(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
☒ | No | ☐ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
☒ | No | ☐ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
☒ | Accelerated filer ☐ | Non-accelerated filer ☐ | Smaller reporting company | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Emerging growth company | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). | Yes | No | ☒ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
APPLICABLE ONLY TO CORPORATE ISSUERS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Title of class: | As of October 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock, $.01 par value per share | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PART I – FINANCIAL INFORMATION | |||||
Item 1 – Financial Statements. The Unaudited Condensed Consolidated Financial Statements of Banner Corporation and Subsidiaries filed as a part of the report are as follows: | |||||
Consolidated Statements of Financial Condition as of September 30, 2023 and December 31, 2022 | |||||
Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2023 and 2022 | |||||
Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2023 and 2022 | |||||
Consolidated Statements of Changes in Shareholders’ Equity for the Three and Nine Months Ended September 30, 2023 and the Year Ended December 31, 2022 | |||||
Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2023 and 2022 | |||||
Selected Notes to the Consolidated Financial Statements | |||||
Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations | |||||
Executive Overview | |||||
Comparison of Financial Condition at September 30, 2023 and December 31, 2022 | |||||
Comparison of Results of Operations for the Three Months Ended September 30, 2023 and June 30, 2023 and the Nine Months Ended September 30, 2023 and 2022 | |||||
Asset Quality | |||||
Liquidity and Capital Resources | |||||
Capital Requirements | |||||
Item 3 – Quantitative and Qualitative Disclosures About Market Risk | |||||
Market Risk and Asset/Liability Management | |||||
Sensitivity Analysis | |||||
Item 4 – Controls and Procedures | |||||
PART II – OTHER INFORMATION | |||||
Item 1 – Legal Proceedings | |||||
Item 1A – Risk Factors | |||||
Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds | |||||
Item 3 – Defaults upon Senior Securities | |||||
Item 4 – Mine Safety Disclosures | |||||
Item 5 – Other Information | |||||
Item 6 – Exhibits | |||||
SIGNATURES |
ASSETS | September 30, 2023 | December 31, 2022 | |||||||||
Cash and due from banks | $ | $ | |||||||||
Interest bearing deposits | |||||||||||
Total cash and cash equivalents | |||||||||||
Securities—trading | |||||||||||
Securities—available-for-sale, net of allowance for credit losses of $ | |||||||||||
Securities—held-to-maturity, net of allowance for credit losses of $ | |||||||||||
Total securities | |||||||||||
Federal Home Loan Bank (FHLB) stock | |||||||||||
Securities purchased under agreements to resell | |||||||||||
Loans held for sale (includes $ | |||||||||||
Loans receivable | |||||||||||
Allowance for credit losses – loans | ( | ( | |||||||||
Net loans receivable | |||||||||||
Accrued interest receivable | |||||||||||
Property and equipment, net | |||||||||||
Goodwill | |||||||||||
Other intangibles, net | |||||||||||
Bank-owned life insurance (BOLI) | |||||||||||
Deferred tax assets, net | |||||||||||
Operating lease right-of-use assets | |||||||||||
Other assets | |||||||||||
Total assets | $ | $ | |||||||||
LIABILITIES | |||||||||||
Deposits: | |||||||||||
Non-interest-bearing | $ | $ | |||||||||
Interest-bearing transaction and savings accounts | |||||||||||
Interest-bearing certificates | |||||||||||
Total deposits | |||||||||||
Advances from FHLB | |||||||||||
Other borrowings | |||||||||||
Subordinated notes, net | |||||||||||
Junior subordinated debentures at fair value (issued in connection with Trust Preferred Securities) | |||||||||||
Operating lease liabilities | |||||||||||
Accrued expenses and other liabilities | |||||||||||
Deferred compensation | |||||||||||
Total liabilities | |||||||||||
COMMITMENTS AND CONTINGENCIES (Note 11) | |||||||||||
SHAREHOLDERS’ EQUITY | |||||||||||
Preferred stock - $ | |||||||||||
Common stock and paid in capital - $ | |||||||||||
Common stock (non-voting) and paid in capital - $ | |||||||||||
Retained earnings | |||||||||||
Carrying value of shares held in trust for stock-based compensation plans | ( | ( | |||||||||
Liability for common stock issued to stock related compensation plans | |||||||||||
Accumulated other comprehensive loss | ( | ( | |||||||||
Total shareholders’ equity | |||||||||||
Total liabilities and shareholders’ equity | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
INTEREST INCOME: | |||||||||||||||||||||||
Loans receivable | $ | $ | $ | $ | |||||||||||||||||||
Mortgage-backed securities | |||||||||||||||||||||||
Securities and cash equivalents | |||||||||||||||||||||||
Total interest income | |||||||||||||||||||||||
INTEREST EXPENSE: | |||||||||||||||||||||||
Deposits | |||||||||||||||||||||||
FHLB advances | |||||||||||||||||||||||
Other borrowings | |||||||||||||||||||||||
Subordinated debt | |||||||||||||||||||||||
Total interest expense | |||||||||||||||||||||||
Net interest income | |||||||||||||||||||||||
PROVISION FOR CREDIT LOSSES | |||||||||||||||||||||||
Net interest income after provision for credit losses | |||||||||||||||||||||||
NON-INTEREST INCOME: | |||||||||||||||||||||||
Deposit fees and other service charges | |||||||||||||||||||||||
Mortgage banking operations | |||||||||||||||||||||||
BOLI | |||||||||||||||||||||||
Miscellaneous | |||||||||||||||||||||||
Net (loss) gain on sale of securities | ( | ( | |||||||||||||||||||||
Net change in valuation of financial instruments carried at fair value | ( | ( | |||||||||||||||||||||
Gain on sale of branches, including related deposits | |||||||||||||||||||||||
Total non-interest income | |||||||||||||||||||||||
NON-INTEREST EXPENSE: | |||||||||||||||||||||||
Salary and employee benefits | |||||||||||||||||||||||
Less capitalized loan origination costs | ( | ( | ( | ( | |||||||||||||||||||
Occupancy and equipment | |||||||||||||||||||||||
Information and computer data services | |||||||||||||||||||||||
Payment and card processing services | |||||||||||||||||||||||
Professional and legal expenses | |||||||||||||||||||||||
Advertising and marketing | |||||||||||||||||||||||
Deposit insurance | |||||||||||||||||||||||
State and municipal business and use taxes | |||||||||||||||||||||||
Real estate operations, net | ( | ( | ( | ||||||||||||||||||||
Amortization of core deposit intangibles | |||||||||||||||||||||||
Loss on extinguishment of debt | |||||||||||||||||||||||
Miscellaneous | |||||||||||||||||||||||
Total non-interest expense | |||||||||||||||||||||||
Income before provision for income taxes | |||||||||||||||||||||||
PROVISION FOR INCOME TAXES | |||||||||||||||||||||||
NET INCOME | $ | $ | $ | $ | |||||||||||||||||||
Earnings per common share: | |||||||||||||||||||||||
Basic | $ | $ | $ | $ | |||||||||||||||||||
Diluted | $ | $ | $ | $ | |||||||||||||||||||
Cumulative dividends declared per common share | $ | $ | $ | $ | |||||||||||||||||||
Weighted average number of common shares outstanding: | |||||||||||||||||||||||
Basic | |||||||||||||||||||||||
Diluted |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
NET INCOME | $ | $ | $ | $ | |||||||||||||||||||
OTHER COMPREHENSIVE (LOSS) INCOME, NET OF INCOME TAXES: | |||||||||||||||||||||||
Unrealized holding loss on securities—available-for-sale arising during the period | ( | ( | ( | ( | |||||||||||||||||||
Income tax benefit related to securities—available-for-sale unrealized holding losses | |||||||||||||||||||||||
Reclassification for net loss (gain) on securities—available-for-sale realized in earnings | ( | ( | |||||||||||||||||||||
Income tax (benefit) expense related to securities—available-for-sale realized in earnings | ( | ( | |||||||||||||||||||||
Reclassification of (recapture) provision for credit losses on securities—available-for-sale realized in earnings | ( | ||||||||||||||||||||||
Income tax benefit (expense) related to the reclassification of (recapture) provision for credit losses on securities—available-for-sale realized in earnings | ( | ||||||||||||||||||||||
Unrealized loss on securities transferred from available-for-sale to held-to-maturity | ( | ||||||||||||||||||||||
Income tax benefit related to securities transferred from available-for-sale to held-to-maturity | |||||||||||||||||||||||
Amortization of unrealized loss on securities transferred from available-for-sale to held-to-maturity | |||||||||||||||||||||||
Income tax expense related to amortization of unrealized loss on securities transferred from available-for-sale to held-to-maturity | ( | ( | ( | ( | |||||||||||||||||||
Net unrealized gain (loss) on interest rate swaps used in cash flow hedges | ( | ( | |||||||||||||||||||||
Income tax (expense) benefit related to interest rate swaps used in cash flow hedges | ( | ( | |||||||||||||||||||||
Changes in fair value of junior subordinated debentures related to instrument specific credit risk | ( | ( | |||||||||||||||||||||
Income tax (expense) benefit related to junior subordinated debentures | ( | ( | |||||||||||||||||||||
Reclassification of fair value of junior subordinated debentures redeemed | |||||||||||||||||||||||
Income tax expense related to junior subordinated debentures redeemed | ( | ||||||||||||||||||||||
Other comprehensive loss | ( | ( | ( | ( | |||||||||||||||||||
COMPREHENSIVE (LOSS) INCOME | $ | ( | $ | ( | $ | $ | ( |
Common Stock and Paid in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Shareholders’ Equity | |||||||||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||||||
Balance, January 1, 2022 | $ | $ | $ | $ | ||||||||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||||||||
Other comprehensive loss, net of income tax | ( | ( | ||||||||||||||||||||||||||||||
Accrual of dividends on common stock ($ | ( | ( | ||||||||||||||||||||||||||||||
Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered | ( | ( | ||||||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||||||||
Other comprehensive loss, net of income tax | ( | ( | ||||||||||||||||||||||||||||||
Accrual of dividends on common stock ($ | ( | ( | ||||||||||||||||||||||||||||||
Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered | ||||||||||||||||||||||||||||||||
Repurchase of common stock | ( | ( | ( | |||||||||||||||||||||||||||||
Balance, June 30, 2022 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||||||||
Other comprehensive loss, net of income tax | ( | ( | ||||||||||||||||||||||||||||||
Accrual of dividends on common stock ($ | ( | ( | ||||||||||||||||||||||||||||||
Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered | ||||||||||||||||||||||||||||||||
Balance, September 30, 2022 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||||||||
Other comprehensive income, net of income tax | ||||||||||||||||||||||||||||||||
Accrual of dividends on common stock ($ | ( | ( | ||||||||||||||||||||||||||||||
Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered | ||||||||||||||||||||||||||||||||
Balance, December 31, 2022 | $ | $ | $ | ( | $ |
Balance, January 1, 2023 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||||||||
Other comprehensive income, net of income tax | ||||||||||||||||||||||||||||||||
Accrual of dividends on common stock ($ | ( | ( | ||||||||||||||||||||||||||||||
Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered | ( | ( | ||||||||||||||||||||||||||||||
Balance, March 31, 2023 | ( | |||||||||||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||||||||
Other comprehensive loss, net of income tax | ( | ( | ||||||||||||||||||||||||||||||
Accrual of dividends on common stock ($ | ( | ( | ||||||||||||||||||||||||||||||
Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered | ||||||||||||||||||||||||||||||||
Balance, June 30, 2023 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||||||||
Other comprehensive loss, net of income tax | ( | ( | ||||||||||||||||||||||||||||||
Accrual of dividends on common stock ($ | ( | ( | ||||||||||||||||||||||||||||||
Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered | ||||||||||||||||||||||||||||||||
Balance, September 30, 2023 | $ | $ | $ | ( | $ |
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
OPERATING ACTIVITIES: | |||||||||||
Net income | $ | $ | |||||||||
Adjustments to reconcile net income to net cash provided from operating activities: | |||||||||||
Depreciation | |||||||||||
Deferred income and expense, net of amortization | ( | ( | |||||||||
Capitalized loan servicing rights, net of amortization | |||||||||||
Amortization of core deposit intangibles | |||||||||||
Loss (gain) on sale of securities, net | ( | ||||||||||
Net change in valuation of financial instruments carried at fair value | ( | ||||||||||
Gain on sale of branches, including related deposits | ( | ||||||||||
Decrease in deferred taxes | |||||||||||
(Decrease) increase in current taxes receivable, net | ( | ||||||||||
Stock-based compensation | |||||||||||
Net change in cash surrender value of BOLI | ( | ( | |||||||||
Gain on sale of loans, excluding capitalized servicing rights | ( | ( | |||||||||
Gain on disposal of real estate held for sale and property and equipment, net | ( | ||||||||||
Provision for credit losses | |||||||||||
Loss on extinguishment of debt | |||||||||||
Origination of loans held for sale | ( | ( | |||||||||
Proceeds from sales of loans held for sale | |||||||||||
Net change in: | |||||||||||
Other assets | ( | ( | |||||||||
Other liabilities | |||||||||||
Net cash provided from operating activities | |||||||||||
INVESTING ACTIVITIES: | |||||||||||
Purchases of securities—available-for-sale | ( | ( | |||||||||
Principal repayments and maturities of securities—available-for-sale | |||||||||||
