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Loans and Credit Quality
 6 Months Ended
Jun. 30, 2014
Receivables [Abstract]  
LOANS AND CREDIT QUALITY
NOTE 3–LOANS AND CREDIT QUALITY:

For a detailed discussion of loans and credit quality, including accounting policies and the methodology used to estimate the allowance for credit losses, see Note 1, Summary of Significant Accounting Policies and Note 6, Loans and Credit Quality within our 2013 Annual Report on Form 10-K.

The Company's portfolio of loans held for investment is divided into two portfolio segments, consumer loans and commercial loans, which are the same segments used to determine the allowance for loan losses.  Within each portfolio segment, the Company monitors and assesses credit risk based on the risk characteristics of each of the following loan classes: single family and home equity loans within the consumer loan portfolio segment and commercial real estate, multifamily, construction/land development and commercial business loans within the commercial loan portfolio segment.

Loans held for investment consist of the following:
 
(in thousands)
At June 30,
2014
 
At December 31,
2013
 
 
 
 
Consumer loans
 
 
 
Single family
$
749,204

 
$
904,913

Home equity
136,181

 
135,650

 
885,385

 
1,040,563

Commercial loans
 
 
 
Commercial real estate
476,411

 
477,642

Multifamily
72,327

 
79,216

Construction/land development
219,282

 
130,465

Commercial business
185,177

 
171,054

 
953,197

 
858,377

 
1,838,582

 
1,898,940

Net deferred loan fees and discounts
(3,761
)
 
(3,219
)
 
1,834,821

 
1,895,721

Allowance for loan losses
(21,926
)
 
(23,908
)
 
$
1,812,895

 
$
1,871,813



Loans in the amount of $634.4 million and $800.5 million at June 30, 2014 and December 31, 2013, respectively, were pledged to secure borrowings from the FHLB as part of our liquidity management strategy. The FHLB does not have the right to sell or re-pledge these loans.

Concentrations of credit risk arise when a number of customers are engaged in similar business activities or activities in the same geographic region, or when they have similar economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions.

Loans held for investment are primarily secured by real estate located in the states of Washington, Oregon, California, Idaho and Hawaii. At June 30, 2014, we had concentrations representing 10% or more of the total portfolio by state and property type for the loan classes of single family, commercial real estate and construction/land development within the state of Washington, which represented 27.5%, 21.8% and 10.1% of the total portfolio, respectively. At December 31, 2013 we had concentrations representing 10% or more of the total portfolio by state and property type for the loan classes of single family and commercial real estate within the state of Washington, which represented 37.3% and 21.2% of the total portfolio, respectively. These loans were mostly located within the metropolitan area of Puget Sound, particularly within King County.

Credit Quality

Management considers the level of allowance for loan losses to be appropriate to cover credit losses inherent within the loans held for investment portfolio as of June 30, 2014. In addition to the allowance for loan losses, the Company maintains a separate allowance for losses related to unfunded loan commitments, and this amount is included in accounts payable and other liabilities on the consolidated statements of financial condition. Collectively, these allowances are referred to as the allowance for credit losses.

For further information on the policies that govern the determination of the allowance for loan losses levels, see Note 1, Summary of Significant Accounting Policies within our 2013 Annual Report on Form 10-K.

Activity in the allowance for credit losses was as follows.

 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
(in thousands)
 
2014
 
2013
 
2014
 
2013
 
 
 
 
 
 
 
 
 
Allowance for credit losses (roll-forward):
 
 
 
 
 
 
 
 
Beginning balance
 
$
22,317

 
$
28,594

 
$
24,089

 
$
27,751

Provision (reversal of provision) for credit losses
 
—

 
400

 
(1,500
)
 
2,400

(Charge-offs), net of recoveries
 
(149
)
 
(1,136
)
 
(421
)
 
(2,293
)
Ending balance
 
$
22,168

 
$
27,858

 
$
22,168

 
$
27,858

Components:
 
 
 
 
 
 
 
 
Allowance for loan losses
 
$
21,926

 
$
27,655

 
$
21,926

 
$
27,655

Allowance for unfunded commitments
 
242

 
203

 
242

 
203

Allowance for credit losses
 
$
22,168

 
$
27,858

 
$
22,168

 
$
27,858




Activity in the allowance for credit losses by loan portfolio and loan class was as follows.

