XML 27 R31.htm IDEA: XBRL DOCUMENT

LOANS AND LEASES, NET (Tables)

3 Months Ended

Dec. 31, 2019

Loans and Leases Receivable Disclosure [Abstract]

Loans and leases at December 31, 2019 and September 30, 2019 were as follows:



(Dollars in Thousands)	December 31, 2019			September 30, 2019
National Lending
Term lending⁽¹⁾	$	695,347		$	641,742
Asset based lending⁽¹⁾	250,633			250,465
Factoring	285,776			296,507
Lease financing⁽¹⁾	223,715			177,915
Insurance premium finance	349,299			361,105
SBA/USDA	90,269			88,831
Other commercial finance	99,617			99,665
Commercial finance	1,994,656			1,916,230
Consumer credit products	115,843			106,794
Other consumer finance	154,772			161,404
Consumer finance	270,615			268,198
Tax services	101,739			2,240
Warehouse finance	272,522			262,924
Total National Lending	2,639,532			2,449,592
Community Banking
Commercial real estate and operating	682,399			883,932
Consumer one-to-four family real estate and other	220,588			259,425
Agricultural real estate and operating	40,778			58,464
Total Community Banking	943,765			1,201,821
Total loans and leases	3,583,297			3,651,413
Net deferred loan origination fees (costs)	7,177			7,434
Total gross loans and leases	3,590,474			3,658,847

Allowance for loan and lease losses	(30,176		)	(29,149		)
Total loans and leases, net⁽²⁾	$	3,560,298		$	3,629,698

⁽¹⁾The Company has updated the presentation of its loan and lease table beginning in the fiscal 2020 first quarter. The new presentation includes a new category called term lending. Certain balances previously included in the asset based lending and lease financing categories have been reclassified into the new term lending category during the fiscal 2020 first quarter. Prior period balances have been conformed to the new presentation.

⁽²⁾ As of December 31, 2019, the remaining balance of acquired loans and leases from the acquisition of Crestmark Bancorp, Inc. ("Crestmark") and its bank subsidiary, Crestmark Bank (the "Crestmark Acquisition") was $276.7 million and the remaining balances of the credit and interest rate mark discounts related to the acquired loans and leases held for investment were $5.0 million and $2.6 million, respectively, while the remaining balance of the interest rate mark premium related to the acquired loans held for sale was $0.7 million. On August 1, 2018, the Company acquired loans and leases from the Crestmark Acquisition totaling $1.06 billion and recorded related credit and interest rate mark discounts of $12.3 million and $6.0 million, respectively.

Schedule of Loans Purchased and Sold by Portfolio Segment

Loans purchased and sold by portfolio segment, including participation interests, for the three months ended December 31, 2019 and 2018 were as follows:



	Three Months Ended
(Dollars in Thousands)	December 31, 2019		December 31, 2018
Loans Purchased
Loans held for investment:
Total National Lending	$	14,464	$	111,587
Total Community Banking	4,349		11,081
Total purchases	18,813		122,668
Loans Sold
Loans held for sale	143,035		22,611
Loans held for investment:
Total Community Banking	3,099		378
Total sales	$	146,134	$	22,989

Sales-type Lease, Lease Income

The net investment in direct financing and sales-type leases was comprised of the following as of December 31, 2019 and September 30, 2019:



(Dollars in Thousands)	December 31, 2019			September 30, 2019
Carrying Amount	$	239,351		$	191,733
Unguaranteed residual assets	16,260			13,353
Unamortized initial direct costs	1,856			1,790
Unearned income	(31,896		)	(27,171		)
Total net investment in direct financing and sales-type leases	$	225,571		$	179,705

Operating Lease, Lease Income

The components of total lease income were as follows:



(Dollars in Thousands)	Quarter Ended December 31, 2019
Interest income - loans and leases
Interest income on net investments in direct financing and sales-type leases	$	4,087

Leasing and equipment finance non-interest income
Lease income from operating lease payments	11,203
Profit (loss) recorded on commencement date on sales-type leases	471
Other⁽¹⁾	750
Total leasing and equipment finance non-interest income	12,424
Total lease income	$	16,511

⁽¹⁾ Other leasing and equipment finance non-interest income consists of gains (losses) on sales of leased equipment, fees and service charges on leases and gains (losses) on sales of leases.

