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LOANS AND ALLOWANCE FOR CREDIT LOSSES (Tables)
9 Months Ended
Sep. 30, 2024
Receivables [Abstract]  
Schedule of Loan Portfolio
The composition of the Company’s loan portfolio at September 30, 2024 and December 31, 2023 was as follows:
(dollars in thousands)September 30,
2024
December 31,
2023
Construction and land development$247,934 $243,521 
Real estate - other:
  1-4 family residential152,540 143,903 
  Multifamily residential252,134 221,247 
  Commercial real estate and other1,755,908 1,024,243 
Commercial and industrial765,472 320,142 
Consumer 25,726 4,386 
Loans held for investment (1)
3,199,714 1,957,442 
Allowance for credit losses(53,552)(22,569)
Loans held for investment, net$3,146,162 $1,934,873 
(1)Loans held for investment includes net unearned fees of $1.6 million and $2.3 million and net unearned discounts on acquired loans of $66.0 million and $1.4 million at September 30, 2024 and December 31, 2023, respectively. The Company recognized $4.2 million and $4.3 million, respectively, in interest accretion for acquired loans for the three and nine months ended September 30, 2024.
Schedule of Risk Category of Loans by Class and Origination Year
The risk category of loans by class of loans and origination year as of September 30, 2024 follows:

Term Loans Amortized Cost Basis by Origination YearRevolving Loans Amortized Cost BasisRevolving Loans Amortized Cost Basis
Converted to Term During the Period
(dollars in thousands)20242023202220212020PriorTotal
September 30, 2024
Construction and land development
Pass$493 $40,861 $111,686 $51,163 $17,283 $2,340 $8,476 $— $232,302 
Special mention— — — — — — — — — 
Substandard— — 9,659 — 2,945 3,028 — — 15,632 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total construction and land development493 40,861 121,345 51,163 20,228 5,368 8,476 — 247,934 
Real estate - other:
1-4 family residential
Pass6,271 21,137 33,768 17,995 6,736 17,562 45,329 — 148,798 
Special mention— — — — — 847 — — 847 
Substandard— — 2,895 — — — — — 2,895 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total 1-4 family residential6,271 21,137 36,663 17,995 6,736 18,409 45,329 — 152,540 
Multifamily residential
Pass1,625 18,808 91,437 89,992 5,287 43,506 1,479 — 252,134 
Special mention— — — — — — — — — 
Substandard— — — — — — — — — 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total multifamily residential1,625 18,808 91,437 89,992 5,287 43,506 1,479 — 252,134 
Term Loans Amortized Cost Basis by Origination YearRevolving Loans Amortized Cost BasisRevolving Loans Amortized Cost Basis
Converted to Term During the Period
(dollars in thousands)20242023202220212020PriorTotal
September 30, 2024
Commercial real estate and other
Pass74,938 83,188 457,671 398,356 101,050 472,661 106,386 151 1,694,401 
Special mention— 9,585 5,059 14,148 2,277 10,870 1,596 497 44,032 
Substandard— — — 11,573 — 5,902 — — 17,475 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total commercial real estate and other74,938 92,773 462,730 424,077 103,327 489,433 107,982 648 1,755,908 
Commercial and industrial
Pass48,106 75,264 122,585 45,355 15,765 70,103 271,764 — 648,942 
Special mention383 1,251 — 7,556 285 2,099 36,995 — 48,569 
Substandard— 50 21,535 268 — 3,644 42,464 — 67,961 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total commercial and industrial48,489 76,565 144,120 53,179 16,050 75,846 351,223 — 765,472 
Consumer
Pass1,088 — 1,107 22,946 100 143 — 25,391 
Special mention— — — — — — — — — 
Substandard— — — 335 — — — — 335 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total consumer1,088 — 1,107 23,281 100 143 — 25,726 
Total loans$132,904 $250,144 $857,402 $659,687 $151,728 $632,569 $514,632 $648 $3,199,714 
Total by risk rating:
Pass$132,521 $239,258 $818,254 $625,807 $146,221 $606,179 $433,577 $151 $3,001,968 
Special mention383 10,836 5,059 21,704 2,562 13,816 38,591 497 93,448 
Substandard— 50 34,089 12,176 2,945 12,574 42,464 — 104,298 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total loans$132,904 $250,144 $857,402 $659,687 $151,728 $632,569 $514,632 $648 $3,199,714 
The risk category of loans by class of loans and origination year as of December 31, 2023 follows:

Term Loans Amortized Cost Basis by Origination YearRevolving Loans Amortized Cost BasisRevolving Loans Amortized Cost Basis
Converted to Term During the Period
(dollars in thousands)20232022202120202019PriorTotal
December 31, 2023
Construction and land development
Pass$25,113 $127,496 $71,199 $17,022 $2,071 $528 $— $— $243,429 
Special mention— — — — — — — — — 
Substandard— — — — — 92 — — 92 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total construction and land development25,113 127,496 71,199 17,022 2,071 620 — — 243,521 
Real estate - other:
1-4 family residential
Pass24,928 35,670 20,207 6,887 4,884 15,582 35,645 100 143,903 
Special mention— — — — — — — — — 
Substandard— — — — — — — — — 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total 1-4 family residential24,928 35,670 20,207 6,887 4,884 15,582 35,645 100 143,903 
Multifamily residential
Pass18,803 61,677 73,365 5,712 27,292 21,245 149 — 208,243 
Special mention— — — — — — — — — 
Substandard— 13,004 — — — — — — 13,004 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total multifamily residential18,803 74,681 73,365 5,712 27,292 21,245 149 — 221,247 
Term Loans Amortized Cost Basis by Origination YearRevolving Loans Amortized Cost BasisRevolving Loans Amortized Cost Basis
Converted to Term During the Period
(dollars in thousands)20232022202120202019PriorTotal
Commercial real estate and other
Pass76,434 304,524 287,245 57,736 51,992 203,976 36,543 1,626 1,020,076 
Special mention— 2,701 — — — — 295 — 2,996 
Substandard— — — — — 1,171 — — 1,171 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total commercial real estate and other76,434 307,225 287,245 57,736 51,992 205,147 36,838 1,626 1,024,243 
Commercial and industrial
Pass46,701 70,658 12,883 7,095 8,266 13,715 153,712 1,877 314,907 
Special mention— — — — — — — — — 
Substandard— 346 64 — 1,208 121 3,097 399 5,235 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total commercial and industrial46,701 71,004 12,947 7,095 9,474 13,836 156,809 2,276 320,142 
Consumer
Pass163 — 39 91 11 4,076 — 4,386 
Special mention— — — — — — — — — 
Substandard— — — — — — — — — 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total consumer163 — 39 91 11 4,076 — 4,386 
Total loans$192,142 $616,076 $465,002 $94,543 $95,719 $256,441 $233,517 $4,002 $1,957,442 
Total by risk rating:
Pass$192,142 $600,025 $464,938 $94,543 $94,511 $255,057 $230,125 $3,603 $1,934,944 
Special mention— 2,701 — — — — 295 — 2,996 
Substandard— 13,350 64 — 1,208 1,384 3,097 399 19,502 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total loans$192,142 $616,076 $465,002 $94,543 $95,719 $256,441 $233,517 $4,002 $1,957,442 
A summary of gross charge-offs by class of loans and origination year for the nine months ended September 30, 2024 and 2023 follows:
Term Loans Gross Charge-offs by Origination YearRevolving Loans Amortized Cost BasisRevolving Loans Amortized Cost Basis
Converted to Term During the Period
(dollars in thousands)20242023202220212020PriorTotal
Nine Months Ended September 30, 2024
Construction and land development$— $— $967 $— $— $— $— $— $967 
Real estate - other:
1-4 family residential— — — — — — — 
Multifamily residential— — 1,456 — — — — — 1,456 
Commercial real estate and other— — — — — — — — — 
Commercial and industrial — 37 24 — — — — — 61 
Consumer — — — 135 — — — — 135 
Total
$— $37 $2,447 $135 $— $— $$— $2,620 


Term Loans Gross Charge-offs by Origination YearRevolving Loans Amortized Cost BasisRevolving Loans Amortized Cost Basis
Converted to Term During the Period
(dollars in thousands)20232022202120202019PriorTotal
Nine Months Ended September 30, 2023
Construction and land development$— $— $— $— $— $— $— $— $— 
Real estate - other:
1-4 family residential— — — — — 12 — — 12 
Multifamily residential— — — — — — — — — 
Commercial real estate and other— — — — — — — — — 
Commercial and industrial — — — 15 — — — 24 
Consumer — — — — — — — — — 
Total
$— $— $— $15 $— $21 $— $— $36 
Schedule of Past Due Loans and Collateral Dependent Loans
A summary of past due loans as of September 30, 2024 and December 31, 2023 follows:
Current
(dollars in thousands)30-59 Days
Past Due
60-89 Days
Past Due
Over 90 Days
Past Due
Total
Past Due
Current
Nonaccrual
Total
September 30, 2024
Construction and land development$— $— $— $— $238,275 $9,659 $247,934 
Real estate - other:
  1-4 family residential— — — — 149,645 2,895 152,540 
  Multifamily residential— — — — 252,134 — 252,134 
  Commercial real estate and other18,175 — — 18,175 1,728,628 9,105 1,755,908 
Commercial and industrial 667 — — 667 760,803 4,002 765,472 
Consumer 96 172 37 305 25,421 — 25,726 
$18,938 $172 $37 $19,147 $3,154,906 $25,661 $3,199,714 

Current
(dollars in thousands)30-59 Days
Past Due
60-89 Days
Past Due
Over 90 Days
Past Due
Total
Past Due
CurrentNonaccrualTotal
December 31, 2023
Construction and land development$— $— $— $— $243,521 $— $243,521 
Real estate - other:
  1-4 family residential— — — — 143,903 — 143,903 
  Multifamily residential— — — — 208,243 13,004 221,247 
  Commercial real estate and other— — — — 1,024,243 — 1,024,243 
Commercial and industrial 19 — — 19 320,123 — 320,142 
Consumer — — — — 4,386 — 4,386 
$19 $— $— $19 $1,944,419 $13,004 $1,957,442 
A summary of collateral dependent loans by collateral type as of September 30, 2024 and December 31, 2023 follows:
Type of Collateral
(dollars in thousands)
Commercial
Real Estate
Residential
Real Estate
Business
Assets
September 30, 2024
Construction and land development$— $9,659 $— 
Real estate - other:
  1-4 family residential— 2,895 — 
  Commercial real estate and other10,535 — — 
Commercial and industrial — 271 2,301 
$10,535 $12,825 $2,301 
December 31, 2023
Multifamily residential$— $13,004 $— 
$— $13,004 $— 
Schedule of Nonaccrual Loans
A summary of total nonaccrual loans and the amount of nonaccrual loans with no related ACL as of September 30, 2024 and December 31, 2023 follows:
September 30, 2024December 31, 2023
(dollars in thousands)Total
Nonaccrual
Loans
Nonaccrual
Loans with no ACL
Total
Nonaccrual
Loans
Nonaccrual
Loans with no ACL
Construction and land development$9,659 $9,659 $— $— 
Real estate - other:
  1-4 family residential2,895 2,895 — — 
  Multifamily residential— — 13,004 13,004 
  Commercial real estate and other9,105 117 — — 
Commercial and industrial 4,002 — — — 
Consumer — — — — 
$25,661 $12,671 $13,004 $13,004 
Schedule of Modified Loans to Borrowers
A summary of modified loans to borrowers experiencing financial difficulty as of September 30, 2024 follows:
(dollars in thousands)Commercial & IndustrialTotal
September 30, 2024:
Term extension:
Amortized cost basis
13,094 13,094 
% of total class of loans1.7 %0.4 %
Schedule of Modified Financing Receivable, Modified, Past Due
A summary of the payment status for modified loans to borrowers experiencing financial difficulty as of September 30, 2024 follows:

(dollars in thousands)
30-59
Days
Past Due
60-89
Days
Past Due
Over 90
Days
Past Due
Total
Past Due
CurrentTotal
September 30, 2024:
Commercial and industrial— — 397 397 12,697 13,094 
$— $— $397 $397 $12,697 $13,094 
Schedule of Changes in Allowance for Credit Losses
A summary of the changes in the ACL for loans and unfunded commitments for the periods indicated follows:
Three Months Ended
September 30,
Nine Months Ended
September 30,
(dollars in thousands)2024202320242023
Allowance for loan losses (ALL)
Balance, beginning of period$23,788 $22,502 $22,569 $17,099 
Adoption of ASU No. 2016-13(1)
— — — 5,027 
Initial allowance for acquired PCD loans
11,216 — 11,216 — 
Provision for loan losses(2)
19,711 202 22,387 600 
Charge-offs(1,163)— (2,620)(36)
Recoveries— — 15 
     Net (charge-offs) recoveries
(1,163)(2,620)(21)
Balance, end of period$53,552 $22,705 $53,552 $22,705 
Reserve for unfunded loan commitments
Balance, beginning of period$819 $1,538 $933 $1,310 
Adoption of ASU No. 2016-13(1)
— — — 439 
Provision for (reversal of) credit losses for unfunded loan commitments(3)
3,252 (298)3,138 (509)
Balance, end of period4,071 1,240 4,071 1,240 
Allowance for credit losses, end of period
$57,623 $23,945 $57,623 $23,945 
(1)Represents the impact of adopting ASU 2016-13, Financial Instruments - Credit Losses on January 1, 2023. As a result of adopting ASU 2016-13, the Company’s methodology to compute our ACL is based on a CECL methodology, rather than the previously applied incurred loss methodology.
(2)Includes an initial provision for credit losses for non-PCD loans acquired in the Merger of $18.5 million for the three and nine months ended September 30, 2024. There was no similar activity in the comparable 2023 period.
(3)Includes an initial provision for credit losses for unfunded commitments acquired in the Merger of $2.7 million for the three and nine months ended September 30, 2024. There was no similar activity in the comparable 2023 period.
A summary of changes in the ALL by loan portfolio segment for the periods indicated follows:
(dollars in thousands)Construction and Land DevelopmentReal Estate -
Other
Commercial & IndustrialConsumerTotal
Three Months Ended September 30, 2024
Beginning of period$2,942 $17,048 $3,795 $$23,788 
Initial allowance for acquired PCD loans
328 2,392 8,355 141 11,216 
(Reversal of) provision for loan losses(1)
(219)10,020 8,769 1,141 19,711 
Charge-offs(967)— (61)(135)(1,163)
Recoveries— — — — — 
Net charge-offs(967)— (61)(135)(1,163)
End of period$2,084 $29,460 $20,858 $1,150 $53,552 
Three Months Ended September 30, 2023
Beginning of period$3,556 $15,097 $3,808 $41 $22,502 
(Reversal of) provision for loan losses
(1,021)1,318 (70)(25)202 
Charge-offs— — — — — 
Recoveries— — — 
Net recoveries
— — — 
End of period$2,535 $16,415 $3,739 $16 $22,705 
(1)Includes an initial provision for credit losses for non-PCD loans acquired in the Merger of $18.5 million for the three months ended September 30, 2024. There was no similar activity in the comparable 2023 period.

(dollars in thousands)Construction and Land DevelopmentReal Estate -
Other
Commercial & IndustrialConsumerTotal
Nine Months Ended September 30, 2024
Beginning of period$2,032 $16,280 $4,242 $15 $22,569 
Initial allowance for acquired PCD loans
328 2,392 8,355 141 11,216 
Provision for loan losses(1)
691 12,245 8,322 1,129 22,387 
Charge-offs(967)(1,457)(61)(135)(2,620)
Recoveries— — — — — 
Net charge-offs$(967)$(1,457)$(61)$(135)$(2,620)
End of period$2,084 $29,460 $20,858 $1,150 $53,552 
Nine Months Ended September 30, 2023
Beginning of period$2,301 $11,691 $3,079 $28 $17,099 
Adoption of ASU No. 2016-13(2)
881 2,983 1,132 31 5,027 
(Reversal of) provision for loan losses
(647)1,753 (463)(43)600 
Charge-offs— (12)(24)— (36)
Recoveries— — 15 — 15 
Net charge-offs$— $(12)$(9)$— $(21)
End of period$2,535 $16,415 $3,739 $16 $22,705 
(1)Includes an initial provision for credit losses for non-PCD loans acquired in the Merger of $18.5 million for the nine months ended September 30, 2024. There was no similar activity in the comparable 2023 period.
(2)Represents the impact of adopting ASU 2016-13, Financial Instruments - Credit Losses on January 1, 2023. As a result of adopting ASU 2016-13, the Company’s methodology to compute our ACL is based on a CECL methodology, rather than the previously applied incurred loss methodology.