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Note 3 - LOANS/LEASES RECEIVABLE (Tables)

3 Months Ended

Mar. 31, 2021


	2021
	(dollars in thousands)

C&I:
C&I - revolving	$	168,842
C&I - other *		1,616,144
		1,784,986

CRE - owner occupied		461,272
CRE - non-owner occupied		610,582
Construction and land development		607,798
Multi-family		396,272
Direct financing leases**		60,134
1-4 family real estate***		368,927
Consumer		71,080
		4,361,051
Allowance for credit losses		(81,831)
	$	4,279,220
** Direct financing leases:
Net minimum lease payments to be received	$	66,182
Estimated unguaranteed residual values of leased assets		239
Unearned lease/residual income		(6,287)
		60,134
Plus deferred lease origination costs, net of fees		905
		61,039
Less allowance for credit losses		(2,192)
	$	58,847


	2020


C&I loans*	$	1,726,723
CRE loans
Owner-occupied CRE		496,471
Commercial construction, land development, and other land		541,455
Other non owner-occupied CRE		1,069,703
		2,107,629

Direct financing leases **		66,016
Residential real estate loans ***		252,121
Installment and other consumer loans		91,302
		4,243,791
Plus deferred loan/lease origination costs, net of fees		7,338
		4,251,129
Less allowance		(84,376)
	$	4,166,753
** Direct financing leases:
Net minimum lease payments to be received	$	72,940
Estimated unguaranteed residual values of leased assets		239
Unearned lease/residual income		(7,163)
		66,016
Plus deferred lease origination costs, net of fees		1,072
		67,088
Less allowance		(1,764)
	$	65,324

* Includes equipment financing agreements outstanding at m2, totaling $189.3 million and $171.5 million as of March 31, 2021 and December 31, 2020, respectively and PPP loans totaling $243.9 million and $273.1 million as of March 31, 2021 and December 31, 2020, respectively

** Management performs an evaluation of the estimated unguaranteed residual values of leased assets on an annual basis, at a minimum. The evaluation consists of discussions with reputable and current vendors, which is combined with management's expertise and understanding of the current states of particular industries to determine informal valuations of the equipment. As necessary and where available, management will utilize valuations by independent appraisers. The majority of leases with residual values contain a lease options rider, which requires the lessee to pay the residual value directly, finance the payment of the residual value, or extend the lease term to pay the residual value. In these cases, the residual value is protected and the risk of loss is minimal.

*** Includes residential real estate loans held for sale totaling $5.7 million and $3.8 million as of March 31, 2021 and December 31, 2020, respectively.

Changes in accretable yield for acquired loans


	Three months ended March 31, 2021
	PCI		Performing
	Loans		Loans		Total

	(dollars in thousands)

Balance at the beginning of the period	$	—	$	(3,139)	$	(3,139)
Accretion recognized		—		609		609
Balance at the end of the period	$	—	$	(2,530)	$	(2,530)


	Three months ended March 31, 2020
	PCI		Performing
	Loans		Loans		Total

	(dollars in thousands)

Balance at the beginning of the period	$	(57)	$	(6,378)	$	(6,435)
Reclassification of nonaccretable discount to accretable		(30)		—		(30)
Accretion recognized		28		653		681
Balance at the end of the period	$	(59)	$	(5,725)	$	(5,784)

Aging of the loan/lease portfolio by classes of loans/leases


	As of March 31, 2021
										Accruing Past
				30-59 Days			60-89 Days			Due 90 Days or			Nonaccrual
Classes of Loans/Leases	Current			Past Due			Past Due			More			Loans/Leases			Total

	(dollars in thousands)

