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LOANS HELD FOR INVESTMENT, NET

12 Months Ended

Dec. 31, 2024

4. LOANS HELD FOR INVESTMENT, NET

The following table presents the loan categories for the period ended as indicated:


(In thousands)	December 31, 2024		December 31, 2023
Business loans⁽¹⁾	$	2,725,726	$	2,308,171
One-to-four family residential and cooperative/condominium apartment		951,528		887,555
Multifamily residential and residential mixed-use		3,820,283		4,017,176
Non-owner-occupied commercial real estate		3,230,535		3,379,667
Acquisition, development, and construction ("ADC")		136,172		168,513
Other loans		5,084		5,755
Total		10,869,328		10,766,837
Fair value hedge basis point adjustments ⁽²⁾		2,615		6,591
Total loans, net of fair value hedge basis point adjustments		10,871,943		10,773,428
Allowance for credit losses		(88,751)		(71,743)
Loans held for investment, net	$	10,783,192	$	10,701,685

(1)	Business loans include C&I loans, owner-occupied commercial real estate loans and PPP loans.

(2)	The loan portfolio included a fair value hedge basis point adjustment to the carrying amount of hedged owner-occupied commercial real estate in business loans, one-to-four family residential mortgage loans, multifamily residential mortgage loans and non-owner occupied commercial real estate loans.

The following tables present data regarding the allowance for credit losses activity for the periods indicated:


			One-to-Four
			Family		Multifamily
			Residential and		Residential		Non-Owner
			Cooperative/		and		Occupied
	Business		Condominium		Residential		Commercial				Other
(In thousands)	Loans		Apartment		Mixed-Use		Real Estate		ADC		Loans		Total
Beginning balance as of January 1, 2022		62,366		5,932		7,816		2,131		4,857		751		83,853
(Credit) provision for credit losses		(8,073)		37		542		17,968		(3,134)		(430)		6,910
Charge-offs		(11,401)		—		—		—		—		(53)		(11,454)
Recoveries		4,137		—		2		54		—		5		4,198
Ending balance as of December 31, 2022	$	47,029	$	5,969	$	8,360	$	20,153	$	1,723	$	273	$	83,507

Provision (credit) for credit losses		3,273		858		(1,121)		(530)		266		129		2,875
Charge-offs		(15,364)		(14)		(2)		—		—		(300)		(15,680)
Recoveries		1,024		—		—		—		—		17		1,041
Ending balance as of December 31, 2023	$	35,962	$	6,813	$	7,237	$	19,623	$	1,989	$	119	$	71,743

Provision for credit losses		14,435		2,688		9,385		9,176		334		179		36,197
Charge-offs		(8,051)		—		(4,677)		(6,926)		—		(110)		(19,764)
Recoveries		552		—		1		3		—		19		575
Ending balance as of December 31, 2024	$	42,898	$	9,501	$	11,946	$	21,876	$	2,323	$	207	$	88,751

The following tables present the amortized cost basis of loans on non-accrual status as of the periods indicated:


	December 31, 2024
	Non-accrual with		Non-accrual with		Related
(In thousands)	No Allowance		Allowance		Allowance
Business loans	$	5,196	$	17,428	$	15,810
One-to-four family residential and cooperative/condominium apartment		—		3,213		31
Non-owner-occupied commercial real estate		16,456		6,504		432
ADC		—		657		287
Other loans		—		25		25
Total	$	21,652	$	27,827	$	16,585


	December 31, 2023
	Non-accrual with		Non-accrual with		Related
(In thousands)	No Allowance		Allowance		Allowance
Business loans	$	3,780	$	14,794	$	13,228
One-to-four family residential and cooperative/condominium apartment		—		3,248		133
Non-owner-occupied commercial real estate		—		6,620		636
ADC		—		657		205
Total	$	3,780	$	25,319	$	14,202

The Company did not recognize interest income on non-accrual loans held for investment during the years ended December 31, 2024 or 2023.