Proceeds from sales of securities—available-for-sale | |||||||||||
Purchases of securities—held-to-maturity | ( | ||||||||||
Principal repayments and maturities of securities—held-to-maturity | |||||||||||
Loan originations, net of repayments | ( | ( | |||||||||
Purchases of loans and participating interest in loans | ( | ||||||||||
Proceeds from sales of other loans | |||||||||||
Net cash paid related to branch divestiture | ( | ||||||||||
Purchases of property and equipment | ( | ( | |||||||||
Proceeds from sale of real estate held for sale and sale of other property | |||||||||||
Proceeds from FHLB stock repurchase program | |||||||||||
Purchase of FHLB stock | ( | ||||||||||
Proceeds from maturity of securities purchased under agreements to resell | |||||||||||
Investment in bank-owned life insurance | ( | ( | |||||||||
Other | |||||||||||
Net cash provided from (used by) investing activities | ( |
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
FINANCING ACTIVITIES: | |||||||||||
(Decrease) increase in deposits, net | $ | ( | $ | ||||||||
Repayment of long term FHLB advances | ( | ||||||||||
Advances of overnight and short term FHLB advances, net | |||||||||||
Decrease in other borrowings, net | ( | ( | |||||||||
Repayment of junior subordinated debentures | ( | ||||||||||
Proceeds from redemption of trust preferred securities related to junior subordinated debentures | |||||||||||
Cash dividends paid | ( | ( | |||||||||
Cash paid for repurchase of common stock | ( | ||||||||||
Taxes paid related to net share settlement of equity awards | ( | ( | |||||||||
Net cash used by financing activities | ( | ( | |||||||||
NET CHANGE IN CASH AND CASH EQUIVALENTS | ( | ||||||||||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | |||||||||||
CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | $ | |||||||||
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | |||||||||||
Interest paid in cash | $ | $ | |||||||||
Tax paid | |||||||||||
NON-CASH INVESTING AND FINANCING TRANSACTIONS: | |||||||||||
Transfer of loans to real estate owned and other repossessed assets | |||||||||||
Dividends accrued but not paid until after period end | |||||||||||
Loans, held-for-sale, transferred (from) to portfolio | ( | ||||||||||
Securities, available-for-sale, transferred to held-to-maturity | |||||||||||
DISPOSITIONS: | |||||||||||
Assets divested | ( | ||||||||||
Liabilities divested | ( |
September 30, 2023 | |||||||||||
Amortized Cost | Fair Value | ||||||||||
Trading: | |||||||||||
Corporate bonds | $ | $ | |||||||||
$ | $ |
September 30, 2023 | |||||||||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Allowance for Credit Losses | Fair Value | |||||||||||||||||||||||||
Available-for-Sale: | |||||||||||||||||||||||||||||
U.S. Government and agency obligations | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
Municipal bonds | ( | ||||||||||||||||||||||||||||
Corporate bonds | ( | ( | |||||||||||||||||||||||||||
Mortgage-backed or related securities | ( | ||||||||||||||||||||||||||||
Asset-backed securities | ( | ||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | ( | $ |
September 30, 2023 | |||||||||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Allowance for Credit Losses | |||||||||||||||||||||||||
Held-to-Maturity: | |||||||||||||||||||||||||||||
U.S. Government and agency obligations | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
Municipal bonds | ( | ( | |||||||||||||||||||||||||||
Corporate bonds | ( | ( | |||||||||||||||||||||||||||
Mortgage-backed or related securities | ( | ||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | ( |
December 31, 2022 | |||||||||||
Amortized Cost | Fair Value | ||||||||||
Trading: | |||||||||||
Corporate bonds | $ | $ | |||||||||
$ | $ |
December 31, 2022 | |||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||
Available-for-Sale: | |||||||||||||||||||||||
U.S. Government and agency obligations | $ | $ | $ | ( | $ | ||||||||||||||||||
Municipal bonds | ( | ||||||||||||||||||||||
Corporate bonds | ( | ||||||||||||||||||||||
Mortgage-backed or related securities | ( | ||||||||||||||||||||||
Asset-backed securities | ( | ||||||||||||||||||||||
$ | $ | $ | ( | $ |
December 31, 2022 | |||||||||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Allowance for Credit Losses | |||||||||||||||||||||||||
Held-to-Maturity: | |||||||||||||||||||||||||||||
U.S. Government and agency obligations | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
Municipal bonds | ( | ( | |||||||||||||||||||||||||||
Corporate bonds | ( | ( | |||||||||||||||||||||||||||
Mortgage-backed or related securities | ( | ||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | ( |
September 30, 2023 | |||||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | |||||||||||||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||||||||||||||
Available-for-Sale: | |||||||||||||||||||||||||||||||||||
U.S. Government and agency obligations | $ | $ | $ | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||
Municipal bonds | ( | ( | ( | ||||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | ( | ||||||||||||||||||||||||||||||||
Mortgage-backed or related securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Asset-backed securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
$ | $ | ( | $ | $ | ( | $ | $ | ( |
December 31, 2022 | |||||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | |||||||||||||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||||||||||||||
Available-for-Sale: | |||||||||||||||||||||||||||||||||||
U.S. Government and agency obligations | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||
Municipal bonds | ( | ( | ( | ||||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | ( | ||||||||||||||||||||||||||||||||
Mortgage-backed or related securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Asset-backed securities | ( | ( | |||||||||||||||||||||||||||||||||
$ | $ | ( | $ | $ | ( | $ | $ | ( |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Available-for-Sale: | |||||||||||||||||||||||
Gross Gains | $ | $ | $ | $ | |||||||||||||||||||
Gross Losses | ( | ( | ( | ||||||||||||||||||||
Balance, end of the period | $ | ( | $ | $ | ( | $ |
September 30, 2023 | |||||||||||||||||||||||||||||||||||
Trading | Available-for-Sale | Held-to-Maturity | |||||||||||||||||||||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | Amortized Cost | Fair Value | ||||||||||||||||||||||||||||||
Maturing within one year | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Maturing after one year through five years | |||||||||||||||||||||||||||||||||||
Maturing after five years through ten years | |||||||||||||||||||||||||||||||||||
Maturing after ten years | |||||||||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ |
September 30, 2023 | |||||||||||||||||
Carrying Value | Amortized Cost | Fair Value | |||||||||||||||
Purpose or beneficiary: | |||||||||||||||||
State and local governments public deposits | $ | $ | $ | ||||||||||||||
Federal Reserve | |||||||||||||||||
Interest rate swap counterparties | |||||||||||||||||
Repurchase transaction accounts | |||||||||||||||||
Other | |||||||||||||||||
Total pledged securities | $ | $ | $ |
September 30, 2023 | |||||||||||||||||||||||||||||
U.S. Government and agency obligations | Municipal bonds | Corporate bonds | Mortgage-backed or related securities | Total | |||||||||||||||||||||||||
AAA/AA/A | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Not Rated | |||||||||||||||||||||||||||||
$ | $ | $ | $ | $ |
December 31, 2022 | |||||||||||||||||||||||||||||
U.S. Government and agency obligations | Municipal bonds | Corporate bonds | Mortgage-backed or related securities | Total | |||||||||||||||||||||||||
AAA/AA/A | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Not Rated | |||||||||||||||||||||||||||||
$ | $ | $ | $ | $ |
For the Three Months Ended September 30, 2023 | |||||||||||||||||||||||||||||
U.S. Government and agency obligations | Municipal bonds | Corporate bonds | Mortgage-backed or related securities | Total | |||||||||||||||||||||||||
Allowance for credit losses – securities available-for-sale | |||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
(Recapture) provision for credit losses | ( | ( | |||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
For the Nine Months Ended September 30, 2023 | |||||||||||||||||||||||||||||
U.S. Government and agency obligations | Municipal bonds | Corporate bonds | Mortgage-backed or related securities | Total | |||||||||||||||||||||||||
Allowance for credit losses – securities available-for-sale | |||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Provision for credit losses | |||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
Amount | Percent of Total | Amount | Percent of Total | ||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||
Owner-occupied | $ | % | $ | % | |||||||||||||||||||
Investment properties | |||||||||||||||||||||||
Small balance CRE | |||||||||||||||||||||||
Multifamily real estate | |||||||||||||||||||||||
Construction, land and land development: | |||||||||||||||||||||||
Commercial construction | |||||||||||||||||||||||
Multifamily construction | |||||||||||||||||||||||
One- to four-family construction | |||||||||||||||||||||||
Land and land development | |||||||||||||||||||||||
Commercial business: | |||||||||||||||||||||||
Commercial business (1) | |||||||||||||||||||||||
Small business scored | |||||||||||||||||||||||
Agricultural business, including secured by farmland (2) | |||||||||||||||||||||||
One- to four-family residential | |||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||
Consumer—home equity revolving lines of credit | |||||||||||||||||||||||
Consumer—other | |||||||||||||||||||||||
Total loans | % | % | |||||||||||||||||||||
Less allowance for credit losses – loans | ( | ( | |||||||||||||||||||||
Net loans | $ | $ |
September 30, 2023 | |||||||||||||||||
Payment Delay | Term Extension | Total | |||||||||||||||
One- to four-family construction | — | $ | $ | ||||||||||||||
Commercial business | 121 | — | 121 | ||||||||||||||
Agricultural business, including secured by farmland | 1,580 | — | 1,580 | ||||||||||||||
One- to four-family residential | 1,060 | — | 1,060 | ||||||||||||||
Total | $ | 2,761 | $ | $ |
September 30, 2023 | |||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | 90 Days or More Past Due | Total Past Due | ||||||||||||||||||||
Commercial business | — | — | 121 | 121 | |||||||||||||||||||
Agricultural business, including secured by farmland | — | — | 1,580 | 1,580 | |||||||||||||||||||
One- to four-family residential | — | — | 1,060 | 1,060 | |||||||||||||||||||
Total | $ | — | $ | — | $ | 2,761 | $ | 2,761 |
The following table presents the financial effect of the loan modifications presented above for borrowers experiencing financial difficulty for the nine months ended September 30, 2023: | |||||||||||
Nine Months Ended September 30, 2023 | |||||||||||
Weighted Average Payment Delay Period (in months) | Weighted-Average Term Extension (in months) | ||||||||||
Commercial real estate: | |||||||||||
One- to four-family construction | n/a | ||||||||||
Commercial business | 8 | n/a | |||||||||
Agricultural business, including secured by farmland | 8 | n/a | |||||||||
One- to four-family residential | 8 | n/a | |||||||||
September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Year of Origination | Revolving Loans | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
By class: | 2023 | 2022 | 2021 | 2020 | 2019 | Prior | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate - owner occupied | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Commercial real estate - owner occupied | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Commercial real estate - investment properties | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Commercial real estate - investment properties | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Multifamily real estate | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Multifamily real estate | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ |
September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Year of Origination | Revolving Loans | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
By class: | 2023 | 2022 | 2021 | 2020 | 2019 | Prior | |||||||||||||||||||||||||||||||||||||||||
Commercial construction | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Commercial construction | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Multifamily construction | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Multifamily construction | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
One- to four- family construction | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total One- to four- family construction | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ |
September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Year of Origination | Revolving Loans | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
By class: | 2023 | 2022 | 2021 | 2020 | 2019 | Prior | |||||||||||||||||||||||||||||||||||||||||
Land and land development | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Land and land development | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Commercial business | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Commercial business | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Agricultural business, including secured by farmland | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Agricultural business, including secured by farmland | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ |
December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Year of Origination | Revolving Loans | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
