Real Estate. Real estate loans include residential real estate non-conforming loans, residential real estate conforming loans, commercial real estate, and home equity lines of credit. The allowance methodology related to real estate loans considers several factors, including, but not limited to, loan-to-value ratio, FICO score, home price index, delinquency status, credit limits, and utilization rates.

Commercial and industrial (C&I). C&I loans primarily include commercial and industrial lending used for general corporate purposes, working capital and liquidity, and “event-driven.” “Event-driven” loans support client merger, acquisition or recapitalization activities. C&I lending is structured as revolving lines of credit, letter of credit facilities, term loans and bridge loans. Risk factors considered in determining the allowance for corporate loans include the borrower’s financial strength, seniority of the loan, collateral type, leverage, volatility of collateral value, debt cushion, and covenants.

Fund banking. Fund banking loans primarily include capital call lines of credit, also known as subscription lines of credit. These credit facilities are used by closed-end private investment funds (“Fund”) that have raised capital commitments from limited partners to effectively manage the Fund’s cash and bridge timing between the Fund’s investments and capital calls. The lines of credit are collateralized by a pledge of the limited partner’s contractually callable capital and the general partner’s right to call such capital as permitted in the Fund’s partnership agreement.

Securities-based loans. Securities-based loans allow clients to borrow money against the value of qualifying securities for any suitable purpose other than purchasing, trading, or carrying securities or refinancing margin debt. The majority of consumer loans are structured as revolving lines of credit and letter of credit facilities and are primarily offered through Stifel’s Pledged Asset (“SPA”) program. The allowance methodology for securities-based lending considers the collateral type underlying the loan, including the liquidity and trading volume of the collateral, position concentration and other borrower specific factors such as personal guarantees.

Construction and land. Short-term loans used to finance the development of commercial real estate projects.

The following table presents the balance and associated percentage of each major loan category in our bank loan portfolio at September 30, 2024 and December 31, 2023 (in thousands, except percentages):


	September 30, 2024						December 31, 2023
	Balance			Percent			Balance			Percent
Residential real estate	$	8,406,932			41.3	%	$	8,047,647			41.4	%
Commercial and industrial		3,896,824			19.1			3,566,987			18.3
Fund banking		3,762,960			18.5			3,633,126			18.7
Securities-based loans		2,273,246			11.2			2,306,455			11.9
Construction and land		1,219,787			6.0			1,034,370			5.3
Commercial real estate		565,686			2.8			660,631			3.4
Home equity lines of credit		170,732			0.8			136,270			0.7
Other		53,414			0.3			55,981			0.3
Gross bank loans		20,349,581			100.0	%		19,441,467			100.0	%
Loans in process/(unapplied loan payments), net		(38,825	)					1,108
Unamortized loan fees, net		(5,720	)					(8,478	)
Allowance for loan losses		(137,350	)					(128,292	)
Loans held for investment, net	$	20,167,686					$	19,305,805

At September 30, 2024 and December 31, 2023, Stifel Bancorp had loans outstanding to its executive officers and directors and executive officers and directors of certain affiliated entities in the amount of $41.8 million and $46.0 million, respectively.

At September 30, 2024 and December 31, 2023, we had loans held for sale of $465.7 million and $424.0 million, respectively. For the three months ended September 30, 2024 and 2023, we recognized losses, included in other income in the accompanying consolidated statements of operations, of $0.1 million and $0.2 million, respectively, from the sale of originated loans, net of fees and costs. For the nine months ended September 30, 2024 and 2023, we recognized losses, included in other income in the accompanying consolidated statements of operations, of $3.0 million and $2.8 million, respectively, from the sale of originated loans, net of fees and costs.

At September 30, 2024 and December 31, 2023, loans, primarily consisting of residential and commercial real estate loans of $7.8 billion and $7.4 billion, respectively, were pledged at the Federal Home Loan Bank as collateral for borrowings. At September 30, 2024, loans of $2.3 billion were pledged with the Federal Reserve discount window.

Accrued interest receivable for loans and loans held for sale at September 30, 2024 and December 21, 2023 was $100.9 million and $94.0 million, respectively, and is reported in other assets on the consolidated statement of financial condition.

The following tables detail activity in the allowance for loan losses by portfolio segment for the three and nine months ended September 30, 2024 (in thousands).


