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Allowance for Credit Losses (Tables)
 9 Months Ended
Sep. 30, 2020
Provision for Loan and Lease Losses [Abstract]  
Summary of allocation of the allowance for loan losses
The following table provides the allocation of the ACL for loans held for investment as well as the activity in the ACL attributed to various segments in the loan portfolio as of, and for the period indicated:

Three Months Ended September 30, 2020
 Beginning ACL Balance  Charge-offs  Recoveries Provision for Credit Losses  Ending
ACL Balance
(Dollars in thousands)
Investor loans secured by real estate
CRE non-owner occupied$63,007 $(443)$— $(8,459)$54,105 
Multifamily63,511 — — 3,825 67,336 
Construction and land18,804 (377)— (2,870)15,557 
SBA secured by real estate2,010 (145)34 3,428 5,327 
Business loans secured by real estate
CRE owner-occupied48,213 (1,739)21 2,171 48,666 
Franchise real estate secured13,060 — — (1,072)11,988 
SBA secured by real estate4,368 — 76 1,716 6,160 
Commercial loans
Commercial and industrial41,967 (2,437)10 8,374 47,914 
Franchise non-real estate secured21,676 (207)865 (2,185)20,149 
SBA non-real estate secured600 (10)8 353 951 
Retail loans
Single family residential1,479 — 2 (238)1,243 
Consumer loans3,576 (129)1 (341)3,107 
Totals$282,271 $(5,487)$1,017 $4,702 $282,503 

Nine Months Ended September 30, 2020
 Beginning ACL Balance (1)
 Adoption of ASC 326  Initial ACL Recorded for PCD Loans  Charge-offs  Recoveries Provision for Credit Losses  Ending
ACL Balance
(Dollars in thousands)
Investor loans secured by real estate
CRE non-owner occupied$1,899 $8,423 $3,025 $(830)$— $41,588 $54,105 
Multifamily729 9,174 8,710 — — 48,723 67,336 
Construction and land4,484 (124)2,051 (377)— 9,523 15,557 
SBA secured by real estate1,915 (1,401)— (699)34 5,478 5,327 
Business loans secured by real estate
CRE owner-occupied2,781 20,166 3,766 (1,739)44 23,648 48,666 
Franchise real estate secured592 5,199 — — — 6,197 11,988 
SBA secured by real estate2,119 2,207 235 (315)147 1,767 6,160 
Commercial loans
Commercial and industrial13,857 87 2,325 (5,213)37 36,821 47,914 
Franchise non-real estate secured5,816 9,214 — (1,434)865 5,688 20,149 
SBA non-real estate secured445 218 924 (803)13 154 951 
Retail loans
Single family residential655 541 206 (62)3 (100)1,243 
Consumer loans406 1,982 — (137)2 854 3,107 
Totals$35,698 $55,686 $21,242 $(11,609)$1,145 $180,341 $282,503 
______________________________
(1) Beginning ACL balance represents the ALLL accounted for under ASC 450 and ASC 310, which is reflective of probable incurred losses as of the balance sheet date.
