Loans Held for Investment (Tables)

3 Months Ended

Mar. 31, 2017

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, 2017			December 31, 2016
	(dollars in thousands)
Business loans:
Commercial and industrial	$	593,457		$	563,169
Franchise	493,158			459,421
Commercial owner occupied (1)	482,295			454,918
SBA	107,233			96,705
Real estate loans:
Commercial non-owner occupied	612,787			586,975
Multi-family	682,237			690,955
One-to-four family (2)	100,423			100,451
Construction	298,279			269,159
Land	19,738			19,829
Other loans	3,930			4,112
Total gross loans (3)	3,393,537			3,245,694
Plus: Deferred loan origination costs/(fees) and premiums/(discounts), net	3,250			3,630
Total loans	3,396,787			3,249,324
Less: loans held for sale, at lower of cost or fair value	11,090			7,711
Loans held for investment	3,385,697			3,241,613
Allowance for loan losses	(23,075		)	(21,296		)
Loans held for investment, net	$	3,362,622		$	3,220,317

______________________________

(1) Secured by real estate.

(2) Includes second trust deeds.

(3) Total gross loans for March 31, 2017 are net of the unaccreted fair value purchase discounts of $6.4 million.

Summary of Company's investment in purchased credit impaired loans

The carrying amount of those loans is as follows:



	March 31, 2017		December 31, 2016
	(dollars in thousands)
Business loans:
Commercial and industrial	$	2,536	$	2,586
Commercial owner occupied	481		491
Real estate loans:
Commercial non-owner occupied	1,036		1,088
One-to-four family	—		1
Other loans	318		393
Total purchase credit impaired	$	4,371	$	4,559

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, 2017, December 31, 2016 and March 31, 2016:



		Three Months Ended
		March 31, 2017			December 31, 2016			March 31, 2016
	(dollars in thousands)
Balance at the beginning of period		$	3,747		$	3,254		$	2,726
Additions		—			—			788
Accretion		(629		)	(432		)	(129		)
Payoffs		—			(113		)	(323		)
Reclassification from (to) nonaccretable difference		483			1,038			192
Balance at the end of period		$	3,601		$	3,747		$	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
	(dollars in thousands)
March 31, 2017
Business loans:
Commercial owner occupied	$	118	$	86	$	—	$	86	$	—
SBA	2,442		298		—		298		—
Real estate loans:
One-to-four family	286		115		—		115		—
Land	36		14		—		14		—
Totals	$	2,882	$	513	$	—	$	513	$	—



	Impaired Loans
	Contractual Unpaid Principal Balance		Recorded Investment		With Specific Allowance		Without Specific Allowance		Specific Allowance for Impaired Loans
	(dollars in thousands)
December 31, 2016
Business loans:
Commercial and industrial	$	1,990	$	250	$	250	$	—	$	250
Commercial owner occupied	847		436		—		436		—
SBA	3,865		316		—		316		—
Real estate loans:
One-to-four family	291		124		—		124		—
Land	36		15		—		15		—
Totals	$	7,029	$	1,141	$	250	$	891	$	250



	Impaired Loans
	Three Months Ended
	March 31, 2017				December 31, 2016				March 31, 2016
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
	(in thousands)
Business loans:
Commercial and industrial	$	200	$	5	$	1,410	$	47	$	308	$	5
Franchise	—		—		—		—		1,629		27
Commercial owner occupied	192		3		493		10		518		9
SBA	307		5		672		13		23		—
Real estate loans:
Commercial non-owner occupied	—		—		1,658		49		143		2
One-to-four family	116		3		128		4		251		5
Land	14		1		16		1		20		1
Totals	$	829	$	17	$	4,377	$	124	$	2,892	$	49

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, 2017		December 31, 2016
	(dollars in thousands)
Nonaccruing loans	$	513	$	1,141
Accruing loans	—		—
Total impaired loans	$	513	$	1,141

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 as of the periods indicated:



	Credit Risk Grades
	Pass		Special Mention		Substandard		Doubtful		Total Gross Loans
March 31, 2017	(dollars in thousands)
Business loans:
Commercial and industrial	$	579,569	$	9,365	$	4,523	$	—	$	593,457
Franchise	493,158		—		—		—		493,158
Commercial owner occupied	477,109		997		4,189		—		482,295
SBA	106,644		18		571		—		107,233
Real estate loans:
Commercial non-owner occupied	611,357		806		624		—		612,787
Multi-family	681,690		—		547		—		682,237
One-to-four family	99,992		—		431		—		100,423
Construction	298,279		—		—		—		298,279
Land	19,724		—		14		—		19,738
Other loans	3,607		—		323		—		3,930
Totals	$	3,371,129	$	11,186	$	11,222	$	—	$	3,393,537



	Credit Risk Grades
	Pass		Special Mention		Substandard		Doubtful		Total Gross Loans
December 31, 2016	(dollars in thousands)
Business loans:
Commercial and industrial	$	550,919	$	8,216	$	3,784	$	250	$	563,169
Franchise	459,421		—		—		—		459,421
Commercial owner occupied	450,416		281		4,221		—		454,918
SBA	96,190		53		462		—		96,705
Real estate loans:
Commercial non-owner occupied	585,093		810		1,072		—		586,975
Multi-family	681,942		6,610		2,403		—		690,955
One-to-four family	100,010		—		441		—		100,451
Construction	269,159		—		—		—		269,159
Land	19,814		—		15		—		19,829
Other loans	3,719		—		393		—		4,112
Totals	$	3,216,683	$	15,970	$	12,791	$	250	$	3,245,694

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, 2017	(dollars in thousands)
Business loans:
Commercial and industrial	$	593,375	$	82	$	—	$	—	$	593,457	$	—
Franchise	493,158		—		—		—		493,158		—
Commercial owner occupied	482,260		35		—		—		482,295		86
SBA	106,936		—		—		297		107,233		298
Real estate loans:
Commercial non-owner occupied	612,787		—		—		—		612,787		—
Multi-family	682,237		—		—		—		682,237		—
One-to-four family	100,374		—		—		49		100,423		115
Construction	298,279		—		—		—		298,279		—
Land	19,724		—		—		14		19,738		14
Other loans	3,930		—		—		—		3,930		—
Totals	$	3,393,060	$	117	$	—	$	360	$	3,393,537	$	513



			Days Past Due								Non-
	Current		30-59		60-89		90+		Total		Accruing
December 31, 2016	(dollars in thousands)
Business loans:
Commercial and industrial	$	562,805	$	104	$	—	$	260	$	563,169	$	250
Franchise	459,421		—		—		—		459,421		—
Commercial owner occupied	454,918		—		—		—		454,918		436
SBA	96,389		—		—		316		96,705		316
Real estate loans:
Commercial non-owner occupied	586,975		—		—		—		586,975		—
Multi-family	690,955		—		—		—		690,955		—
One-to-four family	100,314		18		71		48		100,451		124
Construction	269,159		—		—		—		269,159		—
Land	19,814		—		—		15		19,829		15
Other loans	4,112		—		—		—		4,112		—
Totals	$	3,244,862	$	122	$	71	$	639	$	3,245,694	$	1,141