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Loans and Allowance for Credit Losses (Tables)
 9 Months Ended
Sep. 30, 2023
Receivables [Abstract]  
Schedule of Loans, Net of Unamortized Net Deferred Fees
Loans, net of unamortized deferred fees and costs, at September 30, 2023 and December 31, 2022 are summarized by portfolio segment as follows:
September 30, 2023December 31, 2022
(dollars in thousands, except amounts in the footnote)Amount%Amount%
Commercial$1,418,760 18 %$1,487,349 19 %
PPP loans588 — %3,256 — %
Income-producing - commercial real estate4,147,301 52 %3,919,941 51 %
Owner-occupied - commercial real estate1,182,959 15 %1,110,325 15 %
Real estate mortgage - residential76,511 1 %73,001 1 %
Construction - commercial and residential904,282 11 %877,755 12 %
Construction - C&I (owner-occupied)129,616 2 %110,479 1 %
Home equity53,917 1 %51,782 1 %
Other consumer2,457 — %1,744 — %
Total loans7,916,391 100 %7,635,632 100 %
Less: allowance for credit losses(83,332)(74,444)
Net loans (1)
$7,833,059 $7,561,188 
(1)Excludes accrued interest receivable of $45.4 million and $43.5 million at September 30, 2023 and December 31, 2022, respectively, which were recorded in other assets on the Consolidated Balance Sheets.
Schedule of Detail Activity in the Allowance for Credit Losses by Portfolio Segment
The following table details activity in the allowance for credit losses by portfolio segment for the three and nine months ended September 30, 2023 and 2022. PPP loans are excluded from these tables since they do not carry an allowance for credit loss, as these loans are fully guaranteed as to principal and interest by the SBA, whose guarantee is backed by the full faith and credit of the U.S. Government. Allocation of a portion of the allowance to one category of loans does not restrict the use of the allowance to absorb losses in other categories.
(dollars in thousands)CommercialIncome-Producing Commercial Real EstateOwner-Occupied -Commercial Real EstateReal Estate Mortgage ResidentialConstruction - Commercial and ResidentialConstruction - C&I (Owner-Occupied)Home EquityOther ConsumerTotal
Three Months Ended September 30, 2023
Allowance for credit losses:
Balance at beginning of period$15,374 $38,486 $12,805 $811 $8,018 1,914 $595 $26 $78,029 
Loans charged-off(467)— — — — — — — (467)
Recoveries of loans previously charged-off103 — 23 — — — — 1 127 
Net loans (charged-off) recovered(364)— 23 — — — — 1 (340)
Provision for (reversal of) credit losses1,327 2,207 1,424 53 615 (20)39 (2)5,643 
Ending balance$16,337 $40,693 $14,252 $864 $8,633 $1,894 $634 $25 $83,332 
Nine Months Ended September 30, 2023
Allowance for credit losses:
Balance at beginning of period$15,655 $35,688 $12,702 $969 $7,195 1,606 $555 $74 $74,444 
Loans charged-off(1,828)(5,306)— — (136)— — (50)(7,320)
Recoveries of loans previously charged-off335 — 31 — 34 — — 6 406 
Net loans (charged-off) recovered(1,493)(5,306)31 — (102)— — (44)(6,914)
Provision for (reversal of) credit losses2,175 10,311 1,519 (105)1,540 288 79 (5)15,802 
Ending balance$16,337 $40,693 $14,252 $864 $8,633 $1,894 $634 $25 $83,332 
Three Months Ended September 30, 2022
Allowance for credit losses:
Balance at beginning of period$15,754 $34,120 $12,796 $790 $6,470 2,024 $647 $64 $72,665 
Loans charged-off(53)— — — — — — (70)(123)
Recoveries of loans previously charged-off152 — 25 — — — — 2 179 
Net loans (charged-off) recovered99 — 25 — — — — (68)56 
Provision for (reversal of) credit losses20 2,207 (240)20 759 261 (23)42 3,046 
Ending balance$15,873 $36,327 $12,581 $810 $7,229 $2,285 $624 $38 $75,767 
Nine Months Ended September 30, 2022
Allowance for credit losses:
Balance at beginning of period$14,475 $38,287 $12,146 $449 $7,094 $2,005 $474 $35 $74,965 
Loans charged-off(604)— (1,356)— — — — (74)(2,034)
Recoveries of loans previously charged-off648 — 25 — 1,627 — — 4 2,304 