The following table provides the allocation of the ALLL for loans held for investment as well as the activity attributed to various segments in the loan portfolio as of, and for the period indicated, as determined in accordance with ASC 450 and ASC 310, prior to the adoption of ASC 326:
 For the Three Months Ended September 30, 2019
Beginning ALLL BalanceCharge-offsRecoveriesProvision for Credit LossesEnding
ALLL Balance
(Dollars in thousands)
Investor loans secured by real estate
CRE non-owner-occupied$1,765 $(86)$— $199 $1,878 
Multifamily705 — — 10 715 
Construction and land5,408 — — (617)4,791 
SBA secured by real estate1,322 — — 468 1,790 
Business loans secured by real estate
CRE owner-occupied2,299 — 8 257 2,564 
Franchise real estate secured579 — — (12)567 
SBA secured by real estate1,611 (61)21 539 2,110 
Commercial loans
Commercial and industrial13,796 (290)54 (664)12,896 
Franchise non-real estate secured6,186 (995)— 975 6,166 
SBA non-real estate secured430 (82)41 92 481 
Retail loans
Single family residential704 — 1 (14)691 
Consumer loans221 (11)9 132 351 
Totals$35,026 $(1,525)$134 $1,365 $35,000 
For the Nine Months Ended September 30, 2019
Beginning ALLL BalanceCharge-offsRecoveriesProvision for Credit LossesEnding
ALLL Balance
(Dollars in thousands)
Investor loans secured by real estate
CRE non-owner-occupied$1,624 $(574)$— $828 $1,878 
Multifamily740 — — (25)715 
Construction and land5,964 — — (1,173)4,791 
SBA secured by real estate1,827 (721)— 684 1,790 
Business loans secured by real estate
CRE owner-occupied1,908 — 31 625 2,564 
Franchise real estate secured743 (1,376)— 1,200 567 
SBA secured by real estate1,824 (315)21 580 2,110 
Commercial loans
Commercial and industrial13,695 (985)168 18 12,896 
Franchise non-real estate secured6,066 (1,155)— 1,255 6,166 
SBA non-real estate secured654 (326)45 108 481 
Retail loans
Single family residential808 — 2 (119)691 
Consumer loans219 (16)10 138 351 
Totals$36,072 $(5,468)$277 $4,119 $35,000 
The following table presents loans individually and collectively evaluated for impairment and their respective ALLL allocation at December 31, 2019 as determined in accordance with ASC 450 and ASC 310, prior to the adoption of ASC 326:
December 31, 2019
Loans Evaluated Individually for ImpairmentALLL Attributed to Individually Evaluated LoansLoans Evaluated Collectively for ImpairmentALLL Attributed to Collectively Evaluated Loans
(Dollars in thousands)
Investor loans secured by real estate
CRE non-owner-occupied$1,088 $— $2,069,053 $1,899 
Multifamily— — 1,575,726 729 
Construction and land— — 438,786 4,484 
SBA secured by real estate390 — 68,041 1,915 
Business loans secured by real estate
CRE owner-occupied— — 1,846,554 2,781 
Franchise real estate secured— — 353,240 592 
SBA secured by real estate1,517 — 86,864 2,119 
Commercial loans
Commercial and industrial7,529 — 1,385,741 13,857 
Franchise non-real estate secured10,834 — 553,523 5,816 
SBA non-real estate secured1,118 — 16,308 445 
Retail loans
Single family residential366 — 254,658 655 
Consumer loans— — 50,975 406 
Totals$22,842 $— $8,699,469 $35,698 
Schedule of allowance for credit quality indicators
The following table stratifies the loans held for investment portfolio by the Company’s internal risk grading, and by year of origination, as of September 30, 2020:
Term Loans by Vintage
20202019201820172016PriorRevolvingRevolving Converted to Term During the PeriodTotal
September 30, 2020(Dollars in thousands)
Investor loans secured by real estate
CRE non-owner-occupied
Pass$190,701 $566,855 $475,363 $314,190 $290,179 $852,044 $11,031 $— $2,700,363 
Special mention— — 1,839 435 — 1,816 — — 4,090 
Substandard— — 202 — 517 2,199 559 — 3,477 
Multifamily
