Loans (Tables)

9 Months Ended

Sep. 30, 2022

Loans and Leases Receivable, Net Amount [Abstract]

Schedule of Loans Receivable

Loan segments have been identified by evaluating the portfolio based on collateral and credit risk characteristics. Loans receivable consist of the following:

	September 30, 2022			December 31, 2021
	(In Thousands)
Real Estate:
Residential	$	1,478,360		$	1,167,466
Commercial		2,674,078			2,450,349
Construction		1,242,045			862,815
		5,394,483			4,480,630
Other Loans:
Commercial		1,042,604			895,638
Home equity and improvement		272,367			264,354
Consumer finance		212,790			126,417
		1,527,761			1,286,409
Loans before deferred loan origination fees and costs		6,922,244			5,767,039
Deduct:
Undisbursed construction loan funds		(724,797	)		(477,890	)
Net deferred loan origination fees and costs		10,261			7,019
Allowance for credit losses		(70,626	)		(66,468	)
Total loans	$	6,137,082		$	5,229,700

Summary of Amortized Cost Basis of Collateral-Dependent Loans by Class of Loans and Collateral Type

The following table presents the amortized cost basis of collateral-dependent loans by class of loans and collateral type as of September 30, 2022 and December 31, 2021 (in thousands):

	September 30, 2022
	Real Estate		Equipment and Machinery		Inventory and Receivables		Vehicles		Total
Real Estate:
Residential	$	54	$	—	$	—	$	—	$	54
Commercial		12,394		—		2,716		—		15,110
Construction		—		—		—		—		—
Other Loans:
Commercial		2,607		561		3,858		—		7,026
Home equity and improvement		—		—		—		—		—
Consumer finance		—		—		—		—		—
Total	$	15,055	$	561	$	6,574	$	—	$	22,190

	December 31, 2021
	Real Estate		Equipment and Machinery		Inventory and Receivables		Vehicles		Total
Real Estate:
Residential	$	226	$	—	$	—	$	—	$	226
Commercial		18,399		—		—		—		18,399
Construction		—		—		—		—		—
Other Loans:
Commercial		1,574		160		14,023		25		15,782
Home equity and improvement		—		—		—		—		—
Consumer finance		—		—		—		—		—
Total	$	20,199	$	160	$	14,023	$	25	$	34,407

Schedule of current balance of the aggregate amounts of non-performing assets, comprised of non-performing loans and real estate owned

The following table presents the current balance of the aggregate amounts of non-performing assets, comprised of non-performing loans and real estate owned as of the dates indicated:

	September 30, 2022		December 31, 2021
	(In Thousands)
Non-accrual loans with reserve	$	19,308	$	35,480
Non-accrual loans without reserve		13,829		12,534
Loans 90 days plus past due and still accruing		—		—
Total non-performing loans		33,137		48,014
Real estate and other assets held for sale		416		171
Total non-performing assets	$	33,553	$	48,185
Troubled debt restructuring, still accruing	$	6,909	$	7,768

Schedule of Aging of the Amortized Cost/ Recorded Investment in Past Due and Non- Accrual Loans

The following table presents the aging of the amortized cost in past due and non-accrual loans as of September 30, 2022, by class of loans (in thousands):

	Current		30 - 59 days		60 - 89 days		90 + days		Total Past Due		Total Non- Accrual
Real Estate:
Residential	$	1,460,105	$	547	$	5,816	$	4,954	$	11,317	$	6,458
Commercial		2,663,003		809		177		11,570		12,556		13,709
Construction		517,248		—		—		—		—		—
Other Loans:
Commercial		1,031,322		333		50		4,685		5,068		4,895
Home equity and improvement		266,002		2,586		207		992		3,785		1,423
Consumer finance		209,642		2,540		803		1,759		5,102		1,881
PCD		18,332		358		220		3,648		4,226		4,771
Total Loans	$	6,165,654	$	7,173	$	7,273	$	27,608	$	42,054	$	33,137

The following table presents the aging of the recorded investment in past due and non-accrual loans as of December 31, 2021, by class of loans (in thousands):