The following tables summarize the past due status of the Company’s investment in loans as of the dates indicated:

December 31, 2024

Loans 90

Days or

Total

30 to 59

60 to 89

More Past Due

Past Due

Days

and Still

and

Total

(In thousands)

Past Due

Accruing Interest

Non-accrual

Current

Loans

Business loans

3,385

2,441

—

22,624

28,450

2,697,276

2,725,726

One-to-four family residential, including condominium and cooperative apartment

1,919

1,271

—

3,213

6,403

945,125

951,528

Multifamily residential and residential mixed-use

3,759

27,601

—

31,360

3,788,923

3,820,283

Non-owner-occupied commercial real estate

1,265

—

22,960

24,225

3,206,310

3,230,535

ADC

—

657

135,515

136,172

Other loans

—

5,057

5,084

Total

10,330

31,313

—

49,479

91,122

10,778,206

10,869,328


	December 31, 2023
					Loans 90
					Days or				Total
	30 to 59		60 to 89		More Past Due				Past Due
	Days		Days		and Still				and				Total
(In thousands)	Past Due		Past Due		Accruing Interest		Non-accrual		Non-accrual		Current		Loans
Business loans	$	7,139	$	1,217	$	—	$	18,574	$	26,930	$	2,281,241	$	2,308,171
One-to-four family residential, including condominium and cooperative apartment		4,071		73		—		3,248		7,392		880,163		887,555
Multifamily residential and residential mixed-use		—		—		—		—		—		4,017,176		4,017,176
Non-owner-occupied commercial real estate		337		—		—		6,620		6,957		3,372,710		3,379,667
ADC		430		—		—		657		1,087		167,426		168,513
Other loans		—		—		—		—		—		5,755		5,755
Total	$	11,977	$	1,290	$	—	$	29,099	$	42,366	$	10,724,471	$	10,766,837

Accruing Loans 90 Days or More Past Due:

The Company did not have accruing loans 90 days or more past due at December 31, 2024 and 2023.

Collateral Dependent Loans:

The Company had collateral dependent loans which were individually evaluated to determine expected credit losses as of the dates indicated:


	December 31, 2024				December 31, 2023
	Real Estate		Associated Allowance		Real Estate		Associated Allowance
(In thousands)	Collateral Dependent		for Credit Losses		Collateral Dependent		for Credit Losses
Business loans	$	9,290	$	1,408	$	3,742	$	—
Non-owner-occupied commercial real estate		22,944		416		6,605		621
ADC		657		287		657		305
Total	$	32,891	$	2,111	$	11,004	$	926

Related Party Loans

Certain directors, executive officers, and their related parties, including their immediate families and companies in which they are principal owners, were loan customers of the Bank during 2024.

The following table sets forth selected information about related party loans:


	Year Ended December 31,
(In thousands)	2024		2023
Beginning balance	$	4,922	$	4,956
New loans		8		531
Effect of changes in composition of related parties		(1,146)		—
Repayments		(39)		(565)
Balance at end of period	$	3,745	$	4,922

Loan Restructurings

The Company applies the loan refinancing and restructuring guidance to determine whether a modification or other forms of restructuring result in a new loan or a continuation of an existing loan. Loan modifications to borrowers experiencing financial difficulty that result in a direct change in the timing or amount of contractual cash flows include conditions where there is principal forgiveness, interest rate reductions, other-than-insignificant payment delays, term extensions, and/or a combination of these modifications. The disclosures related to loan restructuring are only for modifications that directly affect cash flows.