 
Three Months Ended June 30, 2014
(in thousands)
Beginning
balance
 
Charge-offs
 
Recoveries
 
(Reversal of) Provision
 
Ending
balance
 
 
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
 
 
Single family
$
9,406

 
$
(172
)
 
$
25

 
$
(148
)
 
$
9,111

Home equity
3,882

 
(136
)
 
236

 
(465
)
 
3,517

 
13,288

 
(308
)
 
261

 
(613
)
 
12,628

Commercial loans
 
 
 
 
 
 
 
 
 
Commercial real estate
4,309

 
(23
)
 
100

 
(323
)
 
4,063

Multifamily
965

 
—

 
—

 
(78
)
 
887

Construction/land development
2,003

 
—

 
46

 
369

 
2,418

Commercial business
1,752

 
(288
)
 
63

 
645

 
2,172

 
9,029

 
(311
)
 
209

 
613

 
9,540

Total allowance for credit losses
$
22,317

 
$
(619
)
 
$
470

 
$
—

 
$
22,168

 
 
Three Months Ended June 30, 2013
(in thousands)
Beginning
balance
 
Charge-offs
 
Recoveries
 
(Reversal of) Provision
 
Ending
balance
 
 
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
 
 
Single family
$
14,478

 
$
(1,141
)
 
$
171

 
$
302

 
$
13,810

Home equity
4,708

 
(299
)
 
156

 
314

 
4,879

 
19,186

 
(1,440
)
 
327

 
616

 
18,689

Commercial loans
 
 
 
 
 
 
 
 
 
Commercial real estate
5,958

 
(340
)
 
—

 
105

 
5,723

Multifamily
635

 
—

 
—

 
55

 
690

Construction/land development
894

 
—

 
281

 
10

 
1,185

Commercial business
1,921

 
—

 
36

 
(386
)
 
1,571

 
9,408

 
(340
)
 
317

 
(216
)
 
9,169

Total allowance for credit losses
$
28,594

 
$
(1,780
)
 
$
644

 
$
400

 
$
27,858




 
Six Months Ended June 30, 2014
(in thousands)
Beginning
balance
 
Charge-offs
 
Recoveries
 
(Reversal of) Provision
 
Ending
balance
 
 
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
 
 
Single family
$
11,990

 
$
(283
)
 
$
41

 
$
(2,637
)
 
$
9,111

Home equity
3,987

 
(559
)
 
326

 
(237
)
 
3,517

 
15,977

 
(842
)
 
367

 
(2,874
)
 
12,628

Commercial loans
 
 
 
 
 
 
 
 
 
Commercial real estate
4,012

 
(23
)
 
156

 
(82
)
 
4,063

Multifamily
942

 
—

 
—

 
(55
)
 
887

Construction/land development
1,414

 
—

 
62

 
942

 
2,418

Commercial business
1,744

 
(288
)
 
147

 
569

 
2,172

 
8,112

 
(311
)
 
365

 
1,374

 
9,540

Total allowance for credit losses
$
24,089

 
$
(1,153
)
 
$
732

 
$
(1,500
)
 
$
22,168



 
Six Months Ended June 30, 2013
(in thousands)
Beginning
balance
 
Charge-offs
 
Recoveries
 
(Reversal of) Provision
 
Ending
balance
 
 
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
 
 
Single family
$
13,388

 
$
(1,862
)
 
$
246

 
$
2,038

 
$
13,810

Home equity
4,648

 
(1,138
)
 
253

 
1,116

 
4,879

 
18,036

 
(3,000
)
 
499

 
3,154

 
18,689

Commercial loans
 
 
 
 
 
 
 
 
 
Commercial real estate
5,312

 
(143
)
 
—

 
554

 
5,723

Multifamily
622

 
—

 
—

 
68

 
690

Construction/land development
1,580

 
(148
)
 
351

 
(598
)
 
1,185

Commercial business
2,201

 
—

 
148

 
(778
)
 
1,571

 
9,715

 
(291
)
 
499

 
(754
)
 
9,169

Total allowance for credit losses
$
27,751

 
$
(3,291
)
 
$
998

 
$
2,400

 
$
27,858



The following table disaggregates our allowance for credit losses and recorded investment in loans by impairment methodology.
 