C& I:
C&I - revolving	$	168,809		$	33		$	—		$	—		$	—	$		168,842
C&I - other		1,607,456			3,048			425			—			5,215			1,616,144
CRE - owner occupied		460,965			307			—			—			—			461,272
CRE - non-owner occupied		606,073			—			—			—			4,509			610,582
Construction and land development		607,721			—			—			—			77			607,798
Multi-family		396,122			—			—			—			150			396,272
Direct financing leases		59,482			194			138			—			320			60,134
1-4 family real estate		364,114			1,366			—			—			3,447			368,927
Consumer		70,856			79			—			—			145			71,080
	$	4,341,598		$	5,027		$	563		$	—		$	13,863		$	4,361,051

As a percentage of total loan/lease portfolio		99.55	%		0.12	%		0.01	%		—	%		0.32	%		100.00	%


	As of December 31, 2020

										Accruing Past
				30-59 Days			60-89 Days			Due 90 Days or			Nonaccrual
Classes of Loans/Leases	Current			Past Due			Past Due			More			Loans/Leases			Total

	(dollars in thousands)

C&I	$	1,720,058		$	1,535		$	323		$	—		$	4,807		$	1,726,723
CRE
Owner-occupied CRE		496,459			—			—			—			12			496,471
Commercial construction, land development, and other land		541,455			—			—			—			—			541,455
Other non-owner occupied CRE		1,062,215			—			—			—			7,488			1,069,703
Direct financing leases		64,918			501			191			—			406			66,016
Residential real estate		249,364			1,512			223			—			1,022			252,121
Installment and other consumer		91,047			43			4			3			205			91,302
	$	4,225,516		$	3,591		$	741		$	3		$	13,940		$	4,243,791

As a percentage of total loan/lease portfolio		99.57	%		0.08	%		0.02	%		0.00	%		0.33	%		100.00	%

NPLs by classes of loans/leases


	As of March 31, 2021
	Accruing Past		Nonaccrual		Nonaccrual
	Due 90 Days or		Loans/Leases		Loans/Leases				Percentage of
Classes of Loans/Leases	More		with an ACL*		without an ACL*		Total NPLs		Total NPLs

	(dollars in thousands)
C&I:
C&I - revolving	$	—	$	—	$	—	$	—	-	%
C&I - other		—		4,998		217		5,215	37.61
CRE - owner occupied		—		—		—		—	-
CRE - non-owner occupied		—		3,715		794		4,509	32.53
Construction and land development		—		77		—		77	0.56
Multi-family		—		150		—		150	1.08
Direct financing leases		—		193		127		320	2.31
1-4 family real estate		—		3,423		24		3,447	24.86
Consumer		—		145		—		145	1.05
	$	—	$	12,701	$	1,162	$	13,863	100.00	%


	As of December 31, 2020
	Accruing Past
	Due 90 Days or		Nonaccrual						Percentage of
Classes of Loans/Leases	More		Loans/Leases *		Accruing TDRs		Total NPLs		Total NPLs

		(dollars in thousands)

C&I	$	—	$	4,807	$	606	$	5,413	36.87	%
CRE
Owner-occupied CRE		—		12		—		12	0.08	%
Commercial construction, land development, and other land		—		—		—		—	-	%
Other non-owner occupied CRE		—		7,488		—		7,488	50.99	%
Direct financing leases		—		406		135		541	3.68	%
Residential real estate		—		1,022		—		1,022	6.96	%
Installment and other consumer		3		205		—		208	1.42	%
	$	3	$	13,940	$	741	$	14,684	100.00	%

** Nonaccrual loans/leases included $984 thousand of TDRs, including $836 thousand in CRE loans, $100 thousand in direct financing leases, $48 thousand in installment loans.