By class: | 2022 | 2021 | 2020 | 2019 | 2018 | Prior | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate - owner occupied | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Commercial real estate - owner occupied | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Commercial real estate - investment properties | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Commercial real estate - investment properties | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Multifamily real estate | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Multifamily real estate | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Year of Origination | Revolving Loans | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
By class: | 2022 | 2021 | 2020 | 2019 | 2018 | Prior | |||||||||||||||||||||||||||||||||||||||||
Commercial construction | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Commercial construction | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Multifamily construction | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Multifamily construction | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
One- to four- family construction | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total One- to four- family construction | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Year of Origination | Revolving Loans | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
By class: | 2022 | 2021 | 2020 | 2019 | 2018 | Prior | |||||||||||||||||||||||||||||||||||||||||
Land and land development | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Land and land development | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Commercial business | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Commercial business | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Agricultural business, including secured by farmland | |||||||||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||
Loss | |||||||||||||||||||||||||||||||||||||||||||||||
Total Agricultural business, including secured by farmland | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Year of Origination | Revolving Loans | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
By class: | 2023 | 2022 | 2021 | 2020 | 2019 | Prior | |||||||||||||||||||||||||||||||||||||||||
Small balance CRE | |||||||||||||||||||||||||||||||||||||||||||||||
Past Due Category | |||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
60-89 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
90 Days + Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
Total Small balance CRE | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Small business scored | |||||||||||||||||||||||||||||||||||||||||||||||
Past Due Category | |||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
60-89 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
90 Days + Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
Total Small business scored | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
One- to four- family residential | |||||||||||||||||||||||||||||||||||||||||||||||
Past Due Category | |||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
60-89 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
90 Days + Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
Total One- to four- family residential | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ |
September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Year of Origination | Revolving Loans | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
By class: | 2023 | 2022 | 2021 | 2020 | 2019 | Prior | |||||||||||||||||||||||||||||||||||||||||
Consumer—home equity revolving lines of credit | |||||||||||||||||||||||||||||||||||||||||||||||
Past Due Category | |||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
60-89 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
90 Days + Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
Total Consumer—home equity revolving lines of credit | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||
Consumer-other | |||||||||||||||||||||||||||||||||||||||||||||||
Past Due Category | |||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
60-89 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
90 Days + Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
Total Consumer-other | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period gross charge-offs | $ | $ | $ | $ | $ | $ | $ | $ |
December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Year of Origination | Revolving Loans | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
By class: | 2022 | 2021 | 2020 | 2019 | 2018 | Prior | |||||||||||||||||||||||||||||||||||||||||
Small balance CRE | |||||||||||||||||||||||||||||||||||||||||||||||
Past Due Category | |||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
60-89 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
90 Days + Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
Total Small balance CRE | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Small business scored | |||||||||||||||||||||||||||||||||||||||||||||||
Past Due Category | |||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
60-89 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
90 Days + Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
Total Small business scored | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
One- to four- family residential | |||||||||||||||||||||||||||||||||||||||||||||||
Past Due Category | |||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
60-89 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
90 Days + Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
Total One- to four- family residential | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Year of Origination | Revolving Loans | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
By class: | 2022 | 2021 | 2020 | 2019 | 2018 | Prior | |||||||||||||||||||||||||||||||||||||||||
Consumer—home equity revolving lines of credit | |||||||||||||||||||||||||||||||||||||||||||||||
Past Due Category | |||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
60-89 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
90 Days + Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
Total Consumer—home equity revolving lines of credit | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Consumer-other | |||||||||||||||||||||||||||||||||||||||||||||||
Past Due Category | |||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
60-89 Days Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
90 Days + Past Due | |||||||||||||||||||||||||||||||||||||||||||||||
Total Consumer-other | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
September 30, 2023 | |||||||||||||||||
Real Estate | Equipment | Total | |||||||||||||||
Small balance CRE | $ | $ | $ | ||||||||||||||
Construction, land and land development: | |||||||||||||||||
One- to four-family construction | |||||||||||||||||
Land and land development | |||||||||||||||||
Commercial business | |||||||||||||||||
Commercial business | |||||||||||||||||
Small business scored | |||||||||||||||||
Agricultural business, including secured by farmland | |||||||||||||||||
One- to four-family residential | |||||||||||||||||
Consumer—home equity revolving lines of credit | |||||||||||||||||
Total | $ | $ | $ |
December 31, 2022 | |||||||||||||||||
Real Estate | Equipment | Total | |||||||||||||||
Small balance CRE | $ | $ | $ | ||||||||||||||
Commercial business | |||||||||||||||||
Commercial business | |||||||||||||||||
Small business scored | |||||||||||||||||
One- to four-family residential | |||||||||||||||||
Total | $ | $ | $ |
September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | 90 Days or More Past Due | Total Past Due | Current | Total Loans | Non-accrual with no Allowance | Total Non-accrual (1) | Loans 90 Days or More Past Due and Accruing | |||||||||||||||||||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Owner-occupied | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
Investment properties | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Small balance CRE | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Multifamily real estate | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Construction, land and land development: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Multifamily construction | |||||||||||||||||||||||||||||||||||||||||||||||||||||
One- to four-family construction | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Land and land development | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial business: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial business | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Small business scored | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Agricultural business, including secured by farmland | |||||||||||||||||||||||||||||||||||||||||||||||||||||
One- to four-family residential | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer—home equity revolving lines of credit | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer—other | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ | $ |
December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | 90 Days or More Past Due | Total Past Due | Current | Total Loans | Non-accrual with no Allowance | Total Non-accrual (1) | Loans 90 Days or More Past Due and Accruing | |||||||||||||||||||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Owner-occupied | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
Investment properties | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Small balance CRE | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Multifamily real estate | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Construction, land and land development: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Multifamily construction | |||||||||||||||||||||||||||||||||||||||||||||||||||||
One- to four-family construction | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Land and land development | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial business: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial business | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Small business scored | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Agricultural business, including secured by farmland | |||||||||||||||||||||||||||||||||||||||||||||||||||||
One-to four-family residential | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer—home equity revolving lines of credit | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer—other | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ | $ |
For the Three Months Ended September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
Commercial Real Estate | Multifamily Real Estate | Construction and Land | Commercial Business | Agricultural Business | One- to Four-Family Residential | Consumer | Total | ||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Provision/(recapture) for credit losses | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Nine Months Ended September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
Commercial Real Estate | Multifamily Real Estate | Construction and Land | Commercial Business | Agricultural Business | One- to Four-Family Residential | Consumer | Total | ||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(Recapture)/provision for credit losses | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ | $ | $ |
For the Three Months Ended September 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Commercial Real Estate | Multifamily Real Estate | Construction and Land | Commercial Business | Agricultural Business | One- to Four-Family Residential | Consumer | Total | ||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(Recapture)/provision for credit losses | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Nine Months Ended September 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Commercial Real Estate | Multifamily Real Estate | Construction and Land | Commercial Business | Agricultural Business | One- to Four-Family Residential | Consumer | Total | ||||||||||||||||||||||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(Recapture)/provision for credit losses | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ | $ | $ |
Goodwill | CDI | Total | |||||||||||||||
Balance, December 31, 2021 | $ | $ | $ | ||||||||||||||
Amortization | — | ( | ( | ||||||||||||||
Other changes(1) | — | ( | ( | ||||||||||||||
Balance, December 31, 2022 | |||||||||||||||||
Amortization | — | ( | ( | ||||||||||||||
Balance, September 30, 2023 | $ | $ | $ |
Estimated Amortization | ||||||||
Remainder of 2023 | $ | |||||||
2024 | ||||||||
2025 | ||||||||
2026 | ||||||||
2027 | ||||||||
Thereafter | ||||||||
$ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Balance, beginning of the period | $ | $ | $ | $ | |||||||||||||||||||
Additions—amounts capitalized | |||||||||||||||||||||||
Additions—through purchase | |||||||||||||||||||||||
Amortization (1) | ( | ( | ( | ( | |||||||||||||||||||
Fair value adjustments (3) | ( | ( | ( | ( | |||||||||||||||||||
Balance, end of the period (2) | $ | $ | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||
Non-interest-bearing accounts | $ | $ | |||||||||
Interest-bearing checking | |||||||||||
Regular savings accounts | |||||||||||
Money market accounts | |||||||||||
Total interest-bearing transaction and savings accounts | |||||||||||
Certificates of deposit: | |||||||||||
Certificates of deposit greater than or equal to $250,000 | |||||||||||
Certificates of deposit less than $250,000 | |||||||||||
Total certificates of deposit | |||||||||||
Total deposits | $ | $ | |||||||||
Included in total deposits: | |||||||||||
Public fund transaction and savings accounts | $ | $ | |||||||||
Public fund interest-bearing certificates | |||||||||||
Total public deposits | $ | $ | |||||||||
Total brokered certificates of deposit | $ | $ |
September 30, 2023 | |||||||||||
Amount | Weighted Average Rate | ||||||||||
Maturing in one year or less | $ | % | |||||||||