 
At June 30, 2014
(in thousands)
Allowance:
collectively
evaluated for
impairment
 
Allowance:
individually
evaluated for
impairment
 
Total
 
Loans:
collectively
evaluated for
impairment
 
Loans:
individually
evaluated for
impairment
 
Total
 
 
 
 
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
 
 
 
 
Single family
$
8,235

 
$
876

 
$
9,111

 
$
678,418

 
$
70,786

 
$
749,204

Home equity
3,439

 
78

 
3,517

 
133,787

 
2,394

 
136,181

 
11,674

 
954

 
12,628

 
812,205

 
73,180

 
885,385

Commercial loans
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate
3,851

 
212

 
4,063

 
445,130

 
31,281

 
476,411

Multifamily
485

 
402

 
887

 
69,202

 
3,125

 
72,327

Construction/land development
2,418

 
—

 
2,418

 
213,439

 
5,843

 
219,282

Commercial business
1,212

 
960

 
2,172

 
181,594

 
3,583

 
185,177

 
7,966

 
1,574

 
9,540

 
909,365

 
43,832

 
953,197

Total
$
19,640

 
$
2,528

 
$
22,168

 
$
1,721,570

 
$
117,012

 
$
1,838,582

 
 
At December 31, 2013
(in thousands)
Allowance:
collectively
evaluated for
impairment
 
Allowance:
individually
evaluated for
impairment
 
Total
 
Loans:
collectively
evaluated for
impairment
 
Loans:
individually
evaluated for
impairment
 
Total
 
 
 
 
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
 
 
 
 
Single family
$
10,632

 
$
1,358

 
$
11,990

 
$
831,730

 
$
73,183

 
$
904,913

Home equity
3,903

 
84

 
3,987

 
133,006

 
2,644

 
135,650

 
14,535

 
1,442

 
15,977

 
964,736

 
75,827

 
1,040,563

Commercial loans
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate
4,012

 
—

 
4,012

 
445,766

 
31,876

 
477,642

Multifamily
515

 
427

 
942

 
76,053

 
3,163

 
79,216

Construction/land development
1,414

 
—

 
1,414

 
124,317

 
6,148

 
130,465

Commercial business
1,042

 
702

 
1,744

 
168,199

 
2,855

 
171,054

 
6,983

 
1,129

 
8,112

 
814,335

 
44,042

 
858,377

Total
$
21,518

 
$
2,571

 
$
24,089

 
$
1,779,071

 
$
119,869

 
$
1,898,940




Impaired Loans

The following tables present impaired loans by loan portfolio segment and loan class.
 
 
At June 30, 2014
(in thousands)
Recorded
investment (1)
 
Unpaid
principal
balance (2)
 
Related
allowance
 
 
 
 
 
 
With no related allowance recorded:
 
 
 
 
 
Consumer loans
 
 
 
 
 
Single family
$
38,056

 
$
40,366

 
$
—

Home equity
1,991

 
2,068

 
—

 
40,047

 
42,434

 
—

Commercial loans
 
 
 
 
 
Commercial real estate
26,185

 
29,383

 
—

Multifamily
508

 
508

 
—

Construction/land development
5,843

 
14,974

 
—

Commercial business
1,033

 
1,911

 
—

 
33,569

 
46,776

 
—

 
$
73,616

 
$
89,210

 
$
—

With an allowance recorded:
 
 
 
 
 
Consumer loans
 
 
 
 
 
Single family
$
32,730

 
$
32,826

 
$
876

Home equity
403

 
402

 
78

 
33,133

 
33,228

 
954

Commercial loans
 
 
 
 
 
Commercial real estate
5,096

 
5,325

 
212

Multifamily
2,617

 
2,795

 
402

Construction/land development
—

 
—

 
—

Commercial business
2,550

 
2,824

 
960

 
10,263

 
10,944

 
1,574

 
$
43,396

 
$
44,172

 
$
2,528

Total:
 
 
 
 
 
Consumer loans
 
 
 
 
 
Single family(3)
$
70,786

 
$
73,192

 
$
876

Home equity
2,394

 
2,470

 
78

 
73,180

 
75,662

 
954

Commercial loans
 
 
 
 
 
Commercial real estate
31,281

 
34,708

 
212

Multifamily
3,125

 
3,303

 
402

Construction/land development
5,843

 
14,974

 
—

Commercial business
3,583

 
4,735

 
960

 
43,832

 
57,720

 
1,574

Total impaired loans
$
117,012

 
$
133,382

 
$
2,528


(1)
Includes partial charge-offs and nonaccrual interest paid.
(2)
Unpaid principal balance does not include partial charge-offs or nonaccrual interest paid. Related allowance is calculated on net book balances not unpaid principal balances.
(3)
Includes $67.8 million in performing troubled debt restructurings ("TDRs").