	Current		30 - 59 days		60 - 89 days		90 + days		Total Past Due		Total Non- Accrual
Real Estate:
Residential	$	1,144,533	$	234	$	5,340	$	7,487	$	13,061	$	9,034
Commercial		2,439,552		96		847		7,168		8,111		14,621
Construction		383,136		43		1,746		—		1,789		—
Other Loans:
Commercial		884,025		42		35		867		944		11,531
Home equity and improvement		257,055		1,851		408		1,634		3,893		2,051
Consumer finance		124,073		1,112		819		1,728		3,659		1,873
PCD		25,111		225		1,005		5,996		7,226		8,904
Total Loans	$	5,257,485	$	3,603	$	10,200	$	24,880	$	38,683	$	48,014

Schedule of Present Loans by Class Modified as TDRs that Occurred

The following tables present loans by class modified as TDRs that occurred during the three and nine months ended September 30, 2022:

	Loans Modified as a TDR for the Three Months Ended September 30, 2022 (Dollars in Thousands)				Loans Modified as a TDR for the Nine Months Ended September 30, 2022 (Dollars in Thousands)
Troubled Debt Restructurings	Number of Loans		Recorded Investment (as of period end)		Number of Loans		Recorded Investment (as of period end)
Real Estate:
Residential		3	$	1,084		11	$	2,097
Commercial		1		115		4		5,094
Construction		—		—		—		—
Other Loans:
Commercial		1		17		3		4,281
Home equity and improvement		3		198		6		277
Consumer finance		3		43		8		87
Total		11	$	1,457		32	$	11,836

The loans described above increased the ACL by $28,000 and $428,000 in the three and nine months ended September 30, 2022, respectively.

	Loans Modified as a TDR for the Three Months Ended September 30, 2021 (Dollars in Thousands)				Loans Modified as a TDR for the Nine Months Ended September 30, 2021 (Dollars in Thousands)
Troubled Debt Restructurings	Number of Loans		Recorded Investment (as of period end)		Number of Loans		Recorded Investment (as of period end)
Real Estate:
Residential		1	$	263		4	$	512
Commercial		—		—		—		—
Construction		—		—		—		—
Other Loans:
Commercial		1		275		6		1,853
Home equity and improvement		—		—		—		—
Consumer finance		—		—		—		—
Total		2	$	538		10	$	2,365

The following table presents loans by class modified as TDRs for which there was a payment default within twelve months following the modification during the three and nine months ended September 30, 2022:

	Three Months Ended September 30, 2022				Nine Months Ended September 30, 2022
	(Dollars in Thousands)				(Dollars in Thousands)
Troubled Debt Restructurings That Subsequently Defaulted	Number of Loans		Recorded Investment (as of period end)		Number of Loans		Recorded Investment (as of period end)
Real Estate:
Residential		2	$	219		3	$	282
Commercial		—		—		—		—
Construction		—		—		—		—
Other Loans:
Commercial		—		—		—		—
Home equity and improvement		—		—		—		—
Consumer finance		2		40		2		40
Total		4	$	259		5	$	322

Schedule of Risk Category of Loans by Class of Loans

As of September 30, 2022, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows (in thousands):

Class	Unclassified		Special Mention		Substandard		Doubtful		Total classified		Total
Real Estate:
Residential	$	1,463,034	$	1,267	$	7,121	$	—	$	7,121	$	1,471,422
Commercial		2,588,092		65,233		22,234		—		22,234		2,675,559
Construction		515,948		1,300		—		—		—		517,248
Other Loans:
Commercial		1,009,333		20,106		6,951		—		6,951		1,036,390
Home equity and improvement		268,385		—		1,402		—		1,402		269,787
Consumer finance		212,853		—		1,891		—		1,891		214,744
PCD		17,044		93		5,421		—		5,421		22,558
Total Loans	$	6,074,689	$	87,999	$	45,020	$	—	$	45,020	$	6,207,708

As of December 31, 2021, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows (in thousands):

