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Loans Receivable Held for Investment (Tables)

3 Months Ended

Mar. 31, 2023

Loans Receivable Held for Investment [Abstract]

Loans receivable held for investment were as follows as of the dates indicated:

	March 31, 2023			December 31, 2022
	(In thousands)
Real estate:
Single family	$	29,216		$	30,038
Multi-family		509,514			502,141
Commercial real estate		129,031			114,574
Church		13,983			15,780
Construction		59,143			40,703
Commercial – other		37,354			64,841
SBA loans ⁽¹⁾		3,565			3,601
Consumer		10			11
Gross loans receivable before deferred loan costs and premiums		781,816			771,689
Unamortized net deferred loan costs and premiums		1,532			1,755
Gross loans receivable		783,348			773,444
Credit and interest marks on purchased loans, net		(1,010	)		(1,010	)
Allowance for credit losses ⁽²⁾		(6,285	)		(4,388	)
Loans receivable, net	$	776,053		$	768,046

(1)	Including Paycheck Protection Program (PPP) loans.

(2)

The allowance for credit losses as of December 31, 2022 was accounted for under ASC 450 and ASC 310, which is reflective of probable incurred losses as of the date of the consolidated statement of financial condition. Effective January 1, 2023, the allowance for credit losses is accounted for under ASC 326, which is reflective of estimated expected lifetime credit losses.

Carrying Amount of Purchased Credit Impaired Loans

The carrying amount of those loans was as follows:

	March 31, 2023		December 31, 2022
Real estate:	(In thousands)
Single family	$	68	$	68
Commercial – other		57		57
	$	125	$	125

Accretable yield on Purchased Credit Impaired Loans

The following table summarizes the discount on the PCI loans for the three months ended:

	March 31, 2023		March 31, 2022
	(In thousands)
Balance at the beginning of the period	$	165	$	883
Deduction due to payoffs		–		(707	)
Accretion		–		(11	)
Balance at the end of the period	$	165	$	165

Activity in Allowance for Credit Losses on Loans

The following tables summarize the activity in the allowance for credit losses on loans for the period indicated:

	March 31, 2023
	Beginning Balance		Impact of CECL Adoption			Charge-offs		Recoveries		Provision (benefit)			Ending Balance
	(In thousands)
Loans receivable held for investment:
Single family	$	109	$	214		$	–	$	–	$	(62	)	$	261
Multi-family		3,273		603			–		–		56			3,932
Commercial real estate		449		466			–		–		97			1,012
Church		65		37			–		–		(10	)		92
Construction		313		219			–		–		61			593
Commercial - other		175		254			–		–		(72	)		357
SBA loans		–		20			–		–		18			38
Consumer		4		(4	)		–		–		–			–
Total	$	4,388	$	1,809		$	–	$	–	$	88		$	6,285

The following tables present the activity in the allowance for loan losses by loan type for the period indicated:

	For the Three Months Ended March 31, 2022
	Real Estate
	Single Family		Multi- Family		Commercial Real Estate			Church			Construction		Commercial - Other		Consumer		Total
	(In thousands)
Beginning balance	$	145	$	2,657	$	236		$	103		$	212	$	23	$	15	$	3,391
Provision for (recapture of) loan losses		12		114		(20	)		(40	)		25		57		–		148
Recoveries		–		–		–			–			–		–		–		–
Loans charged off		–		–		–			–			–		–		–		–
Ending balance	$	157	$	2,771	$	216		$	63		$	237	$	80		15		3,539

Collateral Dependent Loans By Collateral Type

The following table presents collateral dependent loans by collateral type as of the date indicated:

	March 31, 2023
	Single Family		Condominium		Church		Business Assets		Total
Real estate:	(In thousands)
Single family	$	53	$	112	$	–	$	–	$	165
Commercial real estate		–		–		78		–		78
Church		–		–		695		–		695
Commercial – other		–		–		–		281		281
Total	$	53	$	112	$	773	$	281	$	1,219

Allowance for Loan Losses and Recorded Investment in Loans by Type of Loans and Based on Impairment Method

The following tables present the balance in the allowance for loan losses and the recorded investment (unpaid contractual principal balance less charge-offs, less interest applied to principal, plus unamortized deferred costs and premiums) by loan type and based on impairment method as of the date indicated:

	December 31, 2022
	Real Estate
	Single Family		Multi- Family		Commercial Real Estate		Church		Construction		Commercial - Other		Consumer		Total
	(In thousands)
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	3	$	–	$	–	$	4	$	–	$	–	$	–	$	7
Collectively evaluated for impairment		106		3,273		449		61		313		175		4		4,381
Total ending allowance balance	$	109	$	3,273	$	449	$	65	$	313	$	175	$	4	$	4,388
Loans:
Loans individually evaluated for impairment	$	57	$	–	$	–	$	1,655	$	–	$	–	$	–	$	1,712
Loans collectively evaluated for impairment		20,893		462,539		63,929		9,008		38,530		29,558		11		624,468
Subtotal		20,950		462,539		63,929		10,663		38,530		29,558		11		626,180
Loans acquired in the Merger		9,088		41,357		50,645		5,117		2,173		38,884		–		147,264
Total ending loans balance	$	30,038	$	503,896	$	114,574	$	15,780	$	40,703	$	68,442	$	11	$	773,444

Loans Individually Evaluated for Impairment by Loan Type

The following table presents information related to loans individually evaluated for impairment by loan type as of the date indicated:

	December 31, 2022
	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated
	(In thousands)
With no related allowance recorded:
Church	$	1,572	$	1,572	$	–
With an allowance recorded:
Single family		57		57		3
Church		83		83		4
Total	$	1,712	$	1,712	$	7

Average of Loans Individually Evaluated for Impairment by Loan Type and Related Interest Income

The following tables present the monthly average of loans individually evaluated for impairment by loan type and the related interest income for the period indicated:

	Three Months Ended March 31, 2022
	Average Recorded Investment		Cash Basis Interest Income Recognized
	(In thousands)
Single family	$	64	$	1
Multi-family		279		5
Church		2,535		25
Total	$	2,878	$	31

Aging of Recorded Investment in Past Due Loans by Loan Type

The following tables present the aging of the recorded investment in past due loans by loan type as of the dates indicated:

	March 31, 2023
	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Current		Total
	(In thousands)
Loans receivable held for investment:
Single family	$	–	$	–	$	–	$	–	$	29,216	$	29,216
Multi-family		406		–		–		406		510,640		511,046
Commercial real estate		–		–		–		–		129,031		129,031
Church		–		–		–		–		13,983		13,983
Construction		–		–		–		–		59,143		59,143
Commercial - other		–		–		–		–		37,354		37,354
SBA loans		–		–		–		–		3,565		3,565
Consumer		–		–		–		–		10		10
Total	$	406	$	–	$	–	$	406	$	782,942	$	783,348

December 31, 2022

30-59

Days

Past Due

60-89

Days

Past Due

Greater

than

90 Days

Past Due

Total

Past Due

Current

Total

(In thousands)

Loans receivable held for investment:

Single family

–

30,038

Multi-family

–

503,896

Commercial real estate

–

114,574

Church

–

15,780

Construction

–

40,703

Commercial - other

–

64,841

SBA loans

–

3,601

Consumer

–

Total

–

773,444

Recorded Investment in Non-accrual Loans by Loan Type

The following table presents the recorded investment in non-accrual loans by loan type as of the dates indicated:

	March 31, 2023		December 31, 2022
	(In thousands)
Loans receivable held for investment:
Church	$	–	$	144
Total non-accrual loans	$	–	$	144

Loans Held for Investment Portfolio By Internal Risk Grading and By Year of Origination

The following table stratifies the loans held for investment portfolio by the Company’s internal risk grading, and by year of origination as of the date indicated:

	Term Loans Amortized Cost Basis by Origination Year - As of March 31, 2023
	2023		2022		2021		2020		2019		Prior		Revolving Loans		Total
	(In thousands)
Single family:
Pass	$	–	$	2,517	$	2,663	$	4,399	$	1,833	$	16,798	$	–	$	28,210
Watch		–		–		–		–		–		349		–		349
Special Mention		–		–		–		–		–		258		–		258
Substandard		–		–		–		–		–		399		–		399
Total	$	–	$	2,517	$	2,663	$	4,399	$	1,833	$	17,804	$	–	$	29,216

