Loans Receivable

12 Months Ended

Sep. 30, 2017

Receivables [Abstract]

Loans Receivable

LOANS RECEIVABLE

The following table is a summary of loans receivable.

	September 30, 2017				September 30, 2016
	(In thousands)				(In thousands)
Gross loans by category
Single-family residential	$	5,711,004	46.8	%	$	5,658,830	51.7	%
Construction	1,597,996		13.1		1,110,411		10.1
Construction - custom	602,631		4.9		473,069		4.3
Land - acquisition & development	124,308		1.0		118,497		1.1
Land - consumer lot loans	104,405		0.9		104,567		1.0
Multi-family	1,303,148		10.7		1,124,290		10.3
Commercial real estate	1,434,610		11.8		1,093,639		10.0
Commercial & industrial	1,093,360		9.0		978,589		8.9
HELOC	144,850		1.2		149,716		1.4
Consumer	85,075		0.7		139,000		1.3
Total gross loans	12,201,387		100	%	10,950,608		100	%
Less:
Allowance for probable losses	123,073				113,494
Loans in process	1,149,934				879,484
Net deferred fees, costs and discounts	45,758				46,710
Total loan contra accounts	1,318,765				1,039,688
Net loans	$	10,882,622			$	9,910,920

The following summary breaks down the Company's fixed rate and adjustable rate loans by time to maturity or to rate adjustment.

September 30, 2017
Fixed-Rate					Adjustable-Rate
Term To Maturity	Gross Loans		% of Gross Loans		Term To Rate Adjustment	Gross Loans		% of Gross Loans
	(In thousands)					(In thousands)
Within 1 year	$	71,810	0.6	%	Less than 1 year	$	3,157,055	25.9	%
1 to 3 years	216,724		1.8		1 to 3 years	498,844		4.1
3 to 5 years	308,967		2.5		3 to 5 years	624,254		5.1
5 to 10 years	847,518		6.9		5 to 10 years	512,774		4.2
10 to 20 years	1,047,541		8.6		10 to 20 years	—		—
Over 20 years	4,915,900		40.3		Over 20 years	—		—
	$	7,408,460	60.7	%		$	4,792,927	39.3	%

The following tables provide information regarding loans receivable by loan category and geography.

September 30, 2017	Single - family residential		Multi- family		Land - A & D		Land - lot loans		Construction - custom		Construction		Commercial real estate		Commercial and industrial		Consumer		HELOC		Total
	(In thousands)
Washington	$	3,013,957	$	315,356	$	55,794	$	65,449	$	357,080	$	613,362	$	528,762	$	555,651	$	2,186	$	87,290	$	5,594,887
Oregon	659,602		378,588		33,109		13,535		59,861		269,037		254,513		217,813		2,252		13,577		1,901,887
Arizona	581,137		340,609		4,801		11,446		77,315		102,546		218,200		50,506		296		13,781		1,400,637
Other	57,891		3,423		—		69		—		4,360		95,304		106,226		78,614		53		345,940
Utah	514,922		40,014		90		4,321		55,064		272,723		28,586		38,328		22		7,823		961,893
Idaho	306,853		41,243		14,593		4,586		23,721		45,603		65,342		29,529		123		7,293		538,886
New Mexico	202,703		115,289		10,272		2,108		17,406		62,635		173,774		14,186		768		13,332		612,473
Texas	185,835		43,493		5,649		106		3,534		205,595		61,439		59,484		775		—		565,910
Nevada	188,104		25,133		—		2,785		8,650		22,135		8,690		21,637		39		1,701		278,874
	$	5,711,004	$	1,303,148	$	124,308	$	104,405	$	602,631	$	1,597,996	$	1,434,610	$	1,093,360	$	85,075	$	144,850	$	12,201,387

