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Loans Receivable, Net (Tables)
 3 Months Ended
Mar. 31, 2020
Receivables [Abstract]  
Components of Loans Receivable, Net
Loans receivable, net at March 31, 2020 and December 31, 2019 consisted of the following (in thousands):
 
March 31, 2020
 
December 31, 2019
Commercial:
 
 
 
Commercial and industrial
$
502,760

 
$
396,434

Commercial real estate – owner occupied
1,220,983

 
792,653

Commercial real estate – investor
3,331,662

 
2,296,410

Total commercial
5,055,405

 
3,485,497

Consumer:
 
 
 
Residential real estate
2,458,641

 
2,321,157

Home equity loans and lines
335,624

 
318,576

Other consumer
82,920

 
89,422

Total consumer
2,877,185

 
2,729,155

Total loans
7,932,590

 
6,214,652

Deferred origination costs, net
10,586

 
9,880

Allowance for credit losses
(29,635
)
 
(16,852
)
Total loans, net
$
7,913,541

 
$
6,207,680
Risk Category of Loans by Loan Portfolio Segment Excluding PCI Loans
The following table summarizes total loans by year of origination and internally assigned credit grades and risk characteristics (in thousands):
 
 
2020
 
2019
 
2018
 
2017
 
2016
 
2015 and prior
 
Revolving lines of credit
 
Total
March 31, 2020
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial and industrial
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass
 
$
7,718

 
$
61,109

 
$
60,217

 
$
47,452

 
$
47,051

 
$
111,383

 
$
147,529

 
$
482,459

Special Mention
 
—

 
—

 
112

 
832

 
712

 
54

 
800

 
2,510

Substandard
 
400

 
—

 
3,912

 
1,497

 
72

 
7,877

 
4,033

 
17,791

Total commercial and industrial
 
8,118

 
61,109

 
64,241

 
49,781

 
47,835

 
119,314

 
152,362

 
502,760

Commercial real estate - owner occupied
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass
 
59,276

 
154,245

 
138,376

 
143,086

 
136,276

 
531,105

 
22,560

 
1,184,924

Special Mention
 
—

 
191

 
—

 
1,399

 
1,396

 
1,439

 
306

 
4,731

Substandard
 
—

 
2,138

 
410

 
2,431

 
2,391

 
23,958

 
—

 
31,328

Total commercial real estate - owner occupied
 
59,276

 
156,574

 
138,786

 
146,916

 
140,063

 
556,502

 
22,866

 
1,220,983

Commercial real estate - investor
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass
 
200,651

 
662,802

 
410,180

 
511,079

 
345,525

 
983,984

 
144,341

 
3,258,562

Special Mention
 
—

 
29

 
—

 
3,031

 
5,950

 
19,709

 
8,768

 
37,487

Substandard
 
—

 
178

 
664

 
—

 
5,069

 
25,691

 
4,011

 
35,613

Total commercial real estate - investor
 
200,651

 
663,009

 
410,844

 
514,110

 
356,544

 
1,029,384

 
157,120

 
3,331,662

Residential real estate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass
 
138,889

 
588,723

 
347,761

 
220,624

 
182,541

 
976,664

 
—

 
2,455,202

Special Mention
 
—

 
—

 
—

 
221

 
144

 
3,074

 
—

 
3,439

Substandard
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Total residential real estate
 
138,889

 
588,723

 
347,761

 
220,845

 
182,685

 
979,738

 
—

 
2,458,641

Consumer
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass
 
6,665

 
37,024

 
119,311

 
34,358

 
21,322

 
194,187

 
2,514

 
415,381

Special Mention
 
—

 
—

 
—

 
—

 
—

 
530

 
—

 
530

Substandard
 
—

 
—

 
35

 
—

 
—

 
2,598

 
—

 
2,633

Total consumer
 
6,665

 
37,024

 
119,346

 
34,358

 
21,322

 
197,315

 
2,514

 
418,544

Total loans
 
$
413,599

 
$
1,506,439

 
$
1,080,978

 
$
966,010

 
$
748,449

 
$
2,882,253

 
$
334,862

 
$
7,932,590
Analysis of Allowance for Loan Losses
An analysis of the allowance for credit losses on loans for the three months ended March 31, 2020 and 2019 is as follows (in thousands):
 