The following tables show the amortized cost basis as of December 31, 2024 and 2023 of the loans modified to borrowers experiencing financial difficulty, disaggregated by loan category and type of concession granted:


	For the Year Ended December 31, 2024
											Significant
											Payment
							Significant				Delay,
					Term		Payment		Term		Term
					Extension		Delay		Extension		Extension				% of
					and		and		and		and				Total
			Significant		Significant		Interest		Interest		Interest				Class of
	Term		Payment		Payment		Rate		Rate		Rate				Financing
(Dollars in thousands)	Extension		Delay		Delay		Reduction		Reduction		Reduction		Total		Receivable
Business loans	$	19,668	$	182	$	187	$	27	$	—	$	—	$	20,064	0.7	%
One-to-four family residential, including condominium and cooperative apartment		—		—		—		—		896		—		896	0.1
Multifamily residential and residential mixed-use		—		34,087		—		—		—		—		34,087	0.9
Non-owner-occupied commercial real estate		—		31,102		—		—		—		—		31,102	1.0
Total	$	19,668	$	65,371	$	187	$	27	$	896	$	—	$	86,149	0.8	%


	For the Year Ended December 31, 2023
											Significant
											Payment
							Significant				Delay,
					Term		Payment		Term		Term
					Extension		Delay		Extension		Extension				% of
					and		and		and		and				Total
			Significant		Significant		Interest		Interest		Interest				Class of
	Term		Payment		Payment		Rate		Rate		Rate				Financing
(Dollars in thousands)	Extension		Delay		Delay		Reduction		Reduction		Reduction		Total		Receivable
Business loans	$	1,789	$	12,020	$	520	$	298	$	—	$	—	$	14,627	0.6	%
One-to-four family residential, including condominium and cooperative apartment		—		2,856		92		—		—		—		2,948	0.3
Non-owner-occupied commercial real estate		—		24,706		—		—		—		—		24,706	0.7
Total	$	1,789	$	39,582	$	612	$	298	$	—	$	—	$	42,281	0.4	%

The following tables describe the financial effect of the modifications made to borrowers experiencing financial difficulty as of the dates indicated:


	For the Year Ended December 31, 2024
	Weighted Average		Weighted Average
	Interest Rate		Months of	Weighted Average
(Dollars in thousands)	Reductions		Term Extensions	Payment Delay
Business loans	5.00	%	8	$	59
One-to-four family residential, including condominium and cooperative apartment	1.00		231		—
Multifamily residential and residential mixed-use	—		—		256
Non-owner-occupied commercial real estate	—		—		560


	For the Year Ended December 31, 2023
	Weighted Average		Weighted Average
	Interest Rate		Months of	Weighted Average
(Dollars in thousands)	Reductions		Term Extensions	Payment Delay
Business loans	4.27	%	13	$	2,406
One-to-four family residential, including condominium and cooperative apartment	—		189		76
Non-owner-occupied commercial real estate	—		—		988

The Bank monitors the performance of loans modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following tables describe the performance of loans that have been modified during the years ended December 31, 2024 and 2023.

December 31, 2024

30-59

60-89

90+

(In thousands)

Current

Days Past Due

Non-Accrual

Total

Business loans

19,668

129

—

267

20,064

One-to-four family residential, including condominium and cooperative apartment

—

896

Multifamily residential and residential mixed-use

6,486

—

27,601

—

34,087

Non-owner-occupied commercial real estate

31,102

—

31,102

Total

57,256

129

27,601

—

1,163

86,149


	December 31, 2023
			30-59		60-89		90+
(In thousands)	Current		Days Past Due		Days Past Due		Days Past Due		Non-Accrual		Total
Business loans	$	12,496	$	—	$	—	$	—	$	2,131	$	14,627
One-to-four family residential, including condominium and cooperative apartment		2,856		—		—		—		92		2,948
Non-owner-occupied commercial real estate		24,706		—		—		—		—		24,706
Total	$	40,058	$	—	$	—	$	—	$	2,223	$	42,281

There were no loans held for investment made to borrowers experiencing financial difficulty that were modified during the year ended December 31, 2024 and 2023, that subsequently defaulted. For the purposes of this disclosure, a payment default is defined as 90 or more days past due. Non-accrual loans that are modified to borrowers experiencing financial difficulty remain on non-accrual status until the borrower has demonstrated performance under the modified terms.

Credit Quality Indicators

The Company categorizes 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 structure, loan documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by classifying them as to credit risk. The Company uses the following definitions for risk ratings:

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 Bank’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 so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.

