Loans

12 Months Ended

Dec. 31, 2022

Loans and Leases Receivable, Net Amount [Abstract]

Loans

The Company’s loan portfolio includes originated and purchased loans. The following is an analysis of the loan portfolio by segment (net of unearned income):


	December 31,
	2022		2021

	(in thousands)
Commercial loans:
Commercial real estate	$	5,352,785	$	4,981,263
Commercial business	3,750,564		3,423,268
Agriculture	848,903		795,715
Construction	540,861		384,755
Consumer loans:
One-to-four family residential real estate	1,077,494		1,013,908
Other consumer	40,366		43,028
Total loans	11,610,973		10,641,937
Less: Allowance for credit losses	(158,438)		(155,578)
Total loans, net	$	11,452,535	$	10,486,359

At December 31, 2022 and 2021, 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 Idaho and California.

At December 31, 2022 and 2021, $4.36 billion and $3.49 billion, respectively, of commercial and residential real estate loans were pledged as collateral on FHLB advances. The Company has also pledged $301.4 million and $200.5 million of commercial loans to the FRB for additional borrowing capacity at December 31, 2022 and 2021, 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 December 31, 2022 and 2021, accrued interest receivable for loans was $43.4 million and $32.4 million, respectively. The Company does not measure an allowance for credit losses for accrued interest receivable.

The following is an aging of the amortized cost of the loan portfolio as of December 31, 2022 and 2021:


	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, 2022	(in thousands)
Commercial loans:
Commercial real estate	$	5,338,999	$	6,756	$	3,786	$	—	$	10,542	$	3,244	$	5,352,785
Commercial business	3,739,731		4,336		1,364		—		5,700		5,133		3,750,564
Agriculture	842,506		493		1,537		—		2,030		4,367		848,903
Construction	540,861		—		—		—		—		—		540,861
Consumer loans:
One-to-four family residential real estate	1,072,211		4,315		283		—		4,598		685		1,077,494
Other consumer	40,172		160		22		—		182		12		40,366
Total	$	11,574,480	$	16,060	$	6,992	$	—	$	23,052	$	13,441	$	11,610,973

	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, 2021	(in thousands)
Commercial loans:
Commercial real estate	$	4,977,781	$	—	$	1,610	—		$	1,610	$	1,872	$	4,981,263
Commercial business	3,406,539		2,721		687		—		3,408		13,321		3,423,268
Agriculture	789,112		1,207		—		—		1,207		5,396		795,715
Construction	384,755		—		—		—		—		—		384,755
Consumer loans:
One-to-four family residential real estate	1,010,343		921		211		—		1,132		2,433		1,013,908
Other consumer	42,998		11		—		—		11		19		43,028
Total	$	10,611,528	$	4,860	$	2,508	$	—	$	7,368	$	23,041	$	10,641,937

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.

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 years ended December 31, 2022, 2021 and 2020:


	Years Ended December 31,
	2022		2021		2020

	(in thousands)
Commercial loans	$	604	$	628	$	1,972
Consumer loans	25		45		28
Total	$	629	$	673	$	2,000

The following summarizes the amortized cost of nonaccrual loans for which there was no related ACL as of December 31, 2022 and 2021:


	December 31, 2022		December 31, 2021

	(in thousands)
Commercial loans:
Commercial real estate	$	2,281	$	932
Commercial business	815		5,131
Agriculture	2,111		3,756




Total	$	5,207	$	9,819

The following is an analysis of loans classified as TDR for the years ended December 31, 2022, 2021 and 2020:


	Years Ended December 31,
	2022					2021					2020
	Number of TDR Modifications	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of TDR Modifications	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of TDR Modifications	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment

	(dollars in thousands)
Commercial loans:
Commercial real estate	—	$	—	$	—	1	$	628	$	628	—	$	—	$	—
Commercial business	2	637		637		11	2,600		2,600		11	3,257		3,257
Agriculture	1	633		633		1	583		583		2	3,495		3,495

Consumer loans:
One-to-four family residential real estate	1	50		50		3	155		155		6	814		814
Other consumer	—	—		—		—	—		—		—	—		—
Total	4	$	1,320	$	1,320	16	$	3,966	$	3,966	19	$	7,566	$	7,566

The Company’s loans classified as TDR are loans that have been modified or 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 Company had $123 thousand of commitments to lend additional funds on loans classified as TDR as of December 31, 2022 as compared to $1.5 million of similar commitments at December 31, 2021. 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. The Company had no loans classified as TDR that defaulted within 12 months of being classified as TDR during the years ended December 31, 2022, 2021 and 2020.