	Three Months Ended September 30, 2024
	Beginning Balance		Provision			Charge-offs			Recoveries		Ending Balance
Commercial and industrial	$	76,354	$	10,321		$	(6,813	)	$	—	$	79,862
Construction and land		16,379		3,396			—			—		19,775
Commercial real estate		15,312		(2,997	)		—			—		12,315
Fund banking		12,179		(1,642	)		—			—		10,537
Residential real estate		11,242		28			—			—		11,270
Securities-based loans		2,813		40			—			—		2,853
Home equity lines of credit		362		(143	)		—			—		219
Other		473		205			(159	)		—		519
	$	135,114	$	9,208		$	(6,972	)	$	—	$	137,350


	Nine Months Ended September 30, 2024
	Beginning Balance		Provision			Charge-offs			Recoveries		Ending Balance
Commercial and industrial	$	67,077	$	22,476		$	(10,624	)	$	933	$	79,862
Construction and land		11,817		7,958			—			—		19,775
Commercial real estate		21,386		(7,381	)		(1,690	)		—		12,315
Fund banking		10,173		364			—			—		10,537
Residential real estate		13,855		(2,585	)		—			—		11,270
Securities-based loans		3,035		(182	)		—			—		2,853
Home equity lines of credit		371		(152	)		—			—		219
Other		578		100			(159	)		—		519
	$	128,292	$	20,598		$	(12,473	)	$	933	$	137,350

During the three months ended September 30, 2024, we recorded $5.3 million of net credit loss reserves, including $9.2 million of the reserve for credit losses for funded loans, partially offset by a release of $3.9 million of the allowance for unfunded lending commitments. During the nine months ended September 30, 2024, we recorded $13.5 million of net credit loss reserves, including $20.6 million of the reserve for credit losses for funded loans and $0.3 million related to employee retention awards, partially offset by a release of $7.4 million of the allowance for unfunded lending commitments. During the three months ended September 30, 2023, we recorded $10.0 million of net credit loss reserves, including $13.4 million of the reserve for credit losses for funded loans, partially offset by a release of $3.4 million of the allowance for unfunded lending commitments. During the nine months ended September 30, 2023, we recorded $22.7 million of net credit loss reserves, including $24.9 million of the reserve for credit losses for funded loans, partially offset by a release of $2.2 million of the allowance for unfunded lending commitments. The provision for unfunded lending agreements is included in the provision for credit losses on the consolidated statement of operations. The expected credit losses for unfunded lending commitments, including standby letters of credit and binding unfunded loan commitments, are reported on the consolidated statement of financial condition in accounts payable and accrued expenses.

The following tables detail activity in the allowance for loan losses by portfolio segment for the three and nine months ended September 30, 2023 (in thousands).


	Three Months Ended September 30, 2023
	Beginning Balance		Provision			Charge-offs			Recoveries		Ending Balance
Commercial and industrial	$	66,377	$	8,584		$	(302	)	$	—	$	74,659
Commercial real estate		13,429		6,437			—			—		19,866
Residential real estate		14,413		194			—			—		14,607
Fund banking		12,178		(660	)		—			—		11,518
Construction and land		12,645		(1,145	)		—			—		11,500
Securities-based loans		3,086		(68	)		—			—		3,018
Home equity lines of credit		168		27			—			—		195
Other		385		49			—			—		434
	$	122,681	$	13,418		$	(302	)	$	—	$	135,797


	Nine Months Ended September 30, 2023
	Beginning Balance		Provision			Charge-offs			Recoveries		Ending Balance
Commercial and industrial	$	54,143	$	21,283		$	(920	)	$	153	$	74,659
Commercial real estate		12,897		6,969			—			—		19,866
Residential real estate		20,441		(5,834	)		—			—		14,607
Fund banking		11,711		(193	)		—			—		11,518
Construction and land		8,568		2,932			—			—		11,500
Securities-based loans		3,157		(139	)		—			—		3,018
Home equity lines of credit		364		(169	)		—			—		195
Other		372		62			—			—		434
	$	111,653	$	24,911		$	(920	)	$	153	$	135,797

The following tables present the aging of the recorded investment in past due loans at September 30, 2024 and December 31, 2023 by portfolio segment (in thousands):