Allowance for credit losses on financing receivables


	Three Months Ended March 31, 2021
									CRE		CRE		Construction				Direct		Residential		1-4
			C&I -		C&I -				Owner		Non-Owner		and Land		Multi-		Financing		Real		Family
	C&I		Revolving		Other		CRE		Occupied		Occupied		Development		Family		Leases		Estate		Real Estate		Consumer		Total

	(dollars in thousands)

Balance, beginning	$	35,421	$	—	$	—	$	42,161	$	—	$	—	$	—	$	—	$	1,764	$	3,732	$	—	$	1,298	$	84,376
Adoption of ASU 2016-13		(35,421)		2,982		29,130		(42,161)		8,696		11,428		11,999		5,836		(1,764)		(3,732)		5,042		(137)		(8,102)
Provision		—		565		4,549		—		451		(286)		328		442		—		—		161		(217)		5,993
Charge-offs		—		—		(668)		—		—		—		—		—		—		—		(44)		(1)		(713)
Recoveries		—		—		156		—		—		13		—		—		—		—		6		102		277
Balance, ending	$	—	$	3,547	$	33,167	$	—	$	9,147	$	11,155	$	12,327	$	6,278	$	—	$	—	$	5,165	$	1,045	$	81,831

* Included within the C&I – Other column are leases with adoption impact of $685 thousand, provision of $135 thousand ,charge-offs of $198 thousand and recoveries of $76 thousand. ACL on leases was $2.2 million as of March 31, 2021.


	Three Months Ended March 31, 2020
					Direct Financing		Residential Real		Installment and
	C&I		CRE		Leases		Estate		Other Consumer		Total

	(dollars in thousands)

Balance, beginning	$	16,072	$	15,379	$	1,464	$	1,948	$	1,138	$	36,001
Provision		3,697		3,816		394		336		124		8,367
Charge-offs		(1,639)		—		(600)		—		(96)		(2,335)
Recoveries		21		74		45		29		31		200
Balance, ending	$	18,151	$	19,269	$	1,303	$	2,313	$	1,197	$	42,233


	As of March 31, 2021
	Amortized Cost of Loans Receivable						Allowance for Credit Losses
	Individually		Collectively				Individually		Collectively
	Evaluated for		Evaluated for				Evaluated for		Evaluated for
	Credit Losses		Credit Losses		Total		Credit Losses		Credit Losses		Total

	(dollars in thousands)
C&I :
C&I - Revolving	$	2,987	$	165,855	$	168,842	$	450	$	3,097	$	3,547
C&I - Other*		41,690		1,634,588		1,676,278		4,397		28,770		33,167
		44,677		1,800,443		1,845,120		4,847		31,867		36,714
CRE - owner occupied		5,487		455,785		461,272		287		8,860		9,147
CRE - non-owner occupied		23,309		587,273		610,582		1,843		9,312		11,155
Construction and Land Development		10,554		597,244		607,798		11		12,316		12,327
Multi-family		150		396,122		396,272		13		6,265		6,278
1-4 family real wstate		5,305		363,622		368,927		651		4,514		5,165
Consumer		300		70,780		71,080		36		1,009		1,045
	$	89,782	$	4,271,269	$	4,361,051	$	7,688	$	74,143	$	81,831

Impaired financing receivables


											Interest Income
							Average				Recognized for
	Recorded		Unpaid Principal		Related		Recorded		Interest Income		Cash Payments
Classes of Loans/Leases	Investment		Balance		Allowance		Investment		Recognized		Received
	(dollars in thousands)
Impaired Loans/Leases with No Specific Allowance Recorded:
C&I	$	2,260	$	2,332	$	—	$	1,895	$	12	$	12
CRE
Owner-occupied CRE		99		115		—		102		—		—
Commercial construction, land development, and other land		—		—		—		—		—		—
Other non-owner occupied CRE		1,054		1,054		—		662		7		7
Direct financing leases		1,515		1,515		—		1,440		6		6
Residential real estate		423		407		—		399		—		—
Installment and other consumer		538		538		—		507		—		—
	$	5,889	$	5,961	$	—	$	5,005	$	25	$	25

Impaired Loans/Leases with Specific Allowance Recorded:
C&I	$	86	$	86	$	86	$	43	$	—	$	—
CRE
Owner-occupied CRE		—		—		—		—		—		—
Commercial construction, land development, and other land		—		—		—		—		—		—
Other non-owner occupied CRE		6,528		6,528		1,228		4,698		—		—
Direct financing leases		59		59		20		61		—		—
Residential real estate		180		180		15		180		—		—
Installment and other consumer		77		77		78		79		—		—
	$	6,930	$	6,930	$	1,427	$	5,061	$	—	$	—