 
At December 31, 2013
(in thousands)
Recorded
investment (1)
 
Unpaid
principal
balance (2)
 
Related
allowance
 
 
 
 
 
 
With no related allowance recorded:
 
 
 
 
 
Consumer loans
 
 
 
 
 
Single family
$
39,341

 
$
41,935

 
$
—

Home equity
1,895

 
1,968

 
—

 
41,236

 
43,903

 
—

Commercial loans
 
 
 
 
 
Commercial real estate
31,876

 
45,921

 
—

Multifamily
508

 
508

 
—

Construction/land development
6,148

 
15,299

 
—

Commercial business
1,533

 
7,164

 
—

 
40,065

 
68,892

 
—

 
$
81,301

 
$
112,795

 
$
—

With an allowance recorded:
 
 
 
 
 
Consumer loans
 
 
 
 
 
Single family
$
33,842

 
$
33,900

 
$
1,358

Home equity
749

 
749

 
84

 
34,591

 
34,649

 
1,442

Commercial loans
 
 
 
 
 
Multifamily
2,655

 
2,832

 
427

Commercial business
1,322

 
1,478

 
702

 
3,977

 
4,310

 
1,129

 
$
38,568

 
$
38,959

 
$
2,571

Total:
 
 
 
 
 
Consumer loans
 
 
 
 
 
Single family(3)
$
73,183

 
$
75,835

 
$
1,358

Home equity
2,644

 
2,717

 
84

 
75,827

 
78,552

 
1,442

Commercial loans
 
 
 
 
 
Commercial real estate
31,876

 
45,921

 
—

Multifamily
3,163

 
3,340

 
427

Construction/land development
6,148

 
15,299

 
—

Commercial business
2,855

 
8,642

 
702

 
44,042

 
73,202

 
1,129

Total impaired loans
$
119,869

 
$
151,754

 
$
2,571

 
(1)
Includes partial charge-offs and nonaccrual interest paid.
(2)
Unpaid principal balance does not include partial charge-offs or nonaccrual interest paid. Related allowance is calculated on net book balances not unpaid principal balances.
(3)
Includes $70.3 million in performing TDRs.

The following table provides the average recorded investment in impaired loans by portfolio segment and class.

 
Three Months Ended June 30,
 
Six Months Ended June 30,
(in thousands)
2014
 
2013
 
2014
 
2013
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
Single family
$
70,977

 
$
81,628

 
$
71,713

 
$
79,194

Home equity
2,466

 
3,550

 
2,525

 
3,607

 
73,443

 
85,178

 
74,238

 
82,801

Commercial loans
 
 
 
 
 
 
 
Commercial real estate
31,771

 
28,191

 
31,806

 
27,952

Multifamily
3,135

 
3,204

 
3,144

 
3,210

Construction/land development
5,875

 
9,115

 
5,966

 
10,378

Commercial business
3,200

 
1,921

 
3,085

 
2,054

 
43,981

 
42,431

 
44,001

 
43,594

 
$
117,424

 
$
127,609

 
$
118,239

 
$
126,395



Credit Quality Indicators
Management regularly reviews loans in the portfolio to assess credit quality indicators and to determine appropriate loan classification and grading in accordance with applicable bank regulations. The following tables present designated loan grades by loan portfolio segment and loan class.
 