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

The following is a summary of the credit risk profile of loans by internally assigned grade as of the periods indicated, the years represent the year of origination for non-revolving loans:


	December 31, 2024
(In thousands)	2024		2023		2022		2021		2020		2019 and Prior		Revolving		Revolving-Term		Total
Business loans
Pass	$	400,607	$	232,017	$	327,174	$	201,799	$	164,834	$	348,388	$	828,287	$	67,238	$	2,570,344
Special mention		135		754		36,740		4,220		4,333		17,226		26,292		14,497		104,197
Substandard		—		398		1,985		2,482		3,944		11,298		—		30,467		50,574
Doubtful		—		—		—		—		—		611		—		—		611
Total business loans		400,742		233,169		365,899		208,501		173,111		377,523		854,579		112,202		2,725,726
YTD Gross Charge-Offs		—		—		158		166		267		586		89		6,785		8,051

One-to-four family residential, and condominium/cooperative apartment:
Pass		134,804		159,300		202,706		98,491		63,093		247,952		26,724		8,364		941,434
Special mention		—		—		—		—		—		711		159		—		870
Substandard		—		—		—		—		984		7,326		—		914		9,224
Doubtful		—		—		—		—		—		—		—		—		—
Total one-to-four family residential, and condominium/cooperative apartment		134,804		159,300		202,706		98,491		64,077		255,989		26,883		9,278		951,528
YTD Gross Charge-Offs		—		—		—		—		—		—		—		—		—

Multifamily residential and residential mixed-use:
Pass		21,810		252,975		1,285,619		560,039		286,653		1,239,261		4,285		4,267		3,654,909
Special mention		—		—		1,202		12,369		14,172		73,778		—		—		101,521
Substandard		—		—		—		—		—		63,853		—		—		63,853
Doubtful		—		—		—		—		—		—		—		—		—
Total multifamily residential and residential mixed-use		21,810		252,975		1,286,821		572,408		300,825		1,376,892		4,285		4,267		3,820,283
YTD Gross Charge-Offs		400		—		—		—		1,292		2,985		—		—		4,677

Non-owner-occupied commercial real estate
Pass		57,280		215,279		724,041		601,508		408,361		1,020,137		11,937		8,966		3,047,509
Special mention		—		—		—		658		75,802		29,564		—		—		106,024
Substandard		—		—		—		16,471		34,236		26,295		—		—		77,002
Doubtful		—		—		—		—		—		—		—		—		—
Total non-owner-occupied commercial real estate		57,280		215,279		724,041		618,637		518,399		1,075,996		11,937		8,966		3,230,535
YTD Gross Charge-Offs		—		—		—		2,797		4,033		—		—		96		6,926

ADC:
Pass		16,154		34,169		25,950		4,810		—		2,468		24,868		12,122		120,541
Special mention		—		—		—		14,974		—		—		—		—		14,974
Substandard		—		—		—		—		—		—		—		657		657
Doubtful		—		—		—		—		—		—		—		—		—
Total ADC		16,154		34,169		25,950		19,784		—		2,468		24,868		12,779		136,172
YTD Gross Charge-Offs		—		—		—		—		—		—		—		—		—

Total:
Pass		630,655		893,740		2,565,490		1,466,647		922,941		2,858,206		896,101		100,957		10,334,737
Special mention		135		754		37,942		32,221		94,307		121,279		26,451		14,497		327,586
Substandard		—		398		1,985		18,953		39,164		108,772		—		32,038		201,310
Doubtful		—		—		—		—		—		611		—		—		611
Total Loans	$	630,790	$	894,892	$	2,605,417	$	1,517,821	$	1,056,412	$	3,088,868	$	922,552	$	147,492	$	10,864,244
YTD Gross Charge-Offs	$	400	$	—	$	158	$	2,963	$	5,592	$	3,571	$	89	$	6,881	$	19,654