Total Impaired Loans/Leases:
C&I	$	2,346	$	2,418	$	86	$	1,938	$	12	$	12
CRE
Owner-occupied CRE		99		115		—		102		—		—
Commercial construction, land development, and other land		—		—		—		—		—		—
Other non-owner occupied CRE		7,582		7,582		1,228		5,360		7		7
Direct financing leases		1,574		1,574		20		1,501		6		6
Residential real estate		603		587		15		579		—		—
Installment and other consumer		615		615		78		586		—		—
	$	12,819	$	12,891	$	1,427	$	10,066	$	25	$	25


	December 31, 2020



	Recorded		Unpaid Principal		Related
Classes of Loans/Leases	Investment		Balance		Allowance
	(dollars in thousands)

Impaired Loans/Leases with No Specific Allowance Recorded:
C&I	$	1,607	$	1,647	$	—
CRE
Owner-occupied CRE		34		50		—
Commercial construction, land development, and other land		—		—		—
Other non-owner occupied CRE		684		686		—
Direct financing leases		1,642		1,642		—
Residential real estate		469		614		—
Installment and other consumer		476		476		—
	$	4,912	$	5,115	$	—

Impaired Loans/Leases with Specific Allowance Recorded:
C&I	$	239	$	239	$	170
CRE
Owner-occupied CRE		—		—		—
Commercial construction, land development, and other land		—		—		—
Other non-owner occupied CRE		2,867		2,867		125
Direct financing leases		383		383		270
Residential real estate		180		180		15
Installment and other consumer		80		80		80
	$	3,749	$	3,749	$	660

Total Impaired Loans/Leases:
C&I	$	1,846	$	1,886	$	170
CRE
Owner-occupied CRE		34		50		—
Commercial construction, land development, and other land		—		—		—
Other non-owner occupied CRE		3,551		3,553		125
Direct financing leases		2,025		2,025		270
Residential real estate		649		794		15
Installment and other consumer		556		556		80
	$	8,661	$	8,864	$	660

Schedule of loans receivable by collateral type



	As of March 31, 2021
			Non
	Commercial		Owner-Occupied		Owner Occupied
	Assets		Real Estate		Real Estate		Securities		Equipment		Other		Total

	(dollars in thousands)
C & I:
C&I - Revolving	$	2,513	$	—	$	—	$	—	$	474	$	—	$	2,987
C&I - Other*		1,030		—		2,630		6,235		31,783		12		41,690
		3,543		—		2,630		6,235		32,257		12		44,677
CRE - owner occupied		—		—		5,487		—		—		—		5,487
CRE - non-owner occupied		—		23,309		—		—		—		—		23,309
Construction and Land Development		—		10,477		77		—		—		—		10,554
Multi-family		—		150		—		—		—		—		150
1-4 Family Real Estate		—		2,719		2,586		—		—		—		5,305
Consumer		—		—		298		—		—		2		300
	$	3,543	$	36,655	$	11,078	$	6,235	$	32,257	$	14	$	89,782

Schedule of financing receivable credit quality indicators based on internally assigned Risk rating


	As of March 31, 2021
	Term Loans
	Amortized Cost Basis by Origination Year
													Revolving
													Loans
Internally Assigned													Amortized
Risk Rating	2021		2020		2019		2018		2017		Prior		Cost Basis		Total

	(dollars in thousands)
C&I - revolving
Pass (Ratings 1 through 5)	$	—	$	—	$	—	$	—	$	—	$	—	$	162,696	$	162,696
Special Mention (Rating 6)		—		—		—		—		—		—		3,159		3,159
Substandard (Rating 7)		—		—		—		—		—		—		2,987		2,987
Doubtful (Rating 8)		—		—		—		—		—		—		—		—
Total C&I - revolving	$	—	$	—	$	—	$	—	$	—	$	—	$	168,842	$	168,842