 
At June 30, 2014
(in thousands)
Pass
 
Watch
 
Special mention
 
Substandard
 
Total
 
 
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
 
 
Single family
$
719,493

 
$
230

 
$
15,346

 
$
14,135

 
$
749,204

Home equity
134,225

 
368

 
422

 
1,166

 
136,181

 
853,718

 
598

 
15,768

 
15,301

 
885,385

Commercial loans
 
 
 
 
 
 
 
 
 
Commercial real estate
380,101

 
71,009

 
18,403

 
6,898

 
476,411

Multifamily
67,671

 
1,531

 
3,125

 
—

 
72,327

Construction/land development
209,293

 
6,923

 
92

 
2,974

 
219,282

Commercial business
161,215

 
19,482

 
558

 
3,922

 
185,177

 
818,280

 
98,945

 
22,178

 
13,794

 
953,197

 
$
1,671,998

 
$
99,543

 
$
37,946

 
$
29,095

 
$
1,838,582


 
At December 31, 2013
(in thousands)
Pass
 
Watch
 
Special mention
 
Substandard
 
Total
 
 
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
 
 
Single family
$
817,877

 
$
53,711

 
$
12,746

 
$
20,579

 
$
904,913

Home equity
132,086

 
1,442

 
276

 
1,846

 
135,650

 
949,963

 
55,153

 
13,022

 
22,425

 
1,040,563

Commercial loans
 
 
 
 
 
 
 
 
 
Commercial real estate
368,817

 
63,579

 
37,758

 
7,488

 
477,642

Multifamily
74,509

 
1,544

 
3,163

 
—

 
79,216

Construction/land development
121,026

 
3,414

 
2,895

 
3,130

 
130,465

Commercial business
145,760

 
20,062

 
586

 
4,646

 
171,054

 
710,112

 
88,599

 
44,402

 
15,264

 
858,377

 
$
1,660,075

 
$
143,752

 
$
57,424

 
$
37,689

 
$
1,898,940


The Company considers ‘adversely classified assets’ to include loans graded as Substandard, Doubtful, and Loss as well as other real estate owned ("OREO"). As of June 30, 2014 and December 31, 2013, none of the Company's loans were rated Doubtful or Loss. The total amount of adversely classified assets was $40.2 million and $50.6 million as of June 30, 2014 and December 31, 2013, respectively. For a detailed discussion on credit quality indicators used by management, see Note 6, Loans and Credit Quality within our 2013 Annual Report on Form 10-K.

Nonaccrual and Past Due Loans
Loans are placed on nonaccrual status when the full and timely collection of principal and interest is doubtful, generally when the loan becomes 90 days or more past due for principal or interest payment or if part of the principal balance has been charged off. Loans whose repayments are insured by the Federal Housing Authority ("FHA") or guaranteed by the Department of Veterans' Affairs ("VA") are generally maintained on accrual status even if 90 days or more past due.
The following table presents an aging analysis of past due loans by loan portfolio segment and loan class.

 
At June 30, 2014
(in thousands)
30-59 days
past due
 
60-89 days
past due
 
90 days or
more
past due
 
Total past
due
 
Current
 
Total
loans
 
90 days or
more past
due and
accruing(1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
 
 
 
 
 
 
Single family
$
10,967

 
$
3,943

 
$
39,020

 
$
53,930

 
$
695,274

 
$
749,204

 
$
32,032

Home equity
209

 
368

 
1,166

 
1,743

 
134,438

 
136,181

 
—

 
11,176

 
4,311

 
40,186

 
55,673

 
829,712

 
885,385

 
32,032

Commercial loans
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate
—

 
—

 
9,871

 
9,871

 
466,540

 
476,411

 
—

Multifamily
—

 
—

 
—

 
—

 
72,327

 
72,327

 
—

Construction/land development
—

 
72

 
—

 
72

 
219,210

 
219,282

 
—

Commercial business
759

 
837

 
3,172

 
4,768

 
180,409

 
185,177

 
—

 
759

 
909

 
13,043

 
14,711

 
938,486

 
953,197

 
—

 
$
11,935

 
$
5,220

 
$
53,229

 
$
70,384

 
$
1,768,198

 
$
1,838,582

 
$
32,032

(1)
FHA-insured and VA-guaranteed single family loans that are 90 days or more past due are maintained on accrual status if they are determined to have little to no risk of loss.
 