	December 31, 2023
(In thousands)	2023		2022		2021		2020		2019		2018 and Prior		Revolving		Revolving-Term		Total
Business loans
Pass	$	258,699	$	390,760	$	196,790	$	144,796	$	150,871	$	305,258	$	633,719	$	35,079	$	2,115,972
Special mention		481		41,682		1,199		13,567		7,125		3,150		21,108		25,306		113,618
Substandard		—		1,857		2,180		6,729		2,803		30,248		15,567		18,449		77,833
Doubtful		—		—		—		—		—		748		—		—		748
Total business loans		259,180		434,299		200,169		165,092		160,799		339,404		670,394		78,834		2,308,171
YTD Gross Charge-Offs		—		—		77		38		4,166		2,229		5,464		3,390		15,364

One-to-four family residential, and condominium/cooperative apartment:
Pass		170,601		213,479		102,684		69,524		62,356		213,131		31,205		12,493		875,473
Special mention		—		—		—		—		—		33		159		776		968
Substandard		—		—		—		1,005		337		8,711		—		1,061		11,114
Doubtful		—		—		—		—		—		—		—		—		—
Total one-to-four family residential, and condominium/cooperative apartment		170,601		213,479		102,684		70,529		62,693		221,875		31,364		14,330		887,555
YTD Gross Charge-Offs		—		—		—		—		—		—		—		14		14

Multifamily residential and residential mixed-use:
Pass		256,822		1,340,197		578,352		283,633		384,937		981,820		4,841		4,325		3,834,927
Special mention		—		—		9,334		3,880		3,886		64,273		—		—		81,373
Substandard		—		—		—		28,799		5,089		66,988		—		—		100,876
Doubtful		—		—		—		—		—		—		—		—		—
Total multifamily residential and residential mixed-use		256,822		1,340,197		587,686		316,312		393,912		1,113,081		4,841		4,325		4,017,176
YTD Gross Charge-Offs		—		—		—		—		—		2		—		—		2

Non-owner-occupied commercial real estate
Pass		220,045		738,133		645,246		447,002		359,201		756,921		11,919		7,926		3,186,393
Special mention		—		—		19,872		75,378		4,563		2,763		—		—		102,576
Substandard		—		—		16		60,272		6,254		24,156		—		—		90,698
Doubtful		—		—		—		—		—		—		—		—		—
Total non-owner-occupied commercial real estate		220,045		738,133		665,134		582,652		370,018		783,840		11,919		7,926		3,379,667
YTD Gross Charge-Offs		—		—		—		—		—		—		—		—		—

ADC:
Pass		16,735		17,534		59,202		9,900		2,665		437		22,444		225		129,142
Special mention		—		11,500		14,961		—		12,253		—		—		—		38,714
Substandard		—		—		—		—		—		—		—		657		657
Doubtful		—		—		—		—		—		—		—		—		—
Total ADC		16,735		29,034		74,163		9,900		14,918		437		22,444		882		168,513
YTD Gross Charge-Offs		—		—		—		—		—		—		—		—		—

Total:
Pass		922,902		2,700,103		1,582,274		954,855		960,030		2,257,567		704,128		60,048		10,141,907
Special mention		481		53,182		45,366		92,825		27,827		70,219		21,267		26,082		337,249
Substandard		—		1,857		2,196		96,805		14,483		130,103		15,567		20,167		281,178
Doubtful		—		—		—		—		—		748		—		—		748
Total Loans	$	923,383	$	2,755,142	$	1,629,836	$	1,144,485	$	1,002,340	$	2,458,637	$	740,962	$	106,297	$	10,761,082
YTD Gross Charge-Offs	$	—	$	—	$	77	$	38	$	4,166	$	2,231	$	5,464	$	3,404	$	15,380

For other loans, the Company evaluates credit quality based on payment activity. Other loans that are 90 days or more past due are placed on non-accrual status, while all remaining other loans are classified and evaluated as performing. The following is a summary of the credit risk profile of other loans by internally assigned grade:


(In thousands)	December 31, 2024		December 31, 2023
Performing	$	5,059	$	5,755
Non-accrual		25		—
Total	$	5,084	$	5,755