Percentage by geographic area
September 30, 2017	Single - family residential		Multi- family		Land - A & D		Land - lot loans		Construction - custom		Construction		Commercial real estate		Commercial and industrial		Consumer		HELOC		Total
	As % of total gross loans
Washington	24.6	%	2.6	%	0.4	%	0.5	%	2.9	%	5.1	%	4.4	%	4.6	%	—	%	0.7	%	45.8	%
Oregon	5.4		3.1		0.3		0.1		0.5		2.2		2.1		1.8		—		0.1		15.6
Arizona	4.8		2.8		—		0.1		0.6		0.8		1.8		0.4		—		0.1		11.4
Other	0.5		—		—		—		—		—		0.8		0.9		0.7		—		2.9
Utah	4.2		0.3		—		0.1		0.5		2.2		0.2		0.3		—		0.1		7.9
Idaho	2.5		0.4		0.1		0.1		0.2		0.4		0.5		0.2		—		0.1		4.5
New Mexico	1.7		0.9		0.1		—		0.1		0.5		1.4		0.1		—		0.1		4.9
Texas	1.5		0.4		—		—		—		1.7		0.5		0.5		—		—		4.6
Nevada	1.5		0.2		0.1		—		0.1		0.2		0.1		0.2		—		—		2.4
	46.7	%	10.7	%	1.0	%	0.9	%	4.9	%	13.1	%	11.8	%	9.0	%	0.7	%	1.2	%	100	%

Percentage by geographic area as a % of each loan type
September 30, 2017	Single - family residential		Multi- family		Land - A & D		Land - lot loans		Construction - custom		Construction		Commercial real estate		Commercial and industrial		Consumer		HELOC
	As % of total gross loans
Washington	52.8	%	24.2	%	44.9	%	62.6	%	59.4	%	38.3	%	36.9	%	50.9	%	2.8	%	60.3	%
Oregon	11.5		29.1		26.6		13.0		9.9		16.8		17.7		19.9		2.6		9.4
Arizona	10.2		26.1		3.9		11.0		12.8		6.4		15.2		4.6		0.3		9.5
Other	1.0		0.3		—		0.1		—		0.3		6.6		9.7		92.4		—
Utah	9.0		3.1		0.1		4.1		9.1		17.1		2.0		3.5		—		5.4
Idaho	5.4		3.2		11.7		4.4		3.9		2.9		4.6		2.7		0.1		5.0
New Mexico	3.5		8.8		8.3		2.0		2.9		3.9		12.1		1.3		0.9		9.2
Texas	3.3		3.3		4.5		0.1		0.6		12.9		4.3		5.4		0.9		—
Nevada	3.3		1.9		—		2.7		1.4		1.4		0.6		2.0		—		1.2
	100	%	100	%	100	%	100	%	100	%	100	%	100	%	100	%	100	%	100	%

The Company has granted loans to officers and directors of the Company and related interests. These loans are made on the same terms,

including interest rates and collateral, as those prevailing at the time for comparable transactions with unrelated persons and do not involve more than the normal risk of collectability. The aggregate dollar amount of these loans, including unfunded commitments to lend, was $84,166,000 and $57,153,000 at September 30, 2017 and 2016, respectively. As of September 30, 2017, all of these loans were performing in accordance with contractual terms.

The following table provides additional information on impaired loans, loan commitments and loans serviced for others.

	September 30, 2017		September 30, 2016
	(In thousands)
Recorded investment in impaired loans	$	251,274	$	285,243
TDRs included in impaired loans	207,377		261,531
Allocated reserves on impaired loans	1,363		1,980
Specific reserves on impaired loans	126		366
Average balance of impaired loans for year ended	274,530		301,685
Interest income from impaired loans for year ended	11,736		12,843
Outstanding fixed-rate origination commitments	425,130		331,947
Gross loans serviced for others	77,119		80,896

The following table sets forth information regarding non-accrual loans.

	September 30, 2017					September 30, 2016
	(In thousands)					(In thousands)
Non-accrual loans:
Single-family residential	$	27,930		56.3	%	$	33,148		78.2	%
Construction - custom	91			0.2		—			—
Land - acquisition & development	296			0.6		58			0.1
Land - consumer lot loans	605			1.2		510			1.2
Multi-family	139			0.3		776			1.8
Commercial real estate	11,815			23.8		7,100			16.7
Commercial & industrial	8,082			16.3		583			1.4
HELOC	531			1.1		239			0.6
Consumer	91			0.2		—			—
Total non-accrual loans	$	49,580		100	%	$	42,414		100	%
Non-accrual loans as % of total loans	0.46		%			0.43		%

The following table breaks down delinquent loans by loan category and delinquency bucket.