 
Commercial
and 
Industrial
 
Commercial
Real Estate –
Owner
Occupied
 
Commercial
Real Estate –
Investor
 
Residential
Real Estate
 
Consumer
 
Unallocated
 
Total
For the three months ended
March 31, 2020
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for credit losses on loans
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at beginning of period
 
$
1,458

 
$
2,893

 
$
9,883

 
$
2,002

 
$
591

 
$
25

 
$
16,852

Impact of CECL adoption
 
2,416

 
(1,109
)
 
(5,395
)
 
3,833

 
2,981

 
(25
)
 
2,701

Credit loss expense
 
1,529

 
1,286

 
2,377

 
3,585

 
(180
)
 
—

 
8,597

Initial allowance for credit losses on PCD loans
 
1,221

 
26

 
260

 
109

 
1,023

 
 
 
2,639

Charge-offs
 
—

 
—

 
—

 
(1,275
)
 
(109
)
 
—

 
(1,384
)
Recoveries
 
25

 
—

 
34

 
163

 
8

 
—

 
230

Balance at end of period
 
$
6,649

 
$
3,096

 
$
7,159

 
$
8,417

 
$
4,314

 
$
—

 
$
29,635

For the three months ended
March 31, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for credit losses on loans
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at beginning of period
 
$
1,609

 
$
2,277

 
$
8,770

 
$
2,413

 
$
486

 
$
1,022

 
$
16,577

Credit loss (benefit) expense
 
(19
)
 
1,550

 
(802
)
 
(23
)
 
(110
)
 
24

 
620

Charge-offs
 
—

 
(389
)
 
(21
)
 
(427
)
 
(31
)
 
—

 
(868
)
Recoveries
 
57

 
—

 
295

 
2

 
22

 
—

 
376

Balance at end of period
 
$
1,647

 
$
3,438

 
$
8,242

 
$
1,965

 
$
367

 
$
1,046

 
$
16,705
Allowance for Loan Losses and Recorded Investment in Loans by Portfolio Segment and Based on Impairment Method Excluding PCI Loans
In accordance with ASC 310, prior to the adoption of ASU 2016-13, the following table presents the balance in the allowance for credit losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2019, excluding PCD loans (in thousands):
 
Commercial
and 
Industrial
 
Commercial
Real Estate –
Owner
Occupied
 
Commercial
Real Estate –
Investor
 
Residential
Real Estate
 
Consumer
 
Unallocated
 
Total
December 31, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for credit losses:
 
 
 
 
 
 
 
 
 
 
 
 
 
Ending allowance balance attributed to loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
—

 
$
474

 
$
—

 
$
—

 
$
2

 
$
—

 
$
476

Collectively evaluated for impairment
1,458

 
2,419

 
9,883

 
2,002

 
589

 
25

 
16,376

Total ending allowance balance
$
1,458

 
$
2,893

 
$
9,883

 
$
2,002

 
$
591

 
$
25

 
$
16,852

Loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans individually evaluated for impairment
$
243

 
$
6,163

 
$
5,584

 
$
11,009

 
$
3,511

 
$
—

 
$
26,510

Loans collectively evaluated for impairment
395,848

 
785,778

 
2,279,114

 
2,309,812

 
404,325

 
—

 
6,174,877

Total ending loan balance
$
396,091

 
$
791,941

 
$
2,284,698

 
$
2,320,821

 
$
407,836

 
$
—

 
$
6,201,387
Summary of Impaired Loans Excluding PCI Loans
In accordance with ASC 310, prior to the adoption of ASU 2016-13, the following table presents the balance in the allowance for credit losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2019, excluding PCD loans (in thousands):
 