Maturing after one year through two years | |||||||||||
Maturing after two years through three years | |||||||||||
Maturing after three years through four years | |||||||||||
Maturing after four years through five years | |||||||||||
Maturing after five years | |||||||||||
Total certificates of deposit | $ | % |
September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||
Level | Carrying Value | Estimated Fair Value | Carrying Value | Estimated Fair Value | |||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents | 1 | $ | $ | $ | $ | ||||||||||||||||||||||||
Securities—trading | 3 | ||||||||||||||||||||||||||||
Securities—available-for-sale | 2 | ||||||||||||||||||||||||||||
Securities—held-to-maturity | 2 | ||||||||||||||||||||||||||||
Securities—held-to-maturity | 3 | ||||||||||||||||||||||||||||
Securities purchased under agreements to resell | 2 | ||||||||||||||||||||||||||||
Loans held for sale | 2 | ||||||||||||||||||||||||||||
Loans receivable, net | 3 | ||||||||||||||||||||||||||||
Equity securities | 1 | ||||||||||||||||||||||||||||
FHLB stock | 3 | ||||||||||||||||||||||||||||
Bank-owned life insurance | 1 | ||||||||||||||||||||||||||||
Mortgage servicing rights | 3 | ||||||||||||||||||||||||||||
SBA servicing rights | 3 | ||||||||||||||||||||||||||||
Investments in limited partnerships | 3 | ||||||||||||||||||||||||||||
Derivatives: | |||||||||||||||||||||||||||||
Interest rate swaps | 2 | ||||||||||||||||||||||||||||
Interest rate lock and forward sales commitments | 2,3 | ||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||
Demand, interest checking and money market accounts | 2 | ||||||||||||||||||||||||||||
Regular savings | 2 | ||||||||||||||||||||||||||||
Certificates of deposit | 2 | ||||||||||||||||||||||||||||
FHLB advances | 2 | ||||||||||||||||||||||||||||
Other borrowings | 2 | ||||||||||||||||||||||||||||
Subordinated notes, net | 2 | ||||||||||||||||||||||||||||
Junior subordinated debentures | 3 | ||||||||||||||||||||||||||||
Derivatives: | |||||||||||||||||||||||||||||
Interest rate swaps | 2 | ||||||||||||||||||||||||||||
Interest rate lock and forward sales commitments | 2,3 | ||||||||||||||||||||||||||||
Risk participation agreement | 2 |
September 30, 2023 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
Assets: | |||||||||||||||||||||||
Securities—trading | |||||||||||||||||||||||
Corporate bonds (Trust Preferred Securities) | $ | $ | $ | $ | |||||||||||||||||||
Securities—available-for-sale | |||||||||||||||||||||||
U.S. Government and agency obligations | |||||||||||||||||||||||
Municipal bonds | |||||||||||||||||||||||
Corporate bonds | |||||||||||||||||||||||
Mortgage-backed or related securities | |||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||
Loans held for sale(1) | |||||||||||||||||||||||
Equity securities | |||||||||||||||||||||||
SBA servicing rights | |||||||||||||||||||||||
Investment in limited partnerships | |||||||||||||||||||||||
Derivatives | |||||||||||||||||||||||
Interest rate swaps | |||||||||||||||||||||||
Interest rate lock and forward sales commitments | |||||||||||||||||||||||
$ | $ | $ | $ | ||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Junior subordinated debentures | $ | $ | $ | $ | |||||||||||||||||||
Derivatives | |||||||||||||||||||||||
Interest rate swaps | |||||||||||||||||||||||
Interest rate lock and forward sales commitments | |||||||||||||||||||||||
Risk participation agreement | |||||||||||||||||||||||
$ | $ | $ | $ |
December 31, 2022 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
Assets: | |||||||||||||||||||||||
Securities—trading | |||||||||||||||||||||||
Corporate bonds (Trust Preferred Securities) | $ | $ | $ | $ | |||||||||||||||||||
Securities—available-for-sale | |||||||||||||||||||||||
U.S. Government and agency obligations | |||||||||||||||||||||||
Municipal bonds | |||||||||||||||||||||||
Corporate bonds | |||||||||||||||||||||||
Mortgage-backed or related securities | |||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||
Loans held for sale(1) | |||||||||||||||||||||||
Equity securities | |||||||||||||||||||||||
SBA servicing rights | |||||||||||||||||||||||
Investment in limited partnerships | |||||||||||||||||||||||
Derivatives | |||||||||||||||||||||||
Interest rate swaps | |||||||||||||||||||||||
Interest rate lock and forward sales commitments | |||||||||||||||||||||||
$ | $ | $ | $ | ||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Junior subordinated debentures | $ | $ | $ | $ | |||||||||||||||||||
Derivatives | |||||||||||||||||||||||
Interest rate swaps | |||||||||||||||||||||||
Interest rate lock and forward sales commitments | |||||||||||||||||||||||
Risk participation agreement | |||||||||||||||||||||||
$ | $ | $ | $ |
Weighted Average Rate | ||||||||||||||||||||||||||
Financial Instruments | Valuation Technique | Unobservable Inputs | September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
Corporate bonds (TPS) | Discounted cash flows | Discount rate | % | % | ||||||||||||||||||||||
Junior subordinated debentures | Discounted cash flows | Discount rate | % | % | ||||||||||||||||||||||
Loans individually evaluated | Collateral valuations | Discount to appraised value | n/a | n/a | ||||||||||||||||||||||
REO | Appraisals | Discount to appraised value | % | % | ||||||||||||||||||||||
Interest rate lock commitments | Pricing model | Pull-through rate | % | % | ||||||||||||||||||||||
SBA servicing rights | Discounted cash flows | Constant prepayment rate | % | % |
Three Months Ended | |||||||||||||||||||||||||||||
September 30, 2023 | |||||||||||||||||||||||||||||
Level 3 Fair Value Inputs | |||||||||||||||||||||||||||||
TPS | Borrowings—Junior Subordinated Debentures | Interest Rate Lock and Forward Sales Commitments | Investments in Limited Partnerships | SBA Servicing Asset | |||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Net change recognized in earnings | ( | ( | ( | ( | |||||||||||||||||||||||||
Net change recognized in accumulated other comprehensive income (AOCI) | — | ( | — | — | — | ||||||||||||||||||||||||
Purchases, issuances and settlements | — | — | — | ||||||||||||||||||||||||||
Ending balance at September 30, 2023 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, 2023 | |||||||||||||||||||||||||||||
Level 3 Fair Value Inputs | |||||||||||||||||||||||||||||
TPS Securities | Borrowings—Junior Subordinated Debentures | Interest Rate Lock and Forward Sales Commitments | Investments in Limited Partnerships | SBA Servicing Asset | |||||||||||||||||||||||||
Beginning balance | $ | $ | $ | 39 | $ | $ | |||||||||||||||||||||||
Net change recognized in earnings | ( | ( | ( | ||||||||||||||||||||||||||
Net change recognized in AOCI | — | ( | — | — | — | ||||||||||||||||||||||||
Purchases, issuances and settlements | — | — | — | ||||||||||||||||||||||||||
Ending balance at September 30, 2023 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||
September 30, 2022 | |||||||||||||||||||||||||||||
Level 3 Fair Value Inputs | |||||||||||||||||||||||||||||
TPS | Borrowings—Junior Subordinated Debentures | Interest Rate Lock and Forward Sales Commitments | Investments in Limited Partnerships | SBA Servicing Asset | |||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Net change recognized in earnings | ( | ( | ( | ||||||||||||||||||||||||||
Net change recognized in AOCI | — | — | — | — | |||||||||||||||||||||||||
Purchases, issuances and settlements | — | — | — | ||||||||||||||||||||||||||
Ending balance at September 30, 2022 | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, 2022 | |||||||||||||||||||||||||||||
Level 3 Fair Value Inputs | |||||||||||||||||||||||||||||
TPS Securities | Borrowings—Junior Subordinated Debentures | Interest Rate Lock and Forward Sales Commitments | Investments in Limited Partnerships | SBA Servicing Asset | |||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Net change recognized in earnings | ( | ( | ( | ||||||||||||||||||||||||||
Net change recognized in AOCI | — | — | — | — | |||||||||||||||||||||||||
Purchases, issuances and settlements | — | — | — | ||||||||||||||||||||||||||
Redemptions | — | (50,518) | — | — | — | ||||||||||||||||||||||||
Ending balance at September 30, 2022 | $ | $ | $ | ( | $ | $ |
September 30, 2023 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
REO | $ | $ | $ | $ | |||||||||||||||||||
Loans held for sale | |||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
Loans individually evaluated | $ | $ | $ | $ | |||||||||||||||||||
REO | |||||||||||||||||||||||
Loans held for sale | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
REO | $ | $ | $ | $ | — | |||||||||||||||||||||
Loans held for sale | ( | ( | ( | ( | ||||||||||||||||||||||
Total loss from non-recurring measurements | $ | ( | $ | ( | $ | ( | $ | ( |
September 30, 2023 | December 31, 2022 | ||||||||||
Tax credit investments | $ | $ | |||||||||
Unfunded commitments—tax credit investments |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Tax credits and other tax benefits recognized | $ | $ | $ | $ | |||||||||||||||||||
Tax credit amortization expense included in provision for income taxes |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Basic weighted average shares outstanding | |||||||||||||||||||||||
Dilutive effect of unvested restricted stock | |||||||||||||||||||||||
Diluted weighted shares outstanding | |||||||||||||||||||||||
Earnings per common share | |||||||||||||||||||||||
Basic | $ | $ | $ | $ | |||||||||||||||||||
Diluted | $ | $ | $ | $ |
Contract or Notional Amount | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
Commitments to extend credit | $ | $ | |||||||||
Standby letters of credit and financial guarantees | |||||||||||
Commitments to originate loans | |||||||||||
Risk participation agreements | |||||||||||
Derivatives also included in Note 13: | |||||||||||
Commitments to originate loans held for sale | |||||||||||
Commitments to sell loans secured by one- to four-family residential properties | |||||||||||
Commitments to sell securities related to mortgage banking activities |
September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
Funded Balance | Unfunded Balance | Funded Balance | Unfunded Balance | ||||||||||||||||||||
Limited partnerships investments | $ | $ | $ | $ |
Asset Derivatives | Liability Derivatives | ||||||||||||||||||||||||||||||||||||||||||||||
September 30, 2023 | December 31, 2022 | September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||
Notional/ Contract Amount | Fair Value | Notional/ Contract Amount | Fair Value | Notional/ Contract Amount | Fair Value | Notional/ Contract Amount | Fair Value | ||||||||||||||||||||||||||||||||||||||||
Hedged interest rate swaps | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Interest rate swaps not designated in hedge relationships | |||||||||||||||||||||||||||||||||||||||||||||||
Master netting agreements | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
Cash offset/(settlement) | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Net interest rate swaps | |||||||||||||||||||||||||||||||||||||||||||||||
Risk participation agreements | |||||||||||||||||||||||||||||||||||||||||||||||
Mortgage loan commitments | |||||||||||||||||||||||||||||||||||||||||||||||
Forward sales contracts | |||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ |
For the Three Months Ended September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||
Amount of Gain or (Loss) Recognized in AOCI on Derivative | Amount of Gain or (Loss) Recognized in AOCI Included Component | Amount of Gain or (Loss) Recognized in AOCI Excluded Component | Location of Gain or (Loss) Recognized from AOCI into Income | Amount of Gain or (Loss) Reclassified from AOCI into Income | Amount of Gain or (Loss) Reclassified from AOCI into Income Included Component | Amount of Gain or (Loss) Reclassified from AOCI into Income Excluded Component | |||||||||||||||||||||||||||||||||||
Interest rate swaps | $ | ( | $ | ( | $ | Interest Income | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||||
For the Nine Months Ended September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||
Amount of Gain or (Loss) Recognized in AOCI on Derivative | Amount of Gain or (Loss) Recognized in AOCI Included Component | Amount of Gain or (Loss) Recognized in AOCI Excluded Component | Location of Gain or (Loss) Recognized from AOCI into Income | Amount of Gain or (Loss) Reclassified from AOCI into Income | Amount of Gain or (Loss) Reclassified from AOCI into Income Included Component | Amount of Gain or (Loss) Reclassified from AOCI into Income Excluded Component | |||||||||||||||||||||||||||||||||||
Interest rate swaps | $ | ( | $ | ( | $ | Interest Income | $ | ( | $ | ( | $ |
For the Three Months Ended September 30, 2022 | |||||||||||||||||||||||||||||||||||||||||
Amount of Gain or (Loss) Recognized in AOCI on Derivative | Amount of Gain or (Loss) Recognized in AOCI Included Component | Amount of Gain or (Loss) Recognized in AOCI Excluded Component | Location of Gain or (Loss) Recognized from AOCI into Income | Amount of Gain or (Loss) Reclassified from AOCI into Income | Amount of Gain or (Loss) Reclassified from AOCI into Income Included Component | Amount of Gain or (Loss) Reclassified from AOCI into Income Excluded Component | |||||||||||||||||||||||||||||||||||
Interest rate swaps | $ | ( | $ | ( | $ | Interest Income | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||||
For the Nine Months Ended September 30, 2022 | |||||||||||||||||||||||||||||||||||||||||
Amount of Gain or (Loss) Recognized in AOCI on Derivative | Amount of Gain or (Loss) Recognized in AOCI Included Component | Amount of Gain or (Loss) Recognized in AOCI Excluded Component | Location of Gain or (Loss) Recognized from AOCI into Income | Amount of Gain or (Loss) Reclassified from AOCI into Income | Amount of Gain or (Loss) Reclassified from AOCI into Income Included Component | Amount of Gain or (Loss) Reclassified from AOCI into Income Excluded Component | |||||||||||||||||||||||||||||||||||
