Note 5 - Loans

12 Months Ended

Dec. 31, 2022

Notes to Financial Statements

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

5.         Loans

Most of the Company’s business activities are with clients located in the high-density Asian-populated areas of Southern and Northern California; New York City, New York; Houston and Dallas, Texas; Seattle, Washington; Boston, Massachusetts; Chicago, Illinois; Edison, New Jersey; Rockville, Maryland; and Las Vegas, Nevada. The Company also has loan clients in Hong Kong. The Company has no specific industry concentration, and generally its loans, when secured, are secured by real property or other collateral of the borrowers. The Company generally expects loans to be paid off from the operating profits of the borrowers, from refinancing by another lender, or through sale by the borrowers of the secured collateral.

The following table presents the composition of the Company’s loans as of December 31, 2022, and 2021, were as follows:

	As of December 31,
	2022			2021
	(In thousands)
Loans:
Commercial loans	$	3,318,778		$	2,982,399
Real estate construction loans		559,372			611,031
Commercial mortgage loans		8,793,685			8,143,272
Residential mortgage loans		5,252,952			4,182,006
Equity lines		324,548			419,487
Installment and other loans		4,689			4,284
Gross loans		18,254,024			16,342,479
Less:
Allowance for loan losses		(146,485	)		(136,157	)
Unamortized deferred loan fees		(6,641	)		(4,321	)
Total loans, net	$	18,100,898		$	16,202,001

The Company pledged real estate loans of $13.07 billion as of December 31, 2022, and $11.54 billion as of December 31, 2021, to the Federal Home Loan Bank of San Francisco under its blanket lien pledging program. The Company pledged commercial loans of $583 thousand as of December 31, 2022, and $773 thousand as of December 31, 2021, to the Federal Reserve Bank’s Discount Window under the Borrower-in-Custody program.

Loans serviced for others as of December 31, 2022, totaled $181.4 million and were comprised of $80.2 million of residential mortgages, $51.6 million of commercial real estate loans, $2.5 million of construction loans, and $47.1 million of commercial loans. As of December 31, 2021, loans serviced for others, totaled $141.5 million and were comprised of $92.1 million of residential mortgages, $17.0 million of commercial real estate loans, $30.1 million of construction loans and $2.3 million of commercial loans.

The Company has entered into transactions with its directors, executive officers, or principal holders of its equity securities, or the associates of such persons (“Related Parties”). All loans to Related Parties were current as of December 31, 2022 and 2021. An analysis of the activity with respect to loans to Related Parties for the years indicated is as follows:

	December 31,
	2022			2021
	(In thousands)
Balance at beginning of year	$	38,532		$	51,288
Additional loans made		25,050			29,182
Payment received		(30,365	)		(41,938	)
Balance at end of year	$	33,217		$	38,532

As of December 31, 2022, recorded investment in non-accrual loans totaled $68.9 million. As of December 31, 2021, recorded investment in non-accrual loans totaled $65.8 million. The average balance of non-accrual loans was $71.4 million and $72.7 million as of December 31, 2022 and 2021, respectively. Interest recognized on non-accrual loans totaled $435 thousand, $1.1 million and $1.0 million for the years ended December 31, 2022, 2021 and 2020. For non-accrual loans, the amounts previously charged off represent 14.1% of the contractual balances for non-accrual loans as of December 31, 2022 and 10.7% as of December 31, 2021.

The following tables present the average balance and interest income recognized on non-accrual loans for the periods indicated:

	For the year ended December 31, 2022
	Average Recorded Investment		Interest Income Recognized
	(In thousands)
Commercial loans	$	28,109	$	4
Commercial mortgage loans		28,983		405
Residential mortgage and equity lines		14,251		26
Installment and other loans		28		—
Total	$	71,371	$	435

	For the year ended December 31, 2021
	Average Recorded Investment		Interest Income Recognized
	(In thousands)
Commercial loans	$	21,453	$	—
Real estate construction loans		3,805		—
Commercial mortgage loans		38,047		1,044
Residential mortgage and equity lines		9,435		30
Total	$	72,740	$	1,074

The following table presents non-accrual loans and the related allowance as of December 31, 2022 and 2021:

	As of December 31, 2022
	Unpaid Principal Balance		Recorded Investment		Allowance
	(In thousands)
With no allocated allowance:
Commercial loans	$	27,341	$	12,949	$	—
Commercial mortgage loans		37,697		32,205		—
Residential mortgage and equity lines		9,626		8,978		—
Installment and other loans		9		8		—
Subtotal	$	74,673	$	54,140	$	—
With allocated allowance:
Commercial loans	$	14,643	$	12,823	$	3,734
Commercial mortgage loans		1,896		1,891		207
Residential mortgage and equity lines		—		—		—
Subtotal	$	16,539	$	14,714	$	3,941
Total non-accrual loans	$	91,212	$	68,854	$	3,941

	As of December 31, 2021
	Unpaid Principal Balance		Recorded Investment		Allowance
	(In thousands)
With no allocated allowance:
Commercial loans	$	15,879	$	11,342	$	—
Commercial mortgage loans		24,437		21,209		—
Residential mortgage and equity lines		6,020		5,850		—
Subtotal	$	46,336	$	38,401	$	—
With allocated allowance:
Commercial loans	$	14,294	$	5,217	$	894
Commercial mortgage loans		17,930		16,964		3,631
Residential mortgage and equity lines		6,048		5,264		22
Subtotal	$	38,272	$	27,445	$	4,547
Total non-accrual loans	$	84,608	$	65,846	$	4,547

The following table is a summary of non-accrual loans as of December 31, 2022, 2021, and 2020 and the related net interest foregone for the years then ended:

	As of December 31,
	2022		2021		2020
	(In thousands)
Non-accrual portfolio loans	$	68,854	$	65,846	$	67,684
Contractual interest due		4,620		4,032		3,093
Interest recognized		435		1,074		1,008
Net interest foregone	$	4,185	$	2,958	$	2,085

The following tables present the aging of the loan portfolio by type as of December 31, 2022, and December 31, 2021:

	As of December 31, 2022
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Non-accrual Loans		Total Past Due		Loans Not Past Due		Total
Type of Loans:	(In thousands)
Commercial loans	$	8,192	$	3,235	$	10,208	$	25,772	$	47,407	$	3,271,371	$	3,318,778
Real estate construction loans		—		—		—		—		—		559,372		559,372
Commercial mortgage loans		25,772		—		1,372		34,096		61,240		8,732,445		8,793,685
Residential mortgage loans and equity lines		47,043		5,685		—		8,978		61,706		5,515,794		5,577,500
Installment and other loans		5		1		—		8		14		4,675		4,689
Total loans	$	81,012	$	8,921	$	11,580	$	68,854	$	170,367	$	18,083,657	$	18,254,024

	As of December 31, 2021
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Non-accrual Loans		Total Past Due		Loans Not Past Due		Total
Type of Loans:	(In thousands)
Commercial loans	$	4,294	$	9,877	$	1,439	$	16,558	$	32,168	$	2,950,231	$	2,982,399
Real estate construction loans		—		—		—		—		—		611,031		611,031
Commercial mortgage loans		8,389		—		—		38,173		46,562		8,096,710		8,143,272
Residential mortgage loans		20,129		3,138		—		11,115		34,382		4,567,111		4,601,493
Installment and other loans		—		—		—		—		—		4,284		4,284
Total loans	$	32,812	$	13,015	$	1,439	$	65,846	$	113,112	$	16,229,367	$	16,342,479

A TDR is a formal modification of the terms of a loan when the lender, for economic or legal reasons related to the borrower’s financial difficulties, grants a concession to the borrower. The concessions may be granted in various forms, including a change in the stated interest rate, a reduction in the loan balance or accrued interest, or an extension of the maturity date. Although these loan modifications are considered TDRs, TDR loans that have, pursuant to the Bank’s policy, performed under the restructured terms and have demonstrated sustained performance under the modified terms for six months are returned to accrual status. The sustained performance considered by management pursuant to its policy includes the periods prior to the modification if the prior performance met or exceeded the modified terms. This would include cash paid by the borrower prior to the restructure to set up interest reserves. Loans classified as TDRs are reported as individually evaluated loans.

The allowance for credit loss on a TDR is measured using the same method as all other loans held for investment, except when the value of a concession cannot be measured using a method other than the discounted cash flow method. When the value of a concession is measured using the discounted cash flow method, the allowance for credit loss is determined by discounting the expected future cash flows at the original interest rate of the loan.

The Company establishes a specific reserve for individually evaluated loans that do not share similar risk characteristics with the loans included in the quantitative baseline. These individually evaluated loans are removed from the pooling approach discussed in the “Basis of Presentation and Summary of Significant Accounting Policies” above, for the quantitative baseline, and include non-accrual loans, TDRs, and other loans as deemed appropriate by management. In addition, the Company individually evaluates “reasonably expected” TDRs, which are identified by the Company as a commercial loan expected to be classified as a TDR. Individually evaluated loans also includes “reasonably expected” TDRs, identified by the Company as a consumer loan for which a borrower’s application of loan modification due to hardship has been received by the Company. Management judgment is utilized to make this determination.

Although the Company took steps to incorporate the impact of the COVID-19 pandemic on the economic conditions and other factors utilized to determine the expected loan losses, if the economic conditions or other factors worsen relative to the assumptions the Company utilized, the expected loan losses will increase accordingly in future periods.

As of December 31, 2022, accruing TDRs were $15.1 million and non-accrual TDRs were $6.3 million compared to accruing TDRs of $12.8 million and non-accrual TDRs of $8.2 million as of December 31, 2021. The Company allocated zero in reserves to accruing TDRs and $427 thousand to non-accrual TDRs as of December 31, 2022, and seven thousand to accruing TDRs and three thousand to non-accrual TDRs as of December 31, 2021. The following table presents TDRs that were modified during 2022, their specific reserve as of December 31, 2022, and charge-offs during 2022:

	Loans Modified as TDRs During the Year Ended December 31, 2022
	No. of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Specific Reserve (1)		Charge-offs
	(Dollars in thousands)
Commercial loans		4	$	6,115	$	6,115	$	427	$	—
Commercial mortgage loans		3		3,676		3,669		—		—
Residential mortgage and equity lines		8		2,189		2,162		—		—
Total		15	$	11,980	$	11,946	$	427	$	—

(1) represents amounts recorded since the modification date.

The following table presents TDRs that were modified during 2021, their specific reserve as of December 31, 2021, and charge-offs during 2021:

	Loans Modified as TDRs During the Year Ended December 31, 2021
	No. of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Specific Reserve		Charge-offs
	(Dollars in thousands)
Commercial loans		3	$	2,150	$	2,150	$	—	$	—
Residential mortgage and equity lines		2		3		3		—		—
Total		5	$	2,153	$	2,153	$	—	$	—

The following table presents TDRs that were modified during 2020, their specific reserve as of December 31, 2020, and charge-offs during 2020:

	Loans Modified as TDRs During the Year Ended December 31, 2020
	No. of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Specific Reserve		Charge-off
	(Dollars in thousands)
Commercial loans		5	$	5,417	$	5,417	$	—	$	—
Total		5	$	5,417	$	5,417	$	—	$	—

A summary of TDRs by type of concession and by type of loans as of December 31, 2022, and December 31, 2021, are shown below:

	December 31, 2022
Accruing TDRs	Payment Deferral		Rate Reduction		Rate Reduction and Payment Deferral		Total
	(In thousands)
Commercial loans	$	2,588	$	—	$	—	$	2,588
Commercial mortgage loans		2,791		—		5,855		8,646
Residential mortgage loans		2,181		445		1,285		3,911
Total accruing TDRs	$	7,560	$	445	$	7,140	$	15,145

	December 31, 2022
Non-accrual TDRs	Payment Deferral		Rate Reduction		Rate Reduction and Payment Deferral		Total
	(In thousands)
Commercial loans	$	3,629	$	—	$	—	$	3,629
Commercial mortgage loans		1,098		—		—		1,098
Residential mortgage loans		1,621		—		—		1,621
Total non-accrual TDRs	$	6,348	$	—	$	—	$	6,348

	December 31, 2021
Accruing TDRs	Payment Deferral		Rate Reduction		Rate Reduction and Payment Deferral		Total
	(In thousands)
Commercial loans	$	3,368	$	—	$	—	$	3,368
Commercial mortgage loans		438		5,522		168		6,128
Residential mortgage loans		1,464		249		1,628		3,341
Total accruing TDRs	$	5,270	$	5,771	$	1,796	$	12,837

	December 31, 2021
Non-accrual TDRs	Payment Deferral		Rate Reduction		Rate Reduction and Payment Deferral		Total
	(In thousands)
Commercial loans	$	7,717	$	—	$	—	$	7,717
Residential mortgage loans		458		—		—		458
Total non-accrual TDRs	$	8,175	$	—	$	—	$	8,175

Modifications of the loan terms in the twelve months ended December 31, 2022, were in the form of extensions of maturity dates, which ranged generally from three to twelve months from the modification date. 

We expect that the TDRs on accruing status as of December 31, 2022, which were all performing in accordance with their restructured terms, will continue to comply with the restructured terms because of the reduced principal or interest payments on these loans.  

The Company considers a loan to be in payment default once it is 60 to 90 days contractually past due under the modified terms.  The Company did not have any loans that were modified as a TDR during the previous twelve months and which had subsequently defaulted as of December 31, 2022. 

Under the Company’s internal underwriting policy, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification in order to determine whether a borrower is experiencing financial difficulty.

As of December 31, 2022, there were no commitments to lend additional funds to those borrowers whose loans have been restructured, were considered individually evaluated, or were on non-accrual status.

The CARES Act, signed into law on March 27, 2020, and as extended by the CAA, 2021, permits financial institutions to suspend requirements under GAAP for loan modifications to borrowers affected by COVID-19 that would otherwise be characterized as TDRs and suspend any determination related thereto if (i) the loan modification is made between March 1, 2020 and January 1, 2022 and (ii) the applicable loan was not more than 30 days past due as of December 31, 2019. In addition, federal bank regulatory authorities have issued guidance to encourage financial institutions to make loan modifications for borrowers affected by COVID-19 and have assured financial institutions that they will neither receive supervisory criticism for such prudent loan modifications, nor be required by examiners to automatically categorize COVID-19-related loan modifications as TDRs. The Company is applying this guidance to qualifying loan modifications.

As part of the on-going monitoring of the credit quality of our loan portfolio, the Company utilizes a risk grading matrix to assign a risk rating to each loan. Loans are risk rated based on analysis of the current state of the borrower’s credit quality. The analysis of credit quality includes a review of sources of repayment, the borrower’s current financial and liquidity status and other relevant information. The risk rating categories can be generally described by the following grouping for non-homogeneous loans:

● Pass/Watch – These loans range from minimal credit risk to higher than average, but still acceptable, credit risk. The loans have sufficient sources of repayment to repay the loans in full, in accordance with all the terms and conditions and remains currently well protected by collateral values.

● Special Mention – Borrower is deemed fundamentally sound, and the loan is currently protected but adverse trends are apparent that, if not corrected, may affect ability to repay. Primary source of loan repayment remains viable but there is increasing reliance on collateral or guarantor support.

● Substandard – These loans are deemed inadequately protected by current sound worth, paying capacity or pledged collateral. Well-defined weaknesses exist that could jeopardize repayment of debt. Loss may not be imminent, but if weaknesses are not corrected, there is a good possibility of some loss.

● Doubtful – The possibility of loss is deemed extremely high, but due to identifiable and important pending events (which may strengthen the loan) a loss classification is deferred until the situation is better defined.

● Loss – These loans are deemed uncollectible and of such little value that to continue to carry the loans as an active asset is no longer warranted.

The following table summarizes the Company’s loan held for investment as of December 31, 2022 and 2021, by loan portfolio segments, internal risk ratings and vintage year. The vintage year is the year of origination, renewal or major modification:

	Loans Amortized Cost Basis by Origination Year
December 31, 2022	2022			2021		2020			2019			2018			Prior			Revolving Loans			Revolving Converted to Term Loans			Total
	(In thousands)
Commercial loans
Pass/Watch	$	488,748		$	446,647	$	180,226		$	119,355		$	107,896		$	106,649		$	1,753,509		$	6,560		$	3,209,590
Special Mention		1,212			4,696		2,818			68			308			4,354			41,110			—			54,566
Substandard		25			12,750		342			4,859			2,766			6,985			22,084			133			49,944
Doubtful		—			—		—			1,504			2,185			—			234			—			3,923
Total	$	489,985		$	464,093	$	183,386		$	125,786		$	113,155		$	117,988		$	1,816,937		$	6,693		$	3,318,023
YTD period charge-offs	$	96		$	587	$	120		$	71		$	1,786		$	360		$	202		$	—		$	3,222
YTD period recoveries		(8	)		—		(39	)		—			(254	)		(335	)		(1,829	)		—			(2,465	)
Net	$	88		$	587	$	81		$	71		$	1,532		$	25		$	(1,627	)	$	—		$	757
Real estate construction loans
Pass/Watch	$	99,798		$	264,197	$	113,312		$	20,479		$	3,067		$	—		$	—		$	—		$	500,853
Special Mention		—			360		9,449			11,643			22,945			—			—			—			44,397
Substandard		—			—		—			1,736			9,309			—			—			—			11,045
Total	$	99,798		$	264,557	$	122,761		$	33,858		$	35,321		$	—		$	—		$	—		$	556,295
YTD period charge-offs	$	—		$	—	$	—		$	—		$	—		$	—		$	—		$	—		$	—
YTD period recoveries		—			—		—			—			—			(6	)		—			—			(6	)
Net	$	—		$	—	$	—		$	—		$	—		$	(6	)	$	—		$	—		$	(6	)
Commercial mortgage loans
Pass/Watch	$	2,087,650		$	1,728,607	$	975,953		$	1,094,505		$	908,748		$	1,420,982		$	178,116		$	—		$	8,394,561
Special Mention		22,150			57,015		25,593			32,119			17,999			63,782			1,600			—			220,258
Substandard		12,320			7,861		14,392			19,972			34,899			81,844			2,631			—			173,919
Total	$	2,122,120		$	1,793,483	$	1,015,938		$	1,146,596		$	961,646		$	1,566,608		$	182,347		$	—		$	8,788,738
YTD period charge-offs	$	—		$	—	$	—		$	—		$	2,091		$	—		$	—		$	—		$	2,091
YTD period recoveries		—			—		—			(240	)		—			(7	)		(111	)		—			(358	)
Net	$	—		$	—	$	—		$	(240	)	$	2,091		$	(7	)	$	(111	)	$	—		$	1,733
Residential mortgage loans
Pass/Watch	$	1,228,391		$	964,799	$	580,990		$	600,786		$	417,565		$	1,444,320		$	—		$	—		$	5,236,851
Special Mention		—			—		33			—			752			905			—			—			1,690
Substandard		206			762		2,028			1,966			1,799			8,785			—			—			15,546
Total	$	1,228,597		$	965,561	$	583,051		$	602,752		$	420,116		$	1,454,010		$	—		$	—		$	5,254,087
YTD period charge-offs	$	—		$	—	$	—		$	—		$	—		$	—		$	—		$	—		$	—
YTD period recoveries		—			—		—			—			—			(45	)		—			—			(45	)
Net	$	—		$	—	$	—		$	—		$	—		$	(45	)	$	—		$	—		$	(45	)
Equity lines
Pass/Watch	$	731		$	—	$	—		$	—		$	—		$	—		$	302,825		$	21,460		$	325,016
Special Mention		5			—		—			—			—			—			—			—			5
Substandard		12			—		—			—			—			—			1,043			220			1,275
Total	$	748		$	—	$	—		$	—		$	—		$	—		$	303,868		$	21,680		$	326,296
YTD period charge-offs	$	—		$	—	$	—		$	—		$	—		$	—		$	—		$	—		$	—
YTD period recoveries		—			—		—			—			—			—			(11	)		(16	)		(27	)
Net	$	—		$	—	$	—		$	—		$	—		$	—		$	(11	)	$	(16	)	$	(27	)
Installment and other loans
Pass/Watch	$	1,792		$	2,152	$	—		$	—		$	—		$	—		$	—		$	—		$	3,944
Total	$	1,792		$	2,152	$	—		$	—		$	—		$	—		$	—		$	—		$	3,944
YTD period charge-offs	$	115		$	—	$	—		$	—		$	—		$	—		$	62		$	—		$	177
YTD period recoveries		(2	)		—		—			—			—			—			(2	)		—			(4	)
Net	$	113		$	—	$	—		$	—		$	—		$	—		$	60		$	—		$	173
Total loans	$	3,943,040		$	3,489,846	$	1,905,136		$	1,908,992		$	1,530,238		$	3,138,606		$	2,303,152		$	28,373		$	18,247,383
Net charge-offs/(recoveries)	$	201		$	587	$	81		$	(169	)	$	3,623		$	(33	)	$	(1,689	)	$	(16	)	$	2,585

	Loans Amortized Cost Basis by Origination Year
December 31, 2021	2021		2020			2019			2018			2017		Prior			Revolving Loans			Revolving Converted to Term Loans			Total
	(In thousands)
Commercial loans
Pass/Watch	$	606,770	$	268,756		$	183,468		$	142,419		$	80,701	$	100,496		$	1,437,463		$	7,433		$	2,827,506
Special Mention		395		780			1,138			1,645			3,157		—			40,761			49			47,925
Substandard		450		5,879			22,513			16,423			14,309		5,221			34,713			5,716			105,224
Doubtful		—		—			—			—			—		—			900			—			900
Total	$	607,615	$	275,415		$	207,119		$	160,487		$	98,167	$	105,717		$	1,513,837		$	13,198		$	2,981,555
YTD period charge-offs	$	—	$	1,478		$	507		$	366		$	—	$	50		$	17,650		$	—		$	20,051
YTD period recoveries		—		(1	)		(29	)		(124	)		—		(191	)		(1,361	)		—			(1,706	)
Net	$	—	$	1,477		$	478		$	242		$	—	$	(141	)	$	16,289		$	—		$	18,345
Real estate construction loans
Pass/Watch	$	199,188	$	188,782		$	125,316		$	24,548		$	—	$	—		$	—		$	—		$	537,834
Special Mention		—		23,107			27,672			17,374			—		—			—			—			68,153
Substandard		—		—			1,919			—			—		—			—			—			1,919
Total	$	199,188	$	211,889		$	154,907		$	41,922		$	—	$	—		$	—		$	—		$	607,906
YTD period charge-offs	$	—	$	—		$	—		$	—		$	—	$	—		$	—		$	—		$	—
YTD period recoveries		—		—			—			—			—		(76	)		—			—			(76	)
Net	$	—	$	—		$	—		$	—		$	—	$	(76	)	$	—		$	—		$	(76	)
Commercial mortgage loans
Pass/Watch	$	1,893,807	$	1,201,825		$	1,253,548		$	1,031,191		$	727,916	$	1,313,882		$	198,869		$	—		$	7,621,038
Special Mention		45,719		59,182			49,796			103,101			61,105		60,448			750			—			380,101
Substandard		1,110		—			13,483			42,803			1,580		76,906			3,297			—			139,179
Total	$	1,940,636	$	1,261,007		$	1,316,827		$	1,177,095		$	790,601	$	1,451,236		$	202,916		$	—		$	8,140,318
YTD period charge-offs	$	—	$	—		$	—		$	—		$	—	$	—		$	—		$	—		$	—
YTD period recoveries		—		—			(240	)		—			—		(28	)		(111	)		—			(379	)
Net	$	—	$	—		$	(240	)	$	—		$	—	$	(28	)	$	(111	)	$	—		$	(379	)
Residential mortgage loans
Pass/Watch	$	978,375	$	622,999		$	678,775		$	502,325		$	453,992	$	929,846		$	—		$	—		$	4,166,312
Special Mention		—		46			1,576			1,064			836		438			—			—			3,960
Substandard		1,684		147			2,698			2,574			862		5,255			—			—			13,220
Total	$	980,059	$	623,192		$	683,049		$	505,963		$	455,690	$	935,539		$	—		$	—		$	4,183,492
YTD period charge-offs	$	—	$	—		$	—		$	—		$	3	$	—		$	—		$	—		$	3
YTD period recoveries		—		—			—			—			—		(208	)		—			—			(208	)
Net	$	—	$	—		$	—		$	—		$	3	$	(208	)	$	—		$	—		$	(205	)
Equity lines
Pass/Watch	$	—	$	—		$	—		$	—		$	—	$	5		$	389,069		$	30,025		$	419,099
Substandard		—		—			—			—			—		—			1,230			273			1,503
Total	$	—	$	—		$	—		$	—		$	—	$	5		$	390,299		$	30,298		$	420,602
YTD period charge-offs	$	—	$	—		$	—		$	—		$	—	$	—		$	—		$	—		$	—
YTD period recoveries		—		—			—			—			—		—			(10	)		(64	)		(74	)
Net	$	—	$	—		$	—		$	—		$	—	$	—		$	(10	)	$	(64	)	$	(74	)
Installment and other loans
Pass/Watch	$	4,117	$	168		$	—		$	—		$	—	$	—		$	—		$	—		$	4,285
Total	$	4,117	$	168		$	—		$	—		$	—	$	—		$	—		$	—		$	4,285
YTD period charge-offs	$	—	$	—		$	—		$	—		$	—	$	—		$	—		$	—		$	—
YTD period recoveries		—		—			—			—			—		—			—			—			—
Net	$	—	$	—		$	—		$	—		$	—	$	—		$	—		$	—		$	—
Total loans	$	3,731,615	$	2,371,671		$	2,361,902		$	1,885,467		$	1,344,458	$	2,492,497		$	2,107,052		$	43,496		$	16,338,158
Net charge-offs/(recoveries)	$	—	$	1,477		$	238		$	242		$	3	$	(453	)	$	16,168		$	(64	)	$	17,611

Revolving loans that are converted to term loans presented in the table above are excluded from the term loans by vintage year columns.

The following table details activity in the allowance for loan losses by portfolio segment for the years ended December 31, 2022, and 2021. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.

				Real Estate			Commercial			Residential			Installment
	Commercial			Construction			Mortgage			Mortgage			and Other
	Loans			Loans			Loans			and Equity Lines			Loans			Total
	(In thousands)
2021 Beginning Balance	$	68,742		$	30,854		$	49,205		$	17,737		$	—		$	166,538
Impact of ASU 2016-13 adoption	$	(31,466	)	$	(24,307	)	$	34,993		$	19,211		$	9		$	(1,560	)
Allowance for loan losses, January 1, 2021	$	37,276		$	6,547		$	84,198		$	36,948		$	9		$	164,978
Provision/(reversal) for loan losses		24,463			(321	)		(23,401	)		(11,943	)		(8	)		(11,210	)
Charge-offs		(20,051	)		—			—			(3	)		—			(20,054	)
Recoveries		1,706			76			284			377			—			2,443
Net (Charge-offs)/Recoveries	$	(18,345	)	$	76		$	284		$	374		$	—		$	(17,611	)
2021 Ending Balance	$	43,394		$	6,302		$	61,081		$	25,379		$	1		$	136,157
Provision/(reversal) for loan losses		6,798			4,109			9,018			(7,219	)		207			12,913
Charge-offs		(3,222	)		—			(2,091	)		—			(177	)		(5,490	)
Recoveries		2,465			6			358			72			4			2,905
Net (Charge-offs)/Recoveries	$	(757	)	$	6		$	(1,733	)	$	72		$	(173	)	$	(2,585	)
2022 Ending Balance	$	49,435		$	10,417		$	68,366		$	18,232		$	35		$	146,485
Allowance for unfunded credit commitments, January 1, 2021	$	8,038		$	3,825		$	35		$	—		$	—		$	11,898
Provision/(reversal) for possible credit losses		(4,313	)		(450	)		(35	)		—			—			(4,798	)
Allowance for unfunded credit commitments 2021 Ending Balance	$	3,725		$	3,375		$	—		$	—		$	—		$	7,100
Provision/(reversal) for possible credit losses		1,115			515			—			—			—			1,630
Allowance for unfunded credit commitments 2022 Ending Balance	$	4,840		$	3,890		$	—		$	—		$	—		$	8,730

Residential mortgage loans in process of formal foreclosure proceedings were $456 thousand as of December 31, 2022, and $2.0 million as of December 31, 2021.