Commercial
and 
Industrial
 
Commercial
Real Estate –
Owner
Occupied
 
Commercial
Real Estate –
Investor
 
Residential
Real Estate
 
Consumer
 
Unallocated
 
Total
December 31, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for credit losses:
 
 
 
 
 
 
 
 
 
 
 
 
 
Ending allowance balance attributed to loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
—

 
$
474

 
$
—

 
$
—

 
$
2

 
$
—

 
$
476

Collectively evaluated for impairment
1,458

 
2,419

 
9,883

 
2,002

 
589

 
25

 
16,376

Total ending allowance balance
$
1,458

 
$
2,893

 
$
9,883

 
$
2,002

 
$
591

 
$
25

 
$
16,852

Loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans individually evaluated for impairment
$
243

 
$
6,163

 
$
5,584

 
$
11,009

 
$
3,511

 
$
—

 
$
26,510

Loans collectively evaluated for impairment
395,848

 
785,778

 
2,279,114

 
2,309,812

 
404,325

 
—

 
6,174,877

Total ending loan balance
$
396,091

 
$
791,941

 
$
2,284,698

 
$
2,320,821

 
$
407,836

 
$
—

 
$
6,201,387
Summary of Loans Individually Evaluated for Impairment by Loan Portfolio Segment Excluding PCI Loans
In accordance with ASC 310, prior to the adoption of ASU 2016-13, the summary of loans individually evaluated for impairment by loan portfolio segment as of December 31, 2019 and for the three months ended March 31, 2019, is as follows, excluding PCI loans (in thousands):
 
Unpaid
Principal
Balance
 
Recorded
Investment
 
Allowance
for Credit
Losses
Allocated
As of December 31, 2019
 
 
 
 
 
With no related allowance recorded:
 
 
 
 
 
Commercial and industrial
$
265

 
$
243

 
$
—

Commercial real estate – owner occupied
4,062

 
3,968

 
—

Commercial real estate – investor
6,665

 
5,584

 
—

Residential real estate
11,009

 
11,009

 
—

Consumer
3,734

 
3,509

 
—

 
$
25,735

 
$
24,313

 
$
—

With an allowance recorded:
 
 
 
 
 
Commercial and industrial
$
—

 
$
—

 
$
—

Commercial real estate – owner occupied
2,376

 
2,195

 
474

Commercial real estate – investor
—

 
—

 
—

Residential real estate
—

 
—

 
—

Consumer
2

 
2

 
2

 
$
2,378

 
$
2,197

 
$
476

 
Three Months Ended March 31, 2019
 
Average
Recorded
Investment
 
Interest
Income
Recognized
With no related allowance recorded:
 
 
 
Commercial and industrial
$
938

 
$
3

Commercial real estate – owner occupied
4,153

 
42

Commercial real estate – investor
11,667

 
136

Residential real estate
10,046

 
131

Consumer
3,071

 
46

 
$
29,875

 
$
358

With an allowance recorded:
 
 
 
Commercial and industrial
$
—

 
$
—

Commercial real estate – owner occupied
2,250

 
36

Commercial real estate – investor
—

 
—

Residential real estate
—

 
—

Consumer
—

 
—

 
$
2,250

 
$
36
Recorded Investment in Non-Accrual Loans by Loan Portfolio Segment Excluding PCI Loans
The following table presents the recorded investment in non-accrual loans by loan portfolio segment as of March 31, 2020 and December 31, 2019 (in thousands). The March 31, 2020 balances include PCD loans while the December 31, 2019 balances exclude PCI loans (in accordance with ASC 310, prior to the adoption of ASU 2016-13 on January 1, 2020).
 
March 31, 2020
 
December 31, 2019
Commercial and industrial
$
782

 
$
207

Commercial real estate – owner occupied
4,219

 
4,811

Commercial real estate – investor
9,123

 
2,917

Residential real estate
6,690

 
7,181

Consumer
3,075

 
2,733

 
$
23,889

 
$
17,849
Aging of Recorded Investment in Past Due Loans Excluding PCI Loans
The following table presents the aging of the recorded investment in past due loans as of March 31, 2020 and December 31, 2019 by loan portfolio segment (in thousands). The March 31, 2020 balances include PCD loans while the December 31, 2019 balances exclude PCI loans (in accordance with ASC 310, prior to the adoption of ASU 2016-13 on January 1, 2020).
 