Interest rate swaps | $ | ( | $ | ( | $ | Interest Income | $ | ( | $ | ( | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Mortgage loan commitments | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||
Forward sales contracts | |||||||||||||||||||||||
$ | $ | $ | $ | ( |
September 30, 2023 | |||||||||||||||||||||||||||||||||||
Gross Amounts of Financial Instruments Not Offset in the Consolidated Statements of Financial Condition | |||||||||||||||||||||||||||||||||||
Gross Amounts Recognized | Amounts offset in the Statement of Financial Condition | Net Amounts in the Statement of Financial Condition | Netting Adjustment Per Applicable Master Netting Agreements | Fair Value of Financial Collateral in the Statement of Financial Condition | Net Amount | ||||||||||||||||||||||||||||||
Derivative assets | |||||||||||||||||||||||||||||||||||
Interest rate swaps | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||
$ | $ | ( | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Derivative liabilities | |||||||||||||||||||||||||||||||||||
Interest rate swaps | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
$ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||||||||
Gross Amounts of Financial Instruments Not Offset in the Consolidated Statements of Financial Condition | |||||||||||||||||||||||||||||||||||
Gross Amounts Recognized | Amounts offset in the Statement of Financial Condition | Net Amounts in the Statement of Financial Condition | Netting Adjustment Per Applicable Master Netting Agreements | Fair Value of Financial Collateral in the Statement of Financial Condition | Net Amount | ||||||||||||||||||||||||||||||
Derivative assets | |||||||||||||||||||||||||||||||||||
Interest rate swaps | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||
$ | $ | ( | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Derivative liabilities | |||||||||||||||||||||||||||||||||||
Interest rate swaps | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
$ | $ | ( | $ | $ | $ | ( | $ |
Quarters Ended | For the Nine Months Ended September 30, | ||||||||||||||||||||||||||||
Sep 30, 2023 | Jun 30, 2023 | Sep 30, 2022 | 2023 | 2022 | |||||||||||||||||||||||||
ADJUSTED REVENUE | |||||||||||||||||||||||||||||
Net interest income (GAAP) | $ | 141,766 | $ | 142,518 | $ | 146,443 | $ | 437,596 | $ | 394,108 | |||||||||||||||||||
Non-interest income (GAAP) | 12,658 | 8,422 | 15,585 | 30,357 | 62,185 | ||||||||||||||||||||||||
Total revenue (GAAP) | 154,424 | 150,940 | 162,028 | 467,953 | 456,293 | ||||||||||||||||||||||||
Exclude: Net loss (gain) on sale of securities | 2,657 | 4,527 | (6) | 14,436 | (473) | ||||||||||||||||||||||||
Net change in valuation of financial instruments carried at fair value | 654 | 3,151 | (532) | 4,357 | (650) | ||||||||||||||||||||||||
Gain on sale of branches | — | — | — | — | (7,804) | ||||||||||||||||||||||||
Adjusted Revenue (non-GAAP) | $ | 157,735 | $ | 158,618 | $ | 161,490 | $ | 486,746 | $ | 447,366 |
Quarters Ended | For the Nine Months Ended September 30, | ||||||||||||||||||||||||||||
Sep 30, 2023 | Jun 30, 2023 | Sep 30, 2022 | 2023 | 2022 | |||||||||||||||||||||||||
ADJUSTED EARNINGS | |||||||||||||||||||||||||||||
Net income (GAAP) | $ | 45,854 | $ | 39,591 | $ | 49,070 | $ | 141,000 | $ | 140,998 | |||||||||||||||||||
Exclude: Net loss (gain) on sale of securities | 2,657 | 4,527 | (6) | 14,436 | (473) | ||||||||||||||||||||||||
Net change in valuation of financial instruments carried at fair value | 654 | 3,151 | (532) | 4,357 | (650) | ||||||||||||||||||||||||
Gain on sale of branches | — | — | — | — | (7,804) | ||||||||||||||||||||||||
Banner Forward expenses(1) | 996 | 195 | 411 | 1,334 | 4,455 | ||||||||||||||||||||||||
Loss on extinguishment of debt | — | — | — | — | 793 | ||||||||||||||||||||||||
Related net tax (benefit) expense | (1,033) | (1,890) | 31 | (4,830) | 883 | ||||||||||||||||||||||||
Total adjusted earnings (non-GAAP) | $ | 49,128 | $ | 45,574 | $ | 48,974 | $ | 156,297 | $ | 138,202 | |||||||||||||||||||
Diluted earnings per share (GAAP) | $ | 1.33 | $ | 1.15 | $ | 1.43 | $ | 4.09 | $ | 4.09 | |||||||||||||||||||
Diluted adjusted earnings per share (non-GAAP) | $ | 1.43 | $ | 1.32 | $ | 1.42 | $ | 4.54 | $ | 4.01 | |||||||||||||||||||
Quarters Ended | For the Nine Months Ended September 30, | ||||||||||||||||||||||||||||
Sep 30, 2023 | Jun 30, 2023 | Sep 30, 2022 | 2023 | 2022 | |||||||||||||||||||||||||
ADJUSTED EFFICIENCY RATIO | |||||||||||||||||||||||||||||
Non-interest expense (GAAP) | $ | 95,891 | $ | 95,405 | $ | 95,034 | $ | 285,917 | $ | 278,282 | |||||||||||||||||||
Exclude: Banner Forward expenses(1) | (996) | (195) | (411) | (1,334) | (4,455) | ||||||||||||||||||||||||
CDI amortization | (857) | (991) | (1,215) | (2,898) | (4,064) | ||||||||||||||||||||||||
State and municipal tax expense | (1,359) | (1,229) | (1,223) | (3,888) | (3,389) | ||||||||||||||||||||||||
REO operations | 383 | (75) | (68) | 585 | 132 | ||||||||||||||||||||||||
Loss on extinguishment of debt | — | — | — | — | (793) | ||||||||||||||||||||||||
Adjusted non-interest expense (non-GAAP) | $ | 93,062 | $ | 92,915 | $ | 92,117 | $ | 278,382 | $ | 265,713 | |||||||||||||||||||
Net interest income (GAAP) | $ | 141,766 | $ | 142,518 | $ | 146,443 | $ | 437,596 | $ | 394,108 | |||||||||||||||||||
Non-interest income (GAAP) | 12,658 | 8,422 | 15,585 | 30,357 | 62,185 | ||||||||||||||||||||||||
Total revenue (GAAP) | 154,424 | 150,940 | 162,028 | 467,953 | 456,293 | ||||||||||||||||||||||||
Exclude: Net loss (gain) on sale of securities | 2,657 | 4,527 | (6) | 14,436 | (473) | ||||||||||||||||||||||||
Net change in valuation of financial instruments carried at fair value | 654 | 3,151 | (532) | 4,357 | (650) | ||||||||||||||||||||||||
Gain on sale of branches | — | — | — | — | (7,804) | ||||||||||||||||||||||||
Adjusted revenue (non-GAAP) | $ | 157,735 | $ | 158,618 | $ | 161,490 | $ | 486,746 | $ | 447,366 | |||||||||||||||||||
Efficiency ratio (GAAP) | 62.10 | % | 63.21 | % | 58.65 | % | 61.10 | % | 60.99 | % | |||||||||||||||||||
Adjusted efficiency ratio (non-GAAP) | 59.00 | % | 58.58 | % | 57.04 | % | 57.19 | % | 59.39 | % | |||||||||||||||||||
TANGIBLE COMMON SHAREHOLDERS’ EQUITY TO TANGIBLE ASSETS | |||||||||||||||||
September 30, 2023 | December 31, 2022 | September 30, 2022 | |||||||||||||||
Shareholders’ equity (GAAP) | $ | 1,520,607 | $ | 1,456,432 | $ | 1,408,659 | |||||||||||
Exclude goodwill and other intangible assets, net | 379,663 | 382,561 | 383,776 | ||||||||||||||
Tangible common shareholders’ equity (non-GAAP) | $ | 1,140,944 | $ | 1,073,871 | $ | 1,024,883 | |||||||||||
Total assets (GAAP) | $ | 15,507,880 | $ | 15,833,431 | $ | 16,360,809 | |||||||||||
Exclude goodwill and other intangible assets, net | 379,663 | 382,561 | 383,776 | ||||||||||||||
Total tangible assets (non-GAAP) | $ | 15,128,217 | $ | 15,450,870 | $ | 15,977,033 | |||||||||||
Common shareholders’ equity to total assets (GAAP) | 9.81 | % | 9.20 | % | 8.61 | % | |||||||||||
Tangible common shareholders’ equity to tangible assets (non-GAAP) | 7.54 | % | 6.95 | % | 6.41 | % | |||||||||||
TANGIBLE COMMON SHAREHOLDERS’ EQUITY PER SHARE | |||||||||||||||||
Tangible common shareholders’ equity (non-GAAP) | $ | 1,140,944 | $ | 1,073,871 | $ | 1,024,883 | |||||||||||
Common shares outstanding at end of period | 34,345,949 | 34,194,018 | 34,191,759 | ||||||||||||||
Common shareholders’ equity (book value) per share (GAAP) | $ | 44.27 | $ | 42.59 | $ | 41.20 | |||||||||||
Tangible common shareholders’ equity (tangible book value) per share (non-GAAP) | $ | 33.22 | $ | 31.41 | $ | 29.97 |
Percentage Change | |||||||||||||||||||||||||||||
Sep 30, 2023 | Dec 31, 2022 | Sep 30, 2022 | Year End | Prior Year Qtr. | |||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||
Owner-occupied | $ | 911,540 | $ | 845,320 | $ | 862,792 | 7.8 | % | 5.7 | % | |||||||||||||||||||
Investment properties | 1,530,087 | 1,589,975 | 1,604,881 | (3.8) | (4.7) | ||||||||||||||||||||||||
Small balance CRE | 1,169,828 | 1,200,251 | 1,188,351 | (2.5) | (1.6) | ||||||||||||||||||||||||
Total Commercial real estate | 3,611,455 | 3,635,546 | 3,656,024 | (0.7) | (1.2) | ||||||||||||||||||||||||
Multifamily real estate | 766,571 | 645,071 | 592,834 | 18.8 | 29.3 | ||||||||||||||||||||||||
Construction, land and land development: | |||||||||||||||||||||||||||||
Commercial construction | 168,061 | 184,876 | 171,029 | (9.1) | (1.7) | ||||||||||||||||||||||||
Multifamily construction | 453,129 | 325,816 | 275,488 | 39.1 | 64.5 | ||||||||||||||||||||||||
One- to four-family construction | 536,349 | 647,329 | 666,350 | (17.1) | (19.5) | ||||||||||||||||||||||||
Land and land development | 346,362 | 328,475 | 329,459 | 5.4 | 5.1 | ||||||||||||||||||||||||
Total Construction, land and land development | 1,503,901 | 1,486,496 | 1,442,326 | 1.2 | 4.3 | ||||||||||||||||||||||||
Commercial business: | |||||||||||||||||||||||||||||
Commercial business | 1,263,747 | 1,283,407 | 1,242,550 | (1.5) | 1.7 | ||||||||||||||||||||||||
Small business scored | 1,000,714 | 947,092 | 906,647 | 5.7 | 10.4 | ||||||||||||||||||||||||
Total Commercial business | 2,264,461 | 2,230,499 | 2,149,197 | 1.5 | 5.4 | ||||||||||||||||||||||||
Agricultural business, including secured by farmland | 334,626 | 295,077 | 299,400 | 13.4 | 11.8 | ||||||||||||||||||||||||
One- to four-family residential | 1,438,694 | 1,173,112 | 1,025,143 | 22.6 | 40.3 | ||||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||||
Consumer—home equity revolving lines of credit | 579,836 | 566,291 | 545,807 | 2.4 | 6.2 | ||||||||||||||||||||||||
Consumer—other | 111,873 | 114,632 | 116,365 | (2.4) | (3.9) | ||||||||||||||||||||||||
Total Consumer | 691,709 | 680,923 | 662,172 | 1.6 | 4.5 | ||||||||||||||||||||||||
Total loans receivable | $ | 10,611,417 | $ | 10,146,724 | $ | 9,827,096 | 4.6 | % | 8.0 | % |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
Sep 30, 2023 | Jun 30, 2023 | Sep 30, 2022 | Sep 30, 2023 | Sep 30, 2022 | |||||||||||||||||||||||||
Commercial real estate | $ | 62,337 | $ | 94,640 | $ | 92,062 | $ | 232,745 | $ | 300,848 | |||||||||||||||||||
Multifamily real estate | 12,725 | 3,441 | 4,603 | 51,686 | 28,731 | ||||||||||||||||||||||||
Construction and land | 421,656 | 488,980 | 444,365 | 1,158,478 | 1,633,672 | ||||||||||||||||||||||||
Commercial business | 157,833 | 128,404 | 218,044 | 418,063 | 736,554 | ||||||||||||||||||||||||
Agricultural business | 17,466 | 28,367 | 9,879 | 69,014 | 65,341 | ||||||||||||||||||||||||
One-to four- family residential | 43,622 | 52,618 | 92,701 | 130,505 | 275,485 | ||||||||||||||||||||||||
Consumer | 70,043 | 112,555 | 126,940 | 243,486 | 442,752 | ||||||||||||||||||||||||
Total commitment amount for loan originations (excluding loans held for sale) | $ | 785,682 | $ | 909,005 | $ | 988,594 | $ | 2,303,977 | $ | 3,483,383 |
Sep 30, 2023 | Dec 31, 2022 | Sep 30, 2022 | Percentage Change | ||||||||||||||||||||||||||||||||
Amount | Percentage | Amount | Amount | Year End | Prior Year Qtr. | ||||||||||||||||||||||||||||||
Washington | $ | 5,046,028 | 47.6 | % | $ | 4,777,546 | $ | 4,648,124 | 5.6 | % | 8.6 | % | |||||||||||||||||||||||
California | 2,570,175 | 24.2 | 2,484,980 | 2,323,740 | 3.4 | 10.6 | |||||||||||||||||||||||||||||
Oregon | 1,929,531 | 18.2 | 1,826,743 | 1,765,254 | 5.6 | 9.3 | |||||||||||||||||||||||||||||
Idaho | 600,648 | 5.7 | 565,586 | 588,498 | 6.2 | 2.1 | |||||||||||||||||||||||||||||
Utah | 57,711 | 0.5 | 75,967 | 95,250 | (24.0) | (39.4) | |||||||||||||||||||||||||||||
Other | 407,324 | 3.8 | 415,902 | 406,230 | (2.1) | 0.3 | |||||||||||||||||||||||||||||
Total loans receivable | $ | 10,611,417 | 100.0 | % | $ | 10,146,724 | $ | 9,827,096 | 4.6 | % | 8.0 | % |
Percentage Change | |||||||||||||||||||||||||||||
Sep 30, 2023 | Dec 31, 2022 | Sep 30, 2022 | Year End | Prior Year Qtr. | |||||||||||||||||||||||||
Non-interest-bearing | $ | 5,197,854 | $ | 6,176,998 | $ | 6,507,523 | (15.9) | % | (20.1) | % | |||||||||||||||||||
Interest-bearing checking | 2,006,866 | 1,811,153 | 1,856,244 | 10.8 | 8.1 | ||||||||||||||||||||||||
Regular savings accounts | 2,751,453 | 2,710,090 | 2,824,711 | 1.5 | (2.6) | ||||||||||||||||||||||||
Money market accounts | 1,760,066 | 2,198,288 | 2,323,844 | (19.9) | (24.3) | ||||||||||||||||||||||||
Interest-bearing transaction & savings accounts | 6,518,385 | 6,719,531 | 7,004,799 | (3.0) | (6.9) | ||||||||||||||||||||||||
Total core deposits | 11,716,239 | 12,896,529 | 13,512,322 | (9.2) | (13.3) | ||||||||||||||||||||||||
Interest-bearing certificates | 1,458,313 | 723,530 | 721,944 | 101.6 | 102.0 | ||||||||||||||||||||||||
Total deposits | $ | 13,174,552 | $ | 13,620,059 | $ | 14,234,266 | (3.3) | % | (7.4) | % |
Sep 30, 2023 | Dec 31, 2022 | Sep 30, 2022 | ||||||||||||||||||
Number of deposit accounts | 466,159 | 471,140 | 477,082 | |||||||||||||||||
Average account balance per account | $ | 28 | $ | 29 | $ | 30 |
Sep 30, 2023 | Dec 31, 2022 | Sep 30, 2022 | Percentage Change | ||||||||||||||||||||||||||||||||
Amount | Percentage | Amount | Amount | Year End | Prior Year Qtr. | ||||||||||||||||||||||||||||||
Washington | $ | 7,241,341 | 55.0 | % | $ | 7,563,056 | $ | 7,845,755 | (4.3) | % | (7.7) | % | |||||||||||||||||||||||
Oregon | 2,918,446 | 22.1 | 2,998,572 | 3,148,520 | (2.7) | (7.3) | |||||||||||||||||||||||||||||
California | 2,342,345 | 17.8 | 2,331,524 | 2,493,977 | 0.5 | (6.1) | |||||||||||||||||||||||||||||
Idaho | 672,420 | 5.1 | 726,907 | 746,014 | (7.5) | (9.9) | |||||||||||||||||||||||||||||
Total deposits | $ | 13,174,552 | 100.0 | % | $ | 13,620,059 | $ | 14,234,266 | (3.3) | % | (7.4) | % |
OPERATING DATA: | Quarters Ended | Nine months ended | |||||||||||||||||||||||||||
(In thousands) | September 30, 2023 | June 30, 2023 | September 30, 2022 | September 30, 2023 | September 30, 2022 | ||||||||||||||||||||||||