Class	Unclassified		Special Mention		Substandard		Doubtful		Total classified		Total
Real Estate:
Residential	$	1,146,212	$	1,316	$	10,066	$	—	$	10,066	$	1,157,594
Commercial		2,324,846		93,676		29,141		—		29,141		2,447,663
Construction		365,403		19,522		—		—		—		384,925
Other Loans:
Commercial		856,402		14,815		13,752		—		13,752		884,969
Home equity and improvement		258,914		—		2,034		—		2,034		260,948
Consumer finance		125,879		—		1,853		—		1,853		127,732
PCD		19,547		101		12,689		—		12,689		32,337
Total Loans	$	5,097,203	$	129,430	$	69,535	$	—	$	69,535	$	5,296,168

Summary of Amortized Cost Basis of Loans by Credit Quality Indicator and Class of Loans

The tables below present the amortized cost basis of loans by credit quality indicator and class of loans as of September 30, 2022 and December 31, 2021 (in thousands):

	Term of loans by origination
	2022		2021		2020		2019		2018		Prior		Revolving Loans		Total
As of September 30, 2022
Real Estate
Residential:
Risk Rating
Pass	$	194,669	$	472,696	$	338,397	$	95,857	$	53,398	$	306,452	$	1,565	$	1,463,034
Special Mention		—		183		182		—		—		144		758		1,267
Substandard		—		1,397		741		856		591		3,536		—		7,121
Doubtful		—		—		—		—		—		—		—		—
Total	$	194,669	$	474,276	$	339,320	$	96,713	$	53,989	$	310,132	$	2,323	$	1,471,422
Commercial:
Risk Rating
Pass	$	468,444	$	504,860	$	521,889	$	321,775	$	198,095	$	560,364	$	12,665	$	2,588,092
Special Mention		2,345		2,284		—		268		25,660		34,210		466		65,233
Substandard		116		2,121		549		4,612		4,490		10,120		226		22,234
Doubtful		—		—		—		—		—		—		—		—
Total	$	470,905	$	509,265	$	522,438	$	326,655	$	228,245	$	604,694	$	13,357	$	2,675,559
Construction:
Risk Rating
Pass	$	213,186	$	220,569	$	52,156	$	30,037	$	-	$	—	$	-	$	515,948
Special Mention		—		1,300		—		—		—		—		—		1,300
Substandard		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—
Total	$	213,186	$	221,869	$	52,156	$	30,037	$	-	$	—	$	-	$	517,248
Other Loans
Commercial:
Risk Rating
Pass	$	224,003	$	209,901	$	97,286	$	58,663	$	28,214	$	27,355	$	363,911	$	1,009,333
Special Mention		2,527		3,733		2,099		1,694		1,291		5,572		3,190		20,106
Substandard		40		120		3,898		5		190		200		2,498		6,951
Doubtful		—		—		—		—		—		—		—		—
Total	$	226,570	$	213,754	$	103,283	$	60,362	$	29,695	$	33,127	$	369,599	$	1,036,390
Home equity and Improvement:
Risk Rating
Pass	$	21,616	$	21,726	$	5,606	$	3,744	$	1,948	$	31,676	$	182,069	$	268,385
Special Mention		—		—		—		—		—		—		—		—
Substandard		—		14		—		28		32		521		807		1,402
Doubtful		—		—		—		—		—		—		—		—
Total	$	21,616	$	21,740	$	5,606	$	3,772	$	1,980	$	32,197	$	182,876	$	269,787
Consumer Finance:
Risk Rating
Pass	$	123,887	$	36,307	$	19,016	$	15,473	$	5,140	$	3,279	$	9,751	$	212,853
Special Mention		—		—		—		—		—		—		—		—
Substandard		61		554		715		393		97		70		1		1,891
Doubtful		—		—		—		—		—		—		—		—
Total	$	123,948	$	36,861	$	19,731	$	15,866	$	5,237	$	3,349	$	9,752	$	214,744
PCD:
Risk Rating
Pass	$	—	$	—	$	—	$	137	$	376	$	13,343	$	3,188	$	17,044
Special Mention		—		—		—		—		—		93		—		93
Substandard		—		—		—		3		27		4,393		998		5,421
Doubtful		—		—		—		—		—		—		—		—
Total	$	—	$	—	$	—	$	140	$	403	$	17,829	$	4,186	$	22,558

