The following table presents the loan categories for the period ended as indicated:

As a result of the Merger, the Company recorded $4.53 billion of loans held for investment on the Merger Date.

As of June 30, 2021, included in C&I loans was $465.5 million of Small Business Administration ("SBA") Paycheck Protection Program ("PPP") loans. There was $313.4 million of SBA PPP loans at December 31, 2020. These loans carry a 100% guarantee from the SBA and have no allowance for credit losses allocated to them based on the nature of the

guarantee. During the three and six months ended June 30, 2021, $596.2 million of SBA PPP loans were sold for a gain of $20.7 million.

The following tables present data regarding the allowance for credit losses activity for the periods indicated:

The following table presents the amortized cost basis of loans on non-accrual status as of the period indicated:

The Company did not recognize interest income on non-accrual loans during the three and six-months ended June 30, 2021.

The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method, prior to the adoption of ASC 326, as of the dates indicated:

A loan is considered impaired when, based on then current information and events, it is probable that all contractual amounts due will not be collected in accordance with the terms of the loan. Factors considered by management in

determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays or shortfalls generally are not classified as impaired. Management determines the significance of payment delays and shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed.

The Bank considers TDRs and all non-accrual loans, except non-accrual one-to-four family loans in less than the FNMA Limits, to be impaired. Non-accrual one-to-four family loans equal to or less than the FNMA Limits, as well as all consumer loans, are considered homogeneous loan pools and are not required to be evaluated individually for impairment unless considered a TDR.

Impairment is typically measured using the difference between the outstanding loan principal balance and either: 1) the likely realizable value of a note sale; 2) the fair value of the underlying collateral, net of likely disposal costs, if repayment is expected to come from liquidation of the collateral; or 3) the present value of estimated future cash flows (using the loan’s pre-modification rate for certain performing TDRs). If a TDR is substantially performing in accordance with its restructured terms, management will look to either the potential net liquidation proceeds of the underlying collateral or the present value of the expected cash flows from the debt service in measuring impairment (whichever is deemed most appropriate under the circumstances). If a TDR has re-defaulted, generally the likely realizable net proceeds from either a note sale or the liquidation of the collateral is considered when measuring impairment. Measured impairment is either charged off immediately or, in limited instances, recognized as an allocated reserve within the allowance for loan losses.

The following tables summarize impaired loans with no related allowance recorded and with related allowance recorded as of the periods indicated (by collateral type within the real estate loan segment):

(1)	The recorded investment excludes net deferred costs due to immateriality.

The following table presents information for impaired loans for the period indicated:


	Three Months Ended				Six Months Ended
	June 30, 2020				June 30, 2020
	Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income
	Investment⁽¹⁾		Recognized⁽²⁾		Investment⁽¹⁾		Recognized⁽²⁾
With no related allowance recorded:
One-to-four family residential, including condominium and cooperative apartment	$	2,948	$	—	$	11	$	—
Multifamily residential and residential mixed-use		1,355		—		608		9
Commercial real estate and commercial mixed-use		1,529		—		6,789		91
Total with no related allowance recorded		5,832		—		7,408		100

With an allowance recorded:
C&I		10,129		—		116		—
Total	$	15,961	$	—	$	7,524	$	100

(1)	The recorded investment excludes net deferred costs due to immateriality.

(2)	Cash basis interest and interest income recognized on accrual basis approximate each other.

The following tables summarize the past due status of the Company’s investment in loans (net deferred costs are excluded from delinquency loan balances) as of the dates indicated:


	June 30, 2021
					Loans 90
					Days or
	30 to 59		60 to 89		More Past Due
	Days		Days		and Still		Non-		Total				Total
(In thousands)	Past Due		Past Due		Accruing Interest		accrual ⁽¹⁾		Past Due		Current		Loans
Real estate:
One-to-four family residential, including condominium and cooperative apartment	$	3,852	$	4,124	$	5,066	$	4,933	$	17,975	$	686,514	$	704,489
Multifamily residential and residential mixed-use		110,712		3,267		157		—		114,136		3,389,069		3,503,205
CRE		32,638		2,928		—		9,152		44,718		3,636,613		3,681,331
ADC		—		—		—		—		—		290,462		290,462
Total real estate		147,202		10,319		5,223		14,085		176,829		8,002,658		8,179,487
C&I		506		472		1,487		14,109		16,574		1,327,295		1,343,869
Other		8		—		—		92		100		23,175		23,275
Total	$	147,716	$	10,791	$	6,710	$	28,286	$	193,503	$	9,353,128	$	9,546,631

(1)	Includes all loans on non-accrual status regardless of the number of days such loans were delinquent as of June 30, 2021.

	December 31, 2020
					Loans 90
					Days or
	30 to 59		60 to 89		More Past Due
	Days		Days		and Still		Non-		Total				Total
(In thousands)	Past Due		Past Due		Accruing Interest		accrual ⁽¹⁾		Past Due		Current		Loans
Real estate:
One-to-four family residential, including condominium and cooperative apartment	$	—	$	—	$	44	$	858	$	902	$	184,087	$	184,989
Multifamily residential and residential mixed-use		—		—		437		1,863		2,300		2,756,443		2,758,743
CRE		15,351		—		—		2,704		18,055		1,860,112		1,878,167
ADC		—		—		—		—		—		156,296		156,296
Total real estate		15,351		—		481		5,425		21,257		4,956,938		4,978,195
C&I		—		917		2,848		12,502		16,267		625,266		641,533
Other		8		1		—		1		10		2,306		2,316
Total	$	15,359	$	918	$	3,329	$	17,928	$	37,534	$	5,584,510	$	5,622,044

(1)	Includes all loans on non-accrual status regardless of the number of days such loans were delinquent as of December 31, 2020.

Accruing Loans 90 Days or More Past Due:

The Company continued accruing interest on eleven loans with an outstanding balance of $6.7 million at June 30, 2021, and three loans with an outstanding balance of $3.3 million at December 31, 2020, all of which were 90 days or more past due on their respective contractual maturity dates. These loans continued to make monthly payments consistent with their initial contractual amortization schedule exclusive of the balloon payments due at maturity. These loans were well secured and/or were expected to be refinanced, and, therefore, remained on accrual status and were deemed performing assets at the dates indicated above.

Collateral Dependent Loans:

At June 30, 2021, the Company had collateral dependent loans which were individually evaluated to determine expected credit losses.

Collateral dependent CRE loans totaled $57.7 million and had a related allowance for credit losses totaling $17.0 million at June 30, 2021. The loans were secured by real estate.

Collateral dependent multi-family residential and residential mixed-use loans totaled $7.7 million and had a related allowance for credit losses totaling $2.6 million. The loans were secured by real estate.

Collateral dependent C&I loans totaled $6.3 million and had a related allowance for credit losses totaling $4.1 million. The loans were secured by business assets.

TDRs

As of June 30, 2021, the Company had a recorded investment in TDRs of $514 thousand. There were none at December 31, 2020. TDRs had an immaterial impact to the allowance for credit losses. There were no TDR charge-offs during the six months ended June 30, 2021.

The following table present the loans by class modified as TDRs that occurred during the six months ended June 30, 2021:


	Modifications During the Six Months Ended June 30, 2021
			Pre-		Post-
			Modification		Modification
			Outstanding		Outstanding
	Number of		Recorded		Recorded
(Dollars in thousands)	Loans		Investment		Investment
One-to-four family residential and cooperative/condominium apartment	1	$	50	$	50
Multifamily residential and residential mixed-use	-		-		-
Commercial real estate ("CRE")	-		-		-
Acquisition, development, and construction ("ADC")	-		-		-
Commercial and industrial ("C&I")	1		456		456
Other loans	-		-		-
Total	2	$	506	$	506

Loan payment deferrals due to COVID-19

Consistent with regulatory guidance to work with borrowers during the unprecedented situation caused by the COVID-19 pandemic and as outlined in the CARES Act, the Company established a formal payment deferral program in April 2020 for borrowers that have been adversely affected by the pandemic.

As of June 30, 2021, the Company had 25 loans, representing outstanding loan balances of $44.5 million, that were deferring both principal and interest (“P&I” deferrals).

The table below presents the P&I deferrals as of June 30, 2021:


	June 30, 2021
	Number
	of Loans	Balance⁽¹⁾		% of Portfolio
(Dollars in thousands)
One-to-four family residential and cooperative/condominium apartment	13	$	12,658	1.8	%
Multifamily residential and residential mixed-use	—		—	—
CRE	3		18,343	0.5
ADC	—		—	—
C&I	9		13,460	1.0
Total	25	$	44,461	0.5

(1)	Amount excludes net deferred costs due to immateriality.

Pursuant to guidance under Section 4013 of the CARES Act, a qualified loan modification, such as a payment deferral, is exempt from classification as a TDR as defined by GAAP. This applies if the loan was current as of December 31, 2019 and the modifications are related to arrangements that defer or delay the payment of principal or interest, or change the interest rate of the loan. This guidance was expected to expire on December 31, 2020. The 2021 Consolidated Appropriations Act, which was signed into law December of 2020, extended the exemption for TDR classification until the earlier of January 1, 2022 or the date that is 60 days after the date on which the national emergency concerning the COVID-19 outbreak is lifted.

Risk-ratings on COVID-19 loan deferrals are evaluated on an ongoing basis.

Credit Quality Indicators

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit structure, loan documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by

classifying them as to credit risk. This analysis includes all loans, such as multifamily residential, mixed-use residential (i.e., loans in which the aggregate rental income of the underlying collateral property is generated from both residential and commercial units, but 50% or more of such income is generated from the residential units), commercial real estate, mixed-use commercial real estate (i.e., loans in which the aggregate rental income of the underlying collateral property is generated from both residential and commercial units, but over 50% of such income is generated from the commercial units), ADC, C&I, as well as all one-to- four family residential and cooperative and condominium apartment loans. The Company uses the following definitions for risk ratings:

Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the Bank’s credit position at some future date.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of then existing facts, conditions, and values, highly questionable and improbable. All real estate and C&I loans not classified as Special Mention, Substandard, or Doubtful were deemed pass loans at both June 30, 2021 and December 31, 2020.

For the three and six months ended June 30, 2021, there were $50.7 million and $54.6 million of sales of criticized loans, respectively. For the six months ended June 30, 2020, there were $7.1 million of sales of criticized loans. There were no sales of criticized loans for the three months ended June 30, 2020.

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


	June 30, 2021
(In thousands)	2021		2020		2019		2018		2017		2016 and Prior		Revolving		Revolving-Term		Total
One-to-four family residential, and condominium/cooperative apartment:
Pass	$	86,022	$	100,125	$	90,239	$	91,137	$	89,074	$	160,866	$	55,128	$	11,691	$	684,282
Special mention		—		—		379		915		355		5,299		847		1,098		8,893
Substandard		—		—		1,083		589		742		7,887		—		1,013		11,314
Doubtful		—		—		—		—		—		—		—		—		—
Total one-to-four family residential, and condominium/cooperative apartment		86,022		100,125		91,701		92,641		90,171		174,052		55,975		13,802		704,489

Multifamily residential and residential mixed-use:
Pass		234,199		362,014		516,988		226,705		407,607		1,529,746		5,339		—		3,282,598
Special mention		—		—		—		—		18,329		14,244		—		—		32,573
Substandard		—		—		35,421		27,250		29,323		92,612		3,428		—		188,034
Doubtful		—		—		—		—		—		—		—		—		—
Total multifamily residential and residential mixed-use		234,199		362,014		552,409		253,955		455,259		1,636,602		8,767		—		3,503,205

CRE:
Pass		410,562		865,541		590,972		351,435		365,870		912,770		39,993		4,986		3,542,129
Special mention		—		4,229		1,673		4,851		11,190		11,444		—		—		33,387
Substandard		—		1,046		5,502		42,437		23,532		33,298		—		—		105,815
Doubtful		—		—		—		—		—		—		—		—		—
Total CRE		410,562		870,816		598,147		398,723		400,592		957,512		39,993		4,986		3,681,331

ADC:
Pass		61,748		60,895		81,000		43,906		8,807		1,279		17,538		613		275,786
Special mention		—		—		—		1,078		—		—		—		—		1,078
Substandard		—		—		—		13,500		—		98		—		—		13,598
Doubtful		—		—		—		—		—		—		—		—		—
Total ADC		61,748		60,895		81,000		58,484		8,807		1,377		17,538		613		290,462

C&I:
Pass		41,557		549,694		63,141		60,724		40,088		29,378		466,245		7,067		1,257,894
Special mention		—		3,515		291		2,241		643		116		6,127		2,637		15,570
Substandard		—		4,557		14,419		6,698		3,185		1,171		22,780		4,585		57,395
Doubtful		—		—		197		752		11,929		132		—		—		13,010
Total C&I		41,557		557,766		78,048		70,415		55,845		30,797		495,152		14,289		1,343,869

Total:
Pass		834,088		1,938,269		1,342,340		773,907		911,446		2,634,039		584,243		24,357		9,042,689
Special mention		—		7,744		2,343		9,085		30,517		31,103		6,974		3,735		91,501
Substandard		—		5,603		56,425		90,474		56,782		135,066		26,208		5,598		376,156
Doubtful		—		—		197		752		11,929		132		—		—		13,010
Total Loans	$	834,088	$	1,951,616	$	1,401,305	$	874,218	$	1,010,674	$	2,800,340	$	617,425	$	33,690	$	9,523,356


	December 31, 2020
			Special
(In thousands)	Pass		Mention		Substandard		Doubtful		Total
Real Estate:
One-to-four family residential and condominium/cooperative apartment	$	183,293	$	—	$	1,696	$	—	$	184,989
Multifamily residential and residential mixed-use		2,523,258		56,400		179,085		—		2,758,743
CRE		1,831,712		13,861		32,594		—		1,878,167
ADC		142,796		13,500		—		—		156,296
Total real estate		4,681,059		83,761		213,375		—		4,978,195
C&I		613,691		2,131		13,315		12,396		641,533
Total Real Estate and C&I	$	5,294,750	$	85,892	$	226,690	$	12,396	$	5,619,728

For other loans, the Company evaluates credit quality based on payment activity. Other loans that are 90 days or more past due are placed on non-accrual status, while all remaining other loans are classified and evaluated as performing. The following is a summary of the credit risk profile of other loans by internally assigned grade:


(In thousands)	June 30, 2021		December 31, 2020
Performing	$	23,183	$	2,315
Non-accrual		92		1
Total	$	23,275	$	2,316