Interest income | $ | 179,064 | $ | 171,809 | $ | 151,119 | $ | 517,834 | $ | 407,011 | |||||||||||||||||||
Interest expense | 37,298 | 29,291 | 4,676 | 80,238 | 12,903 | ||||||||||||||||||||||||
Net interest income | 141,766 | 142,518 | 146,443 | 437,596 | 394,108 | ||||||||||||||||||||||||
Provision for credit losses | 2,027 | 6,764 | 6,087 | 8,267 | 3,660 | ||||||||||||||||||||||||
Net interest income after provision for credit losses | 139,739 | 135,754 | 140,356 | 429,329 | 390,448 | ||||||||||||||||||||||||
Deposit fees and other service charges | 10,916 | 10,600 | 11,449 | 32,078 | 33,638 | ||||||||||||||||||||||||
Mortgage banking operations | 2,049 | 1,686 | 105 | 6,426 | 8,523 | ||||||||||||||||||||||||
Net (loss) gain on sale of securities | (2,657) | (4,527) | 6 | (14,436) | 473 | ||||||||||||||||||||||||
Net change in valuation of financial instruments carried at fair value | (654) | (3,151) | 532 | (4,357) | 650 | ||||||||||||||||||||||||
All other non-interest income | 3,004 | 3,814 | 3,493 | 10,646 | 18,901 | ||||||||||||||||||||||||
Total non-interest income | 12,658 | 8,422 | 15,585 | 30,357 | 62,185 | ||||||||||||||||||||||||
Salary and employee benefits | 61,091 | 61,972 | 61,639 | 184,452 | 181,957 | ||||||||||||||||||||||||
All other non-interest expenses | 34,800 | 33,433 | 33,395 | 101,465 | 96,325 | ||||||||||||||||||||||||
Total non-interest expense | 95,891 | 95,405 | 95,034 | 285,917 | 278,282 | ||||||||||||||||||||||||
Income before provision for income tax expense | 56,506 | 48,771 | 60,907 | 173,769 | 174,351 | ||||||||||||||||||||||||
Provision for income tax expense | 10,652 | 9,180 | 11,837 | 32,769 | 33,353 | ||||||||||||||||||||||||
Net income | $ | 45,854 | $ | 39,591 | $ | 49,070 | $ | 141,000 | $ | 140,998 |
PER COMMON SHARE DATA: | Quarters Ended | Nine months ended | |||||||||||||||||||||||||||
September 30, 2023 | June 30, 2023 | September 30, 2022 | September 30, 2023 | September 30, 2022 | |||||||||||||||||||||||||
Net income: | |||||||||||||||||||||||||||||
Basic | $ | 1.33 | $ | 1.15 | $ | 1.43 | $ | 4.11 | $ | 4.11 | |||||||||||||||||||
Diluted | 1.33 | 1.15 | 1.43 | 4.09 | 4.09 |
ANALYSIS OF NET INTEREST SPREAD | Quarters Ended | ||||||||||||||||||||||||||||||||||
(rates / ratios annualized) | Sep 30, 2023 | Jun 30, 2023 | |||||||||||||||||||||||||||||||||
(dollars in thousands) | Average Balance | Interest and Dividends(3) | Yield / Cost(3) | Average Balance | Interest and Dividends(3) | Yield / Cost(3) | |||||||||||||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||||||||||||
Held for sale loans | $ | 56,697 | $ | 765 | 5.35 | % | $ | 56,073 | $ | 738 | 5.28 | % | |||||||||||||||||||||||
Mortgage loans | 8,596,705 | 118,285 | 5.46 | % | 8,413,392 | 112,097 | 5.34 | % | |||||||||||||||||||||||||||
Commercial/agricultural loans | 1,822,609 | 29,866 | 6.50 | % | 1,763,264 | 27,616 | 6.28 | % | |||||||||||||||||||||||||||
SBA PPP loans | 4,298 | 28 | 2.58 | % | 5,247 | 67 | 5.12 | % | |||||||||||||||||||||||||||
Consumer and other loans | 138,723 | 2,226 | 6.37 | % | 138,902 | 2,137 | 6.17 | % | |||||||||||||||||||||||||||
Total loans(1) | 10,619,032 | 151,170 | 5.65 | % | 10,376,878 | 142,655 | 5.51 | % | |||||||||||||||||||||||||||
Mortgage-backed securities | 2,863,345 | 17,834 | 2.47 | % | 2,958,700 | 18,429 | 2.50 | % | |||||||||||||||||||||||||||
Other securities | 1,071,389 | 12,128 | 4.49 | % | 1,184,503 | 12,932 | 4.38 | % | |||||||||||||||||||||||||||
Interest-bearing deposits with banks | 43,594 | 529 | 4.81 | % | 44,922 | 557 | 4.97 | % | |||||||||||||||||||||||||||
FHLB stock | 16,443 | 385 | 9.29 | % | 25,611 | 157 | 2.46 | % | |||||||||||||||||||||||||||
Total investment securities | 3,994,771 | 30,876 | 3.07 | % | 4,213,736 | 32,075 | 3.05 | % | |||||||||||||||||||||||||||
Total interest-earning assets | 14,613,803 | 182,046 | 4.94 | % | 14,590,614 | 174,730 | 4.80 | % | |||||||||||||||||||||||||||
Non-interest-earning assets | 932,364 | 939,100 | |||||||||||||||||||||||||||||||||
Total assets | $ | 15,546,167 | $ | 15,529,714 | |||||||||||||||||||||||||||||||
Deposits: | |||||||||||||||||||||||||||||||||||
Interest-bearing checking accounts | $ | 1,971,179 | 4,190 | 0.84 | % | $ | 1,870,605 | 2,331 | 0.50 | % | |||||||||||||||||||||||||
Savings accounts | 2,659,890 | 8,400 | 1.25 | % | 2,536,713 | 4,895 | 0.77 | % | |||||||||||||||||||||||||||
Money market accounts | 1,793,953 | 6,639 | 1.47 | % | 1,957,553 | 6,007 | 1.23 | % | |||||||||||||||||||||||||||
Certificates of deposit | 1,412,542 | 11,772 | 3.31 | % | 1,126,647 | 7,306 | 2.60 | % | |||||||||||||||||||||||||||
Total interest-bearing deposits | 7,837,564 | 31,001 | 1.57 | % | 7,491,518 | 20,539 | 1.10 | % | |||||||||||||||||||||||||||
Non-interest-bearing deposits | 5,316,023 | — | — | % | 5,445,960 | — | — | % | |||||||||||||||||||||||||||
Total deposits | 13,153,587 | 31,001 | 0.94 | % | 12,937,478 | 20,539 | 0.64 | % | |||||||||||||||||||||||||||
Other interest-bearing liabilities: | |||||||||||||||||||||||||||||||||||
FHLB advances | 161,087 | 2,233 | 5.50 | % | 390,705 | 5,157 | 5.29 | % | |||||||||||||||||||||||||||
Other borrowings | 194,659 | 1,099 | 2.24 | % | 188,060 | 771 | 1.64 | % | |||||||||||||||||||||||||||
Junior subordinated debentures and subordinated notes | 182,678 | 2,965 | 6.44 | % | 185,096 | 2,824 | 6.12 | % | |||||||||||||||||||||||||||
Total borrowings | 538,424 | 6,297 | 4.64 | % | 763,861 | 8,752 | 4.60 | % | |||||||||||||||||||||||||||
Total funding liabilities | 13,692,011 | 37,298 | 1.08 | % | 13,701,339 | 29,291 | 0.86 | % | |||||||||||||||||||||||||||
Other non-interest-bearing liabilities(2) | 296,578 | 279,232 | |||||||||||||||||||||||||||||||||
Total liabilities | 13,988,589 | 13,980,571 | |||||||||||||||||||||||||||||||||
Shareholders’ equity | 1,557,578 | 1,549,143 | |||||||||||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 15,546,167 | $ | 15,529,714 | |||||||||||||||||||||||||||||||
Net interest income/rate spread (tax equivalent) | $ | 144,748 | 3.86 | % | $ | 145,439 | 3.94 | % | |||||||||||||||||||||||||||
Net interest margin (tax equivalent) | 3.93 | % | 4.00 | % | |||||||||||||||||||||||||||||||
Reconciliation to reported net interest income: | |||||||||||||||||||||||||||||||||||
Adjustments for taxable equivalent basis | (2,982) | (2,921) | |||||||||||||||||||||||||||||||||
Net interest income and margin, as reported | $ | 141,766 | 3.85 | % | $ | 142,518 | 3.92 | % | |||||||||||||||||||||||||||
Additional Key Financial Ratios: | |||||||||||||||||||||||||||||||||||
Return on average assets | 1.17 | % | 1.02 | % | |||||||||||||||||||||||||||||||
Return on average equity | 11.68 | % | 10.25 | % | |||||||||||||||||||||||||||||||
Average equity/average assets | 10.02 | % | 9.98 | % | |||||||||||||||||||||||||||||||
Average interest-earning assets/average interest-bearing liabilities | 174.47 | % | 176.74 | % | |||||||||||||||||||||||||||||||
Average interest-earning assets/average funding liabilities | 106.73 | % | 106.49 | % | |||||||||||||||||||||||||||||||
Non-interest income/average assets | 0.32 | % | 0.22 | % | |||||||||||||||||||||||||||||||
Non-interest expense/average assets | 2.45 | % | 2.46 | % | |||||||||||||||||||||||||||||||
Efficiency ratio(4) | 62.10 | % | 63.21 | % | |||||||||||||||||||||||||||||||
Adjusted efficiency ratio(5) | 59.00 | % | 58.58 | % |
Nine months ended September 30, 2023 | Nine months ended September 30, 2022 | ||||||||||||||||||||||||||||||||||
Average Balance | Interest and Dividends (3) | Yield/ Cost (3) | Average Balance | Interest and Dividends (3) | Yield/ Cost (3) | ||||||||||||||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||||||||||||
Held for sale loans | $ | 55,157 | $ | 2,174 | 5.27 | % | $ | 94,289 | $ | 2,446 | 3.47 | % | |||||||||||||||||||||||
Mortgage loans | 8,427,034 | 337,282 | 5.35 | % | 7,581,540 | 261,021 | 4.60 | % | |||||||||||||||||||||||||||
Commercial/agricultural loans | 1,763,248 | 82,658 | 6.27 | % | 1,574,957 | 52,582 | 4.46 | % | |||||||||||||||||||||||||||
SBA PPP loans | 5,437 | 145 | 3.57 | % | 51,890 | 4,453 | 11.47 | % | |||||||||||||||||||||||||||
Consumer and other loans | 138,246 | 6,478 | 6.26 | % | 117,892 | 5,207 | 5.91 | % | |||||||||||||||||||||||||||
Total loans(1) | 10,389,122 | 428,737 | 5.52 | % | 9,420,568 | 325,709 | 4.62 | % | |||||||||||||||||||||||||||
Mortgage-backed securities | 2,971,124 | 55,386 | 2.49 | % | 3,110,769 | 48,904 | 2.10 | % | |||||||||||||||||||||||||||
Other securities | 1,220,074 | 40,155 | 4.40 | % | 1,624,138 | 32,333 | 2.66 | % | |||||||||||||||||||||||||||
Interest-bearing deposits with banks | 47,330 | 1,694 | 4.79 | % | 1,214,076 | 7,507 | 0.83 | % | |||||||||||||||||||||||||||
FHLB stock | 18,772 | 632 | 4.50 | % | 10,579 | 281 | 3.55 | % | |||||||||||||||||||||||||||
Total investment securities | 4,257,300 | 97,867 | 3.07 | % | 5,959,562 | 89,025 | 2.00 | % | |||||||||||||||||||||||||||
Total interest-earning assets | 14,646,422 | 526,604 | 4.81 | % | 15,380,130 | 414,734 | 3.61 | % | |||||||||||||||||||||||||||
Non-interest-earning assets | 930,934 | 1,250,719 | |||||||||||||||||||||||||||||||||
Total assets | $ | 15,577,356 | $ | 16,630,849 | |||||||||||||||||||||||||||||||
Deposits: | |||||||||||||||||||||||||||||||||||
Interest-bearing checking accounts | $ | 1,874,518 | 7,427 | 0.53 | % | $ | 1,915,184 | 991 | 0.07 | % | |||||||||||||||||||||||||
Savings accounts | 2,604,089 | 15,179 | 0.78 | % | 2,826,757 | 1,187 | 0.06 | % | |||||||||||||||||||||||||||
Money market accounts | 1,971,514 | 16,445 | 1.12 | % | 2,400,267 | 1,806 | 0.10 | % | |||||||||||||||||||||||||||
Certificates of deposit | 1,118,874 | 21,733 | 2.60 | % | 782,548 | 2,517 | 0.43 | % | |||||||||||||||||||||||||||
Total interest-bearing deposits | 7,568,995 | 60,784 | 1.07 | % | 7,924,756 | 6,501 | 0.11 | % | |||||||||||||||||||||||||||
Non-interest-bearing deposits | 5,571,896 | — | — | % | 6,445,579 | — | — | % | |||||||||||||||||||||||||||
Total deposits | 13,140,891 | 60,784 | 0.62 | % | 14,370,335 | 6,501 | 0.06 | % | |||||||||||||||||||||||||||
Other interest-bearing liabilities: | |||||||||||||||||||||||||||||||||||
FHLB advances | 219,461 | 8,654 | 5.27 | % | 13,919 | 291 | 2.80 | % | |||||||||||||||||||||||||||
Other borrowings | 203,932 | 2,251 | 1.48 | % | 253,545 | 245 | 0.13 | % | |||||||||||||||||||||||||||
Junior subordinated debentures and subordinated notes | 186,964 | 8,549 | 6.11 | % | 190,103 | 5,866 | 4.13 | % | |||||||||||||||||||||||||||
Total borrowings | 610,357 | 19,454 | 4.26 | % | 457,567 | 6,402 | 1.87 | % | |||||||||||||||||||||||||||
Total funding liabilities | 13,751,248 | 80,238 | 0.78 | % | 14,827,902 | 12,903 | 0.12 | % | |||||||||||||||||||||||||||
Other non-interest-bearing liabilities (2) | 289,558 | 241,010 | |||||||||||||||||||||||||||||||||
Total liabilities | 14,040,806 | 15,068,912 | |||||||||||||||||||||||||||||||||
Shareholders’ equity | 1,536,550 | 1,561,937 | |||||||||||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 15,577,356 | $ | 16,630,849 | |||||||||||||||||||||||||||||||
Net interest income/rate spread (tax equivalent) | $ | 446,366 | 4.03 | % | $ | 401,831 | 3.49 | % | |||||||||||||||||||||||||||
Net interest margin (tax equivalent) | 4.07 | % | 3.49 | % | |||||||||||||||||||||||||||||||
Reconciliation to reported net interest income: | |||||||||||||||||||||||||||||||||||
Adjustments for taxable equivalent basis | (8,770) | (7,723) | |||||||||||||||||||||||||||||||||
Net interest income and margin | $ | 437,596 | 3.99 | % | $ | 394,108 | 3.43 | % | |||||||||||||||||||||||||||
Additional Key Financial Ratios: | |||||||||||||||||||||||||||||||||||
Return on average assets | 1.21 | % | 1.13 | % | |||||||||||||||||||||||||||||||
Return on average equity | 12.27 | % | 12.07 | % | |||||||||||||||||||||||||||||||
Average equity / average assets | 9.86 | % | 9.39 | % | |||||||||||||||||||||||||||||||
Average interest-earning assets / average interest-bearing liabilities | 179.07 | % | 183.48 | % | |||||||||||||||||||||||||||||||
Average interest-earning assets / average funding liabilities | 106.51 | % | 103.72 | % | |||||||||||||||||||||||||||||||
Non-interest income / average assets | 0.26 | % | 0.50 | % | |||||||||||||||||||||||||||||||
Non-interest expense / average assets | 2.45 | % | 2.24 | % | |||||||||||||||||||||||||||||||
Efficiency ratio (4) | 61.10 | % | 60.99 | % | |||||||||||||||||||||||||||||||
Adjusted efficiency ratio (5) | 57.19 | % | 59.39 | % |
Quarters Ended | Nine Months Ended | |||||||||||||||||||||||||||||||
CHANGE IN THE ALLOWANCE FOR CREDIT LOSSES - LOANS | Sep 30, 2023 | Jun 30, 2023 | Sep 30, 2022 | Sep 30, 2023 | Sep 30, 2022 | |||||||||||||||||||||||||||
Balance, beginning of period | $ | 144,680 | $ | 141,457 | $ | 128,702 | $ | 141,465 | $ | 132,099 | ||||||||||||||||||||||
Provision for credit losses – loans | 2,943 | 3,559 | 6,347 | 7,276 | 2,115 | |||||||||||||||||||||||||||
Recoveries of loans previously charged off: | ||||||||||||||||||||||||||||||||
Commercial real estate | 170 | 74 | 88 | 428 | 304 | |||||||||||||||||||||||||||
Construction and land | 29 | — | — | 29 | 384 | |||||||||||||||||||||||||||
One- to four-family residential | 59 | 36 | 25 | 212 | 163 | |||||||||||||||||||||||||||
Commercial business | 403 | 524 | 924 | 1,046 | 1,307 | |||||||||||||||||||||||||||
Agricultural business, including secured by farmland | 19 | 2 | 252 | 130 | 384 | |||||||||||||||||||||||||||
Consumer | 126 | 117 | 85 | 412 | 413 | |||||||||||||||||||||||||||
806 | 753 | 1,374 | 2,257 | 2,955 | ||||||||||||||||||||||||||||
Loans charged off: | ||||||||||||||||||||||||||||||||
Commercial real estate | — | — | — | — | (2) | |||||||||||||||||||||||||||
Construction and land | — | (156) | (25) | (156) | (30) | |||||||||||||||||||||||||||
One- to four-family residential | — | (4) | — | (34) | — | |||||||||||||||||||||||||||