C&I - other
Pass (Ratings 1 through 5)	$	235,962	$	585,345	$	236,279	$	135,169	$	126,353	$	65,041	$	—	$	1,384,149
Special Mention (Rating 6)		155		717		—		—		542		1,401		—		2,815
Substandard (Rating 7)		58		7,109		25,844		434		167		6,224		—		39,836
Doubtful (Rating 8)		—		—		—		—		—		—		—		—
Total C&I - other	$	236,175	$	593,171	$	262,123	$	135,603	$	127,062	$	72,666	$	—	$	1,426,800

CRE - owner occupied
Pass (Ratings 1 through 5)	$	45,903	$	176,851	$	66,254	$	46,025	$	32,743	$	75,721	$	9,216	$	452,713
Special Mention (Rating 6)		604		57		180		264		676		1,297		—		3,078
Substandard (Rating 7)		224		1,000		929		1,270		2,058		—		—		5,481
Doubtful (Rating 8)		—		—		—		—		—		—		—		—
Total CRE - owner occupied	$	46,731	$	177,908	$	67,363	$	47,559	$	35,477	$	77,018	$	9,216	$	461,272

CRE - non-owner occupied
Pass (Ratings 1 through 5)	$	36,894	$	180,112	$	98,515	$	76,057	$	79,124	$	64,414	$	8,625	$	543,741
Special Mention (Rating 6)		3,481		8,825		3,265		15,424		4,242		7,307		997		43,541
Substandard (Rating 7)		438		794		19,233		504		963		700		668		23,300
Doubtful (Rating 8)		—		—		—		—		—		—		—		—
Total CRE - non-owner occupied	$	40,813	$	189,731	$	121,013	$	91,985	$	84,329	$	72,421	$	10,290	$	610,582

Construction and land development
Pass (Ratings 1 through 5)	$	53,842	$	207,167	$	174,028	$	124,718	$	12,765	$	3,141	$	9,960	$	585,621
Special Mention (Rating 6)		—		—		—		680		—		—		—		680
Substandard (Rating 7)		—		—		10,478		—		—		—		—		10,478
Doubtful (Rating 8)		—		—		—		—		—		—		—		—
Total Construction and land development	$	53,842	$	207,167	$	184,506	$	125,398	$	12,765	$	3,141	$	9,960	$	596,779

Multi-family
Pass (Ratings 1 through 5)	$	49,494	$	213,302	$	64,817	$	47,082	$	7,496	$	13,666	$	265	$	396,122
Special Mention (Rating 6)		—		—		—		—		—		—		—		—
Substandard (Rating 7)		—		—		—		150		—		—		—		150
Doubtful (Rating 8)		—		—		—		—		—		—		—		—
Total Multi-family	$	49,494	$	213,302	$	64,817	$	47,232	$	7,496	$	13,666	$	265	$	396,272

1-4 family real estate
Pass (Ratings 1 through 5)	$	10,273	$	37,895	$	22,631	$	15,897	$	8,273	$	13,523	$	5,862	$	114,354
Special Mention (Rating 6)		38		—		—		—		154		1		—		193
Substandard (Rating 7)		—		—		—		137		2,537		76		—		2,750
Doubtful (Rating 8)		—		—		—		—		—		—		—		—
Total 1-4 family real estate	$	10,311	$	37,895	$	22,631	$	16,034	$	10,964	$	13,600	$	5,862	$	117,297

Total	$	437,366	$	1,419,174	$	722,453	$	463,811	$	278,093	$	252,512	$	204,435	$	3,777,844

Schedule of financing receivable credit quality indicators based on delinquency status


	As of March 31, 2021
	Term Loans
	Amortized Cost Basis by Origination Year												Revolving
													Loans
													Amortized
Delinquency Status *	2021		2020		2019		2018		2017			Prior	Cost Basis		Total