	As of September 30, 2024
	30 – 89 Days Past Due		90 or More Days Past Due		Total Past Due		Current Balance		Total
Residential real estate	$	12,597	$	3,226	$	15,823	$	8,391,109	$	8,406,932
Commercial and industrial		60,901		—		60,901		3,835,923		3,896,824
Fund banking		—		—		—		3,762,960		3,762,960
Securities-based loans		—		850		850		2,272,396		2,273,246
Construction and land		—		—		—		1,219,787		1,219,787
Commercial real estate		—		—		—		565,686		565,686
Home equity lines of credit		305		568		873		169,859		170,732
Other		58		51		109		53,305		53,414
Total	$	73,861	$	4,695	$	78,556	$	20,271,025	$	20,349,581


	As of September 30, 2024*
	Nonaccrual		Nonperforming loans with no allowance		Total
Commercial and industrial	$	43,742	$	13,833	$	57,575
Construction and land		48,349		—		48,349
Commercial real estate		34,813		—		34,813
Residential real estate		1,251		1,705		2,956
Home equity lines of credit		378		—		378
Other		51		—		51
Total	$	128,584	$	15,538	$	144,122

* There were no loans past due 90 days and still accruing interest at September 30, 2024.


	As of December 31, 2023
	30 – 89 Days Past Due		90 or More Days Past Due		Total Past Due		Current Balance		Total
Residential real estate	$	15,312	$	3,945	$	19,257	$	8,028,390	$	8,047,647
Fund banking		—		—		—		3,633,126		3,633,126
Commercial and industrial		—		2,022		2,022		3,564,965		3,566,987
Securities-based loans		—		3		3		2,306,452		2,306,455
Construction and land		—		—		—		1,034,370		1,034,370
Commercial real estate		—		—		—		660,631		660,631
Home equity lines of credit		570		87		657		135,613		136,270
Other		45		59		104		55,877		55,981
Total	$	15,927	$	6,116	$	22,043	$	19,419,424	$	19,441,467


	As of December 31, 2023*
	Nonaccrual		Nonperforming loans with no allowance		Total
Commercial real estate	$	39,195	$	—	$	39,195
Residential real estate		3,090		1,000		4,090
Commercial and industrial		—		2,022		2,022
Securities-based loans		—		3		3
Home equity lines of credit		22		65		87
Other		59		—		59
Total	$	42,366	$	3,090	$	45,456

* There were no loans past due 90 days and still accruing interest at December 31, 2023.

In the normal course of business, we may modify the original terms of a loan agreement. In certain circumstances, we may agree to modify the original terms of a loan agreement to a borrower experiencing financial difficulty, which may include a borrower in default, financial distress, bankruptcy or other circumstances. Modifications of loans to borrowers experiencing financial difficulty are designed to reduce our loss exposure while providing borrowers with an opportunity to work through financial difficulties, often to avoid foreclosure or bankruptcy. Loan modifications to borrowers experiencing financial difficulty typically involve principal forgiveness, an

interest rate reduction, an other-than-insignificant payment delay (i.e., payment or maturity forbearance greater than six months), or a term extension, or any combination thereof. Modified loans to borrowers experiencing financial difficulty are subject to our nonaccrual policies. Loans to borrowers experiencing financial difficulty which were modified during the three and nine months ended September 30, 2024 and 2023 were not significant.

The gross interest income related to impaired loans, which would have been recorded, had these loans been current in accordance with their original terms, and the interest income recognized on these loans during the three and nine months ended September 30, 2024 and 2023, were insignificant to the consolidated financial statements.


	As of December 31, 2023
	Pass		Special Mention		Substandard		Doubtful		Total
Residential real estate	$	8,042,246	$	1,456	$	3,945	$	—	$	8,047,647
Fund banking		3,633,126		—		—		—		3,633,126
Commercial and industrial		3,294,891		89,302		180,772		2,022		3,566,987
Securities-based loans		2,306,452		—		—		3		2,306,455
Construction and land		963,083		71,287		—		—		1,034,370
Commercial real estate		512,171		49,264		99,196		—		660,631
Home equity lines of credit		135,806		377		87		—		136,270
Other		55,922		—		—		59		55,981
Total	$	18,943,697	$	211,686	$	284,000	$	2,084	$	19,441,467