Sales-type and Direct Financing Leases, Lease Receivable, Maturity



(Dollars in Thousands)	At December 31, 2019
2020	$	66,919
2021	70,629
2022	50,676
2023	29,908
2024	16,795
Thereafter	4,414
Equipment under leases not yet commenced	10
Total undiscounted future minimum lease payments receivable for direct financing and sales-type leases	239,351
Third-party residual value guarantees	—
Total carrying amount of direct financing and sales-type leases	$	239,351

Annual Activity in Allowance for Loan Losses, Allowance for Loan Losses and Recorded Investment in Loans

Activity in the allowance for loan and lease losses and balances of loans and leases by portfolio segment for each of the three months ended December 31, 2019 and 2018 was as follows:



Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Three Months Ended December 31, 2019	(Dollars in Thousands)
National Lending
Term lending	$	5,533	$	3,401		$	(2,295	)	$	111	$	6,750
Asset based lending	2,437		(461		)	—			19		1,995
Factoring	3,261		257			(389		)	419		3,548
Lease financing	1,275		504			(215		)	131		1,695
Insurance premium finance	1,024		141			(285		)	90		970
SBA/USDA	383		382			—			—		765
Other commercial finance	683		(523		)	—			—		160
Commercial finance	14,596		3,701			(3,184		)	770		15,883
Consumer credit products	1,044		63			—			—		1,107
Other consumer finance	5,118		476			(734		)	29		4,889
Consumer finance	6,162		539			(734		)	29		5,996
Tax services	—		911			—			739		1,650
Warehouse finance	263		6			—			—		269
Total National Lending	21,021		5,157			(3,918		)	1,538		23,798
Community Banking
Commercial real estate and operating	6,208		(1,543		)	—			—		4,665
Consumer one-to-four family real estate and other	1,053		(22		)	—			—		1,031
Agricultural real estate and operating	867		(185		)	—			—		682
Total Community Banking	8,128		(1,750		)	—			—		6,378
Total	$	29,149	$	3,407		$	(3,918	)	$	1,538	$	30,176



Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Three Months Ended December 31, 2018	(Dollars in Thousands)
National Lending
Term lending	$	89	$	710		$	(328	)	$	1,364	$	1,835
Asset based lending	47		724			—			4		775
Factoring	64		1,223			(250		)	26		1,062
Lease financing	30		600			(352		)	260		538
Insurance premium finance	1,031		93			(208		)	56		972
SBA/USDA	13		240			—			—		253
Other commercial finance	28		263			—			—		291
Commercial finance	1,302		3,853			(1,138		)	1,710		5,727
Consumer credit products	785		366			—			—		1,151
Other consumer finance	2,820		3,023			(1,624		)	3		4,222
Consumer finance	3,605		3,389			(1,624		)	3		5,373
Tax services	—		1,496			(42		)	92		1,546
Warehouse finance	65		111						—		176
Total National Lending	4,972		8,849			(2,804		)	1,805		12,822
Community Banking
Commercial real estate and operating	6,220		350			—			—		6,570
Consumer one-to-four family real estate and other	632		87			—			—		719
Agricultural real estate and operating	1,216		(187		)	—			150		1,179
Total Community Banking	8,068		250			—			150		8,468
Total	$	13,040	$	9,099		$	(2,804	)	$	1,955	$	21,290

The following tables provide details regarding the allowance for loan and lease losses and balance by type of allowance as of December 31, 2019 and September 30, 2019.



	Allowance						Loans and Leases
Recorded Investment	Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total		Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total
As of December 31, 2019	(Dollars in Thousands)
National Lending
Term lending	$	1,299	$	5,451	$	6,750	$	25,912	$	669,435	$	695,347
Asset based lending	109		1,886		1,995		525		250,108		250,633
Factoring	1,075		2,473		3,548		3,900		281,876		285,776
Lease financing	299		1,396		1,695		2,195		221,520		223,715
Insurance premium finance	—		970		970		—		349,299		349,299
SBA/USDA	486		279		765		3,683		86,586		90,269
Other commercial finance	—		160		160		—		99,617		99,617
Commercial finance	3,268		12,615		15,883		36,215		1,958,441		1,994,656
Consumer credit products	—		1,107		1,107		—		115,843		115,843
Other consumer finance	—		4,889		4,889		1,708		153,064		154,772
Consumer finance	—		5,996		5,996		1,708		268,907		270,615
Tax services	—		1,650		1,650		—		101,739		101,739
Warehouse finance	—		269		269		—		272,522		272,522
Total National Lending	3,268		20,530		23,798		37,923		2,601,609		2,639,532
Community Banking
Commercial real estate and operating	—		4,665		4,665		823		681,576		682,399
Consumer one-to-four family real estate and other	—		1,031		1,031		69		220,519		220,588
Agricultural real estate and operating	—		682		682		2,793		37,985		40,778
Total Community Banking	—		6,378		6,378		3,685		940,080		943,765
Total	$	3,268	$	26,908	$	30,176	$	41,608	$	3,541,689	$	3,583,297