Multi-family:
Pass	$	13,179	$	187,621	$	154,166	$	27,839	$	46,232	$	57,980	$	–	$	487,017
Watch		–		3,300		915		–		–		3,453		–		7,668
Special Mention		–		–		–		–		–		1,775		–		1,775
Substandard		–		–		–		–		760		13,826		–		14,586
Total	$	13,179	$	190,921	$	155,081	$	27,839	$	46,992	$	77,034	$	–	$	511,046

Commercial real estate:
Pass	$	2,835	$	22,571	$	26,181	$	30,678	$	6,430	$	32,719	$	–	$	121,414
Watch		–		432		–		–		740		1,101		–		2,273
Special Mention		–		–		–		–		–		–		–		–
Substandard		–		–		–	$	–	$	–		5,344	$	–	$	5,344
Total	$	2,835	$	23,003	$	26,181	$	30,678	$	7,170	$	39,164	$	–	$	129,031

Church:
Pass	$	–	$	–	$	2,247	$	1,785	$	–	$	7,188	$	–	$	11,220
Watch		–		–		–		–		649		1,120		–		1,769
Special Mention		–		–		–		–		–		–		–		–
Substandard		–		–		–		–		–		994		–		994
Total	$	–	$	–	$	2,247	$	1,785	$	649	$	9,302	$	–	$	13,983

Construction:
Pass	$	995	$	–	$	1,219	$	–	$	–	$	2,154	$	–	$	4,368
Watch		17,495		30,012		7,268		–		–		–		–		54,775
Special Mention		–		–		–		–		–		–		–		–
Substandard		–		–		–		–		–		–		–		–
Total	$	18,490	$	30,012	$	8,487	$	–	$	–	$	2,154	$	–	$	59,143

Commercial – others:
Pass	$	–	$	7,611	$	175	$	1,404	$	4,300	$	5,784	$	6,568	$	25,842
Watch		–		1,205		107		1,500		2,250		5,532		637		11,231
Special Mention		–		–		–		–		–		–		–		–
Substandard		–		–		–		–		–		281		–		281
Total	$	–	$	8,816	$	282	$	2,904	$	6,550	$	11,597	$	7,205	$	37,354

SBA:
Pass	$	–	$	148	$	2,723	$	–	$	28	$	128	$	–	$	3,027
Watch		–		–		–		–		–		–		–		–
Special Mention		–		–		–		538		–		–		–		538
Substandard		–		–		–		–		–		–		–		–
Total	$	–	$	148	$	2,723	$	538	$	28	$	128	$	–	$	3,565

Consumer:
Pass	$	10	$	–	$	–	$	–	$	–	$	–	$	–	$	10
Watch		–		–		–		–		–		–		–		–
Special Mention		–		–		–		–		–		–		–		–
Substandard		–		–		–		–		–		–		–		–
Total	$	10	$	–	$	–	$	–	$	–	$	–	$	–	$	10

Total loans:
Pass	$	17,019	$	220,468	$	189,374	$	66,105	$	58,823	$	122,751	$	6,568	$	681,108
Watch		17,495		34,949		8,290		1,500		3,639		11,555		637		78,065
Special Mention		–		–		–		538		–		2,033		–		2,571
Substandard		–		–		–		–		760		20,844		–		21,604
Total loans	$	34,514	$	255,417	$	197,664	$	68,143	$	63,222	$	157,183	$	7,205	$	783,348

The following table stratifies the loan portfolio by the Company’s internal risk rating as of the date indicated:

	December 31, 2022
	Pass		Watch		Special Mention		Substandard		Doubtful		Loss		Total
Single family	$	29,022	$	354	$	260	$	402	$	–	$	–	$	30,038
Multi-family		479,182		9,855		14,859		–		–		–		503,896
Commercial real estate		104,066		4,524		1,471		4,513		–		–		114,574
Church		14,505		728		–		547		–		–		15,780
Construction		2,173		38,530		–		–		–		–		40,703
Commercial – others		53,396		11,157		–		288		–		–		64,841
SBA		3,032		569		–		–		–		–		3,601
Consumer		11		–		–		–		–		–		11
Total	$	685,387	$	65,717	$	16,590	$	5,750	$	–	$	–	$	773,444