LOANS AND LEASES (Tables)

9 Months Ended

Sep. 30, 2022

Receivables [Abstract]

Schedule of composition of loans categorized by the type of loan

Loans outstanding, excluding those held for sale, by general ledger classification, as of September 30, 2022 and December 31, 2021, consisted of the following:

			% of					% of
	September 30,		Totals			December 31,		Total
(Dollars in thousands)	2022		Loans			2021		Loans
Residential mortgage	$	517,755		10.00	%	$	498,300		10.37	%
Multifamily mortgage		1,856,675		35.87			1,595,866		33.20
Commercial mortgage		638,903		12.34			662,626		13.78
Commercial loans (including equipment financing) (1)		2,084,998		40.27			1,955,157		40.67
Commercial construction		4,817		0.09			20,044		0.42
Home equity lines of credit		36,375		0.70			40,803		0.85
Consumer loans, including fixed rate home equity loans		37,412		0.72			33,687		0.70
Other loans		259		0.01			238		0.01
Total loans	$	5,177,194		100.00	%	$	4,806,721		100.00	%

(1)Includes PPP loans of $1.9 million at September 30, 2022 and $13.8 million at December 31, 2021.

In determining an appropriate amount for the allowance, the Bank segments and aggregated the loan portfolio based on common characteristics. The following pool segments identified as of September 30, 2022 are based on the CECL methodology:

			% of
	September 30,		Totals
(Dollars in thousands)	2022		Loans
Primary residential mortgage	$	520,276		10.06	%
Junior lien loan on residence		40,216		0.78
Multifamily property		1,856,675		35.89
Owner-occupied commercial real estate		256,891		4.96
Investment commercial real estate		1,035,254		20.01
Commercial and industrial (1)		1,106,927		21.40
Lease financing		304,256		5.88
Construction		10,384		0.20
Consumer and other		42,506		0.82
Total loans		5,173,385		100.00	%
Net deferred costs		3,809
Total loans including net deferred costs	$	5,177,194

(1) Includes PPP loans of $1.9 million at September 30, 2022.

The portfolio classes identified as of December 31, 2021 are based on the incurred loss methodology and are segmented by federal Call Report codes:

			% of
	December 31,		Total
(Dollars in thousands)	2021		Loans
Primary residential mortgage	$	500,243		10.42	%
Home equity lines of credit		40,803		0.85
Junior lien loan on residence		3,191		0.07
Multifamily property		1,595,866		33.23
Owner-occupied commercial real estate		252,603		5.26
Investment commercial real estate		1,003,979		20.90
Commercial and industrial (1)		992,332		20.66
Lease financing		345,868		7.20
Farmland/agricultural production		6,871		0.14
Commercial construction loans		20,174		0.42
Consumer and other loans		40,828		0.85
Total loans		4,802,758		100.00	%
Net deferred costs		3,963
Total loans including net deferred costs	$	4,806,721

(1)Includes PPP loans of $13.8 million at December 31, 2021.

Schedule of recorded investment in nonaccrual and loans past due 90 days or over still on accrual

The following tables present the recorded investment in nonaccrual and loans past due 90 days or over still on accrual by class of loans as of September 30, 2022 and December 31, 2021:

	September 30, 2022
			Loans Past Due
			90 Days or Over
			And Still
(In thousands)	Nonaccrual		Accruing Interest
Primary residential mortgage	$	2,527	$	—
Owner-occupied commercial real estate		263		—
Investment commercial real estate		12,429		—
Commercial and industrial		505		—
Total	$	15,724	$	—

	December 31, 2021
			Loans Past Due
			90 Days or Over
			And Still
(In thousands)	Nonaccrual		Accruing Interest
Primary residential mortgage	$	1,851	$	—
Junior lien loan on residence		18		—
Owner-occupied commercial real estate		458		—
Investment commercial real estate		12,750		—
Commercial and industrial		496		—
Total	$	15,573	$	—

Schedule of aging of past due loans

The following tables present the aging of the recorded investment in past due loans as of September 30, 2022 and December 31, 2021 by class of loans, excluding nonaccrual loans:

	September 30, 2022
	30-59		60-89		90 Days or
	Days		Days		Greater		Total
(In thousands)	Past Due		Past Due		Past Due		Past Due
Primary residential mortgage	$	323	$	—	$	—	$	323
Commercial and industrial		6,925		—		—		6,925
Total	$	7,248	$	—	$	—	$	7,248

	December 31, 2021
	30-59		60-89		90 Days or
	Days		Days		Greater		Total
(In thousands)	Past Due		Past Due		Past Due		Past Due
Primary residential mortgage	$	639	$	—	$	—	$	639
Commercial and industrial		7,825		142		—		7,967
Total	$	8,464	$	142	$	—	$	8,606

Schedule of credit risk profile of loans

The following is a summary of the credit risk profile of loans by internally assigned grade as of September 30, 2022 based on originations for the periods indicated; the years represent the year of origination for non-revolving loans:

	Grade as of September 30, 2022 for Loans Originated During
											2017				Revolving-
(In thousands)	2022		2021		2020		2019		2018		and Prior		Revolving		Term		Total
Primary residential mortgage:
Pass	$	91,142	$	94,871	$	63,091	$	38,422	$	28,052	$	201,286	$	—	$	694	$	517,558
Special mention		—		—		—		—		—		98		—		—		98
Substandard		—		—		554		1,062		282		722		—		—		2,620
Doubtful		—		—		—		—		—		—		—		—		—
Total primary residential mortgages		91,142		94,871		63,645		39,484		28,334		202,106		—		694		520,276
Junior lien loan on residence:
Pass		1,545		185		46		664		354		1,047		35,867		—		39,708
Special mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		508		—		508
Doubtful		—		—		—		—		—		—		—		—		—
Total junior lien loan on residence		1,545		185		46		664		354		1,047		36,375		—		40,216
Multifamily property:
Pass		449,363		683,097		118,815		229,869		43,062		317,365		981		1,830		1,844,382
Special mention		—		—		—		2,860		—		3,518		—		—		6,378
Substandard		—		—		—		—		—		5,915		—		—		5,915
Doubtful		—		—		—		—		—		—		—		—		—
Total multifamily property		449,363		683,097		118,815		232,729		43,062		326,798		981		1,830		1,856,675
Owner-occupied commercial real estate:
Pass		12,216		44,107		20,990		12,335		22,587		134,701		764		8,739		256,439
Special mention		—		—		—		—		—		189		—		—		189
Substandard		—		—		—		—		—		263		—		—		263
Doubtful		—		—		—		—		—		—		—		—		—
Total owner-occupied commercial real estate		12,216		44,107		20,990		12,335		22,587		135,153		764		8,739		256,891
Investment commercial real estate:
Pass		149,630		155,537		64,245		168,225		93,927		317,770		7,128		21,831		978,293
Special mention		—		—		—		13,069		—		13,379		—		14,588		41,036
Substandard		12,429		—		—		3,496		—		—		—		—		15,925
Doubtful		—		—		—		—		—		—		—		—		—
Total investment commercial real estate		162,059		155,537		64,245		184,790		93,927		331,149		7,128		36,419		1,035,254
Commercial and industrial:
Pass		277,681		250,700		87,541		89,923		30,915		6,107		298,246		33,082		1,074,195
Special mention		16,333		1,788		2,322		4,265		194		—		7,325		—		32,227
Substandard		—		—		—		—		283		186		36		—		505
Doubtful		—		—		—		—		—		—		—		—		—
Total commercial and industrial		294,014		252,488		89,863		94,188		31,392		6,293		305,607		33,082		1,106,927
Lease financing:
Pass		51,120		76,975		61,758		56,022		34,009		20,422		—		—		300,306
Special mention		2,179		—		—		—		—		—		—		—		2,179
Substandard		—		—		—		1,771		—		—		—		—		1,771
Doubtful		—		—		—		—		—		—		—		—		—
Total lease financing		53,299		76,975		61,758		57,793		34,009		20,422		—		—		304,256
Construction loans:

Pass		—		—		—		1,444		—		—		4,848		4,092		10,384
Special mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
Total commercial construction loans		—		—		—		1,444		—		—		4,848		4,092		10,384
Consumer and other loans:
Pass		—		396		200		13		—		5,980		32,661		3,256		42,506
Special mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
Total consumer and other loans		—		396		200		13		—		5,980		32,661		3,256		42,506
Total:
Pass		1,032,697		1,305,868		416,686		596,917		252,906		1,004,678		380,495		73,524		5,063,771
Special mention		18,512		1,788		2,322		20,194		194		17,184		7,325		14,588		82,107
Substandard		12,429		—		554		6,329		565		7,086		544		—		27,507
Doubtful		—		—		—		—		—		—		—		—		—
Total Loans	$	1,063,638	$	1,307,656	$	419,562	$	623,440	$	253,665	$	1,028,948	$	388,364	$	88,112	$	5,173,385

Schedule of the risk category of loans by class of loans

As of December 31, 2021, and based on the most recent analysis performed, the risk category of loans by class of loans was as follows:

			Special
(In thousands)	Pass		Mention		Substandard		Doubtful
Primary residential mortgage	$	494,444	$	557	$	5,242	$	—
Home equity lines of credit		40,274		—		529		—
Junior lien loan on residence		3,173		—		18		—
Multifamily property		1,579,776		7,720		8,370		—
Owner-occupied commercial real estate		251,229		663		711		—
Investment commercial real estate		901,877		87,297		14,805		—
Commercial and industrial		951,127		20,178		21,027		—
Lease financing		345,868		—		—		—
Farmland/agricultural production		6,871		—		—		—
Commercial construction loans		20,099		75		—		—
Consumer and other loans		40,828		—		—		—
Total	$	4,635,566	$	116,490	$	50,702	$	—

Schedule of loans modified as troubled debt restructurings

The following table presents loans by class modified as TDRs during the three-month period ended September 30, 2021:

			Pre-Modification		Post-Modification
			Outstanding		Outstanding
	Number of		Recorded		Recorded
(Dollars in thousands)	Loans		Investment		Investment
Investment commercial real estate		2	$	455	$	455
Total		2	$	455	$	455

The following table presents loans by class modified as TDRs during the nine-month period ended September 30, 2022:

			Pre-Modification		Post-Modification
			Outstanding		Outstanding
	Number of		Recorded		Recorded
(Dollars in thousands)	Loans		Investment		Investment
Investment commercial real estate		1	$	12,429	$	12,429
Total		1	$	12,429	$	12,429

The following table presents loans by class modified as TDRs during the nine-month period ended September 30, 2021:

			Pre-Modification		Post-Modification
			Outstanding		Outstanding
	Number of		Recorded		Recorded
(Dollars in thousands)	Loans		Investment		Investment
Primary residential mortgage		3	$	1,277	$	1,277
Commercial and industrial		1		2,194		2,194
Total		4	$	3,471	$	3,471

The following table presents loans by class modified as TDRs that failed to comply with the modified terms in the twelve months following modification and resulted in a payment default at September 30, 2022:

	Number of		Recorded
(Dollars in thousands)	Loans		Investment
Primary residential mortgage		1	$	145
Total		1	$	145

The following table presents loans by class modified as TDRs that failed to comply with the modified terms in the twelve months following modification and resulted in a payment default at September 30, 2021: