LOANS RECEIVABLE AND THE ALLOWANCE FOR LOAN LOSSES

6 Months Ended

Jun. 30, 2014

LOANS RECEIVABLE AND THE ALLOWANCE FOR LOAN LOSSES

The Banks originate residential mortgage loans for both portfolio investment and sale in the secondary market. At the time of origination, mortgage loans are designated as held for sale or held for investment. Loans held for sale are stated at the lower of cost or estimated market value determined on an aggregate basis. Net unrealized losses on loans held for sale are recognized through a valuation allowance by charges to income. The Banks also originate construction, land and land development, commercial and multifamily real estate, commercial business, agricultural business and consumer loans for portfolio investment. Loans receivable not designated as held for sale are recorded at the principal amount outstanding, net of deferred fees and origination costs, and discounts and premiums. Premiums, discounts and deferred loan fees and origination costs are amortized to maturity using the level-yield methodology.

Interest is accrued as earned unless management doubts the collectability of the loan or the unpaid interest. Interest accruals are generally discontinued when loans become 90 days past due for scheduled interest payments. All previously accrued but uncollected interest is deducted from interest income upon transfer to nonaccrual status. Future collection of interest is included in interest income based upon an assessment of the likelihood that the loans will be repaid or recovered. A loan may be put on nonaccrual status sooner than this policy would dictate if, in management’s judgment, the loan may be uncollectable. Such interest is then recognized as income only if it is ultimately collected.

Loans receivable, including loans held for sale, at June 30, 2014, December 31, 2013 and June 30, 2013 are summarized as follows (dollars in thousands):



	June 30, 2014					December 31, 2013					June 30, 2013
	Amount			Percent of Total		Amount			Percent of Total		Amount			Percent of Total
Commercial real estate:
Owner-occupied	$	541,558		14.4	%	$	502,601		14.7	%	$	500,812		15.2	%
Investment properties	807,499			21.5		692,457			20.3		595,896			18.1
Multifamily real estate	188,792			5.0		137,153			4.0		137,027			4.2
Commercial construction	12,638			0.3		12,168			0.4		25,629			0.8
Multifamily construction	39,864			1.1		52,081			1.5		39,787			1.2
One- to four-family construction	213,414			5.7		200,864			5.8		191,003			5.8
Land and land development:
Residential	73,030			1.9		75,695			2.2		86,037			2.6
Commercial	10,679			0.3		10,450			0.3		11,228			0.3
Commercial business	735,128			19.5		682,169			20.0		639,840			19.5
Agricultural business, including secured by farmland	245,742			6.5		228,291			6.7		233,967			7.1
One- to four-family residential	558,744			14.9		529,494			15.5		552,698			16.8
Consumer:
Consumer secured by one- to four-family	209,511			5.6		173,188			5.1		163,339			5.0
Consumer-other	126,000			3.3		121,834			3.5		112,938			3.4
Total loans outstanding	3,762,599			100.0	%	3,418,445			100.0	%	3,290,201			100.0	%
Less allowance for loan losses	(74,310		)			(74,258		)			(76,121		)
Net loans	$	3,688,289				$	3,344,187				$	3,214,080

Loan amounts are net of unearned loan fees in excess of unamortized costs of $8.4 million as of June 30, 2014, $8.3 million as of December 31, 2013 and $8.9 million as of June 30, 2013.

The Company’s total loans by geographic concentration at June 30, 2014 were as follows (dollars in thousands):



	Washington			Oregon			Idaho			Other			Total
Commercial real estate:
Owner-occupied	$	388,662		$	85,787		$	54,529		$	12,580		$	541,558
Investment properties	535,393			116,493			59,700			95,913			807,499
Multifamily real estate	146,291			27,175			14,932			394			188,792
Commercial construction	11,770			—			868			—			12,638
Multifamily construction	33,454			6,410			—			—			39,864
One- to four-family construction	127,627			83,832			1,955			—			213,414
Land and land development:
Residential	40,492			31,358			1,180			—			73,030
Commercial	5,163			2,605			2,911			—			10,679
Commercial business	397,570			120,286			66,940			150,332			735,128
Agricultural business, including secured by farmland	134,477			59,120			52,145			—			245,742
One- to four-family residential	332,850			202,853			22,025			1,016			558,744
Consumer:
Consumer secured by one- to four-family	125,888			68,272			14,314			1,037			209,511
Consumer—other	81,884			37,708			6,000			408			126,000
Total loans	$	2,361,521		$	841,899		$	297,499		$	261,680		$	3,762,599
Percent of total loans	62.7		%	22.4		%	7.9		%	7.0		%	100.0		%

The geographic concentrations of the Company’s land and land development loans by state at June 30, 2014 were as follows (dollars in thousands):



	Washington			Oregon			Idaho			Total
Residential:
Acquisition and development	$	15,752		$	13,457		$	983		$	30,192
Improved land and lots	19,261			17,289			197			36,747
Unimproved land	5,479			612			—			6,091
Commercial:
Acquisition and development	—			—			—			—
Improved land and lots	2,913			500			1,785			5,198
Unimproved land	2,250			2,105			1,126			5,481
Total land and land development loans	$	45,655		$	33,963		$	4,091		$	83,709
Percent of land and land development loans	54.5		%	40.6		%	4.9		%	100.0		%

The Company originates both adjustable- and fixed-rate loans. The maturity and repricing composition of those loans, less undisbursed amounts and deferred fees and origination costs, at June 30, 2014, December 31, 2013 and June 30, 2013 were as follows (in thousands):



	June 30, 2014		December 31, 2013		June 30, 2013
Fixed-rate (term to maturity):
Maturing in one year or less	$	122,304	$	122,313	$	145,221
Maturing after one year through three years	148,398		143,322		167,187
Maturing after three years through five years	195,309		187,279		201,672
Maturing after five years through ten years	222,369		209,869		192,594
Maturing after ten years	511,972		439,004		425,603
Total fixed-rate loans	1,200,352		1,101,787		1,132,277
Adjustable-rate (term to rate adjustment):
Maturing or repricing in one year or less	1,510,684		1,390,579		1,292,387
Maturing or repricing after one year through three years	372,477		279,791		266,841
Maturing or repricing after three years through five years	568,997		541,529		526,563
Maturing or repricing after five years through ten years	108,989		99,503		69,797
Maturing or repricing after ten years	1,100		5,256		2,336
Total adjustable-rate loans	2,562,247		2,316,658		2,157,924
Total loans	$	3,762,599	$	3,418,445	$	3,290,201

The adjustable-rate loans have interest rate adjustment limitations and are generally indexed to various prime or London Inter-bank Offering Rate (LIBOR) rates, One to Five Year Constant Maturity Treasury Indices or FHLB advance rates. Future market factors may affect the correlation of the interest rate adjustment with the rates the Banks pay on the short-term deposits that were primarily utilized to fund these loans.

Impaired Loans and the Allowance for Loan Losses. A loan is considered impaired when, based on current information and circumstances, the Company determines it is probable that it will be unable to collect all amounts due according to the contractual terms of the loan agreement, including scheduled interest payments. Impaired loans are comprised of loans on nonaccrual, troubled debt restructurings (TDRs) that are performing under their restructured terms, and loans that are 90 days or more past due, but are still on accrual.

Troubled Debt Restructures. Some of the Company’s loans are reported as TDRs. Loans are reported as TDRs when the bank grants one or more concessions to a borrower experiencing financial difficulties that it would not otherwise consider. Examples of such concessions include forgiveness of principal or accrued interest, extending the maturity date(s) or providing a lower interest rate than would be normally available for a transaction of similar risk. Our TDRs have generally not involved forgiveness of amounts due, but almost always include a modification of multiple factors; the most common combination includes interest rate, payment amount and maturity date. As a result of these concessions, restructured loans are impaired as the Company will not collect all amounts due, both principal and interest, in accordance with the terms of the original loan agreement. Loans identified as TDRs are accounted for in accordance with the Company's impaired loan accounting policies.

The amount of impaired loans and the related allocated reserve for loan losses as of June 30, 2014 and December 31, 2013 were as follows (in thousands):



	June 30, 2014				December 31, 2013
	Loan Amount		Allocated Reserves		Loan Amount		Allocated Reserves
Impaired loans:
Nonaccrual loans
Commercial real estate:
Owner-occupied	$	2,381	$	36	$	2,466	$	31
Investment properties	311		62		3,821		89
Multifamily real estate	422		60		—		—
One- to four-family construction	—		—		269		—
Land and land development:
Residential	1,296		176		924		6
Commercial business	925		69		724		104
Agricultural business, including secured by farmland	104		6		—		—
One- to four-family residential	9,354		53		12,532		250
Consumer:
Consumer secured by one- to four-family	1,024		49		903		13
Consumer—other	181		—		269		1
Total nonaccrual loans	15,998		511		21,908		494

Loans 90 days or more past due and still accruing
Commercial real estate:
Owner-occupied	993		1		—		—
Commercial business	280		6		—		—
Agricultural business, including secured by farmland	—		—		105		8
One- to four-family residential	2,181		11		2,611		16
Consumer:
Consumer secured by one- to four-family	6		—		13		—
Consumer—other	287		—		131		1
Total loans past due and still accruing	3,747		18		2,860		25

Troubled debt restructuring on accrual status:
Commercial real estate:
Owner-occupied	184		4		186		4
Investment properties	6,101		747		5,367		415
Multifamily real estate	5,705		850		5,744		1,139
One- to four-family construction	4,831		656		6,864		1,002
Land and land development:
Residential	1,638		459		4,061		754
Commercial business	989		163		1,299		222
One- to four-family residential	17,521		1,131		23,302		1,355
Consumer:
Consumer secured by one- to four-family	259		28		360		33
Consumer—other	233		33		245		34
Total troubled debt restructurings on accrual status	37,461		4,071		47,428		4,958
Total impaired loans	$	57,206	$	4,600	$	72,196	$	5,477

As of June 30, 2014 and December 31, 2013, the Company had commitments to advance funds up to an additional amount of $731,000 and $225,000, respectively, related to TDRs.

The following tables provide additional information on impaired loans with and without specific allowance reserves at or for the six months ended June 30, 2014 and at or for the year ended December 31, 2013 (in thousands):



	At or For the Six Months Ended June 30, 2014
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
Without a specific allowance reserve ⁽¹⁾
Commercial real estate:
Owner-occupied	$	1,599	$	1,649	$	37	$	1,604	$	18
Investment properties	311		857		62		334		—
Multifamily real estate	422		422		60		433		—
Commercial business	1,205		1,571		75		1,299		5
Agricultural business/farmland	104		104		6		104		—
One- to four-family residential	7,923		8,395		26		7,804		13
Consumer:
Consumer secured by one- to four-family	663		676		11		672		—
Consumer—other	348		352		—		354		4
	12,575		14,026		277		12,604		40
With a specific allowance reserve ⁽²⁾
Commercial real estate:
Owner-occupied	1,959		1,959		4		2,070		6
Investment properties	6,101		6,506		747		6,147		160
Multifamily real estate	5,705		5,705		850		5,719		127
One- to-four family construction	4,831		4,831		656		4,592		103
Land and land development:
Residential	2,934		4,089		635		2,943		46
Commercial business	989		989		162		1,035		28
One- to four-family residential	21,133		21,892		1,170		21,870		453
Consumer:
Consumer secured by one- to four-family	627		627		66		677		9
Consumer—other	352		369		33		360		11
	44,631		46,967		4,323		45,413		943
Total
Commercial real estate:
Owner-occupied	3,558		3,608		41		3,674		24
Investment properties	6,412		7,363		809		6,481		160
Multifamily real estate	6,127		6,127		910		6,152		127
One- to four-family construction	4,831		4,831		656		4,592		103
Land and land development:
Residential	2,934		4,089		635		2,943		46
Commercial business	2,194		2,560		237		2,334		33
Agricultural business/farmland	104		104		6		104		—
One- to four-family residential	29,056		30,287		1,196		29,674		466
Consumer:
Consumer secured by one- to four-family	1,290		1,303		77		1,349		9
Consumer—other	700		721		33		714		15
	$	57,206	$	60,993	$	4,600	$	58,017	$	983



	At or For the Year Ended December 31, 2013
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
Without a specific allowance reserve ⁽¹⁾
Commercial real estate:
Owner-occupied	$	534	$	584	$	31	$	569	$	—
Investment properties	429		974		89		624		—
Commercial business	724		1,040		104		896		—
Agricultural business/farmland	105		105		8		110		8
One- to four-family residential	8,611		9,229		42		8,889		31
Consumer:
Consumer secured by one- to four-family	870		1,013		13		900		1
Consumer—other	276		285		2		287		8
	11,549		13,230		289		12,275		48
With a specific allowance reserve ⁽²⁾
Commercial real estate:
Owner-occupied	2,118		2,118		4		2,192		12
Investment properties	8,759		10,395		415		8,353		241
Multifamily real estate	5,744		5,744		1,139		5,705		298
One- to-four family construction	7,133		7,213		1,002		5,870		239
Land and land development:
Residential	4,985		6,140		760		6,053		221
Commercial business	1,298		1,298		222		1,340		59
One- to four-family residential	29,834		31,440		1,579		31,668		1,032
Consumer:
Consumer secured by one- to four-family	406		407		33		503		24
Consumer—other	370		386		34		390		21
	60,647		65,141		5,188		62,074		2,147
Total
Commercial real estate
Owner-occupied	2,652		2,702		35		2,761		12
Investment properties	9,188		11,369		504		8,977		241
Multifamily real estate	5,744		5,744		1,139		5,705		298
One- to four-family construction	7,133		7,213		1,002		5,870		239
Land and land development
Residential	4,985		6,140		760		6,053		221
Commercial business	2,022		2,338		326		2,236		59
Agricultural business/farmland	105		105		8		110		8
One- to four-family residential	38,445		40,669		1,621		40,557		1,063
Consumer
Consumer secured by one- to four-family	1,276		1,420		46		1,403		25
Consumer—other	646		671		36		677		29
	$	72,196	$	78,371	$	5,477	$	74,349	$	2,195


⁽¹⁾	Loans without a specific allowance reserve have not been individually evaluated for impairment, but have been included in pools of homogeneous loans for evaluation of related allowance reserves.

⁽²⁾

Loans with a specific allowance reserve have been individually evaluated for impairment using either a discounted cash flow analysis or, for collateral dependent loans, current appraisals to establish realizable value. These analyses may identify a specific impairment amount needed or may conclude that no reserve is needed. Any specific impairment that is identified is included in the category’s Related Allowance column.

The following tables present TDRs at June 30, 2014 and December 31, 2013 (in thousands):



	June 30, 2014
	Accrual Status		Nonaccrual Status		Total TDRs
Commercial real estate:
Owner-occupied	$	184	$	710	$	894
Investment properties	6,101		45		6,146
Multifamily real estate	5,705		—		5,705
One- to four-family construction	4,831		—		4,831
Land and land development:
Residential	1,638		546		2,184
Commercial business	989		123		1,112
One- to four-family residential	17,521		2,211		19,732
Consumer:
Consumer secured by one- to four-family	259		168		427
Consumer—other	233		119		352
	$	37,461	$	3,922	$	41,383



	December 31, 2013
	Accrual Status		Nonaccrual Status		Total TDRs
Commercial real estate:
Owner-occupied	$	186	$	613	$	799
Investment properties	5,367		1,630		6,997
Multifamily real estate	5,744		—		5,744
One- to four-family construction	6,864		269		7,133
Land and land development:
Residential	4,061		174		4,235
Commercial business	1,299		164		1,463
One- to four-family residential	23,302		2,474		25,776
Consumer:
Consumer secured by one- to four-family	360		252		612
Consumer—other	245		123		368
	$	47,428	$	5,699	$	53,127

The following tables present new TDRs that occurred during the three and six months ended June 30, 2014 and 2013 (dollars in thousands):



	Three Months Ended June 30, 2014					Six Months Ended June 30, 2014
	Number of Contracts	Pre-modification Outstanding Recorded Investment		Post-modification Outstanding Recorded Investment		Number of Contracts	Pre- modification Outstanding Recorded Investment		Post- modification Outstanding Recorded Investment
Recorded Investment ^{(1) (2)}
Commercial real estate
Owner occupied	—	$	—	$	—	1	$	94	$	94
One- to four-family construction	4	980		980		4	980		980
Commercial business	—	—		—		1	100		100
	4	$	980	$	980	6	$	1,174	$	1,174

	Three Months Ended June 30, 2013					Six Months Ended June 30, 2013
	Number of Contracts	Pre-modification Outstanding Recorded Investment		Post-modification Outstanding Recorded Investment		Number of Contracts	Pre- modification Outstanding Recorded Investment		Post- modification Outstanding Recorded Investment
Recorded Investment ^{(1) (2)}
Commercial real estate
Investment properties	1	$	900	$	781	1	$	900	$	781
Multifamily real estate	1	378		378		1	378		378
Land and land development—residential	5	521		521		9	1,597		1,597
One- to four-family residential	—	—		—		9	3,115		3,115
	7	$	1,799	$	1,680	20	$	5,990	$	5,871


⁽¹⁾	Since most loans were already considered classified and/or on nonaccrual status prior to restructuring, the modifications did not have a material effect on the Company’s determination of the allowance for loan losses.


⁽²⁾	The majority of these modifications do not fit into one separate type, such as rate, term, amount, interest-only or payment, but instead are a combination of multiple types of modifications; therefore, they are disclosed in aggregate.

The following table presents TDRs which incurred a payment default within twelve months of the restructure date during the three and six month periods ended June 30, 2014 and 2013 (in thousands). A default on a TDR results in either a transfer to nonaccrual status or a partial charge-off:



	Three Months Ended June 30				Six Months Ended June 30
	2014		2013		2014		2013
Commercial business	$	—	$	—	$	—	$	343
Total	$	—	$	—	$	—	$	343

Credit Quality Indicators: To appropriately and effectively manage the ongoing credit quality of the Company’s loan portfolio, management has implemented a risk-rating or loan grading system for its loans. The system is a tool to evaluate portfolio asset quality throughout each applicable loan’s life as an asset of the Company. Generally, loans and leases are risk rated on an aggregate borrower/relationship basis with individual loans sharing similar ratings. There are some instances when specific situations relating to individual loans will provide the basis for different risk ratings within the aggregate relationship. Loans are graded on a scale of 1 to 9. A description of the general characteristics of these categories is shown below:

Overall Risk Rating Definitions: Risk-ratings contain both qualitative and quantitative measurements and take into account the financial strength of a borrower and the structure of the loan or lease. Consequently, the definitions are to be applied in the context of each lending transaction and judgment must also be used to determine the appropriate risk rating, as it is not unusual for a loan or lease to exhibit characteristics of more than one risk-rating category. Consideration for the final rating is centered in the borrower’s ability to repay, in a timely fashion, both principal and interest. There were no material changes in the risk-rating or loan grading system in the six months ended June 30, 2014.

Risk Rating 1: Exceptional

A credit supported by exceptional financial strength, stability, and liquidity. The risk rating of 1 is reserved for the Company’s top quality loans, generally reserved for investment grade credits underwritten to the standards of institutional credit providers.

Risk Rating 2: Excellent

A credit supported by excellent financial strength, stability and liquidity. The risk rating of 2 is reserved for very strong and highly stable customers with ready access to alternative financing sources.

Risk Rating 3: Strong

A credit supported by good overall financial strength and stability. Collateral margins are strong; cash flow is stable although susceptible to cyclical market changes.

Risk Rating 4: Acceptable

A credit supported by the borrower’s adequate financial strength and stability. Assets and cash flow are reasonably sound and provide for orderly debt reduction. Access to alternative financing sources will be more difficult to obtain.

Risk Rating 5: Watch

A credit with the characteristics of an acceptable credit which requires, however, more than the normal level of supervision and warrants formal quarterly management reporting. Credits in this category are not yet criticized or classified, but due to adverse events or aspects of underwriting require closer than normal supervision. Generally, credits should be watch credits in most cases for six months or less as the impact of stress factors are analyzed.

Risk Rating 6: Special Mention

A credit with potential weaknesses that deserves management’s close attention is risk rated a 6. If left uncorrected, these potential weaknesses will result in deterioration in the capacity to repay debt. A key distinction between Special Mention and Substandard is that in a Special Mention credit, there are identified weaknesses that pose potential risk(s) to the repayment sources, versus well defined weaknesses that pose risk(s) to the repayment sources. Assets in this category are expected to be in this category no more than 9-12 months as the potential weaknesses in the credit are resolved.

Risk Rating 7: Substandard

A credit with well defined weaknesses that jeopardize the ability to repay in full is risk rated a 7. These credits are inadequately protected by either the sound net worth and payment capacity of the borrower or the value of pledged collateral. These are credits with a distinct possibility of loss. Loans headed for foreclosure and/or legal action due to deterioration are rated 7 or worse.

Risk Rating 8: Doubtful

A credit with an extremely high probability of loss is risk rated 8. These credits have all the same critical weaknesses that are found in a substandard loan; however, the weaknesses are elevated to the point that based upon current information, collection or liquidation in full is improbable. While some loss on doubtful credits is expected, pending events may strengthen a credit making the amount and timing of any loss indeterminable. In these situations taking the loss is inappropriate until it is clear that the pending event has failed to strengthen the credit and improve the capacity to repay debt.

Risk Rating 9: Loss

A credit that is considered to be currently uncollectible or of such little value that it is no longer a viable Bank asset is risk rated 9. Losses should be taken in the accounting period in which the credit is determined to be uncollectible. Taking a loss does not mean that a credit has absolutely no recovery or salvage value but, rather, it is not practical or desirable to defer writing off the credit, even though partial recovery may occur in the future.

The following table shows the Company’s portfolio of risk-rated loans and non-risk-rated loans by grade or other characteristics as of June 30, 2014 and December 31, 2013 (in thousands):



	June 30, 2014
	Commercial Real Estate		Multifamily		Construction and Land		Commercial Business		Agricultural Business		One- to Four-Family		Consumer		Total Loans
Risk-rated loans:
Pass (Risk Ratings 1-5) ⁽¹⁾	$	1,316,537	$	182,634	$	331,354	$	717,421	$	244,510	$	545,231	$	332,059	$	3,669,746
Special mention	5,623		—		—		8,188		578		64		134		14,587
Substandard	26,453		6,158		18,271		9,511		654		13,449		3,306		77,802
Doubtful	444		—		—		8		—		—		12		464
Loss	—		—		—		—		—		—		—		—
Total loans	$	1,349,057	$	188,792	$	349,625	$	735,128	$	245,742	$	558,744	$	335,511	$	3,762,599

Performing loans	$	1,345,372	$	188,370	$	348,329	$	733,923	$	245,638	$	547,209	$	334,013	$	3,742,854
Non-performing loans ⁽²⁾	3,685		422		1,296		1,205		104		11,535		1,498		19,745
Total loans	$	1,349,057	$	188,792	$	349,625	$	735,128	$	245,742	$	558,744	$	335,511	$	3,762,599

	December 31, 2013
	Commercial Real Estate		Multifamily		Construction and Land		Commercial Business		Agricultural Business		One- to Four-Family		Consumer		Total Loans
Risk-rated loans:
Pass (Risk Ratings 1-5) ⁽¹⁾	$	1,160,921	$	131,523	$	332,150	$	655,007	$	225,329	$	511,967	$	291,992	$	3,308,889
Special mention	6,614		—		350		10,484		561		—		106		18,115
Substandard	26,979		5,630		18,758		16,669		2,401		17,527		2,924		90,888
Doubtful	544		—		—		9		—		—		—		553
Loss	—		—		—		—		—		—		—		—
Total loans	$	1,195,058	$	137,153	$	351,258	$	682,169	$	228,291	$	529,494	$	295,022	$	3,418,445

Performing loans	$	1,188,771	$	137,153	$	350,065	$	681,445	$	228,187	$	514,351	$	293,705	$	3,393,677
Non-performing loans ⁽²⁾	6,287		—		1,193		724		104		15,143		1,317		24,768
Total loans	$	1,195,058	$	137,153	$	351,258	$	682,169	$	228,291	$	529,494	$	295,022	$	3,418,445

⁽¹⁾

The Pass category includes some performing loans that are part of homogenous pools which are not individually risk-rated. This includes all consumer loans, all one- to four-family residential loans and, as of June 30, 2014 and December 31, 2013, in the commercial business category, $103 million and $94 million, respectively, of credit-scored small business loans. As loans in these pools become non-performing, they are individually risk-rated.


⁽²⁾	Non-performing loans include non-accrual loans and loans past due greater than 90 days and on accrual status.

The following tables provide additional detail on the age analysis of the Company’s past due loans as of June 30, 2014 and December 31, 2013 (in thousands):



	June 30, 2014
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total Past Due		Current		Total Loans		Loans 90 Days or More Past Due and Accruing
Commercial real estate:
Owner-occupied	$	2,896	$	18	$	1,437	$	4,351	$	537,207	$	541,558	$	993
Investment properties	—		—		—		—		807,499		807,499		—
Multifamily real estate	423		—		—		423		188,369		188,792		—
Commercial construction	—		—		—		—		12,638		12,638		—
Multifamily construction	—		—		—		—		39,864		39,864		—
One-to-four-family construction	—		—		—		—		213,414		213,414		—
Land and land development:
Residential	—		—		—		—		73,030		73,030		—
Commercial	—		—		—		—		10,679		10,679		—
Commercial business	673		209		1,622		2,504		732,624		735,128		280
Agricultural business, including secured by farmland	12		250		104		366		245,376		245,742		—
One- to four-family residential	484		2,720		7,552		10,756		547,988		558,744		2,181
Consumer:
Consumer secured by one- to four-family	182		757		474		1,413		208,098		209,511		6
Consumer—other	545		75		287		907		125,093		126,000		287
Total	$	5,215	$	4,029	$	11,476	$	20,720	$	3,741,879	$	3,762,599	$	3,747



	December 31, 2013
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total Past Due		Current		Total Loans		Loans 90 Days or More Past Due and Accruing
Commercial real estate:
Owner-occupied	$	883	$	550	$	813	$	2,246	$	500,355	$	502,601	$	—
Investment properties	—		—		—		—		692,457		692,457		—
Multifamily real estate	1,845		785		—		2,630		134,523		137,153		—
Commercial construction	—		—		—		—		12,168		12,168		—
Multifamily construction	—		—		—		—		52,081		52,081		—
One-to-four-family construction	9		7		4		20		200,844		200,864		—
Land and land development:
Residential	—		—		251		251		75,444		75,695		—
Commercial	—		—		—		—		10,450		10,450		—
Commercial business	2,001		2		299		2,302		679,867		682,169		—
Agricultural business, including secured by farmland	—		—		—		—		228,291		228,291		105
One-to four-family residential	521		2,550		9,142		12,213		517,281		529,494		2,611
Consumer:
Consumer secured by one- to four-family	723		93		918		1,734		171,454		173,188		13
Consumer—other	384		99		131		614		121,220		121,834		131
Total	$	6,366	$	4,086	$	11,558	$	22,010	$	3,396,435	$	3,418,445	$	2,860

The following tables provide additional information on the allowance for loan losses and loan balances individually and collectively evaluated for impairment at or for the three and six months ended June 30, 2014 and 2013 (in thousands):



	For the Three Months Ended June 30, 2014
	Commercial Real Estate			Multifamily		Construction and Land			Commercial Business			Agricultural Business			One- to Four-Family			Consumer			Unallocated			Total
Allowance for loan losses:
Beginning balance	$	17,412		$	5,652	$	18,620		$	11,363		$	2,636		$	10,913		$	912		$	6,863		$	74,371
Provision for loan losses	2,199			113		(1,048		)	625			(123		)	(1,833		)	(38		)	105			—
Recoveries	274			—		472			286			311			204			58			—			1,605
Charge-offs	(1,001		)	—		(207		)	(260		)	—			(14		)	(184		)	—			(1,666		)
Ending balance	$	18,884		$	5,765	$	17,837		$	12,014		$	2,824		$	9,270		$	748		$	6,968		$	74,310

	For the Six Months Ended June 30, 2014
	Commercial Real Estate			Multifamily		Construction and Land			Commercial Business			Agricultural business			One- to Four- Family			Consumer			Unallocated			Total
Allowance for loan losses:
Beginning balance	$	16,759		$	5,306	$	17,640		$	11,773		$	2,841		$	11,486		$	1,335		$	7,118		$	74,258
Provision for loan losses	2,794			459		(300		)	660			(678		)	(2,215		)	(570		)	(150		)	—
Recoveries	570			—		704			579			661			392			340			—			3,246
Charge-offs	(1,239		)	—		(207		)	(998		)	—			(393		)	(357		)	—			(3,194		)
Ending balance	$	18,884		$	5,765	$	17,837		$	12,014		$	2,824		$	9,270		$	748		$	6,968		$	74,310



	At June 30, 2014
	Commercial Real Estate		Multifamily		Construction and Land		Commercial Business		Agricultural Business		One- to Four-Family		Consumer		Unallocated		Total
Allowance individually evaluated for impairment	$	751	$	850	$	1,291	$	162	$	—	$	1,170	$	99	$	—	$	4,323
Allowance collectively evaluated for impairment	18,133		4,915		16,546		11,852		2,824		8,100		649		6,968		69,987
Total allowance for loan losses	$	18,884	$	5,765	$	17,837	$	12,014	$	2,824	$	9,270	$	748	$	6,968	$	74,310



	At June 30, 2014
	Commercial Real Estate		Multifamily		Construction and Land		Commercial Business		Agricultural Business		One- to Four-Family		Consumer		Unallocated		Total
Loan balances:
Loans individually evaluated for impairment	$	8,060	$	5,705	$	7,765	$	989	$	—	$	21,133	$	979	$	—	$	44,631
Loans collectively evaluated for impairment	1,340,997		183,087		341,860		734,139		245,742		537,611		334,532		—		3,717,968
Total loans	$	1,349,057	$	188,792	$	349,625	$	735,128	$	245,742	$	558,744	$	335,511	$	—	$	3,762,599



	For the Three Months Ended June 30, 2013
	Commercial Real Estate			Multifamily			Construction and Land			Commercial Business			Agricultural Business		One- to Four-Family			Consumer			Unallocated			Total
Allowance for loan losses:
Beginning balance	$	14,776		$	5,075		$	15,214		$	10,011		$	2,282	$	15,930		$	1,238		$	11,870		$	76,396
Provision for loan losses	162			(102		)	1,493			527			1,213		(557		)	105			(2,841		)	—
Recoveries	378			—			337			666			310		3			117			—			1,811
Charge-offs	(418		)	—			(419		)	(398		)	—		(402		)	(449		)	—			(2,086		)
Ending balance	$	14,898		$	4,973		$	16,625		$	10,806		$	3,805	$	14,974		$	1,011		$	9,029		$	76,121

	For the Six Months Ended June 30, 2013
	Commercial Real Estate			Multifamily			Construction and Land			Commercial Business			Agricultural business		One- to Four- Family			Consumer			Unallocated			Total
Allowance for loan losses:
Beginning balance	$	15,322		$	4,506		$	14,991		$	9,957		$	2,295	$	16,475		$	1,348		$	11,865		$	76,759
Provision for loan losses	(1,622		)	467			2,050			1,124			1,163		(567		)	221			(2,836		)	—
Recoveries	1,964			—			438			1,052			347		119			219			—			4,139
Charge-offs	(766		)	—			(854		)	(1,327		)	—		(1,053		)	(777		)	—			(4,777		)
Ending balance	$	14,898		$	4,973		$	16,625		$	10,806		$	3,805	$	14,974		$	1,011		$	9,029		$	76,121



	At June 30, 2013
	Commercial Real Estate		Multifamily		Construction and Land		Commercial Business		Agricultural Business		One- to Four-Family		Consumer		Unallocated		Total
Allowance individually evaluated for impairment	$	750	$	1,326	$	1,955	$	216	$	—	$	1,923	$	84	$	—	$	6,254
Allowance collectively evaluated for impairment	14,148		3,647		14,670		10,590		3,805		13,051		927		9,029		69,867
Total allowance for loan losses	$	14,898	$	4,973	$	16,625	$	10,806	$	3,805	$	14,974	$	1,011	$	9,029	$	76,121



	At June 30, 2013
	Commercial Real Estate		Multifamily		Construction and Land		Commercial Business		Agricultural Business		One- to Four-Family		Consumer		Unallocated		Total
Loan balances:
Loans individually evaluated for impairment	$	10,647	$	5,815	$	12,723	$	2,818	$	—	$	29,419	$	1,066	$	—	$	62,488
Loans collectively evaluated for impairment	1,086,061		131,212		340,961		637,022		233,967		523,279		275,211		—		3,227,713
Total loans	$	1,096,708	$	137,027	$	353,684	$	639,840	$	233,967	$	552,698	$	276,277	$	—	$	3,290,201

- Definition

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

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