16,223

 

 

$

838

 

1

The period end balances reflect all partial paydowns and charge-offs since the modification date.  TDRs fully paid off, charged off, or foreclosed upon by period end are not included.

2

Comprised of other revolving credit and installment financing.

 

The following presents by class, loans modified in a TDR that defaulted during the year ended December 31, 2022, and December 31, 2021, and within twelve months of their modification date.  A TDR is considered to be in default once it becomes 60 days or more past due following a modification.

 

 

 

Year Ended December 31,

2022

 

 

Year Ended December 31,

2021

 

TDRs that Defaulted During the Period,

    Within Twelve Months of their Modification Date

(dollars in thousands)

 

Number of

Contracts

 

 

Recorded

Investment

(as of period end) 1

 

 

Number of

Contracts

 

 

Recorded

Investment

(as of period end) 1

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential Mortgage

 

 

1

 

 

 

180

 

 

 

1

 

 

 

521

 

Home Equity

 

 

1

 

 

 

65

 

 

 

4

 

 

 

407

 

Automobile

 

 

12

 

 

 

191

 

 

 

38

 

 

 

644

 

Other 2

 

 

10

 

 

 

73

 

 

 

29

 

 

 

189

 

Total

 

 

24

 

 

$

509

 

 

 

72

 

 

$

1,761

 

1

The period end balances reflect all paydowns and charge-offs since the modification date.  TDRs fully paid off, charged off, or foreclosed upon by period end are not included.

2

Comprised of other revolving credit and installment financing.

Loans modified in a TDR are closely monitored for delinquency as an early indicator of possible future default.  If loans modified in a TDR subsequently default, the Company evaluates the loan for possible further impairment.  The specific Allowance associated with the loan may be increased, adjustments may be made in the allocation of the Allowance, or partial charge-offs may be taken to further write-down the carrying value of the loan.

Foreclosure Proceedings

Consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure totaled $3.9 million as of December 31, 2022.