Commercial business | (616) | (566) | (138) | (2,340) | (468) | |||||||||||||||||||||||||||
Agricultural business, including secured by farmland | (564) | — | (42) | (564) | (42) | |||||||||||||||||||||||||||
Consumer | (289) | (363) | (300) | (944) | (709) | |||||||||||||||||||||||||||
(1,469) | (1,089) | (505) | (4,038) | (1,251) | ||||||||||||||||||||||||||||
Net (charge-offs) recoveries | (663) | (336) | 869 | (1,781) | 1,704 | |||||||||||||||||||||||||||
Balance, end of period | $ | 146,960 | $ | 144,680 | $ | 135,918 | $ | 146,960 | $ | 135,918 | ||||||||||||||||||||||
Net (charge-offs) recoveries / Average loans receivable | (0.006) | % | (0.003) | % | 0.009 | % | (0.017) | % | 0.018 | % | ||||||||||||||||||||||
Allowance for credit losses - loans as a percentage of total loans | 1.38 | % | 1.38 | % | 1.38 | % | 1.38 | % | 1.38 | % |
Quarters Ended | Nine Months Ended | |||||||||||||||||||||||||||||||
CHANGE IN THE ALLOWANCE FOR CREDIT LOSSES - UNFUNDED LOAN COMMITMENTS | Sep 30, 2023 | Jun 30, 2023 | Sep 30, 2022 | Sep 30, 2023 | Sep 30, 2022 | |||||||||||||||||||||||||||
Balance, beginning of period | $ | 14,664 | $ | 13,443 | $ | 14,246 | $ | 14,721 | $ | 12,432 | ||||||||||||||||||||||
Provision (recapture) for credit losses - unfunded loan commitments | 346 | 1,221 | (205) | 289 | 1,609 | |||||||||||||||||||||||||||
Balance, end of period | $ | 15,010 | $ | 14,664 | $ | 14,041 | $ | 15,010 | $ | 14,041 |
Quarters Ended | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
Sep 30, 2023 | Jun 30, 2023 | Change Amount | Change Percent | 2023 | 2022 | Change Amount | Change Percent | ||||||||||||||||||||||||||||||||||||||||
Deposit fees and other service charges | $ | 10,916 | $ | 10,600 | $ | 316 | 3.0 | % | $ | 32,078 | $ | 33,638 | $ | (1,560) | (4.6) | % | |||||||||||||||||||||||||||||||
Mortgage banking operations | 2,049 | 1,686 | 363 | 21.5 | 6,426 | 8,523 | (2,097) | (24.6) | |||||||||||||||||||||||||||||||||||||||
Bank owned life insurance | 2,062 | 2,386 | (324) | (13.6) | 6,636 | 5,674 | 962 | 17.0 | |||||||||||||||||||||||||||||||||||||||
Miscellaneous | 942 | 1,428 | (486) | (34.0) | 4,010 | 5,423 | (1,413) | (26.1) | |||||||||||||||||||||||||||||||||||||||
15,969 | 16,100 | (131) | (0.8) | 49,150 | 53,258 | (4,108) | (7.7) | ||||||||||||||||||||||||||||||||||||||||
Net (loss) gain on sale of securities | (2,657) | (4,527) | 1,870 | (41.3) | (14,436) | 473 | (14,909) | nm | |||||||||||||||||||||||||||||||||||||||
Net change in valuation of financial instruments carried at fair value | (654) | (3,151) | 2,497 | (79.2) | (4,357) | 650 | (5,007) | nm | |||||||||||||||||||||||||||||||||||||||
Gain on sale of branches, including related deposits | — | — | — | nm | — | 7,804 | (7,804) | (100.0) | |||||||||||||||||||||||||||||||||||||||
Total non-interest income | $ | 12,658 | $ | 8,422 | $ | 4,236 | 50.3 | % | $ | 30,357 | $ | 62,185 | $ | (31,828) | (51.2) | % |
Quarters Ended | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
Sep 30, 2023 | Jun 30, 2023 | Change Amount | Change Percent | 2023 | 2022 | Change Amount | Change Percent | ||||||||||||||||||||||||||||||||||||||||
Salary and employee benefits | $ | 61,091 | $ | 61,972 | $ | (881) | (1.4) | % | $ | 184,452 | $ | 181,957 | $ | 2,495 | 1.4 | % | |||||||||||||||||||||||||||||||
Less capitalized loan origination costs | (4,498) | (4,457) | (41) | 0.9 | (12,386) | (19,436) | 7,050 | (36.3) | |||||||||||||||||||||||||||||||||||||||
Occupancy and equipment | 11,722 | 11,994 | (272) | (2.3) | 35,686 | 38,512 | (2,826) | (7.3) | |||||||||||||||||||||||||||||||||||||||
Information and computer data services | 7,118 | 7,082 | 36 | 0.5 | 21,347 | 19,451 | 1,896 | 9.7 | |||||||||||||||||||||||||||||||||||||||
Payment and card processing services | 5,172 | 4,669 | 503 | 10.8 | 14,459 | 16,086 | (1,627) | (10.1) | |||||||||||||||||||||||||||||||||||||||
Professional and legal expenses | 3,042 | 2,400 | 642 | 26.8 | 7,563 | 7,677 | (114) | (1.5) | |||||||||||||||||||||||||||||||||||||||
Advertising and marketing | 1,362 | 940 | 422 | 44.9 | 3,108 | 2,609 | 499 | 19.1 | |||||||||||||||||||||||||||||||||||||||
Deposit insurance | 2,874 | 2,839 | 35 | 1.2 | 7,603 | 4,910 | 2,693 | 54.8 | |||||||||||||||||||||||||||||||||||||||
State and municipal business and use taxes | 1,359 | 1,229 | 130 | 10.6 | 3,888 | 3,389 | 499 | 14.7 | |||||||||||||||||||||||||||||||||||||||
Real estate operations, net | (383) | 75 | (458) | (610.7) | (585) | (132) | (453) | 343.2 | |||||||||||||||||||||||||||||||||||||||
Amortization of core deposit intangibles | 857 | 991 | (134) | (13.5) | 2,898 | 4,064 | (1,166) | (28.7) | |||||||||||||||||||||||||||||||||||||||
Loss on extinguishment of debt | — | — | — | nm | — | 793 | (793) | (100.0) | |||||||||||||||||||||||||||||||||||||||
Miscellaneous | 6,175 | 5,671 | 504 | 8.9 | 17,884 | 18,402 | (518) | (2.8) | |||||||||||||||||||||||||||||||||||||||
Total non-interest expense | $ | 95,891 | $ | 95,405 | $ | 486 | 0.5 | % | $ | 285,917 | $ | 278,282 | $ | 7,635 | 2.7 | % |
September 30, 2023 | December 31, 2022 | September 30, 2022 | |||||||||||||||
Nonaccrual Loans: | |||||||||||||||||
Secured by real estate: | |||||||||||||||||
Commercial | $ | 1,365 | $ | 3,683 | $ | 6,997 | |||||||||||
Construction and land | 5,538 | 181 | 299 | ||||||||||||||
One- to four-family | 5,480 | 5,236 | 2,381 | ||||||||||||||
Commercial business | 5,289 | 9,886 | 1,462 | ||||||||||||||
Agricultural business, including secured by farmland | 3,170 | 594 | 594 | ||||||||||||||
Consumer | 3,378 | 2,126 | 1,779 | ||||||||||||||
24,220 | 21,706 | 13,512 | |||||||||||||||
Loans more than 90 days delinquent, still on accrual: | |||||||||||||||||
Secured by real estate: | |||||||||||||||||
One- to four-family | 1,799 | 1,023 | 1,556 | ||||||||||||||
Commercial business | — | — | 64 | ||||||||||||||
Consumer | 245 | 264 | 61 | ||||||||||||||
2,044 | 1,287 | 1,681 | |||||||||||||||
Total non-performing loans | 26,264 | 22,993 | 15,193 | ||||||||||||||
REO, net | 546 | 340 | 340 | ||||||||||||||
Other repossessed assets held for sale | — | 17 | 17 | ||||||||||||||
Total non-performing assets | $ | 26,810 | $ | 23,350 | $ | 15,550 | |||||||||||
Total non-performing assets to total assets | 0.17 | % | 0.15 | % | 0.10 | % | |||||||||||
Total nonaccrual loans to loans before allowance for credit losses - loans | 0.23 | % | 0.21 | % | 0.14 | % | |||||||||||
Loans 30-89 days past due and on accrual | $ | 6,108 | $ | 17,186 | $ | 15,208 |
September 30, 2023 | December 31, 2022 | September 30, 2022 | |||||||||||||||
Pass | $ | 10,467,498 | $ | 10,000,493 | $ | 9,672,473 | |||||||||||
Special Mention | 19,394 | 9,081 | 18,251 | ||||||||||||||
Substandard | 124,525 | 137,150 | 136,372 | ||||||||||||||
Total | $ | 10,611,417 | $ | 10,146,724 | $ | 9,827,096 |
Actual | Minimum to be Categorized as “Adequately Capitalized” | Minimum to be Categorized as “Well-Capitalized” | ||||||||||||||||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Amount | |||||||||||||||||||||||||||||||||
Banner Corporation—consolidated | ||||||||||||||||||||||||||||||||||||||
Total capital to risk-weighted assets | $ | 1,873,419 | 14.34 | % | $ | 1,045,239 | 8.00 | % | $ | 1,306,548 | 10.00 | % | ||||||||||||||||||||||||||
Tier 1 capital to risk-weighted assets | 1,621,146 | 12.41 | 783,929 | 6.00 | 783,929 | 6.00 | ||||||||||||||||||||||||||||||||
Tier 1 leverage capital to average assets | 1,621,146 | 10.40 | 623,306 | 4.00 | n/a | n/a | ||||||||||||||||||||||||||||||||
Common equity tier 1 capital | 1,534,646 | 11.75 | 587,947 | 4.50 | n/a | n/a | ||||||||||||||||||||||||||||||||
Banner Bank | ||||||||||||||||||||||||||||||||||||||
Total capital to risk-weighted assets | 1,768,801 | 13.54 | 1,045,221 | 8.00 | 1,306,526 | 10.00 | ||||||||||||||||||||||||||||||||
Tier 1 capital to risk-weighted assets | 1,616,528 | 12.37 | 783,916 | 6.00 | 1,045,221 | 8.00 | ||||||||||||||||||||||||||||||||
Tier 1 leverage capital to average assets | 1,616,528 | 10.38 | 623,184 | 4.00 | 778,980 | 5.00 | ||||||||||||||||||||||||||||||||
Common equity tier 1 capital | 1,616,528 | 12.37 | 587,937 | 4.50 | 849,242 | 6.50 |
Estimated Increase (Decrease) in | ||||||||||||||||||||||||||||||||||||||
Change (in Basis Points) in Interest Rates (1) | Net Interest Income Next 12 Months | Net Interest Income Next 24 Months | Economic Value of Equity | |||||||||||||||||||||||||||||||||||
+300 | $ | (20,643) | (3.5) | % | $ | (2,206) | (0.2) | % | $ | (366,146) | (13.7) | % | ||||||||||||||||||||||||||
+200 | (3,507) | (0.6) | 20,684 | 1.6 | (204,479) | (7.6) | ||||||||||||||||||||||||||||||||
+100 | 3,618 | 0.6 | 21,819 | 1.7 | (85,045) | (3.2) | ||||||||||||||||||||||||||||||||
0 | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
-100 | (22,514) | (3.8) | (62,100) | (4.9) | 50,314 | 1.9 | ||||||||||||||||||||||||||||||||
-200 | (45,076) | (7.6) | (125,780) | (9.9) | 59,101 | 2.2 | ||||||||||||||||||||||||||||||||
-300 | (70,180) | (11.8) | (197,924) | (15.6) | (28,752) | (1.1) | ||||||||||||||||||||||||||||||||
Within 6 Months | After 6 Months Within 1 Year | After 1 Year Within 3 Years | After 3 Years Within 5 Years | After 5 Years Within 10 Years | Over 10 Years | Total | |||||||||||||||||||||||||||||||||||
Interest-earning assets: (1) | |||||||||||||||||||||||||||||||||||||||||
Construction loans | $ | 946,350 | $ | 74,436 | $ | 155,384 | $ | 35,493 | $ | 26,188 | $ | 152 | $ | 1,238,003 | |||||||||||||||||||||||||||
Fixed-rate mortgage loans | 232,637 | 192,604 | 707,759 | 558,471 | 782,420 | 305,193 | 2,779,084 | ||||||||||||||||||||||||||||||||||
Adjustable-rate mortgage loans | 1,079,037 | 348,098 | 1,331,944 | 922,267 | 430,577 | 32,111 | 4,144,034 | ||||||||||||||||||||||||||||||||||
Fixed-rate mortgage-backed securities | 83,500 | 92,533 | 337,395 | 417,082 | 853,710 | 1,004,548 | 2,788,768 | ||||||||||||||||||||||||||||||||||
Adjustable-rate mortgage-backed securities | 293,567 | 45 | 193 | 212 | 4,103 | — | 298,120 | ||||||||||||||||||||||||||||||||||
Fixed-rate commercial/agricultural loans | 106,519 | 90,053 | 247,811 | 141,993 | 152,402 | 30,741 | 769,519 | ||||||||||||||||||||||||||||||||||
Adjustable-rate commercial/agricultural loans | 883,233 | 23,836 | 75,429 | 64,472 | 3,589 | — | 1,050,559 | ||||||||||||||||||||||||||||||||||
Consumer and other loans | 448,991 | 92,656 | 51,616 | 36,055 | 27,973 | 43,472 | 700,763 | ||||||||||||||||||||||||||||||||||
Investment securities and interest-earning deposits | 94,400 | 6,442 | 53,455 | 10,610 | 127,925 | 565,828 | 858,660 | ||||||||||||||||||||||||||||||||||
Total rate sensitive assets | 4,168,234 | 920,703 | 2,960,986 | 2,186,655 | 2,408,887 | 1,982,045 | 14,627,510 | ||||||||||||||||||||||||||||||||||
Interest-bearing liabilities: (2) | |||||||||||||||||||||||||||||||||||||||||
Regular savings | 250,247 | 164,406 | 552,999 | 418,059 | 656,643 | 709,099 | 2,751,453 | ||||||||||||||||||||||||||||||||||
Interest checking accounts | 246,128 | 111,610 | 367,024 | 270,934 | 425,607 | 585,563 | 2,006,866 | ||||||||||||||||||||||||||||||||||
Money market deposit accounts | 195,529 | 104,296 | 351,245 | 265,660 | 415,506 | 427,831 | 1,760,067 | ||||||||||||||||||||||||||||||||||
Certificates of deposit | 1,079,544 | 294,419 | 75,290 | 8,276 | 784 | — | 1,458,313 | ||||||||||||||||||||||||||||||||||
FHLB advances | 140,000 | — | — | — | — | — | 140,000 | ||||||||||||||||||||||||||||||||||
Subordinated notes | — | — | 93,500 | — | — | — | 93,500 | ||||||||||||||||||||||||||||||||||
Junior subordinated debentures | 89,178 | — | — | — | — | — | 89,178 | ||||||||||||||||||||||||||||||||||
Retail repurchase agreements | 188,440 | — | — | — | — | — | 188,440 | ||||||||||||||||||||||||||||||||||
Total rate sensitive liabilities | 2,189,066 | 674,731 | 1,440,058 | 962,929 | 1,498,540 | 1,722,493 | 8,487,817 | ||||||||||||||||||||||||||||||||||
Excess of interest-sensitive assets over interest-sensitive liabilities | $ | 1,979,168 | $ | 245,972 | $ | 1,520,928 | $ | 1,223,726 | $ | 910,347 | $ | 259,552 | $ | 6,139,693 | |||||||||||||||||||||||||||
Cumulative excess of interest-sensitive assets | $ | 1,979,168 | $ | 2,225,140 | $ | 3,746,068 | $ | 4,969,794 | $ | 5,880,141 | $ | 6,139,693 | $ | 6,139,693 | |||||||||||||||||||||||||||
Cumulative ratio of interest-earning assets to interest-bearing liabilities | 190.41 | % | 177.70 | % | 187.04 | % | 194.36 | % | 186.92 | % | 172.34 | % | 172.34 | % | |||||||||||||||||||||||||||
Interest sensitivity gap to total assets | 12.76 | 1.59 | 9.81 | 7.89 | 5.87 | 1.67 | 39.59 | ||||||||||||||||||||||||||||||||||
Ratio of cumulative gap to total assets | 12.76 | 14.35 | 24.16 | 32.05 | 37.92 | 39.59 | 39.59 |
Period | Total Number of Common Shares Purchased (1) | Average Price Paid per Common Share | Total Number of Shares Purchased as Part of Publicly Announced Authorization | Maximum Number of Remaining Shares that May be Purchased as Part of Publicly Announced Authorization | ||||||||||||||||||||||
July 1, 2023 - July 31, 2023 | 363 | $ | 47.41 | — | — | |||||||||||||||||||||
August 1, 2023 - August 31, 2023 | 30 | 47.02 | — | — | ||||||||||||||||||||||
September 1, 2023 - September 30, 2023 | — | — | — | — | ||||||||||||||||||||||
Total for quarter | 393 | $ | 47.38 | — |
Exhibit | Index of Exhibits | ||||
3{a} | |||||
3{b} | |||||
10{a} | |||||
10{b} | |||||
10{c} | |||||
10{d} | |||||
10{e} | |||||
10{f} | |||||
10{g} | |||||
10{h} | |||||
10{i} | |||||
10{j} | |||||
10{k} | |||||
31.1 | |||||
31.2 | |||||
32 | |||||
101.INS | Inline XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the XBRL document | ||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document | ||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
Exhibit | Index of Exhibits | ||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | ||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | ||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | ||||