At December 31, 2013
(in thousands)
30-59 days
past due
 
60-89 days
past due
 
90 days or
more
past due
 
Total past
due
 
Current
 
Total
loans
 
90 days or
more past
due and
accruing(1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
 
 
 
 
 
 
Single family
$
6,466

 
$
4,901

 
$
55,672

 
$
67,039

 
$
837,874

 
$
904,913

 
$
46,811

Home equity
375

 
75

 
1,846

 
2,296

 
133,354

 
135,650

 
—

 
6,841

 
4,976

 
57,518

 
69,335

 
971,228

 
1,040,563

 
46,811

Commercial loans
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate
—

 
—

 
12,257

 
12,257

 
465,385

 
477,642

 
—

Multifamily
—

 
—

 
—

 
—

 
79,216

 
79,216

 
—

Construction/land development
—

 
—

 
—

 
—

 
130,465

 
130,465

 
—

Commercial business
—

 
—

 
2,743

 
2,743

 
168,311

 
171,054

 
—

 
—

 
—

 
15,000

 
15,000

 
843,377

 
858,377

 
—

 
$
6,841

 
$
4,976

 
$
72,518

 
$
84,335

 
$
1,814,605

 
$
1,898,940

 
$
46,811


(1)
FHA-insured and VA-guaranteed single family loans that are 90 days or more past due are maintained on accrual status if they are determined to have little to no risk of loss.

The following tables present performing and nonperforming loan balances by loan portfolio segment and loan class.
 
 
At June 30, 2014
(in thousands)
Accrual
 
Nonaccrual
 
Total
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
Single family
$
742,216

 
$
6,988

 
$
749,204

Home equity
135,015

 
1,166

 
136,181

 
877,231

 
8,154

 
885,385

Commercial loans
 
 
 
 
 
Commercial real estate
466,540

 
9,871

 
476,411

Multifamily
72,327

 
—

 
72,327

Construction/land development
219,282

 
—

 
219,282

Commercial business
182,005

 
3,172

 
185,177

 
940,154

 
13,043

(1) 
953,197

 
$
1,817,385

 
$
21,197

 
$
1,838,582

 
(1)
Includes $6.5 million of nonperforming loans at June 30, 2014 that are guaranteed by the Small Business Association ("SBA").

 
At December 31, 2013
(in thousands)
Accrual
 
Nonaccrual
 
Total
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
Single family
$
896,052

 
$
8,861

 
$
904,913

Home equity
133,804

 
1,846

 
135,650

 
1,029,856

 
10,707

 
1,040,563

Commercial loans
 
 
 
 
 
Commercial real estate
465,385

 
12,257

 
477,642

Multifamily
79,216

 
—

 
79,216

Construction/land development
130,465

 
—

 
130,465

Commercial business
168,311

 
2,743

 
171,054

 
843,377

 
15,000

(1) 
858,377

 
$
1,873,233

 
$
25,707

 
$
1,898,940



(1)
Includes $6.5 million of nonperforming loans at December 31, 2013 that are guaranteed by the SBA.


The following tables present information about troubled debt restructurings ("TDRs") activity during the periods presented.

 
Three Months Ended June 30, 2014
(dollars in thousands)
Concession type
 
Number of loan
modifications
 
Recorded
investment
 
Related charge-
offs
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
Single family
 
 
 
 
 
 
 
 
Interest rate reduction
 
15

 
$
2,430

 
$
—

 
Payment restructure
 
—

 
—

 
—

Home equity
 
 
 
 
 
 
 
 
Interest rate reduction
 
—

 
—

 
—

Total consumer
 
 
 
 
 
 
 
 
Interest rate reduction
 
15

 
2,430

 
—

 
Payment restructure
 
—

 
—

 
—

 
 
 
15

 
2,430

 
—

 
 
 
 
 
 
 
 
Commercial loans
 
 
 
 
 
 
 
Commercial real estate
 
 
 
 
 
 
 
 
Payment restructure
 
2

 
2,092

 
—

Commercial business
 
 
 
 
 
 
 
 
Forgiveness of principal
 
1

 
208

 
288

Total commercial
 
 
 
 
 
 
 
 
Payment restructure
 
2

 
2,092

 
—

 
Forgiveness of principal
 
1

 
208

 
288

 
 
 
3

 
2,300

 
288

Total loans
 
 
 
 
 
 
 
 
Interest rate reduction
 
15

 
2,430

 
—

 
Payment restructure
 
2

 
2,092

 
—

 
Forgiveness of principal
 
1

 
$
208

 
$
288

 
 