Net loans (charged-off) recovered44 — (1,331)— 1,627 — — (70)270 
Provision for (reversal of) credit losses1,354 (1,960)1,766 361 (1,492)280 150 73 532 
Ending balance$15,873 $36,327 $12,581 $810 $7,229 $2,285 $624 $38 $75,767 
Schedule of Amortized Cost Basis of Collateral-Dependent Loans by Class of Loans
The following table presents the amortized cost basis of collateral-dependent loans by class of loans as of September 30, 2023 and December 31, 2022:
September 30, 2023December 31, 2022
Business/OtherBusiness/Other
(dollars in thousands)AssetsReal EstateAssetsReal Estate
Commercial$2,330 $1,070 $1,563 $1,871 
Income-producing - commercial real estate1,753 23,236 2,000 4,328 
Owner-occupied - commercial real estate— 19,882 — 19,187 
Real estate mortgage - residential— 1,692 — 1,698 
Construction - commercial and residential— 39,695 — — 
Home equity— 245 — — 
Other consumer— — 50 — 
Total$4,083 $85,820 $3,613 $27,084 
Schedule of the Risk Category of Loans by Class of Loans Based on the most recent analysis performed, the amortized cost basis of loans by risk category, class and year of origination are as follows:
(dollars in thousands)Prior20192020202120222023Revolving Loans Amort. Cost BasisRevolving Loans Convert. to TermTotal
September 30, 2023
Commercial
Pass$179,327 $50,533 $48,437 $217,772 $159,417 $82,375 $665,282 $5,209 $1,408,352 
Special Mention— — 5,299 — 68 — 2,439 — 7,806 
Substandard1,172 90 — 542 149 — 380 269 2,602 
Total180,499 50,623 53,736 218,314 159,634 82,375 668,101 5,478 1,418,760 
YTD gross charge-offs(885)— — — — — — (943)(1,828)
PPP loans
Pass— — — 588 — — — — 588 
Income producing - commercial real estate
Pass1,320,917 385,392 371,421 516,336 731,489 317,755 196,981 1,848 3,842,139 
Special Mention91,756 4,175 6,739 — — — 47,706 — 150,376 
Substandard106,407 48,379 — — — — — — 154,786 
Total1,519,080 437,946 378,160 516,336 731,489 317,755 244,687 1,848 4,147,301 
YTD gross charge-offs(5,306)— — — — — — — (5,306)
Owner occupied - commercial real estate
Pass614,664 117,143 37,206 203,082 45,904 121,169 1,890 22,019 1,163,077 
Substandard19,882 — — — — — — — 19,882 
Total634,546 117,143 37,206 203,082 45,904 121,169 1,890 22,019 1,182,959 
Real estate mortgage - residential
Pass27,025 8,057 2,198 16,007 14,798 6,734 — — 74,819 
Substandard1,692 — — — — — — — 1,692 
Total28,717 8,057 2,198 16,007 14,798 6,734 — — 76,511 
Construction - commercial and residential
Pass39,878 4,087 41,069 268,943 338,874 58,341 112,439 956 864,587 
Substandard525 39,170 — — — — — — 39,695 
Total40,403 43,257 41,069 268,943 338,874 58,341 112,439 956 904,282 
YTD gross charge-offs(136)— — — — — — — (136)
Construction - C&I (owner occupied)
Pass18,658 4,294 56,784 638 33,229 9,607 6,406 — 129,616 
Total18,658 4,294 56,784 638 33,229 9,607 6,406 — 129,616 
Home equity
Pass2,171 — 88 152 133 — 50,452 577 53,573 
Substandard— 37 — — — — 62 245 344 
Total2,171 37 88 152 133 — 50,514 822 53,917 
Other consumer
Pass2 — — — 68 1,858 529 — 2,457 
Total2 — — — 68 1,858 529 — 2,457 
YTD gross charge-offs(50)— — — — — — — (50)
Total recorded investment
$2,424,076 $661,357 $569,241 $1,224,060 $1,324,129 $597,839 $1,084,566 $31,123 $7,916,391 
Total YTD gross charge-offs$(6,377)$— $— $— $— $— $— $(943)$(7,320)
(dollars in thousands)Prior20182019202020212022Revolving Loans Amort. Cost BasisRevolving Loans Convert. to TermTotal
December 31, 2022
Commercial
Pass$183,329 $47,393 $56,261 $64,163 $237,146 $144,390 $736,090 $8,570 $1,477,342 
Special Mention— — — — — 82 5,475 — 5,557 
Substandard1,332 351 276 — — — 1,344 1,147 4,450 
Total184,661 47,744 56,537 64,163 237,146 144,472 742,909 9,717 1,487,349 
YTD gross charge-offs(283)(101)(49)— — — (483)— (916)
PPP loans
Pass— — — 2,479 777 — — — 3,256 
Income producing - commercial real estate
Pass1,016,529 439,221 480,474 334,165 542,143 744,328 192,089 358 3,749,307 
