Loans Held for Investment (Tables)

3 Months Ended

Mar. 31, 2016

Schedule of components of loans held for investment

The following table sets forth the composition of our loan portfolio in dollar amounts at the dates indicated:



	March 31, 2016			December 31, 2015			March 31, 2015
	(in thousands)
Business loans:
Commercial and industrial	$	491,112		$	309,741		$	276,321
Franchise	371,875			328,925			216,544
Commercial owner occupied (1)	424,289			294,726			279,704
SBA	78,350			62,256			49,855
Warehouse facilities	1,394			143,200			216,554
Real estate loans:
Commercial non-owner occupied	522,080			421,583			452,422
Multi-family	619,485			429,003			397,130
One-to-four family (2)	106,854			80,050			116,735
Construction	218,069			169,748			111,704
Land	18,222			18,340			7,243
Other loans	6,045			5,111			6,641
Total gross loans (3)	2,857,775			2,262,683			2,130,853
Less Loans held for sale, net	7,281			8,565			—
Total gross loans held for investment	2,850,494			2,254,118			2,130,853
Less:
Deferred loan origination costs/(fees) and premiums/(discounts), net	938			197			534
Allowance for loan losses	(18,455		)	(17,317		)	(13,646		)
Loans held for investment, net	$	2,832,977		$	2,236,998		$	2,117,741

______________________________

(1) Majority secured by real estate.

(2) Includes second trust deeds.

(3) Total gross loans for March 31, 2016 are net of the unaccreted mark-to-market discounts on Canyon National Bank (“Canyon National“) loans of $121,000, on Palm Desert National Bank (“Palm Desert National”) loans of $877,000, on First Associations Bank (“FAB”) loans of $4,000, on San Diego Trust Bank (“SDTB”) loans of $105,000, on Independence Bank (“IDPK”) loans of $3.3 million and on Security California Bancorp (“SCAF”) loans of $10.7 million.

Summary of Company's investment in purchased credit impaired loans

The following table provides a summary of the Company’s investment in purchased credit impaired loans, acquired from Canyon National Bank, IDPK and SCAF as of the period indicated:



	March 31, 2016
	Canyon National		IDPK		SCAF		Total
	(in thousands)
Business loans:
Commercial and industrial	$	89	$	183	$	4,530	$	4,802
Commercial owner occupied	523		332		1,138		1,993
Real estate loans:
Commercial non-owner occupied	894		648		—		1,542
One-to-four family	—		—		817		817
Other loans	—		—		441		441
Total purchase credit impaired	$	1,506	$	1,163	$	6,926	$	9,595

Summary of accretable yield on purchased credit impaired

The following table summarizes the accretable yield on the purchased credit impaired loans for the three months ended March 31, 2016:



	Three Months Ended
	March 31, 2016
	Canyon National			IDPK			SCAF			Total
	(in thousands)
Balance at the beginning of period	$	1,130		$	1,596		$	—		$	2,726
Accretable yield at acquisition	—			—			788			788
Accretion	(49		)	(4		)	(76		)	(129		)
Disposals and other	—			(323		)	—			(323		)
Change in accretable yield	—			192			—			192
Balance at the end of period	1,081			1,461			712			3,254

Summary of Company's investment in impaired loans

The following tables provide a summary of the Company’s investment in impaired loans as of the period indicated:



					Impaired Loans
	Contractual Unpaid Principal Balance		Recorded Investment		With Specific Allowance		Without Specific Allowance		Specific Allowance for Impaired Loans		Average Recorded Investment		Interest Income Recognized
	(in thousands)
March 31, 2016
Business loans:
Commercial and industrial	$	373	$	306	$	—	$	306	$	—	$	308	$	5
Franchise	2,394		1,630		1,461		169		731		1,629		27
Commercial owner occupied	870		507		—		507		—		518		9
SBA	414		69		—		69		—		23		—
Real estate loans:
Commercial non-owner occupied	—		—		—		—		—		143		2
One-to-four family	556		523		—		523		—		251		5
Land	37		19		—		19		—		20		1
Totals	$	4,644	$	3,054	$	1,461	$	1,593	$	731	$	2,892	$	49