Pass638,349 1,735,235 964,740 750,548 412,893 639,171 574 — 5,141,510 
Substandard— — — 559 — — — — 559 
Construction and land
Pass25,240 145,709 104,702 33,023 19,932 7,997 374 — 336,977 
Substandard— — 895 — — — — — 895 
SBA secured by real estate
Pass494 10,412 11,058 14,842 6,712 9,037 — — 52,555 
Substandard— 163 2,117 698 399 1,678 — — 5,055 
Total investor loans secured by real estate$854,784 $2,458,374 $1,560,916 $1,114,295 $730,632 $1,513,942 $12,538 $— $8,245,481 
Business loans secured by real estate
CRE owner-occupied
Pass$210,662 $412,186 $358,157 $346,906 $235,040 $505,999 $4,593 $— $2,073,543 
Special mention— 15,827 — 10,268 4,186 2,008 — — 32,289 
Substandard— — 3,636 725 2,666 6,679 250 — 13,956 
Franchise real estate secured
Pass20,507 87,749 74,459 102,756 31,512 42,346 — — 359,329 
SBA secured by real estate
Pass2,643 7,658 14,054 17,110 9,643 26,768 95 — 77,971 
Substandard— — 22 1,994 914 3,225 — — 6,155 
Total loans secured by business real estate$233,812 $523,420 $450,328 $479,759 $283,961 $587,025 $4,938 $— $2,563,243 
Term Loans by Vintage
20202019201820172016PriorRevolvingRevolving Converted to Term During the PeriodTotal
September 30, 2020(Dollars in thousands)
Commercial Loans
Commercial and industrial
Pass$98,656 $339,144 $183,259 $232,648 $71,414 $94,220 $682,523 $6,311 $1,708,175 
Special mention— 43 17,231 15,810 1,398 — 7,886 — 42,368 
Substandard— 4,902 22,763 1,111 1,265 4,393 34,271 1,747 70,452 
Franchise non-real estate secured
Pass20,205 201,621 117,113 53,160 47,290 43,239 1,361 511 484,500 
Substandard— 2,050 957 28,473 — — — — 31,480 
SBA non-real estate secured
Pass355 2,299 1,700 2,254 623 3,881 — 268 11,380 
Special mention— — — 1,661 — — — — 1,661 
Substandard— 85 369 820 275 1,424 734 — 3,707 
Total commercial loans$119,216 $550,144 $343,392 $335,937 $122,265 $147,157 $726,775 $8,837 $2,353,723 
Retail Loans
Single family residential
Pass$4,469 $8,385 $14,972 $14,884 $35,074 $133,137 $31,452 — $242,373 
Special mention— — — — — 57 — — 57 
Substandard— — — — — 929 — — 929 
Consumer loans
Pass63 142 60 38,037 12 3,255 3,422 — 44,991 
Substandard— — — — — 43 — — 43 
Total retail loans$4,532 $8,527 $15,032 $52,921 $35,086 $137,421 $34,874 $— $288,393 
Totals gross loans$1,212,344 $3,540,465 $2,369,668 $1,982,912 $1,171,944 $2,385,545 $779,125 $8,837 $13,450,840 
The following tables stratify the loan portfolio by the Company’s internal risk grading as of December 31, 2019:
 Credit Risk Grades
PassSpecial
Mention		SubstandardTotal Gross
Loans
December 31, 2019(Dollars in thousands)
Investor loans secured by real estate    
CRE non-owner-occupied$2,067,875 $1,178 $1,088 $2,070,141 
Multifamily1,575,510 — 216 1,575,726 
Construction and land438,769 — 17 438,786 
SBA secured by real estate65,835 973 1,623 68,431 
Total investor loans secured by real estate4,147,989 2,151 2,944 4,153,084 
Business loans secured by real estate
CRE owner-occupied1,831,853 11,167 3,534 1,846,554 
Franchise real estate secured352,319 921 — 353,240 
SBA secured by real estate83,106 1,842 3,433 88,381 
Total business loans secured by real estate2,267,278 13,930 6,967 2,288,175 
Commercial loans   
Commercial and industrial1,359,662 13,226 20,382 1,393,270 
Franchise non-real estate secured546,594 6,930 10,833 564,357 
SBA not secured by real estate13,933 485 3,008 17,426 
Total commercial loans1,920,189 20,641 34,223 1,975,053 
Retail loans
Single family residential254,463 — 561 255,024 
Consumer loans50,921 — 54 50,975 
Total retail loans305,384 — 615 305,999 
Total gross loans$8,640,840 $36,722 $44,749 $8,722,311 
The following table presents PD bands for commercial real estate and commercial loan segments of the loan portfolio as of the date indicated.