Special Mention44,195 5,206 4,209 6,735 — — 47,676 — 108,021 
Substandard60,613 2,000 — — — — — — 62,613 
Total1,121,337 446,427 484,683 340,900 542,143 744,328 239,765 358 3,919,941 
YTD gross charge-offs(680)(645)(676)— — — — — (2,001)
Owner occupied - commercial real estate
Pass461,029 191,646 111,497 40,562 206,595 41,765 24,240 13,238 1,090,572 
Substandard19,753 — — — — — — — 19,753 
Total480,782 191,646 111,497 40,562 206,595 41,765 24,240 13,238 1,110,325 
Real estate mortgage - residential
Pass16,968 12,438 8,219 2,640 16,307 14,731 — — 71,303 
Substandard1,698 — — — — — — — 1,698 
Total18,666 12,438 8,219 2,640 16,307 14,731 — — 73,001 
Construction - commercial and residential
Pass84,522 71,841 90,560 189,023 191,127 159,771 90,911 — 877,755 
Total84,522 71,841 90,560 189,023 191,127 159,771 90,911 — 877,755 
Construction - C&I (owner occupied)
Pass14,816 8,160 11,810 33,854 653 34,679 6,507 — 110,479 
Home equity
Pass1,747 — — 98 551 — 48,378 906 51,680 
Substandard— — 41 — — — 61 — 102 
Total1,747 — 41 98 551 — 48,439 906 51,782 
Other consumer
Pass4 — — — — 126 1,561 3 1,694 
Substandard— — — — — — — 50 50 
Total4 — — — — 126 1,561 53 1,744 
YTD gross charge-offs(3)— — — — — (75)— (78)
Total recorded investment$1,906,531 $778,256 $763,347 $673,719 $1,195,299 $1,139,872 $1,154,332 $24,272 $7,635,632 
Total YTD gross charge-offs$(966)$(746)$(725)$— $— $— $(558)$— $(2,995)
Schedule by Class of Loan, an Aging Analysis and the Recorded Investments in Loans Past Due
The table presents, by class of loan, an aging analysis and the recorded investments in loans past due on an amortized cost basis as of September 30, 2023 and December 31, 2022:
(dollars in thousands, except amount in the footnote)Loans 30-59 Days Past DueLoans 60-89 Days Past DueLoans 90 Days or More Past DueTotal Past Due LoansCurrent LoansNonaccrual LoansTotal Recorded Investment in Loans
September 30, 2023
Commercial$55 $— $— $55 $1,416,184 $2,521 $1,418,760 
PPP loans— — — — 588 — 588 
Income producing - commercial real estate25,769 — — 25,769 4,096,543 24,989 4,147,301 
Owner occupied - commercial real estate404 19,125 — 19,529 1,162,672 758 1,182,959 
Real estate mortgage - residential— — — — 74,561 1,950 76,511 
Construction - commercial and residential976 — — 976 863,611 39,695 904,282 
Construction - C&I (owner occupied)— — — — 129,616 — 129,616 
Home equity42 — — 42 53,630 245 53,917 
Other consumer— — — — 2,457 — 2,457 
Total$27,246 $19,125 $— $46,371 $7,799,862 $70,158 $7,916,391 
December 31, 2022
Commercial$697 $643 $— $1,340 $1,483,521 $2,488 $1,487,349 
PPP loans— — — — 3,256 — 3,256 
Income producing - commercial real estate— — — — 3,917,941 2,000 3,919,941 
Owner occupied - commercial real estate— 279 — 279 1,110,029 17 1,110,325 
Real estate mortgage – residential— — — — 71,088 1,913 73,001 
Construction - commercial and residential531 — — 531 877,224 — 877,755 
Construction - C&I (owner occupied)— — — — 110,479 — 110,479 
Home equity— 52 — 52 51,730 — 51,782 
Other consumer— 1 — 1 1,693 50 1,744 
Total$1,228 $975 $— $2,203 $7,626,961 $6,468 $7,635,632 
Schedule of Information Related to Nonaccrual Loans by Class
The following presents the nonaccrual loans on an amortized cost basis as of September 30, 2023 and December 31, 2022:
(dollars in thousands, except amounts in footnotes)Nonaccrual with No Allowance for Credit LossesNonaccrual with an Allowance for Credit LossesTotal Nonaccrual Loans
September 30, 2023
Commercial$366 $2,155 $2,521 
Income producing - commercial real estate23,236 1,753 24,989 
Owner occupied - commercial real estate758 — 758 
Real estate mortgage - residential— 1,950 1,950 
Construction - commercial and residential39,170 525 39,695 
Home equity245 — 245 
Total (1)
$63,775 $6,383 $70,158 
December 31, 2022
Commercial$101 $2,387 $2,488 
