XML 23 R13.htm IDEA: XBRL DOCUMENT v3.21.2
Loans
 6 Months Ended
Jun. 30, 2021
Loans and Leases Receivable, Net Amount [Abstract]  
Loans Loans
The Company’s loan portfolio includes originated and purchased loans. The following is an analysis of the loan portfolio by segment and class (net of unearned income):
June 30, 2021December 31, 2020
(dollars in thousands)
Commercial loans:
Commercial real estate$4,101,071 $4,062,313 
Commercial business3,738,288 3,597,968 
Agriculture797,580 779,627 
Construction300,303 268,663 
Consumer loans:
One-to-four family residential real estate724,151 683,570 
Other consumer31,723 35,519 
Total loans9,693,116 9,427,660 
Less: Allowance for credit losses(142,988)(149,140)
Total loans, net$9,550,128 $9,278,520 
At June 30, 2021 and December 31, 2020, the Company had no material foreign activities. Substantially all of the Company’s loans and unfunded commitments are geographically concentrated in its service areas within the states of Washington, Oregon and Idaho.
At June 30, 2021 and December 31, 2020, $3.56 billion and $3.46 billion of commercial and residential real estate loans were pledged as collateral on FHLB advances and additional borrowing capacity. The Company has also pledged $200.3 million and $200.4 million of commercial loans to the FRB for additional borrowing capacity at June 30, 2021 and December 31, 2020, respectively.
Accrued interest receivable for loans is included in “Interest receivable” on the Company’s Consolidated Balance Sheet and is not reflected in the balances in the table above. At June 30, 2021 and December 31, 2020, accrued interest receivable for loans was $33.1 million and $37.8 million, respectively. The Company does not measure an allowance for credit losses for accrued interest receivable.
The following is an aging of the recorded investment of the loan portfolio at the dates presented:
Current
Loans		30 - 59
Days
Past Due		60 - 89
Days
Past Due		Greater
than 90
Days Past
Due		Total
Past Due		Nonaccrual
Loans		Total Loans
June 30, 2021(in thousands)
Commercial loans:
Commercial real estate$4,089,659 $8,244 $149 $— $8,393 $3,019 $4,101,071 
Commercial business3,724,202 2,351 990 — 3,341 10,745 3,738,288 
Agriculture785,071 2,537 938 — 3,475 9,034 797,580 
Construction300,303 — — — — — 300,303 
Consumer loans:
One-to-four family residential real estate720,854 775 1,343 — 2,118 1,179 724,151 
Other consumer31,658 20 1 — 21 44 31,723 
Total$9,651,747 $13,927 $3,421 $— $17,348 $24,021 $9,693,116 
Current
Loans		30 - 59
Days
Past Due		60 - 89
Days
Past Due		Greater
than 90
Days Past
Due		Total
Past Due		Nonaccrual
Loans		Total Loans
December 31, 2020(in thousands)
Commercial loans:
Commercial real estate$4,037,309 $17,292 $— — $17,292 $7,712 $4,062,313 
Commercial business3,578,905 1,282 4,559 — 5,841 13,222 3,597,968 
Agriculture767,102 911 — — 911 11,614 779,627 
Construction268,304 — 142 — 142 217 268,663 
Consumer loans:
One-to-four family residential real estate677,627 2,283 1,659 — 3,942 2,001 683,570 
Other consumer35,450 24 5 — 29 40 35,519 
Total$9,364,697 $21,792 $6,365 $— $28,157 $34,806 $9,427,660 
Loan payments are considered timely when the contractual principal or interest due in accordance with the terms of the loan agreement or any portion thereof is received on the due date of the scheduled payment. In addition, the risk rating on loans modified in association with the CARES Act or Interagency guidance did not change. These loans are not considered past due until after the deferral period is over and scheduled payments resume. Accrued interest on these COVID-19 modified loans is due, in full, when the deferral period ends. The credit quality of these loans will be reevaluated after the deferral period ends.
Nonaccrual loans are generally loans placed on a nonaccrual basis when they become 90 days past due or when there are otherwise serious doubts about the collectability of principal or interest within the existing terms of the loan. The Company’s policy is to write-off all accrued interest on loans when they are placed on nonaccrual status.