	(dollars in thousands)
C&I - other
Performing	$	32,767	$	70,614	$	49,733	$	24,868	$	9,052	$	1,153	$	—	$	188,187
Nonperforming		—		123		683		198		136		17		—		1,157
Total C&I - other	$	32,767	$	70,737	$	50,416	$	25,066	$	9,188	$	1,170	$	—	$	189,344

Direct financing leases
Performing	$	304	$	16,671	$	16,717	$	14,678	$	7,873	$	3,571	$	—	$	59,814
Nonperforming		—		—		19		139		78		84		—		320
Total Direct financing leases	$	304	$	16,671	$	16,736	$	14,817	$	7,951	$	3,655	$	—	$	60,134

Construction and land development
Performing	$	1,270	$	8,723	$	429	$	520	$	—	$	—	$	—	$	10,942
Nonperforming		—		—		—		—		77		—		—		77
Total Construction and land development	$	1,270	$	8,723	$	429	$	520	$	77	$	—	$	—	$	11,019

1-4 family real estate
Performing	$	36,985	$	91,997	$	27,115	$	15,035	$	15,774	$	63,932	$	64	$	250,902
Nonperforming		—		31		72		—		—		625		—		728
Total 1-4 family real estate	$	36,985	$	92,028	$	27,187	$	15,035	$	15,774	$	64,557	$	64	$	251,630

Consumer
Performing	$	2,446	$	7,760	$	3,337	$	2,810	$	997	$	3,789	$	49,796	$	70,935
Nonperforming		—		—		47		49		17		32		—		145
Total Consumer	$	2,446	$	7,760	$	3,384	$	2,859	$	1,014	$	3,821	$	49,796	$	71,080

Total	$	73,772	$	195,919	$	98,152	$	58,297	$	34,004	$	73,203	$	49,860	$	583,207

Financing receivable credit quality indicators



	As of December 31, 2020
			CRE
					Non-Owner Occupied
					Commercial
					Construction,
					Land
			Owner-Occupied		Development,						As a % of
Internally Assigned Risk Rating	C&I		CRE		and Other Land		Other CRE		Total		Total

	(dollars in thousands)

Pass (Ratings 1 through 5)	$	1,506,578	$	488,478	$	530,297	$	999,931	$	3,525,284	96.25	%
Special Mention (Rating 6)		23,929		3,087		680		43,785		71,481	1.95	%
Substandard (Rating 7)		24,710		4,906		10,478		25,987		66,081	1.80	%
Doubtful (Rating 8)		—		—		—		—		—	—	%
	$	1,555,217	$	496,471	$	541,455	$	1,069,703	$	3,662,846	100.00	%

Financing receivable credit quality indicators performance status


	As of December 31, 2020
			Direct Financing		Residential Real		Installment and				As a % of
Delinquency Status *	C&I		Leases		Estate		Other Consumer		Total		Total

	(dollars in thousands)

Performing	$	170,712	$	65,475	$	251,099	$	91,094	$	578,380	99.56	%
Nonperforming		794		541		1,022		208		2,565	0.44	%
	$	171,506	$	66,016	$	252,121	$	91,302	$	580,945	100.00	%

Number and recorded investment of TDRs, by type of concession


	For the three months ended March 31, 2020
		Pre-		Post-
		Modification		Modification
	Number of	Recorded		Recorded		Specific
Classes of Loans/Leases	Loans / Leases	Investment		Investment		Allowance

	(dollars in thousands)
CONCESSION - Significant Payment Delay
C & I	2	$	111	$	111	$	—
Direct Financing Leases	1		68		68		—
TOTAL	3	$	179	$	179	$	—

Unfunded Loan Commitment

Notes Tables

Financing receivable credit quality indicators


	Three Months Ended
	March 31, 2021		March 31, 2020

	(dollars in thousands)

Balance, beginning	$	—	$	—
Impact of adopting ASU 2016-13		9,117		—
Provisions charged to expense		729		—
Balance, ending	$	9,846	$	—