Income producing - commercial real estate— 2,000 2,000 
Owner occupied - commercial real estate17 — 17 
Real estate mortgage - residential— 1,913 1,913 
Other consumer— 50 50 
Total (1)
$118 $6,350 $6,468 
(1)Gross coupon interest income of approximately $4.1 million and $410 thousand would have been recorded for the nine months ended September 30, 2023 and 2022, respectively, if nonaccrual loans shown above had been current and in accordance with their original terms, while $1.1 million and $5 thousand of coupon interest income was actually recorded on such loans for the nine months ended September 30, 2023 and 2022, respectively. See Note 1 to the Consolidated Financial Statements for a description of the Company's policy for placing loans on nonaccrual status.
Schedule of Loans Modified in Troubled Debt Restructurings
The following table presents the amortized cost basis as of September 30, 2023 and the financial effect of loans modified to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2023:
September 30, 2023
(dollars in thousands)Term ExtensionCombination - Term Extension and Principal Payment Delay
Combination - Term Extension, Principal Payment Delay and Interest Rate Reduction
TotalPercentage of Total Loan Type
Weighted Average Term and Principal Payment Extension (1)
Weighted Average Interest Rate Reduction (2)
Three months ended September 30, 2023
Commercial$29,898 $— $— $29,898 2.1 %4 months— %
Income producing - commercial real estate7,190 55,649 113,833 176,672 4.3 %10 months1.89 %
Owner occupied - commercial real estate— 19,125 — 19,125 1.6 %3 months— %
Total$37,088 $74,774 $113,833 $225,695 
Nine months ended September 30, 2023
Commercial$36,969 $— $— $36,969 2.6 %7 months— %
Income producing - commercial real estate (3)
7,190 57,808 113,833 178,831 4.3 %13 months2.55 %
Owner occupied - commercial real estate— 19,125 — 19,125 1.6 %9 months— %
Construction - commercial and residential7,093 — — 7,093 0.8 %6 months— %
Total$51,252 $76,933 $113,833 $242,018 
(1)For loans that received multiple modifications during the nine months ended September 30, 2023, weighted average term and principal payment extensions were calculated based on the aggregated impact of the extensions received during the period.
(2)The weighted average is calculated based on the total amortized cost at September 30, 2023 of loans that received interest rate reduction modifications during the three and nine months ended September 30, 2023.
(3)Includes one loan modified as a combination - principal payment delay and term extension during the first quarter of 2023 that was moved to nonaccrual status and incurred a $2.1 million charge off in the second quarter of 2023. In October 2023, the loan was sold.
The following table presents the performance of loans modified to borrowers experiencing financial difficulty during the nine months ended September 30, 2023:
September 30, 2023
Payment Status (Amortized Cost Basis)
(dollars in thousands)Current30-89 Days Past DueNonaccrual
Commercial$36,969 $— $— 
Income producing - commercial real estate130,461 25,769 22,601 
Owner occupied - commercial real estate— 19,125 — 
Construction - commercial and residential7,093 — — 
Total$174,523 $44,894 $22,601 
Financing Receivable, Amortized Cost Basis of Loan Had a Payment Default
The following table presents the amortized cost basis of loans that had a payment default during the nine months ended September 30, 2023 and were modified in the twelve months prior to that default to borrowers experiencing financial difficulty:
September 30, 2023
Amortized Cost Basis
(dollars in thousands)Combination - Term Extension and Principal Payment Delay
Combination - Term Extension, Principal Payment Delay and Interest Rate Reduction
Income producing - commercial real estate$— $46,211 
Owner occupied - commercial real estate19,125 — 
Total$19,125 $46,211