					Impaired Loans
	Contractual Unpaid Principal Balance		Recorded Investment		With Specific Allowance		Without Specific Allowance		Specific Allowance for Impaired Loans		Average Recorded Investment		Interest Income Recognized
	(in thousands)
December 31, 2015
Business loans:
Commercial and industrial	$	578	$	313	$	—	$	313	$	—	$	90	$	29
Franchise	2,394		1,630		1,461		169		731		1,386		3
Commercial owner occupied	883		536		—		536		—		415		67
Real estate loans:
Commercial non-owner occupied	329		214		—		214		—		430		19
One-to-four family	98		70		—		70		—		204		5
Land	37		21		—		21		—		13		—
Totals	$	4,319	$	2,784	$	1,461	$	1,323	$	731	$	2,543	$	123



					Impaired Loans
	Contractual Unpaid Principal Balance		Recorded Investment		With Specific Allowance		Without Specific Allowance		Specific Allowance for Impaired Loans		Average Recorded Investment		Interest Income Recognized
	(in thousands)
March 31, 2015
Business loans:
Franchise	$	2,225	$	1,853	$	—	$	1,853	$	—	$	618	$	—
Commercial owner occupied	438		379		—		379		—		382		7
Real estate loans:
Commercial non-owner occupied	698		458		—		458		—		465		12
One-to-four family	254		232		—		232		—		234		5
Totals	$	3,615	$	2,922	$	—	$	2,922	$	—	$	1,699	$	24

Summary of additional detail on components of impaired loans

The following table provides additional detail on the components of impaired loans at the period end indicated:



	March 31, 2016		December 31, 2015		March 31, 2015
	(in thousands)
Nonaccruing loans	$	3,054	$	2,736	$	2,742
Accruing loans	—		48		180
Total impaired loans	$	3,054	$	2,784	$	2,922

Summary of loan portfolio by the Company's internal risk grading system

The following tables stratify the loan portfolio by the Company’s internal risk grading system as well as certain other information concerning the credit quality of the loan portfolio as of the periods indicated:



	Credit Risk Grades
	Pass		Special Mention		Substandard		Doubtful		Total Gross Loans
March 31, 2016	(in thousands)
Business loans:
Commercial and industrial	$	481,770	$	2,977	$	6,365	$	—	$	491,112
Franchise	370,245		—		169		1,461		371,875
Commercial owner occupied	413,627		2,029		8,633		—		424,289
SBA	78,280		—		70		—		78,350
Warehouse facilities	1,394		—		—		—		1,394
Real estate loans:									0
Commercial non-owner occupied	520,248		—		1,832		—		522,080
Multi-family	616,620		—		2,865		—		619,485
One-to-four family	104,608		—		2,246		—		106,854
Construction	218,069		—		—		—		218,069
Land	18,203		—		19		—		18,222
Other loans	5,604		—		441		—		6,045
Totals	$	2,828,668	$	5,006	$	22,640	$	1,461	$	2,857,775



	Credit Risk Grades
	Pass		Special Mention		Substandard		Doubtful		Total Gross Loans
December 31, 2015	(in thousands)
Business loans:
Commercial and industrial	$	306,513	$	73	$	3,155	$	—	$	309,741
Franchise	327,295		—		169		1,461		328,925
Commercial owner occupied	286,270		627		7,829		—		294,726
SBA	62,256		—		—		—		62,256
Warehouse facilities	143,200		—		—		—		143,200
Real estate loans:									—
Commercial non-owner occupied	418,917		—		2,666		—		421,583
Multi-family	425,616		—		3,387		—		429,003
One-to-four family	78,997		—		1,053		—		80,050
Construction	169,748		—		—		—		169,748
Land	18,319		—		21		—		18,340
Other loans	5,111		—		—		—		5,111
Totals	$	2,242,242	$	700	$	18,280	$	1,461	$	2,262,683