	Allowance						Loans and Leases
Recorded Investment	Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total		Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total
As of September 30, 2019	(Dollars in Thousands)
National Lending
Term lending	$	450	$	5,083	$	5,533	$	19,568	$	622,174	$	641,742
Asset based lending	—		2,437		2,437		378		250,087		250,465
Factoring	1,262		1,999		3,261		3,824		292,683		296,507
Lease financing	112		1,163		1,275		1,213		176,702		177,915
Insurance premium finance	—		1,024		1,024		—		361,105		361,105
SBA/USDA	51		332		383		3,841		84,990		88,831
Other commercial finance	—		683		683		—		99,665		99,665
Commercial finance	1,875		12,721		14,596		28,824		1,887,406		1,916,230
Consumer credit products	—		1,044		1,044		—		106,794		106,794
Other consumer finance	—		5,118		5,118		1,472		159,932		161,404
Consumer finance	—		6,162		6,162		1,472		266,726		268,198
Tax services	—		—		—		—		2,240		2,240
Warehouse finance	—		263		263		—		262,924		262,924
Total National Lending	1,875		19,146		21,021		30,296		2,419,296		2,449,592
Community Banking
Commercial real estate and operating	—		6,208		6,208		258		883,674		883,932
Consumer one-to-four family real estate and other	—		1,053		1,053		100		259,325		259,425
Agricultural real estate and operating	—		867		867		2,985		55,479		58,464
Total Community Banking	—		8,128		8,128		3,343		1,198,478		1,201,821
Total	$	1,875	$	27,274	$	29,149	$	33,639	$	3,617,774	$	3,651,413

Asset Classification by Credit Quality Indicators of Loans and Leases

The asset classifications of loans and leases at December 31, 2019 and September 30, 2019 were as follows:



Asset Classification	Pass		Watch		Special Mention		Substandard		Doubtful		Total
December 31, 2019	(Dollars in Thousands)
National Lending
Term lending	$	631,408	$	33,446	$	4,581	$	25,847	$	65	$	695,347
Asset based lending	193,824		51,348		4,936		525		—		250,633
Factoring	250,382		26,130		5,364		3,900		—		285,776
Lease financing	218,187		3,334		—		2,194		—		223,715
Insurance premium finance	344,668		869		634		2,926		202		349,299
SBA/USDA	78,259		1,569		6,758		3,683		—		90,269
Other commercial finance	98,926		691		—		—		—		99,617
Commercial finance	1,815,654		117,387		22,273		39,075		267		1,994,656
Warehouse finance	272,522		—		—		—		—		272,522
Total National Lending	2,088,176		117,387		22,273		39,075		267		2,267,178
Community Banking
Commercial real estate and operating	674,189		1,225		3,389		3,596		—		682,399
Consumer one-to-four family real estate and other	219,223		428		781		156		—		220,588
Agricultural real estate and operating	21,789		4,804		5,873		8,312		—		40,778
Total Community Banking	915,201		6,457		10,043		12,064		—		943,765
Total loans and leases	$	3,003,377	$	123,844	$	32,316	$	51,139	$	267	$	3,210,943



Asset Classification	Pass		Watch		Special Mention		Substandard		Doubtful		Total
September 30, 2019	(Dollars in Thousands)
National Lending
Term lending	$	585,382	$	—	$	36,792	$	19,024	$	544	$	641,742
Asset based lending	192,427		—		57,660		378		—		250,465
Factoring	256,048		—		36,635		3,824		—		296,507
Lease financing	171,785		—		4,917		1,213		—		177,915
Insurance premium finance	361,105		—		—		—		—		361,105
SBA/USDA	76,609		—		8,381		3,841		—		88,831
Other commercial finance	99,057		—		608		—		—		99,665
Commercial finance	1,742,413		—		144,993		28,280		544		1,916,230
Warehouse finance	262,924		—		—		—		—		262,924
Total National Lending	2,005,337		—		144,993		28,280		544		2,179,154
Community Banking
Commercial real estate and operating	875,933		1,494		2,884		3,621		—		883,932
Consumer one-to-four family real estate and other	257,575		946		708		196		—		259,425
Agricultural real estate and operating	39,409		4,631		5,876		8,548		—		58,464
Total Community Banking	1,172,917		7,071		9,468		12,365		—		1,201,821
Total loans and leases	$	3,178,254	$	7,071	$	154,461	$	40,645	$	544	$	3,380,975

Past Due Loans and Leases

Past due loans and leases at December 31, 2019 and September 30, 2019 were as follows:



Past Due Loans and Leases	Accruing and Non-accruing Loans and Leases												Non-performing Loans and Leases
December 31, 2019	30-59 Days Past Due		60-89 Days Past Due		> 89 Days Past Due		Total Past Due		Current		Total Loans and Leases Receivable		> 89 Days Past Due and Accruing		Non-accrual balance		Total
(Dollars in Thousands)
Loans held for sale	$	63	$	—	$	—	$	63	$	264,361	$	264,424	$	—	$	—	$	—

National Lending
Term lending	12,300		2,767		12,679		27,746		667,601		695,347		1,316		12,372		13,688
Asset based lending	26		—		—		26		250,607		250,633		—		583		583
Factoring	—		—		—		—		285,776		285,776		—		205		205
Lease financing	3,757		758		1,893		6,408		217,307		223,715		1,286		729		2,015
Insurance premium finance	7,065		1,117		3,131		11,313		337,986		349,299		3,131		—		3,131
SBA/USDA	979		—		29		1,008		89,261		90,269		—		2,704		2,704
Other commercial finance	—		—		—		—		99,617		99,617		—		—		—
Commercial finance	24,127		4,642		17,732		46,501		1,948,155		1,994,656		5,733		16,593		22,326
Consumer credit products	953		430		318		1,701		114,142		115,843		318		—		318
Other consumer finance	1,342		804		1,330		3,476		151,296		154,772		1,330		—		1,330
Consumer finance	2,295		1,234		1,648		5,177		265,438		270,615		1,648		—		1,648
Tax services	—		—		—		—		101,739		101,739		—		—		—
Warehouse finance	—		—		—		—		272,522		272,522		—		—		—
Total National Lending	26,422		5,876		19,380		51,678		2,587,854		2,639,532		7,381		16,593		23,974
Community Banking
Commercial real estate and operating	—		—		—		—		682,399		682,399		—		—		—
Consumer one-to-four family real estate and other	346		74		9		429		220,159		220,588		—		9		9
Agricultural real estate and operating	30		1,538		—		1,568		39,210		40,778		—		—		—
Total Community Banking	376		1,612		9		1,997		941,768		943,765		—		9		9
Total loans and leases held for investment	26,798		7,488		19,389		53,675		3,529,622		3,583,297		7,381		16,602		23,983

Total loans and leases	$	26,861	$	7,488	$	19,389	$	53,738	$	3,793,983	$	3,847,721	$	7,381	$	16,602	$	23,983



Past Due Loans and Leases	Accruing and Non-accruing Loans and Leases												Non-performing Loans and Leases
September 30, 2019	30-59 Days Past Due		60-89 Days Past Due		> 89 Days Past Due		Total Past Due		Current		Total Loans and Leases Receivable		> 89 Days Past Due and Accruing		Non-accrual balance		Total
(Dollars in Thousands)
Loans held for sale	$	1,122	$	755	$	964	$	2,841	$	145,936	$	148,777	$	964	$	—	$	964

National Lending
Term lending	2,162		910		14,098		17,170		624,572		641,742		2,241		12,146		14,387
Asset based lending	—		—		—		—		250,465		250,465		—		—		—
Factoring	—		—		—		—		296,507		296,507		—		1,669		1,669
Lease financing	1,160		1,134		1,736		4,030		173,885		177,915		1,530		308		1,838
Insurance premium finance	1,999		2,881		3,807		8,687		352,418		361,105		3,807		—		3,807
SBA/USDA	83		—		255		338		88,493		88,831		—		255		255
Other commercial finance	—		—		—		—		99,665		99,665		—		—		—
Commercial finance	5,404		4,925		19,896		30,225		1,886,005		1,916,230		7,578		14,378		21,956
Consumer credit products	627		557		239		1,423		105,371		106,794		239		—		239
Other consumer finance	932		1,005		1,078		3,015		158,389		161,404		1,078		—		1,078
Consumer finance	1,559		1,562		1,317		4,438		263,760		268,198		1,317		—		1,317
Tax services	—		—		2,240		2,240		—		2,240		2,240		—		2,240
Warehouse finance	—		—		—		—		262,924		262,924		—		—		—
Total National Lending	6,963		6,487		23,453		36,903		2,412,689		2,449,592		11,135		14,378		25,513
Community Banking
Commercial real estate and operating	565		—		—		565		883,367		883,932		—		—		—
Consumer one-to-four family real estate and other	458		—		9		467		258,958		259,425		—		44		44
Agricultural real estate and operating	49		—		—		49		58,415		58,464		—		—		—
Total Community Banking	1,072		—		9		1,081		1,200,740		1,201,821		—		44		44
Total loans and leases held for investment	8,035		6,487		23,462		37,984		3,613,429		3,651,413		11,135		14,422		25,557