 
18

 
$
4,730

 
$
288


 
Three Months Ended June 30, 2013
(dollars in thousands)
Concession type
 
Number of loan
modifications
 
Recorded
investment
 
Related charge-
offs
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
Single family
 
 
 
 
 
 
 
 
Interest rate reduction
 
36

 
$
8,007

 
$
—

Home equity
 
 
 
 
 
 
 
 
Interest rate reduction
 
3

 
77

 
—

Total consumer
 
 
 
 
 
 
 
 
Interest rate reduction
 
39

 
8,084

 
—

Total loans
 
 
 
 
 
 
 
 
Interest rate reduction
 
39

 
$
8,084

 
$
—



 
Six Months Ended June 30, 2014
(dollars in thousands)
Concession type
 
Number of loan
modifications
 
Recorded
investment
 
Related charge-
offs
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
Single family
 
 
 
 
 
 
 
 
Interest rate reduction
 
24

 
$
4,187

 
$
—

 
Payment restructure
 
2

 
365

 
—

Total consumer
 
 
 
 
 
 
 
 
Interest rate reduction
 
24

 
4,187

 
—

 
Payment restructure
 
2

 
365

 
—

 
 
 
26

 
4,552

 
—

 
 
 
 
 
 
 
 
Commercial loans
 
 
 
 
 
 
 
Commercial real estate
 
 
 
 
 
 
 
 
Payment restructure
 
3

 
4,248

 
—

Commercial business
 
 
 
 
 
 
 
 
Interest rate reduction
 
2

 
117

 
—

 
Forgiveness of principal
 
1

 
208

 
288

Total commercial
 
 
 
 
 
 
 
 
Interest rate reduction
 
2

 
117

 
—

 
Payment restructure
 
3

 
4,248

 
—

 
Forgiveness of principal
 
1

 
208

 
288

 
 
 
6

 
4,573

 
288

Total loans
 
 
 
 
 
 
 
 
Interest rate reduction
 
26

 
4,304

 
—

 
Payment restructure
 
5

 
4,613

 
—

 
Forgiveness of principal
 
1

 
$
208

 
$
288

 
 
 
32

 
$
9,125

 
$
288


 
Six Months Ended June 30, 2013
(dollars in thousands)
Concession type
 
Number of loan
modifications
 
Recorded
investment
 
Related charge-
offs
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
Single family
 
 
 
 
 
 
 
 
Interest rate reduction
 
63

 
$
13,848

 
$
—

Home equity
 
 
 
 
 
 
 
 
Interest rate reduction
 
6

 
248

 
—

Total consumer
 
 
 
 
 
 
 
 
Interest rate reduction
 
69

 
14,096

 
—

 
 
 
69

 
14,096

 
—

Total loans
 
 
 
 
 
 
 
 
Interest rate reduction
 
69

 
$
14,096

 
$
—



The following tables present loans that were modified as TDRs within the previous 12 months and subsequently re-defaulted during the three and six months ended June 30, 2014 and 2013, respectively. A TDR loan is considered re-defaulted when it becomes doubtful that the objectives of the modifications will be met, generally when a consumer loan TDR becomes 60 days or more past due on principal or interest payments or when a commercial loan TDR becomes 90 days or more past due on principal or interest payments.
 
 
Three Months Ended June 30,
 
2014
 
2013
(dollars in thousands)
Number of loan relationships that re-defaulted
 
Recorded
investment
 
Number of loan relationships that re-defaulted
 
Recorded
investment
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
Single family
2

 
$
425

 
1

 
$
133

Home equity
—

 
—

 
—

 
—

 
2

 
425

 
1

 
133

 
2

 
$
425

 
1

 
$
133


 

 
Six Months Ended June 30,
 
2014
 
2013
(dollars in thousands)
Number of loan relationships that re-defaulted
 
Recorded
investment
 
Number of loan relationships that re-defaulted
 
Recorded
investment
 
 
 
 
 
 
 
 
Consumer loans
 
 
 
 
 
 
 
Single family
4

 
$
728

 
7

 
$
1,556

Home equity
1

 
190

 
1

 
22

 
5

 
918

 
8

 
1,578

Commercial loans
 
 
 
 
 
 
 
Commercial real estate
—

 
—

 
1

 
770

 
—

 
—

 
1

 
770

 
5

 
$
918

 
9

 
$
2,348