	Credit Risk Grades
	Pass		Special Mention		Substandard		Doubtful		Total Gross Loans
March 31, 2015	(in thousands)
Business loans:
Commercial and industrial	$	268,285	$	1,250	$	6,786	$	—	$	276,321
Franchise	214,690		—		1,854		—		216,544
Commercial owner occupied	268,038		—		11,666		—		279,704
SBA	49,855		—		—		—		49,855
Warehouse facilities	216,554		—		—		—		216,554
Real estate loans:
Commercial non-owner occupied	446,900		—		5,522		—		452,422
Multi-family	391,690		1,954		3,486		—		397,130
One-to-four family	115,780		—		955		—		116,735
Construction	111,469		—		235		—		111,704
Land	7,243		—		—		—		7,243
Other loans	6,641		—		—		—		6,641
Totals	$	2,097,145	$	3,204	$	30,504	$	—	$	2,130,853

Schedule of delinquencies in the Company's loan portfolio

The following tables set forth delinquencies in the Company’s loan portfolio at the dates indicated:



			Days Past Due								Non-
	Current		30-59		60-89		90+		Total		Accruing
March 31, 2016	(in thousands)
Business loans:
Commercial and industrial	$	490,796	$	—	$	—	$	316	$	491,112	$	498
Franchise	370,245		—		—		1,630		371,875		1,630
Commercial owner occupied	424,289		—		—		—		424,289		839
SBA	78,104		246		—		—		78,350		69
Warehouse facilities	1,394		—		—		—		1,394		—
Real estate loans:
Commercial non-owner occupied	522,080		—		—		—		522,080		428
Multi-family	619,485		—		—		—		619,485		—
One-to-four family	105,619		1		—		1,234		106,854		1,340
Construction	218,069		—		—		—		218,069		—
Land	18,203		—		—		19		18,222		19
Other loans	6,045		—		—		—		6,045		—
Totals	$	2,854,329	$	247	$	—	$	3,199	$	2,857,775	$	4,823



			Days Past Due								Non-
	Current		30-59		60-89		90+		Total		Accruing
December 31, 2015	(in thousands)
Business loans:
Commercial and industrial	$	309,464	$	20	$	—	$	257	$	309,741	$	463
Franchise	327,295		—		—		1,630		328,925		1,630
Commercial owner occupied	294,371		—		355		—		294,726		536
SBA	62,256		—		—		—		62,256		—
Warehouse facilities	143,200		—		—		—		143,200		—
Real estate loans:
Commercial non-owner occupied	421,369		214		—		—		421,583		1,164
Multi-family	429,003		—		—		—		429,003		—
One-to-four family	79,915		89		—		46		80,050		155
Construction	169,748		—		—		—		169,748		—
Land	18,319		—		—		21		18,340		21
Other loans	5,111		—		—		—		5,111		1
Totals	$	2,260,051	$	323	$	355	$	1,954	$	2,262,683	$	3,970



			Days Past Due								Non-
	Current		30-59		60-89		90+		Total		Accruing
March 31, 2015	(in thousands)
Business loans:
Commercial and industrial	$	275,850	$	146	$	—	$	325	$	276,321	$	601
Franchise	214,691		—		—		1,853		216,544		1,854
Commercial owner occupied	278,953		349		375		27		279,704		527
SBA	49,855		—		—		—		49,855		—
Warehouse facilities	216,554		—		—		—		216,554		—
Real estate loans:
Commercial non-owner occupied	452,422		—		—		—		452,422		1,602
Multi-family	397,130		—		—		—		397,130		—
One-to-four family	116,533		149		—		53		116,735		79
Construction	111,704		—		—		—		111,704		—
Land	7,243		—		—		—		7,243		—
Other loans	6,640		1		—		—		6,641		—
Totals	$	2,127,575	$	645	$	375	$	2,258	$	2,130,853	$	4,663