Commercial Real Estate Term Loans by Vintage
20202019201820172016PriorRevolvingRevolving Converted to Term During the PeriodTotal
September 30, 2020(Dollars in thousands)
Investor loans secured by real estate
CRE non-owner-occupied
0% - 5.00%$188,404 $543,940 $374,636 $265,887 $266,967 $792,295 $10,788 $— $2,442,917 
>5.00% - 10.00%— 7,015 102,566 10,874 17,282 25,791 243 — 163,771 
Greater than 10%2,297 15,900 202 37,864 6,447 37,973 559 — 101,242 
Multifamily
0% - 5.00%630,900 1,709,927 935,659 723,886 399,890 618,503 574 — 5,019,339 
>5.00% - 10.00%4,251 11,286 14,944 14,708 2,836 2,102 — — 50,127 
Greater than 10%3,198 14,022 14,137 12,513 10,167 18,566 — — 72,603 
Construction and Land
0% - 5.00%24,862 56,858 12,550 22,362 — 6,448 — — 123,080 
>5.00% - 10.00%— 36,289 10,750 466 — — — — 47,505 
Greater than 10%378 52,562 82,297 10,195 19,932 1,549 374 — 167,287 
SBA secured by real estate
0% - 5.00%494 10,412 12,584 15,540 7,111 10,204 — — 56,345 
>5.00% - 10.00%— — — — — — — — — 
Greater than 10%— 163 591 — — 511 — — 1,265 
Total investor loans secured by real estate$854,784 $2,458,374 $1,560,916 $1,114,295 $730,632 $1,513,942 $12,538 $— $8,245,481 
Business loans secured by real estate
CRE owner-occupied
0% - 5.00%$202,228 $368,034 $299,843 $296,647 $197,043 $426,513 $520 $— $1,790,828 
>5.00% - 10.00%8,434 37,617 58,314 53,967 39,056 78,666 3,826 — 279,880 
Greater than 10%— 22,362 3,636 7,285 5,793 9,507 497 — 49,080 
Franchise real estate secured
0% - 5.00%19,753 85,363 73,100 102,756 31,512 42,346 — — 354,830 
>5.00% - 10.00%754 — 631 — — — — — 1,385 
Greater than 10%— 2,386 728 — — — — — 3,114 
SBA secured by real estate
0% - 5.00%2,643 7,658 13,375 15,993 6,150 22,077 95 — 67,991 
>5.00% - 10.00%— — 679 1,117 3,493 4,679 — — 9,968 
Greater than 10%— — 22 1,994 914 3,237 — — 6,167 
Total business loans secured by real estate$233,812 $523,420 $450,328 $479,759 $283,961 $587,025 $4,938 $— $2,563,243 
Commercial Real Estate Term Loans by Vintage
20202019201820172016PriorRevolvingRevolving Converted to Term During the PeriodTotal
September 30, 2020(Dollars in thousands)
Commercial Loans
Commercial and industrial
0% - 5.00%$90,745 $289,250 $141,811 $206,524 $49,843 $76,628 $343,482 $4,024 $1,202,307 
>5.00% - 10.00%7,911 48,778 39,716 19,950 18,894 14,807 302,843 2,037 454,936 
Greater than 10%— 6,061 41,726 23,095 5,340 7,178 78,355 1,997 163,752 
Franchise non-real estate secured
0% - 5.00%14,547 193,899 112,760 48,916 45,265 40,753 1,361 511 458,012 
>5.00% - 10.00%5,658 7,722 4,353 4,245 2,025 2,486 — — 26,489 
Greater than 10%— 2,050 957 28,472 — — — — 31,479 
SBA not secured by real estate
0% - 5.00%355 2,299 1,392 1,460 499 2,571 — 268 8,844 
>5.00% - 10.00%— — 308 796 124 1,285 — — 2,513 
Greater than 10%— 85 369 2,479 275 1,449 734 — 5,391 
Total commercial loans$119,216 $550,144 $343,392 $335,937 $122,265 $147,157 $726,775 $8,837 $2,353,723 
The following table summarizes the amortized cost of loans in these segments by current estimated LTV and by year of origination as of the date indicated:
Term Loans by Vintage
