The Company adopted ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, effective January 1, 2021. The guidance replaces the incurred loss methodology with an expected loss methodology that is referred to as the CECL methodology. The measurement of expected credit losses under the CECL methodology is applicable to financial assets measured at amortized cost, including loan receivables. It also applies to off-balance sheet credit exposures not accounted for as insurance, including loan commitments, standby letters of credits, financial guarantees, and other similar instruments. The Company adopted ASC 326 using the modified retrospective method for loans and off-balance sheet credit exposures. The Company recorded a one-time cumulative-effect adjustment to the allowance for credit losses of $11.6 million.

This adjustment brought the balance of the allowance for credit losses to $67.3 million as of January 1, 2021. In addition, the Company recorded an $8.7 million liability for unfunded commitments as of January 1, 2021. The after-tax effect decreased retained earnings by $14.2 million. The adjustment was based upon the Company’s analysis of current conditions, assumptions and economic forecasts at January 1, 2021.

The Company adopted ASC 326 using the prospective transition approach for financial assets purchased with credit deterioration (PCD) that were previously classified as purchased credit impaired (PCI) and accounted for under ASC 310-30. In accordance with the standard, management did not reassess whether PCI assets met the criteria of PCD assets as of the date of adoption. On January 1, 2021, the amortized cost basis of the PCD assets were adjusted to reflect the addition of $1.9 million of the allowance for credit losses.

Results for reporting periods after December 31, 2020 are presented under ASC 326 while prior period amounts continue to be reported in accordance with previously applicable GAAP. Under the incurred loss model, the Company delayed recognition of losses until it was probable that a loss was incurred. The allowance for loan losses was established as losses were estimated to have occurred through a provision for loan losses charged to earnings. Loan losses were charged against the allowance when management believed the uncollectability of a loan balance was confirmed. The allowance for loan losses was evaluated on a regular basis by management and was based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. The allowance consisted of allocated and general components. The allocated component relates to loans that are classified as impaired. For loans classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers non-classified loans and is based on historical charge-off experience and expected loss given default derived from the Company’s internal risk rating process. Results for reporting periods after December 31, 2020 include loans acquired and accounted for under ASC 310-30 net of discount within the loan classes, while for reporting periods prior to January 1, 2021 the loans acquired and accounted for under ASC 310-30 are separate.

Beginning on January 1, 2021, the allowance for credit losses is measured using an average historical loss model which incorporates relevant information about past events (including historical credit loss experience on loans with similar risk characteristics), current conditions, and reasonable and supportable forecasts that affect the collectability of the remaining cash flows over the contractual term of the loans. The allowance for credit losses is measured on a collective (pool) basis. Loans are aggregated into pools based on similar risk characteristics including borrower type, collateral and repayment types and expected credit loss patterns. Loans that do not share similar risk characteristics, primarily classified and/or TDR loans with a balance greater than or equal to $100,000, are evaluated on an individual basis.

For loans evaluated for credit losses on a collective basis, average historical loss rates are calculated for each pool using the Company’s historical net charge-offs (combined charge-offs and recoveries by observable historical reporting period) and outstanding loan balances during a lookback period. Lookback periods can be different based on the individual pool and represent management’s credit expectations for the pool of loans over the remaining contractual life. In certain loan pools, if the Company’s own historical loss rate is not reflective of the loss expectations, the historical loss rate is augmented by industry and peer data. The calculated average net charge-off rate is then adjusted for current conditions and reasonable and supportable forecasts. These adjustments increase or decrease the average historical loss rate to reflect expectations of future losses given economic forecasts of key macroeconomic variables including, but not limited to, unemployment rate, GDP, disposable income and market volatility. The adjustments are based on results from various regression models projecting the impact of the macroeconomic variables to loss rates. The forecast is used for a reasonable and supportable period before reverting to historical averages using a straight-line method. The forecast-adjusted loss rate is applied to the amortized cost of loans over the remaining contractual lives, adjusted for expected prepayments. The contractual term excludes expected extensions, renewals and modifications unless there is a reasonable expectation that a troubled debt restructuring will be executed. Additionally, the allowance for credit losses considers other qualitative factors not included in historical loss rates or macroeconomic forecasts such as changes in portfolio composition, underwriting practices, or significant unique events or conditions.

ASU 2016-13 requires an allowance for off balance sheet credit exposures; unfunded lines of credit, undisbursed portions of loans, written residential and commercial commitments, and letters of credit. To determine the amount needed for allowance purposes, a utilization rate is determined either by the model or internally for each pool. Our loss model calculates the reserve on unfunded commitments based upon the utilization rate multiplied by the average loss rate factors in each pool with unfunded and committed balances. The liability for unfunded lending commitments utilizes the same model as the allowance for credit losses on loans; however, the liability for unfunded lending commitments incorporates assumptions for the portion of unfunded commitments that are expected to be funded.

(1)

Loans acquired and accounted for under ASC 310-30 of $91.9 million have been included in the totals by loan class as of March 31, 2021. At the date of CECL adoption, the Company did not reassess whether purchased credit impaired loans met the criteria of purchased credit deteriorated loans.

The following tables present the classes of loans by aging. Loans acquired and accounted for under ASC 310-30 of $91.9 million have been included in the totals by loan class as of March 31, 2021.


	March 31, 2021
													Total Loans
					Over 90						Total		> 90 Days Past
	30-59 Days		60-89 Days		Days		Total Past				Loans		Due and
	Past Due		Past Due		Past Due		Due		Current		Receivable		Still Accruing

	(In Thousands)
One- to four-family residential construction	$	249	$	—	$	—	$	249	$	47,912	$	48,161	$	—
Subdivision construction		—		—		—		—		7,297		7,297		—
Land development		14		—		622		636		53,954		54,590		—
Commercial construction		—		—		—		—		1,206,687		1,206,687		—
Owner occupied one- to four-family residential		2,017		252		4,111		6,380		503,963		510,343		—
Non-owner occupied one- to four-family residential		—		—		112		112		130,497		130,609		—
Commercial real estate		302		—		3,394		3,696		1,585,075		1,588,771		—
Other residential		—		—		185		185		1,055,210		1,055,395		—
Commercial business		83		—		106		189		372,344		372,533		—
Industrial revenue bonds		944		—		—		944		13,615		14,559		—
Consumer auto		145		30		106		281		73,370		73,651		—
Consumer other		117		25		100		242		39,482		39,724		—
Home equity lines of credit		40		63		810		913		112,881		113,794		—

		3,911		370		9,546		13,827		5,202,287		5,216,114		—
Less: FDIC-acquired loans		2,133		109		3,576		5,818		86,116		91,934		—
Total	$	1,778	$	261	$	5,970	$	8,009	$	5,116,171	$	5,124,180	$	—


	December 31, 2020
													Total Loans
					Over 90						Total		> 90 Days Past
	30-59 Days		60-89 Days		Days		Total Past				Loans		Due and
	Past Due		Past Due		Past Due		Due		Current		Receivable		Still Accruing

	(In Thousands)
One- to four-family residential construction	$	1,365	$	—	$	—	$	1,365	$	41,428	$	42,793	$	—
Subdivision construction		—		—		—		—		30,894		30,894		—
Land development		20		—		—		20		53,990		54,010		—
Commercial construction		—		—		—		—		1,212,837		1,212,837		—
Owner occupied one- to four-family residential		1,379		113		1,502		2,994		467,442		470,436		—
Non-owner occupied one- to four-family residential		—		—		69		69		114,500		114,569		—
Commercial real estate		—		79		587		666		1,553,011		1,553,677		—
Other residential		—		—		—		—		1,021,145		1,021,145		—
Commercial business		—		—		114		114		370,784		370,898		—
Industrial revenue bonds		—		—		—		—		14,003		14,003		—
Consumer auto		364		119		169		652		85,521		86,173		—
Consumer other		443		7		94		544		40,218		40,762		—
Home equity lines of credit		153		111		508		772		113,917		114,689		—
Loans acquired and accounted for under ASC 310-30, net of discounts		1,662		641		3,843		6,146		92,497		98,643		—

		5,386		1,070		6,886		13,342		5,212,187		5,225,529		—
Less: Loans acquired and accounted for under ASC 310-30, net of discounts		1,662		641		3,843		6,146		92,497		98,643		—

Total	$	3,724	$	429	$	3,043	$	7,196	$	5,119,690	$	5,126,886	$	—

Loans are placed on nonaccrual status at 90 days past due and interest is considered a loss unless the loan is well secured and in the process of collection. Payments received on nonaccrual loans are applied to principal until the loans are returned to accrual status. Loans are returned to accrual status when all payments contractually due are brought current, payment performance is sustained for a period of time, generally six months, and future payments are reasonably assured. With the exception of consumer loans, charge-offs on loans are recorded when available information indicates a loan is not fully collectible and the loss is reasonably quantifiable. Consumer loans are charged-off at specified delinquency dates consistent with regulatory guidelines.

Non-accruing loans as of December 31, 2020 shown below exclude $3.8 million in loans acquired and accounted for under ASC 310-30, while the non-accruing loans as of March 31, 2021 include $3.6 million in the loans acquired through various FDIC-assisted transactions in the loan classes listed.


	March 31,		December 31,
	2021		2020

	(In Thousands)

One- to four-family residential construction	$	—	$	—
Subdivision construction		—		—
Land development		622		—
Commercial construction		—		—
Owner occupied one- to four-family residential		4,111		1,502
Non-owner occupied one- to four-family residential		112		69
Commercial real estate		3,394		587
Other residential		185		—
Commercial business		106		114
Industrial revenue bonds		—		—
Consumer auto		106		169
Consumer other		100		94
Home equity lines of credit		810		508
Total non-accruing loans		9,546
Less: FDIC-acquired loans		3,576

Total non-accruing loans net of FDIC-acquired loans	$	5,970	$	3,043

No interest income was recorded on these loans for the three months ended March 31, 2021 and 2020, respectively.

Nonaccrual loans for which there is no related allowance for credit losses as of March 31, 2021 had an amortized cost of $3.5 million. These loans are individually assessed and do not hold an allowance due to being adequately collateralized under the collateral-dependent valuation method. A collateral-dependent loan is a financial asset for which the repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty based on the Company’s assessment as of the reporting date. Collateral-dependent loans are identified by either a classified risk rating or TDR status and a loan balance equal to or greater than $100,000, including, but not limited to, any loan in process of foreclosure or repossession.

The following table presents the activity in the allowance for credit losses by portfolio segment for the three months ended March 31, 2021. On January 1, 2021, the Company adopted the CECL methodology, which added $11.6 million to the total Allowance for Credit Loss, which included $1.9 million remaining discount on loans that were previously accounted for as purchased credit impaired. Under the CECL methodology, the Company recorded a $300,000 provision for credit losses on loans during the three months ended

March 31, 2021, compared to a $3.9 million provision for loan losses in the three months ended March 31, 2020, under the incurred loss method.


	One- to Four-
	Family
	Residential and		Other		Commercial		Commercial		Commercial
	Construction		Residential		Real Estate		Construction		Business		Consumer		Total

	(In Thousands)
Allowance for credit losses
Balance, December 31, 2020	$	4,536	$	9,375	$	33,707	$	3,521	$	2,390	$	2,214	$	55,743
CECL adoption		4,533		5,832		(2,531)		(1,165)		1,499		3,427		11,595
Balance, January 1, 2021		9,069		15,207		31,176		2,356		3,889		5,641		67,338

Provision charged to expense		—		—		300		—		—		—		300
Losses charged off		(6)		—		—		—		—		(649)		(655)
Recoveries		38		92		24		10		47		508		719
Balance, March 31, 2021	$	9,101	$	15,299	$	31,500	$	2,366	$	3,936	$	5,500	$	67,702

The following table presents the activity in the allowance for unfunded commitments by portfolio segment for the three months ended March 31, 2021. On January 1, 2021, the Company adopted the CECL methodology, which created an $8.7 million allowance for unfunded commitments. Under the CECL methodology, the Company recorded a $674,000 benefit for unfunded loan commitments during the three months ended March 31, 2021.


	One- to Four-
	Family
	Residential and		Other		Commercial		Commercial		Commercial
	Construction		Residential		Real Estate		Construction		Business		Consumer		Total

	(In Thousands)
Allowance for unfunded commitments
Balance, December 31, 2020	$	—	$	—	$	—	$	—	$	—	$	—	$	—
CECL adoption		917		5,227		354		910		935		347		8,690
Balance, January 1, 2021		917		5,227		354		910		935		347		8,690

Provision (benefit) charged to expense		40		(412)		103		(400)		21		(25)		(673)
Balance, March 31, 2021	$	957	$	4,815	$	457	$	510	$	956	$	322	$	8,017

The following table presents the activity in the allowance for loan losses by portfolio segment for the three months ended March 31, 2020, prepared using the previous GAAP incurred loss method prior to the adoption of ASU 2016-13.


	One- to Four-
	Family
	Residential and		Other		Commercial		Commercial		Commercial
	Construction		Residential		Real Estate		Construction		Business		Consumer		Total

	(In Thousands)
Balance January 1, 2020	$	4,339	$	5,153	$	24,334	$	3,076	$	1,355	$	2,037	$	40,294
Provision (benefit) charged to expense		394		879		1,549		(867)		169		1,747		3,871
Losses charged off		(29)		—		—		(1)		(9)		(1,106)		(1,145)
Recoveries		35		114		40		13		64		642		908
Balance March 31, 2020	$	4,739	$	6,146	$	25,923	$	2,221	$	1,579	$	3,320	$	43,928

The following table presents the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of December 31, 2020, prepared using the previous GAAP incurred loss method prior to the adoption of ASU 2016-13.


	One- to Four-
	Family
	Residential and		Other		Commercial		Commercial		Commercial
	Construction		Residential		Real Estate		Construction		Business		Consumer		Total

	(In Thousands)
Allowance for loan losses
Individually evaluated for impairment	$	90	$	—	$	445	$	—	$	14	$	164	$	713
Collectively evaluated for impairment	$	4,382	$	9,282	$	32,937	$	3,378	$	2,331	$	2,040	$	54,350
Loans acquired and accounted for under ASC 310-30	$	64	$	93	$	325	$	143	$	45	$	10	$	680

Loans
Individually evaluated for impairment	$	3,546	$	—	$	3,438	$	—	$	167	$	1,897	$	9,048
Collectively evaluated for impairment	$	655,146	$	1,021,145	$	1,550,239	$	1,266,847	$	384,734	$	239,727	$	5,117,838
Loans acquired and accounted for under ASC 310-30	$	57,113	$	6,150	$	24,613	$	2,551	$	2,549	$	5,667	$	98,643

The portfolio segments used in the preceding tables correspond to the loan classes used in all other tables in Note 6 as follows:

●

The one- to four-family residential and construction segment includes the one- to four-family residential construction, subdivision construction, owner occupied one- to four-family residential and non-owner occupied one- to four-family residential classes.

●

The other residential segment corresponds to the other residential class.

●

The commercial real estate segment includes the commercial real estate and industrial revenue bonds classes.

●

The commercial construction segment includes the land development and commercial construction classes.

●

The commercial business segment corresponds to the commercial business class.

●

The consumer segment includes the consumer auto, consumer other and home equity lines of credit classes.

The following table presents the amortized cost basis of collateral-dependent loans by class of loans as of March 31, 2021:


	March 31, 2021
	Principal		Specific
	Balance		Allowance

	(In Thousands)
One- to four-family residential construction	$	—	$	—
Subdivision construction		—		—
Land development		622		367
Commercial construction		—		—
Owner occupied one- to four- family residential		3,950		73
Non-owner occupied one- to four-family residential		—		—
Commercial real estate		5,752		1,617
Other residential		185		—
Commercial business		—		—
Industrial revenue bonds		—		—
Consumer auto		—		—
Consumer other		—		—
Home equity lines of credit		393		—

Total	$	10,902	$	2,057

The following table presents information pertaining to impaired loans as of December 31, 2020, in accordance with previous GAAP prior to the adoption of ASU 2016-13. A loan is considered impaired, in accordance with the impairment accounting guidance (FASB ASC 310-10-35-16), when based on current information and events, it is probable the Company will be unable to collect all amounts

due from the borrower in accordance with the contractual terms of the loan. Impaired loans include not only nonperforming loans but also include loans modified in troubled debt restructurings where concessions have been granted to borrowers experiencing financial difficulties.


	At or for the Year Ended December 31, 2020
							Average
			Unpaid				Investment		Interest
	Recorded		Principal		Specific		in Impaired		Income
	Balance		Balance		Allowance		Loans		Recognized

	(In Thousands)
One- to four-family residential construction	$	—	$	—	$	—	$	—	$	—
Subdivision construction		20		20		—		115		3
Land development		—		—		—		—		—
Commercial construction		—		—		—		—		—
Owner occupied one- to four- family residential		3,457		3,776		90		2,999		169
Non-owner occupied one- to four-family residential		69		106		—		309		18
Commercial real estate		3,438		3,472		445		3,736		135
Other residential		—		—		—		—		—
Commercial business		166		551		14		800		34
Industrial revenue bonds		—		—		—		—		—
Consumer auto		865		964		140		932		91
Consumer other		403		552		19		298		47
Home equity lines of credit		630		668		5		550		36

Total	$	9,048	$	10,109	$	713	$	9,739	$	533


	At or for the Three Months Ended March 31, 2020
							Average
			Unpaid				Investment		Interest
	Recorded		Principal		Specific		in Impaired		Income
	Balance		Balance		Allowance		Loans		Recognized

	(In Thousands)
One- to four-family residential construction	$	—	$	—	$	—	$	—	$	—
Subdivision construction		246		246		93		247		2
Land development		—		—		—		—		—
Commercial construction		—		—		—		—		—
Owner occupied one- to four- family residential		2,929		3,214		79		2,522		46
Non-owner occupied one- to four-family residential		494		694		18		433		6
Commercial real estate		4,109		4,143		506		4,122		30
Other residential		—		—		—		—		—
Commercial business		1,238		1,736		10		1,263		16
Industrial revenue bonds		—		—		—		—		—
Consumer auto		1,030		1,253		167		1,078		26
Consumer other		281		441		13		287		10
Home equity lines of credit		475		499		4		577		12

Total	$	10,802	$	12,226	$	890	$	10,529	$	148

At December 31, 2020, $4.8 million of impaired loans had specific valuation allowances totaling $713,000.

Troubled debt restructurings (“TDRs”) by class is presented below as of March 31, 2021 and December 31, 2020. The December 31, 2020 table excludes $1.7 million of FDIC-acquired loans accounted for under ASC 310-30, while the March 31, 2021 table includes the loans acquired through various FDIC-assisted transactions in the loan classes listed.


	March 31, 2021
	Accruing TDR Loans			Non-accruing TDR Loans			Total TDR Loans
	Number	Balance		Number	Balance		Number	Balance

	(In Thousands)
Construction and land development	1	$	18	—	$	—	1	$	18
One- to four-family residential	6		382	13		1,266	19		1,648
Other residential	—		—	—		—	—		—
Commercial real estate	1		1,768	1		88	2		1,856
Commercial business	—		—	1		67	1		67
Consumer	31		338	19		83	50		421
	39	$	2,506	34	$	1,504	73	$	4,010


	December 31, 2020
	Restructured
	Troubled Debt		Accruing		Restructured
	Non-accruing		Interest		Troubled Debt

	(In Thousands)
Commercial real estate	$	—	$	646	$	646
One- to four-family residential		778		1,121		1,899
Other residential		—		—		—
Construction		—		20		20
Commercial		75		52		127
Consumer		118		511		629
	$	971	$	2,350	$	3,321

The following tables present newly restructured loans, which were considered TDRs, during the three months ended March 31, 2021 and 2020, respectively, by type of modification:


	Three Months Ended March 31, 2021
							Total
	Interest Only		Term		Combination		Modification

	(In Thousands)
Commercial Real Estate	$	1,768	$	—	$	—	$	1,768
Consumer		—		21		—		21
	$	1,768	$	21	$	—	$	1,789


	Three Months Ended March 31, 2020
							Total
	Interest Only		Term		Combination		Modification

	(In Thousands)
One- to four-family residential	$	—	$	—	$	130	$	130
Consumer		—		—		48		48
	$	—	$	—	$	178	$	178

At March 31, 2021, of the $4.0 million in TDRs, $3.3 million were classified as substandard using the Company’s internal grading system, which is described below. The Company had no TDRs that were modified in the previous 12 months and subsequently defaulted during the three months ended March 31, 2021.

At December 31, 2020, of the $3.3 million in TDRs, $1.6 million were classified as substandard using the Company’s internal grading system. The Company had no TDRs that were modified in the previous 12 months and subsequently defaulted during the year ended December 31, 2020.

During the three months ended March 31, 2021, there were four loans designated as TDRs, totaling $27,000, which met the criteria for placement back on accrual status. The criteria are generally a minimum of six months of consistent and timely payment performance under original or modified terms. During the three months ended March 31, 2020, there were no loans designated as TDRs that met the criteria for placement back on accrual status.

In addition to the above loans considered TDRs, at March 31, 2021, the Company had remaining 19 modified commercial loans with an aggregate principal balance outstanding of $141 million and 92 modified consumer and mortgage loans with an aggregate principal balance outstanding of $5 million. At March 31, 2021, the largest total modified loans by collateral type were in the following categories: hotel/motel - $69 million; healthcare - $28 million; retail - $22 million; multifamily - $11 million.

At December 31, 2020, the Company had remaining 65 modified commercial loans with an aggregate principal balance outstanding of $233 million and 581 modified consumer and mortgage loans with an aggregate principal balance outstanding of $18 million.

The loan modifications are within the guidance provided by the CARES Act and subsequent legislation, the federal banking regulatory agencies, the SEC and the FASB; therefore, they are not considered troubled debt restructurings. A portion of the loans modified at March 31, 2021, may be further modified, and new loans may be modified, within the guidance provided by the CARES Act (and subsequent legislation enacted in December 2020), the federal banking regulatory agencies, the SEC and the FASB if a more severe or lengthier deterioration in economic conditions occurs in future periods.

The Company utilizes an internal risk rating system comprised of a series of grades to categorize loans according to perceived risk associated with the expectation of debt repayment. The analysis of the borrower’s ability to repay considers specific information, including but not limited to current financial information, historical payment experience, industry information, collateral levels and collateral types. A risk rating is assigned at loan origination and then monitored throughout the contractual term for possible risk rating changes.

Satisfactory loans range from Excellent to Moderate Risk, but generally are loans supported by strong recent financial statements. Character and capacity of individuals or company are strong, including reasonable project performance, good industry experience, liquidity and/or net worth of individuals or company. Probability of financial deterioration seems unlikely. Repayment is expected from approved sources over a reasonable period of time.

Watch loans are identified when the borrower has capacity to perform according to terms; however, elements of uncertainty exist. Margins of debt service coverage may be narrow, historical patterns of financial performance may be erratic, collateral margins may be diminished and the borrower may be a new and/or thinly capitalized company. Some management weakness may also exist, the borrowers may have somewhat limited access to other financial institutions, and that ability may diminish in difficult economic times.

Special Mention loans have weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of repayment prospects or the Bank's credit position at some future date. It is a transitional grade that is closely monitored for improvement or deterioration.

The Substandard rating is applied to loans where the borrower exhibits well-defined weaknesses that jeopardize its continued performance and are of a severity that the distinct possibility of default exists. Loans are placed on “non-accrual” when management does not expect to collect payments consistent with acceptable and agreed upon terms of repayment.

Doubtful loans have all the weaknesses inherent to those classified Substandard with the added characteristics that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, highly questionable and improbable. Loans considered loss are uncollectable and no longer included as an asset.

All loans are analyzed for risk rating updates regularly. For larger loans, rating assessments may be more frequent if relevant information is obtained earlier through debt covenant monitoring or overall relationship management. Smaller loans are monitored as identified by the loan officer based on the risk profile of the individual borrower or if the loan becomes past due related to credit issues. Loans rated Watch, Special Mention, Substandard or Doubtful are subject to quarterly review and monitoring processes. In addition to the regular monitoring performed by the lending personnel and credit committees, loans are subject to review by the credit review department, which verifies the appropriateness of the risk ratings for the loans chosen as part of its risk-based review plan.

The following tables present a summary of loans by risk category and past due status separated by origination and loan class as of March 31, 2021. The March 31, 2021 table was prepared using the CECL methodology and includes $91.9 million in FDIC-assisted acquired loans included in the loan class categories. The remaining accretable discount of $1.3 million has not been included in this table. See Note 7 for further discussion of the FDIC-acquired loans and related discount. The December 31, 2020 table was prepared using the previous GAAP incurred loss methodology prior to the adoption of ASU 2016-13. The $98.6 million in FDIC-assisted acquired loans are shown as a total, not within the loan class categories.


	Term Loans by Origination Year
													Revolving
	2021 YTD		2020		2019		2018		2017		Prior		Loans		Total

	(In Thousands)
One- to four-family residential construction
Satisfactory (1‑4)	$	1,938	$	17,826	$	1,265	$	—	$	—	$	6	$	230	$	21,265
Watch (5)		—		—		1,364		—		—		—		—		1,364
Special Mention (6)		—		—		—		—		—		—		—		—
Classified (7‑9)		—		—		—		—		—		—		—		—
Total		1,938		17,826		2,629		—		—		6		230		22,629

Subdivision construction
Satisfactory (1‑4)		124		1,270		364		302		1,033		1,346		—		4,439
Watch (5)		—		—		—		—		—		—		—		—
Special Mention (6)		—		—		—		—		—		—		—		—
Classified (7‑9)		—		—		—		—		—		18		—		18
Total		124		1,270		364		302		1,033		1,364		—		4,457

Land development construction
Satisfactory (1‑4)		1,756		22,678		10,850		5,110		3,623		8,493		1,463		53,973
Watch (5)		—		—		—		—		—		—		—		—
Special Mention (6)		—		—		—		—		—		—		—		—
Classified (7‑9)		—		—		—		—		—		—		622		622
Total		1,756		22,678		10,850		5,110		3,623		8,493		2,085		54,595

Other Construction
Satisfactory (1‑4)		20,302		138,048		198,014		117,966		338		—		—		474,668
Watch (5)		—		—		—		—		—		—		—		—
Special Mention (6)		—		—		—		—		—		—		—		—
Classified (7‑9)		—		—		—		—		—		—		—		—
Total		20,302		138,048		198,014		117,966		338		—		—		474,668

One- to four-family residential
Satisfactory (1‑4)		52,744		206,419		127,958		82,345		16,902		150,571		1,690		638,629
Watch (5)		—		—		—		134		—		228		77		439
Special Mention (6)		—		—		—		—		—		—		—		—
Classified (7‑9)		—		—		138		—		200		2,046		110		2,494
Total		52,744		206,419		128,096		82,479		17,102		152,845		1,877		641,562

Other residential
Satisfactory (1‑4)		9,227		83,544		176,111		388,986		241,625		126,407		3,718		1,029,618
Watch (5)		—		—		—		—		—		3,490		—		3,490
Special Mention (6)		—		—		—		—		—		—		—		—
Classified (7‑9)		—		—		—		—		—		—		—		—
Total		9,227		83,544		176,111		388,986		241,625		129,897		3,718		1,033,108

Commercial real estate
Satisfactory (1‑4)		10,906		130,305		226,502		240,367		242,150		659,242		19,838		1,529,310
Watch (5)		—		—		—		—		11,555		21,856		595		34,006
Special Mention (6)		—		—		—		—		—		—		—		—
Classified (7‑9)		—		—		—		—		—		5,428		—		5,428
Total		10,906		130,305		226,502		240,367		253,705		686,526		20,433		1,568,744

Commercial business
Satisfactory (1‑4)		58,669		80,786		26,780		25,359		25,903		65,918		49,485		332,900
Watch (5)		—		—		—		2,626		14		2,775		11		5,426
Special Mention (6)		—		—		—		—		—		—		—		—
Classified (7‑9)		—		—		—		—		—		67		40		107
Total		58,669		80,786		26,780		27,985		25,917		68,760		49,536		338,433

Consumer
Satisfactory (1‑4)		5,822		17,926		13,028		17,351		8,692		39,086		124,413		226,318
Watch (5)		—		12		—		24		3		45		31		115
Special Mention (6)		—		—		—		—		—		—		—		—
Classified (7‑9)		—		4		12		61		48		435		471		1,031
Total		5,822		17,942		13,040		17,436		8,743		39,566		124,915		227,464

Combined
Satisfactory (1‑4)		161,488		698,802		780,872		877,786		540,266		1,051,069		200,837		4,311,120
Watch (5)		—		12		1,364		2,784		11,572		28,394		714		44,840
Special Mention (6)		—		—		—		—		—		—		—		—
Classified (7‑9)		—		4		150		61		248		7,994		1,243		9,700
Total	$	161,488	$	698,818	$	782,386	$	880,631	$	552,086	$	1,087,457	$	202,794	$	4,365,660


	December 31, 2020
					Special
	Satisfactory		Watch		Mention		Substandard		Doubtful		Total

	(In Thousands)
One- to four-family residential construction	$	41,428	$	1,365	$	—	$	—	$	—	$	42,793
Subdivision construction		30,874		—		—		20		—		30,894
Land development		54,010		—		—		—		—		54,010
Commercial construction		1,212,837		—		—		—		—		1,212,837
Owner occupied one- to-four-family residential		467,855		216		—		2,365		—		470,436
Non-owner occupied one- to-four-family residential		114,176		324		—		69		—		114,569
Commercial real estate		1,498,031		52,208		—		3,438		—		1,553,677
Other residential		1,017,648		3,497		—		—		—		1,021,145
Commercial business		363,681		7,102		—		115		—		370,898
Industrial revenue bonds		14,003		—		—		—		—		14,003
Consumer auto		85,657		5		—		511		—		86,173
Consumer other		40,514		2		—		246		—		40,762
Home equity lines of credit		114,049		39		—		601		—		114,689
Loans acquired and accounted for under ASC 310‑30, net of discounts		98,633		—		—		10		—		98,643

Total	$	5,153,396	$	64,758	$	—	$	7,375	$	—	$	5,225,529