Loans and Leases Held for Investment, Net of Allowance For Loan and Lease Losses (Tables)

6 Months Ended

Jun. 30, 2021

Loans and Leases Receivable Disclosure [Abstract]

Loans and Notes and Certificates

The Company defines its loans and leases held for investment portfolio segments as (i) consumer and (ii) commercial. The following table presents the components of each portfolio segment by class of financing receivable:

	June 30, 2021
Unsecured personal	$	776,338
Residential mortgages	152,528
Secured consumer	326,318
Other consumer	157
Total consumer loans held for investment	1,255,341
Equipment finance (1)	161,465
Commercial real estate	294,954
Commercial and industrial (2)	658,366
Total commercial loans and leases held for investment	1,114,785
Total loans and leases held for investment	2,370,126
Allowance for loan and lease losses	(71,081)
Loans and leases held for investment, net	$	2,299,045

(1)    Comprised of sales-type leases for equipment. See “Note 17. Leases” for additional information.

(2)    Includes $507.6 million of Paycheck Protection Program (PPP) loans. The Company determined no allowance for expected credit losses is needed on these loans.

Financing Receivable, Allowance for Credit Loss

The activity in the allowance for expected credit losses by portfolio segment for the second quarter and first half of 2021 was as follows:

	Three Months Ended June 30, 2021						Six Months Ended June 30, 2021
	Consumer		Commercial		Total		Consumer		Commercial		Total
Allowance for loan and lease losses, beginning of period	$	19,785	$	16,347	$	36,132	$	—	$	—	$	—
Credit loss expense for loans and leases held for investment	34,317		659		34,976		53,499		5,030		58,529
Initial allowance for PCD loans acquired during the period (1)	—		—		—		603		11,837		12,440
Charge-offs	(90)		(156)		(246)		(90)		(156)		(246)
Recoveries	46		173		219		46		312		358
Allowance for loan and lease losses, end of period	$	54,058	$	17,023	$	71,081	$	54,058	$	17,023	$	71,081
Reserve for unfunded lending commitments, beginning of period	$	6	$	404	$	410	$	—	$	—	$	—
Credit loss expense for unfunded lending commitments	(6)		(14)		(20)		—		390		390
Reserve for unfunded lending commitments, end of period	$	—	$	390	$	390	$	—	$	390	$	390

(1)    For acquired PCD loans, an allowance of $30.4 million was required with a corresponding increase to the amortized cost basis as of the acquisition date. For PCD loans where all or a portion of the loan balance had been previously written-off, or would be subject to write-off under the Company’s charge-off policy, a CECL allowance of $18.0 million included as part of the grossed-up loan balance at acquisition was immediately written-off. The net impact to the allowance for PCD assets on the acquisition date was $12.4 million.

Financing Receivable Credit Quality Indicators

The following table presents the classes of financing receivables within the consumer portfolio segment by credit quality indicator based on delinquency status as of June 30, 2021 and origination year:

June 30, 2021	Term Loans and Leases by Origination Year
	2021		2020		2019		2018		2017		Prior		Within Revolving Period		Total
Unsecured personal
Current	$	775,813	$	—	$	—	$	—	$	—	$	—	$	—	$	775,813
30-59 days past due	239		—		—		—		—		—		—		239
60-89 days past due	206		—		—		—		—		—		—		206
90 or more days past due	80		—		—		—		—		—		—		80
Total unsecured personal	776,338		—		—		—		—		—		—		776,338
Residential mortgages
Current	12,863		42,144		31,584		10,469		2,837		48,548		1,266		149,711
30-59 days past due	—		—		—		—		—		—		—		—
60-89 days past due	—		—		—		—		—		90		—		90
90 or more days past due	—		—		965		677		254		831		—		2,727
Total residential mortgages	12,863		42,144		32,549		11,146		3,091		49,469		1,266		152,528
Secured consumer
Current	113,198		93,884		43,860		44,517		9,459		15,307		—		320,225
30-59 days past due	17		—		—		—		—		—		—		17
60-89 days past due	—		—		—		1,302		—		—		—		1,302
90 or more days past due	—		—		1,203		2,655		916		—		—		4,774
Total secured consumer	113,215		93,884		45,063		48,474		10,375		15,307		—		326,318
Other consumer
Current	145		—		—		—		—		—		11		156
30-59 days past due	—		—		—		—		—		—		1		1
60-89 days past due	—		—		—		—		—		—		—		—
90 or more days past due	—		—		—		—		—		—		—		—
Total other consumer	145		—		—		—		—		—		12		157
Total consumer loans held for investment	$	902,561	$	136,028	$	77,612	$	59,620	$	13,466	$	64,776	$	1,278	$	1,255,341