20202019201820172016PriorRevolvingRevolving Converted to Term During the PeriodTotal
September 30, 2020(Dollars in thousands)
Investor loans secured by real estate
CRE non-owner-occupied
55% and below$100,859 $238,182 $190,263 $156,791 $192,044 $602,788 $11,031 — $1,491,958 
>55-65%71,824 220,089 110,830 136,117 84,644 217,812 559 — 841,875 
>65-75%18,018 105,825 171,532 18,946 13,796 30,887 — — 359,004 
Greater than 75%— 2,759 4,779 2,771 212 4,572 — — 15,093 
Multifamily
55% and below147,694 347,848 303,801 252,662 90,318 294,211 574 — 1,437,108 
>55-65%233,564 742,570 406,271 234,044 169,033 242,603 — — 2,028,085 
>65-75%257,091 628,393 244,007 262,512 153,542 96,542 — — 1,642,087 
Greater than 75%— 16,424 10,661 1,889 — 5,815 — — 34,789 
Construction and land
55% and below24,116 129,160 66,830 26,261 19,932 7,997 374 — 274,670 
>55-65%1,124 13,254 23,699 6,762 — — — — 44,839 
>65-75%— 3,295 15,068 — — — — — 18,363 
Greater than 75%— — — — — — — — — 
SBA secured by real estate
55% and below— 2,070 653 673 330 785 — — 4,511 
>55-65%— 2,433 1,643 4,017 621 4,482 — — 13,196 
>65-75%— 3,905 5,075 4,185 4,795 1,897 — — 19,857 
Greater than 75%494 2,167 5,804 6,665 1,365 3,551 — — 20,046 
Total investor loans secured by real estate$854,784 $2,458,374 $1,560,916 $1,114,295 $730,632 $1,513,942 $12,538 $— $8,245,481 
Business loan secured by real estate
CRE owner-occupied
55% and below$56,954 $156,880 $171,740 $203,875 $133,740 $357,734 $4,843 — $1,085,766 
>55-65%56,139 93,895 97,245 94,359 73,389 80,933 — — 495,960 
>65-75%55,932 155,872 80,898 46,241 32,547 50,458 — — 421,948 
Greater than 75%41,637 21,366 11,910 13,424 2,216 25,561 — — 116,114 
Franchise real estate secured
55% and below7,462 13,322 14,407 21,162 11,592 20,549 — — 88,494 
>55-65%— 9,981 15,893 23,658 7,784 5,862 — — 63,178 
>65-75%3,972 53,584 21,750 9,768 11,017 14,697 — — 114,788 
Greater than 75%9,073 10,862 22,409 48,168 1,119 1,238 — — 92,869 
SBA secured by real estate
55% and below1,355 1,633 5,376 5,683 3,175 15,281 95 — 32,598 
>55-65%104 513 1,802 1,719 3,706 5,665 — — 13,509 
>65-75%264 3,148 751 4,193 2,340 5,401 — — 16,097 
Greater than 75%920 2,364 6,147 7,509 1,336 3,646 — — 21,922 
Total business loans secured by real estate$233,812 $523,420 $450,328 $479,759 $283,961 $587,025 $4,938 $— $2,563,243 
The following table presents FICO bands for the retail segment of the loan portfolio as of the date indicated:
Term Loans by Vintage
20202019201820172016PriorRevolvingRevolving Converted to Term During the PeriodTotal
September 30, 2020(Dollars in thousands)
Retail Loans
Single family residential
Greater than 740$4,469 $7,198 $12,719 $9,658 $29,291 $91,460 $22,566 — $177,361 
>680 - 740— 1,187 2,253 4,763 2,641 28,625 7,919 — 47,388 
>580 - 680— — — 463 3,142 11,113 932 — 15,650 
Less than 580— — — — — 2,925 35 — 2,960 
Consumer loans
Greater than 74063 85 54 46 10 2,648 1,670 — 4,576 
>680 - 740— 40 6 37,991 — 480 1,665 — 40,182 
>580 - 680— 17 — — 2 144 59 — 222 
Less than 580— — — — — 26 28 — 54 
Total retail loans$4,532 $8,527 $15,032 $52,921 $35,086 $137,421 $34,874 $— $288,393