September 30, 2017	Amount of Loans		Days Delinquent Based on $ Amount of Loans										% based on $
Loan type	Net of Loans in Process		Current		30		60		90		Total
	(In thousands)
Single-family residential	$	5,709,690	$	5,671,933	$	10,925	$	4,810	$	22,022	$	37,757	0.66	%
Construction	793,959		793,959		—		—		—		—		—
Construction - custom	277,599		277,508		—		—		91		91		0.03
Land - acquisition & development	104,856		104,526		—		—		330		330		0.31
Land - consumer lot loans	104,335		103,389		112		680		154		946		0.91
Multi-family	1,303,119		1,302,720		5		255		139		399		0.03
Commercial real estate	1,434,610		1,432,052		507		—		2,051		2,558		0.18
Commercial & industrial	1,093,360		1,092,735		—		51		574		625		0.06
HELOC	144,850		143,974		221		342		313		876		0.60
Consumer	85,075		84,644		245		107		79		431		0.51
Total Loans	$	11,051,453	$	11,007,440	$	12,015	$	6,245	$	25,753	$	44,013	0.40	%
Delinquency %			99.60%		0.11%		0.06%		0.23%		0.40%

The percentage of total delinquent loans was 0.40% as of September 30, 2017, as compared to 0.68% as of September 30, 2016.

Most loans restructured in troubled debt restructurings ("TDRs") are accruing and performing loans where the borrower has proactively approached the Company about modifications due to temporary financial difficulties. Each request is individually evaluated for merit and likelihood of success. The concession for these loans is typically a payment reduction through a rate reduction of 100 to 200 bps for a specific term, usually six to 12 months. Interest-only payments may also be approved during the modification period. Principal forgiveness is not an available option for restructured loans. As of September 30, 2017, the outstanding balance of TDR's was $207,377,000 as compared to $261,531,000 as of September 30, 2016. As of September 30, 2017, 97.5% of the restructured loans were performing. Single-family residential loans comprised 87.7% of TDR loans as of September 30, 2017. The Company reserves for restructured loans within its allowance for loan loss methodology by taking into account the following performance indicators: 1) time since modification; 2) current payment status and 3) geographic area.

The following table provides information related to loans that were modified in a TDR during the periods presented.

	Twelve Months Ended September 30, 2017					Twelve Months Ended September 30, 2016
		Pre-Modification		Post-Modification			Pre-Modification		Post-Modification
		Outstanding		Outstanding			Outstanding		Outstanding
	Number of	Recorded		Recorded		Number of	Recorded		Recorded
Troubled Debt Restructurings:	Contracts	Investment		Investment		Contracts	Investment		Investment
		(In thousands)					(In thousands)
Single-family residential	38	$	7,115	$	7,115	120	$	23,541	$	23,541
Land - consumer lot loans	2	211		211		10	970		970
Commercial real estate	—	—		—		7	2,523		2,523
HELOC	4	552		552		1	126		126
Consumer	—	—		—		1	24		24
	44	$	7,878	$	7,878	139	$	27,184	$	27,184

The following table provides information on payment defaults occurring during the periods presented where the loan had been modified in a TDR within 12 months of the payment default.

	Twelve Months Ended September 30, 2017			Twelve Months Ended September 30, 2016
	Number of	Recorded		Number of	Recorded
TDRs That Subsequently Defaulted:	Contracts	Investment		Contracts	Investment
	(In thousands)			(In thousands)
Single-family residential	24	$	4,214	17	$	4,875
Construction	—	—		1	279
Land - consumer lot loans	—	—		5	606
Commercial real estate	2	267		2	326
	26	$	4,481	25	$	6,086

The FDIC loss share coverage for the acquired commercial loans from the former Horizon Bank expired after March 31, 2015. These loans were transferred to loans receivable. The FDIC loss share coverage for the acquired commercial loans from the former Home Valley Bank expired after of September 30, 2015 with final reporting as of October 31, 2015. Recoveries, to the extent that claims were made, will continue to be shared through March 31, 2018 for the former Horizon Bank and September 30, 2018 for the former Home Valley Bank. The FDIC loss share coverage for single-family residential loans will continue for another three years.

The outstanding principal balance of covered loans was $20,572,000 as of September 30, 2017, as compared to $28,974,000 as of September 30, 2016.

The following table shows the year to date activity for the FDIC indemnification asset.

	Twelve Months Ended September 30, 2017			Twelve Months Ended September 30, 2016
	(In thousands)
Balance at beginning of year	$	12,769		$	16,275
Payments received	(584		)	(1,730		)
Amortization	(3,450		)	(2,012		)
Accretion	232			236
Balance at end of year	$	8,967		$	12,769