Total loans and leases	$	9,157	$	7,242	$	24,426	$	40,825	$	3,759,365	$	3,800,190	$	12,099	$	14,422	$	26,521

Impaired Loans and Leases

Impaired loans and leases at December 31, 2019 and September 30, 2019 were as follows:



December 31, 2019	Recorded Balance		Unpaid Principal Balance		Specific Allowance
Loans and leases without a specific valuation allowance	(Dollars in Thousands)
National Lending
Term lending	$	17,125	$	19,112	$	—
Factoring	1,387		2,462		—
Lease financing	1,418		1,418		—
Commercial finance	19,930		22,992		—
Other consumer finance	1,708		1,806		—
Consumer finance	1,708		1,806		—
Total National Lending	21,638		24,798		—
Community Banking
Commercial real estate and operating	823		823		—
Consumer one-to-four family real estate and other	69		69		—
Agricultural real estate and operating	2,793		2,793		—
Total Community Banking	3,685		3,685		—
Total	$	25,323	$	28,483	$	—
Loans and leases with a specific valuation allowance
National Lending
Term lending	$	8,787	$	10,087	$	1,299
Asset based lending	525		525		109
Factoring	2,513		2,525		1,075
Lease financing	777		777		299
SBA/USDA	3,683		3,683		486
Commercial finance	16,285		17,597		3,268
Total National Lending	16,285		17,597		3,268
Total	$	16,285	$	17,597	$	3,268



September 30, 2019	Recorded Balance		Unpaid Principal Balance		Specific Allowance
Loans and leases without a specific valuation allowance	(Dollars in Thousands)
National Lending
Term lending	$	12,644	$	13,944	$	—
Asset based lending	378		378		—
Factoring	1,563		2,638		—
Lease financing	1,062		1,062		—
SBA/USDA	2,595		2,595		—
Commercial finance	18,242		20,617		—
Other consumer finance	1,472		1,539		—
Consumer finance	1,472		1,539		—
Total National Lending	19,714		22,156		—
Community Banking
Commercial real estate and operating	258		258		—
Consumer one-to-four family real estate and other	100		100		—
Agricultural real estate and operating	2,985		2,985		—
Total Community Banking	3,343		3,343		—
Total	$	23,057	$	25,499	$	—
Loans and leases with a specific valuation allowance
National Lending
Term lending	$	6,924	$	6,951	$	450
Factoring	2,261		3,601		1,262
Lease financing	151		151		112
SBA/USDA	1,246		1,246		51
Commercial finance	10,582		11,949		1,875
Total National Lending	10,582		11,949		1,875
Total	$	10,582	$	11,949	$	1,875

The following table provides the average recorded investment in impaired loans and leases for the three-month periods ended December 31, 2019 and 2018.



Three Months Ended December 31,	2019				2018
	Average Recorded Investment		Recognized Interest Income		Average Recorded Investment		Recognized Interest Income
	(Dollars in Thousands)
National Lending
Term lending	$	19,537	$	74	$	5,709	$	79
Asset based lending	427		—		—		—
Factoring	3,849		—		2,780		5
Lease financing	3,686		—		3,602		10
SBA/USDA	3,788		—		—		—
Commercial finance	31,287		74		12,091		94
Other consumer finance	1,551		35		—		—
Consumer finance	1,551		35		—		—
Total National Lending	32,838		109		12,091		94
Community Banking
Commercial real estate and operating	446		13		404		4
Consumer one-to-four family real estate and other	90		8		139		2
Agricultural real estate and operating	2,921		42		1,473		25
Total Community Banking	3,457		63		2,016		31
Total loans and leases	$	36,295	$	172	$	14,107	$	125