	Term of loans by origination
	2021		2020		2019		2018		2017		Prior		Revolving Loans		Total
As of December 31, 2021
Real Estate
Residential:
Risk Rating
Pass	$	219,006	$	373,439	$	112,781	$	65,544	$	71,794	$	301,735	$	1,913	$	1,146,212
Special Mention		—		190		—		—		59		109		958		1,316
Substandard		465		780		1,198		1,006		2,095		4,522		—		10,066
Doubtful		—		—		—		—		—		—		—		—
Total	$	219,471	$	374,409	$	113,979	$	66,550	$	73,948	$	306,366	$	2,871	$	1,157,594
Commercial:
Risk Rating
Pass	$	514,333	$	493,575	$	388,117	$	230,734	$	237,712	$	451,113	$	9,262	$	2,324,846
Special Mention		294		5,349		5,533		11,055		49,993		20,662		790		93,676
Substandard		172		570		4,920		5,525		62		17,665		227		29,141
Doubtful		—		—		—		—		—		—		—		—
Total	$	514,799	$	499,494	$	398,570	$	247,314	$	287,767	$	489,440	$	10,279	$	2,447,663
Construction:
Risk Rating
Pass	$	198,221	$	100,606	$	55,707	$	10,039	$	685	$	145	$	—	$	365,403
Special Mention		—		12,500		—		5,996		1,026		—		—		19,522
Substandard		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—
Total	$	198,221	$	113,106	$	55,707	$	16,035	$	1,711	$	145	$	—	$	384,925
Other Loans
Commercial:
Risk Rating
Pass	$	293,644	$	132,703	$	84,668	$	47,421	$	24,269	$	17,038	$	256,659	$	856,402
Special Mention		—		2,180		4,094		272		1,264		4,663		2,342		14,815
Substandard		136		11,550		23		288		388		131		1,236		13,752
Doubtful		—		—		—		—		—		—		—		—
Total	$	293,780	$	146,433	$	88,785	$	47,981	$	25,921	$	21,832	$	260,237	$	884,969
Home equity and Improvement:
Risk Rating
Pass	$	24,707	$	6,870	$	4,867	$	2,879	$	5,534	$	31,317	$	182,740	$	258,914
Special Mention		—		—		—		—		—		—		—		—
Substandard		15		—		28		48		27		690		1,226		2,034
Doubtful		—		—		—		—		—		—		—		—
Total	$	24,722	$	6,870	$	4,895	$	2,927	$	5,561	$	32,007	$	183,966	$	260,948
Consumer Finance:
Risk Rating
Pass	$	50,202	$	25,866	$	23,000	$	9,643	$	4,313	$	2,769	$	10,086	$	125,879
Special Mention		—		—		—		—		—		—		—		—
Substandard		196		707		619		129		67		131		4		1,853
Doubtful		—		—		—		—		—		—		—		—
Total	$	50,398	$	26,573	$	23,619	$	9,772	$	4,380	$	2,900	$	10,090	$	127,732
PCD:
Risk Rating
Pass	$	—	$	—	$	170	$	1,753	$	1,860	$	12,496	$	3,268	$	19,547
Special Mention		—		—		—		—		—		101		—		101
Substandard		—		—		67		28		3,242		6,490		2,862		12,689
Doubtful		—		—		—		—		—		—		—		—
Total	$	—	$	—	$	237	$	1,781	$	5,102	$	19,087	$	6,130	$	32,337

Summary of Credit Loss Estimation

The remaining life method was selected for the consumer direct loan segment since the pool contains loans with many different structures and payment streams and collateral. The weighted average remaining life uses an average annual charge-off rate applied to the contractual term, further adjusted for estimated prepayments to determine the unadjusted historical charge-off rate for the remaining balance of assets.