The following table presents the classes of financing receivables within the commercial portfolio segment by risk rating as of June 30, 2021 and origination year:

June 30, 2021	Term Loans and Leases by Origination Year
	2021		2020		2019		2018		2017		Prior		Within Revolving Period		Total
Equipment finance
Pass	$	38,699	$	41,282	$	33,861	$	22,080	$	7,745	$	13,154	$	—	$	156,821
Special mention	1,634		222		1,942		—		—		—		—		3,798
Substandard	—		—		—		846		—		—		—		846
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total equipment finance	40,333		41,504		35,803		22,926		7,745		13,154		—		161,465
Commercial real estate
Pass	16,273		56,511		67,318		43,652		23,212		53,583		3,681		264,230
Special mention	—		8,347		277		1,367		1,047		10,914		—		21,952
Substandard	—		—		—		2,746		662		5,158		—		8,566
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		206		—		206
Total commercial real estate	16,273		64,858		67,595		47,765		24,921		69,861		3,681		294,954
Commercial and industrial
Pass	316,309		261,066		29,056		9,648		15,281		9,047		3,285		643,692
Special mention	—		—		3,173		664		1,364		106		—		5,307
Substandard	—		1,120		130		2,935		2,277		1,742		100		8,304
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		1,063		—		1,063
Total commercial and industrial (1)	316,309		262,186		32,359		13,247		18,922		11,958		3,385		658,366
Total commercial loans and leases held for investment	372,915		368,548		135,757		83,938		51,588		94,973		7,066		1,114,785

(1)    Includes $507.6 million of PPP loans. The Company determined no allowance for expected credit losses is needed on these loans.

Past Due Financing Receivables

The following table presents an analysis of the past-due loans and leases held for investment within the commercial portfolio segment at June 30, 2021:

June 30, 2021	Days Past Due
	Current-29		30-59		60-89		90 or more		Total
Equipment finance	$	161,465	$	—	$	—	$	—	$	161,465
Commercial real estate	294,090		—		—		864		294,954
Commercial and industrial (1)	656,735		261		8		1,362		658,366
Total commercial loans and leases held for investment	$	1,112,290	$	261	$	8	$	2,226	$	1,114,785

(1)    Includes $507.6 million of PPP loans. The Company determined no allowance for expected credit losses is needed on these loans.

The following table presents nonaccrual loans and leases as of June 30, 2021:

	June 30, 2021
	Nonaccrual(1)		Nonaccrual with no related ACL(2)
Unsecured personal	$	80	$	—
Residential mortgages	2,973		2,719
Secured consumer	9,503		1,203
Other consumer	—		—
Total nonaccrual consumer loans held for investment	12,556		3,922
Equipment finance	846		—
Commercial real estate	1,624		317
Commercial and industrial	1,988		1,063
Total nonaccrual commercial loans and leases held for investment	4,458		1,380
Total nonaccrual loans and leases held for investment	$	17,014	$	5,302

(1)     There were no loans and leases that were 90 days or more past due and accruing as of June 30, 2021.

(2)     Subset of total nonaccrual loans and leases.

Financing Receivable, Acquired Financial Assets With Credit Deterioration

Acquired PCD loans during the first half of 2021 were as follows:

	Six Months Ended June 30, 2021
Purchase price	$	337,118
Allowance for expected credit losses (1)	30,378
Discount attributable to other factors	12,204
Par value	$	379,700

(1)    For acquired PCD loans, an allowance of $30.4 million was required with a corresponding increase to the amortized cost basis as of the acquisition date. For PCD loans where all or a portion of the loan balance had been previously written-off, or would be subject to write-off under the Company’s charge-off policy, a CECL allowance of $18.0 million included as part of the grossed-up loan balance at acquisition was immediately written-off. The net impact to the allowance for PCD assets on the acquisition date was $12.4 million.