The following table summarizes written-off interest on nonaccrual loans for the periods indicated:
Three Months Ended June 30,Six Months Ended June 30,
2021202020212020
(in thousands)
Commercial loans$212 $665 $424 $1,448 
Consumer loans2 8 9 13 
Total$214 $673 $433 $1,461 
The following summarizes the amortized cost of nonaccrual loans for which there was no related ACL for the periods indicated:
June 30, 2021December 31, 2020
(in thousands)
Commercial loans:
Commercial real estate$942 $6,393 
Commercial business6,125 6,382 
Agriculture6,744 8,136 
Total$13,811 $20,911 
The following is an analysis of loans classified as TDR for the periods indicated:
Three Months Ended June 30, 2021Three Months Ended June 30, 2020
Number of TDR ModificationsPre-Modification
Outstanding
Recorded
Investment 		Post-Modification
Outstanding
Recorded
Investment 		Number of TDR ModificationsPre-Modification
Outstanding
Recorded
Investment 		Post-Modification
Outstanding
Recorded
Investment
(dollars in thousands)
Commercial loans:
Commercial business4 $1,757 $1,757 4 $1,690 $1,690 
Consumer loans:
One-to-four family residential real estate— — — 1 128 128 
Total4 $1,757 $1,757 5 $1,818 $1,818 

Six Months Ended June 30, 2021Six Months Ended June 30, 2020
Number of TDR ModificationsPre-Modification
Outstanding
Recorded
Investment 		Post-Modification
Outstanding
Recorded
Investment 		Number of TDR ModificationsPre-Modification
Outstanding
Recorded
Investment 		Post-Modification
Outstanding
Recorded
Investment
(dollars in thousands)
Commercial loans:
Commercial real estate
1 $628 $628 — $— $— 
Commercial business
11 2,600 2,600 6 1,962 1,962 
Agriculture
— — — 1 895 895 
Consumer loans:
One-to-four family residential real estate
2 140 140 2 196 196 
Total14 $3,368 $3,368 9 $3,053 $3,053 
The Company’s loans classified as TDR are loans that have been modified or with respect to which the borrower has been granted special concessions due to financial difficulties that, if not for the challenges of the borrower, the Company would not otherwise consider. The TDR modifications or concessions are made to increase the likelihood that these borrowers with financial difficulties will be able to satisfy their debt obligations as amended. The concessions granted in the restructurings, summarized in the table above, largely consisted of maturity extensions, interest rate modifications or a combination of both. In limited circumstances, a reduction in the principal balance of the loan could also be made as a concession. Loans classified as TDR are included with the loans collectively measured for credit losses.
The Company had commitments to lend $988 thousand of additional funds on loans classified as TDR as of June 30, 2021. The Company had $651 thousand of such commitments at December 31, 2020. The Company had no loans classified as TDR that defaulted within 12 months of being classified as TDR during the three months and six months ended June 30, 2021 and 2020.
Financial institutions are required to maintain records of the volume of loans involved in modifications to which troubled debt restructuring relief is applicable. At June 30, 2021, the Company had 10 short–term deferments on $40.7 million of loans, gross of unearned income. These short–term deferments are not classified as TDRs and will not be reported as past due provided that they are performing in accordance with the modified terms.
The Company offered PPP loans to provide financial support to small and medium-size businesses to cover payroll and certain other expenses during the COVID-19 pandemic. The PPP was established by the CARES Act and is implemented by the U.S. SBA with support from the U.S. Department of Treasury. The program, which was amended by the Paycheck Protection Flexibility Act of 2020, provides small businesses with funds to pay up to 24 weeks of payroll costs including benefits, as well as interest on mortgages, rent and utilities. Funds are provided to small businesses in the form of loans that will be fully forgiven when used for permitted purposes and when at least 60% of the funds are used for payroll costs and applicable employment levels are maintained in accordance with the requirements of the amended PPP. At June 30, 2021, we had $691.9 million of PPP loans outstanding, which are included in commercial business loans.