Portfolio Segments	Loan Pool	Methodology	Loss Drivers
Residential real estate	1-4 Family nonowner occupied	DCF	National unemployment
	1-4 Family owner occupied	DCF	National unemployment
Commercial real estate	Commercial real estate nonowner occupied	DCF	National unemployment
	Commercial real estate owner occupied	DCF	National unemployment
	Multi Family	DCF	National unemployment
	Agriculture Land	DCF	National unemployment
	Other commercial real estate	DCF	National unemployment
Construction secured by real estate	Construction Other	PD/LGD	Call report loss history
	Construction Residential	PD/LGD	Call report loss history
Commercial	Commercial working capital	PD/LGD	Call report loss history
	Agriculture production	PD/LGD	Call report loss history
	Other commercial	PD/LGD	Call report loss history
Home equity and improvement	Home equity and improvement	PD/LGD	Call report loss history
Consumer finance	Consumer direct	Remaining life	Call report loss history
	Consumer indirect	DCF	National unemployment

Schedule of allowance for credit loss (ACL) activity

The following table discloses allowance for credit loss (“ACL”) activity for the three and nine months ended September 30, 2022 and 2021 by portfolio segment (in thousands):

Three Months Ended September 30, 2022	Residential Real Estate			Commercial Real Estate			Construction		Commercial			Home Equity and Improvement			Consumer Finance			Total
Beginning Allowance	$	14,113		$	34,952		$	2,999	$	9,762		$	4,003		$	1,245		$	67,074
Charge-Offs		(15	)		(206	)		—		(29	)		(47	)		(185	)		(482	)
Recoveries		77			48			—		84			95			24			328
Provisions		2,136			(2,082	)		287		2,465			159			741			3,706
Ending Allowance	$	16,311		$	32,712		$	3,286	$	12,282		$	4,210		$	1,825		$	70,626

Nine Months Ended September 30, 2022	Residential Real Estate			Commercial Real Estate			Construction			Commercial			Home Equity and Improvement			Consumer Finance			Total
Beginning Allowance	$	12,029		$	32,399		$	3,004		$	13,410		$	4,221		$	1,405		$	66,468
Charge-Offs		(1,016	)		(350	)		(16	)		(5,342	)		(324	)		(426	)		(7,474	)
Recoveries		831			562			3			370			208			175			2,149
Provisions		4,467			101			295			3,844			105			671			9,483
Ending Allowance	$	16,311		$	32,712		$	3,286		$	12,282		$	4,210		$	1,825		$	70,626

Three Months Ended September 30, 2021	Residential Real Estate			Commercial Real Estate			Construction		Commercial			Home Equity and Improvement			Consumer Finance			Total
Beginning Allowance	$	15,268		$	34,461		$	2,739	$	12,211		$	4,988		$	1,700		$	71,367
Charge-Offs		(27	)		(84	)		—		(375	)		(47	)		(85	)		(618	)
Recoveries		75			143			—		576			23			57			874
Provisions		(1,567	)		(428	)		882		3,016			(276	)		(33	)		1,594
Ending Allowance	$	13,749		$	34,092		$	3,621	$	15,428		$	4,688		$	1,639		$	73,217

Nine Months Ended  September 30, 2021	Residential Real Estate			Commercial Real Estate			Construction		Commercial			Home Equity and Improvement			Consumer Finance			Total
Beginning Allowance	$	17,534		$	43,417		$	2,741	$	11,665		$	4,739		$	1,983		$	82,079
Charge-Offs		(29	)		(689	)		—		(445	)		(50	)		(227	)		(1,440	)
Recoveries		165			332			12		1,279			217			122			2,127
Provisions		(3,921	)		(8,968	)		868		2,929			(218	)		(239	)		(9,549	)
Ending Allowance	$	13,749		$	34,092		$	3,621	$	15,428		$	4,688		$	1,639		$	73,217

Schedule of Outstanding Balance and Related Allowance on Loans

The outstanding balance and related allowance on these loans as of September 30, 2022 and December 31, 2021 is as follows (in thousands):

	As of September 30, 2022				As of December 31, 2021
	Loan Balance		ACL Balance		Loan Balance		ACL Balance
	(In Thousands)				(In Thousands)
Real Estate:
Residential	$	11,890	$	151	$	13,396	$	197
Commercial		1,627		27		5,878		151
Construction		—		—		—		—
		13,517		178		19,274		348
Other Loans:
Commercial		6,163		871		9,167		1,531
Home equity and improvement		2,581		104		3,405		154
Consumer finance		297		5		491		7
		9,041		980		13,063		1,692
Total	$	22,558	$	1,158	$	32,337	$	2,040