30-59
Days
Past Due
 
60-89
Days
Past Due
 
Greater
than
90 Days
Past Due
 
Total
Past Due
 
Loans Not
Past Due
 
Total
March 31, 2020
 
 
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
3,052

 
$
575

 
$
207

 
$
3,834

 
$
498,926

 
$
502,760

Commercial real estate – owner occupied
8,883

 
1,307

 
392

 
10,582

 
1,210,401

 
1,220,983

Commercial real estate – investor
19,152

 
2,595

 
7,466

 
29,213

 
3,302,449

 
3,331,662

Residential real estate
18,363

 
206

 
3,234

 
21,803

 
2,436,838

 
2,458,641

Consumer
1,825

 
530

 
2,633

 
4,988

 
413,556

 
418,544

 
$
51,275

 
$
5,213

 
$
13,932

 
$
70,420

 
$
7,862,170

 
$
7,932,590

December 31, 2019
 
 
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
100

 
$
—

 
$
207

 
$
307

 
$
395,784

 
$
396,091

Commercial real estate – owner occupied
1,541

 
1,203

 
1,040

 
3,784

 
788,157

 
791,941

Commercial real estate – investor
381

 
938

 
2,792

 
4,111

 
2,280,587

 
2,284,698

Residential real estate
8,161

 
3,487

 
2,859

 
14,507

 
2,306,314

 
2,320,821

Consumer
1,048

 
491

 
2,388

 
3,927

 
403,909

 
407,836

 
$
11,231

 
$
6,119

 
$
9,286

 
$
26,636

 
$
6,174,751

 
$
6,201,387
Troubled Debt Restructurings
The following table presents information about troubled debt restructurings which occurred during the three months ended March 31, 2020 and 2019, and troubled debt restructurings modified within the previous year and which defaulted during the three months ended March 31, 2020 and 2019 (dollars in thousands):
 
Number of Loans
 
Pre-modification
Recorded Investment
 
Post-modification
Recorded Investment
Three months ended March 31, 2020
 
 
 
 
 
Troubled Debt Restructurings:
 
 
 
 
 
Consumer
4

 
$
159

 
$
177

Residential real estate
2

 
226

 
234

 
Number of Loans
  
Recorded Investment
Troubled Debt Restructurings
 
 
 
Which Subsequently Defaulted:
None

 
None

 
 
 
Number of Loans
 
Pre-modification
Recorded Investment
 
Post-modification
Recorded Investment
Three Months Ended March 31, 2019
 
 
 
 
 
Troubled Debt Restructurings:
 
 
 
 
 
Residential real estate
3

 
589

 
621


 
Number of Loans
  
Recorded Investment
Troubled Debt Restructurings
 
 
 
Which Subsequently Defaulted
None

 
None
Financing Receivable, Purchased With Credit Deterioration The carrying amount of those loans is as follows (in thousands):
 
 
Two River
January 1, 2020
 
Country Bank January 1, 2020
Purchase price of loans at acquisition
 
$
26,104

 
$
24,667

Allowance for credit losses at acquisition
 
1,343

 
1,296

Non-credit discount at acquisition
 
2,562

 
5,334

Par value of acquired loans at acquisition
 
$
30,009

 
$
31,297
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities Acquired During Period
In accordance with ASC 310, prior to the adoption of ASU 2016-13,the following table summarizes the changes in accretable yield for PCI loans during the three months ended March 31, 2019 (in thousands):
 
Three Months Ended
March 31,
 
 
2019
Beginning balance
 
$
3,630

Acquisition
 
1,171

Accretion
 
(653
)
Reclassification from non-accretable difference
 
45

Ending balance
 
$
4,193