104 | The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, formatted in Inline XBRL (included in Exhibit 101) |
Banner Corporation | ||||||||
November 2, 2023 | /s/ Mark J. Grescovich | |||||||
Mark J. Grescovich | ||||||||
President and Chief Executive Officer (Principal Executive Officer) | ||||||||
November 2, 2023 | /s/ Robert G. Butterfield | |||||||
Robert G. Butterfield | ||||||||
Executive Vice President, Treasurer and Chief Financial Officer (Principal Financial and Accounting Officer) |
November 2, 2023 | /s/Mark J. Grescovich | |||||||
Mark J. Grescovich | ||||||||
Chief Executive Officer |
November 2, 2023 | /s/ Robert G. Butterfield | |||||||
Robert G. Butterfield | ||||||||
Chief Financial Officer |
November 2, 2023 | /s/ Mark J. Grescovich | |||||||
Mark J. Grescovich | ||||||||
Chief Executive Officer | ||||||||
November 2, 2023 | /s/ Robert G. Butterfield | |||||||
Robert G. Butterfield | ||||||||
Chief Financial Officer |
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Dec. 31, 2022 |
Sep. 30, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2021 |
|
Statement of Stockholders' Equity [Abstract] | ||||||||||
Common Stock, Dividends, Per Share, Declared | $ 0.48 | $ 0.48 | $ 0.48 | $ 0.44 | $ 0.44 | $ 0.44 | $ 0.44 | $ 1.44 | $ 1.32 | |
Net Income (Loss) Attributable to Parent | $ 45,854 | $ 39,591 | $ 55,555 | $ 54,380 | $ 49,070 | $ 47,965 | $ 43,963 | $ 141,000 | $ 140,998 | |
Other Comprehensive Income (Loss), Net of Tax | (53,467) | 37,133 | 6,421 | (113,275) | (101,824) | (154,275) | (30,146) | (369,374) | ||
Accrual of dividends on common stock | (16,666) | (16,670) | (16,691) | (15,246) | (15,208) | (15,378) | (15,066) | |||
Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered | 2,373 | 1,709 | (734) | 2,218 | 2,242 | 2,247 | (1,169) | |||
Repurchase of common stock | (10,960) | |||||||||
Equity, Attributable to Parent | $ 1,520,607 | $ 1,542,513 | $ 1,531,695 | $ 1,456,432 | $ 1,408,659 | $ 1,485,830 | $ 1,563,780 | $ 1,520,607 | $ 1,408,659 | $ 1,690,327 |
Common Stock, Dividends, Per Share, Declared | $ 0.48 | $ 0.48 | $ 0.48 | $ 0.44 | $ 0.44 | $ 0.44 | $ 0.44 | $ 1.44 | $ 1.32 | |
Common Stock [Member] | ||||||||||
Shares Issued, Shares, Share-Based Payment Arrangement, after Forfeiture | 1,322 | 36,087 | 114,522 | 2,259 | 429 | 18,546 | 120,152 | |||
Stock Repurchased and Retired During Period, Shares | (200,000) | |||||||||
Shares, Outstanding | 34,345,949 | 34,344,627 | 34,308,540 | 34,194,018 | 34,191,759 | 34,191,330 | 34,372,784 | 34,345,949 | 34,191,759 | 34,252,632 |
Common Stock and Paid in Capital [Member] | ||||||||||
Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered | $ 2,373 | $ 1,709 | $ (734) | $ 2,218 | $ 2,242 | $ 2,247 | $ (1,169) | |||
Repurchase of common stock | (10,960) | |||||||||
Equity, Attributable to Parent | 1,297,307 | 1,294,934 | 1,293,225 | 1,293,959 | 1,291,741 | 1,289,499 | 1,298,212 | $ 1,297,307 | $ 1,291,741 | $ 1,299,381 |
Retained Earnings [Member] | ||||||||||
Net Income (Loss) Attributable to Parent | 45,854 | 39,591 | 55,555 | 54,380 | 49,070 | 47,965 | 43,963 | |||
Accrual of dividends on common stock | (16,666) | (16,670) | (16,691) | (15,246) | (15,208) | (15,378) | (15,066) | |||
Equity, Attributable to Parent | 616,215 | 587,027 | 564,106 | 525,242 | 486,108 | 452,246 | 419,659 | 616,215 | 486,108 | 390,762 |
Accumulated Other Comprehensive Income (Loss) [Member] | ||||||||||
Other Comprehensive Income (Loss), Net of Tax | 37,133 | 6,421 | (113,275) | (101,824) | (154,275) | |||||
Equity, Attributable to Parent | $ (392,915) | $ (339,448) | $ (325,636) | $ (362,769) | $ (369,190) | $ (255,915) | $ (154,091) | $ (392,915) | $ (369,190) | $ 184 |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | The accompanying unaudited condensed consolidated financial statements include the accounts of Banner Corporation (the Company or Banner), a bank holding company incorporated in the State of Washington and its wholly-owned subsidiary, Banner Bank (the Bank). These unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X as promulgated by the SEC. In preparing these financial statements, the Company has evaluated events and transactions subsequent to September 30, 2023, for potential recognition or disclosure. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the financial position and results of operations for the periods presented have been included. Certain information and note disclosures have been condensed or omitted pursuant to the rules and regulations of the SEC and the accounting standards for interim financial statements. Certain reclassifications have been made to the 2022 Consolidated Financial Statements and/or schedules to conform to the 2023 presentation. These reclassifications may have affected certain ratios for the prior periods. The effect of these reclassifications is considered immaterial. All significant intercompany transactions and balances have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts reported in the financial statements. Various elements of the Company’s accounting policies, by their nature, are inherently subject to estimation techniques, valuation assumptions and other subjective assessments. The information included in this Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. Interim results are not necessarily indicative of results for a full year or any other interim period.
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ACCOUNTING STANDARDS RECENTLY ISSUED OR ADOPTED |
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Sep. 30, 2023 | |
Accounting Changes and Error Corrections [Abstract] | |
ACCOUNTING STANDARDS RECENTLY ISSUED OR ADOPTED | Financial Instruments – Credit Losses (Topic 326) On January 1, 2023, the Company adopted the Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) 2022-02, Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. The ASU eliminated the troubled debt restructuring (TDR) recognition and measurement guidance and, instead, requires that a creditor evaluate (consistent with the accounting for other loan modifications) whether the modification represents a new loan or a continuation of an existing loan. The ASU also introduced new disclosure requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. In addition, the ASU requires vintage disclosures including current-period gross write-offs by year of origination for financing receivables. The Company applied the ASU prospectively and new disclosures have been added when applicable. Reference Rate Reform (Topic 848) In March 2020, the FASB issued guidance within ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, in response to the scheduled discontinuation of LIBOR on December 31, 2021. The amendments in this ASU provide optional guidance designed to provide relief from the accounting analysis and impacts that may otherwise be required for modifications to agreements (e.g., loans, debt securities, derivatives, borrowings) necessitated by reference rate reform. Since the issuance of this guidance, the publication cessation of U.S. dollar LIBOR was extended to June 30, 2023. In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of Sunset Date of Topic 848. This ASU defers the sunset date of Topic 848 from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. This deferral of the sunset date is in response to the extension of the publication cessation date. The amendments in this ASU are effective upon the issuance date of December 2022. The following optional expedients for applying the requirements of certain Topics or Industry Subtopics in the Codification are permitted for contracts that are modified because of reference rate reform and that meet certain scope guidance: 1) modifications of contracts within the scope of Topics 310, Receivables, and 470, Debt, should be accounted for by prospectively adjusting the effective interest rate; 2) modifications of contracts within the scope of Topic 842, Leases, should be accounted for as a continuation of the existing contracts with no reassessments of the lease classification and the discount rate or remeasurements of lease payments that otherwise would be required for modifications not accounted for as separate contracts; 3) modifications of contracts do not require an entity to reassess its original conclusion about whether that contract contains an embedded derivative that is clearly and closely related to the economic characteristics and risks of the host contract; and 4) the amendments in this ASU also include a general principle that permits an entity to consider contract modifications due to reference rate reform to be an event that does not require contract remeasurement at the modification date or reassessment of a previous accounting determination. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope. This ASU clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The ASU also amends the expedients and exceptions to capture the incremental consequences of the scope clarification and to tailor the existing guidance to derivative instruments affected by the discounting transition. The amendments in this ASUs are effective upon the issuance date of March 12, 2020, and applies to contract modifications made and new hedging relationships entered into through December 31, 2022. The Company used the expedients in the Reference Rate Reform guidance to manage through the transition from LIBOR, specifically as they relate to loans, leases and hedging relationships. The adoption of this accounting guidance did not have a material impact on the Company’s Consolidated Financial Statements. Fair Value Measurement (Topic 820) In June 2022, the FASB issued guidance within ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. The ASU affects all entities that have investments in equity securities measured at fair value that are subject to a contractual sale restriction. These amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The ASU is effective for fiscal years, beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. The adoption of this ASU is not expected to have a material impact on the Company’s Consolidated Financial Statements.
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SECURITIES |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SECURITIES | The amortized cost, gross unrealized gains and losses and estimated fair value of securities at September 30, 2023 and December 31, 2022 are summarized as follows (in thousands):
Accrued interest receivable on held-to-maturity debt securities was $4.2 million and $4.8 million at September 30, 2023 and December 31, 2022, respectively, and was $11.0 million and $12.4 million on available-for-sale debt securities at September 30, 2023 and December 31, 2022, respectively. Accrued interest receivable on securities is reported in accrued interest receivable on the Consolidated Statements of Financial Condition and is excluded from the calculation of the allowance for credit losses. At September 30, 2023 and December 31, 2022, the gross unrealized losses and the fair value for securities available-for-sale aggregated by the length of time that individual securities have been in a continuous unrealized loss position were as follows (in thousands):
At September 30, 2023, there were 233 securities—available-for-sale with unrealized losses, compared to 298 at December 31, 2022. As of September 30, 2023, we had an allowance for credit losses of $750,000 related to the estimated credit loss on one security. Management does not believe that any remaining individual unrealized loss as of September 30, 2023 or December 31, 2022 resulted from credit loss. The decline in fair market value of these securities was generally due to changes in interest rates and changes in market-desired spreads subsequent to their purchase. There were no sales of securities—trading during the nine months ended September 30, 2023 or 2022. There were no securities—trading in a nonaccrual status at September 30, 2023 or December 31, 2022. Net unrealized holding losses of $3.4 million were recognized during the nine months ended September 30, 2023, compared to $1.4 million of net unrealized holding gains recognized during the nine months ended September 30, 2022. The following table presents gross gains and losses on sales and partial calls of securities available-for-sale (in thousands):
There were no securities—available-for-sale in a nonaccrual status at September 30, 2023 or December 31, 2022. The following table presents the amortized cost and estimated fair value of securities at September 30, 2023, by contractual maturity and does not reflect any required periodic payments (in thousands). Expected maturities will differ from contractual maturities because some securities may be called or prepaid with or without call or prepayment penalties.
The following table presents, as of September 30, 2023, investment securities which were pledged to secure borrowings, public deposits or other obligations as permitted or required by law (in thousands):
The Company monitors the credit quality of held-to-maturity debt securities through the use of credit ratings which are reviewed and updated quarterly. The Company’s non-rated held-to-maturity debt securities are primarily United States government sponsored enterprise debentures carrying minimal to no credit risk. The non-rated corporate bonds primarily consist of Community Reinvestment Act related bonds secured by loan instruments from low to moderate income borrowers. The remaining non-rated held-to-maturity debt securities balance is comprised of local municipal debt from within the Company’s geographic footprint and is monitored through quarterly or annual financial review. This municipal debt is predominately essential service or unlimited general obligation backed debt. The following tables summarize the amortized cost of held-to-maturity debt securities by credit rating at September 30, 2023 and December 31, 2022 (in thousands):
The following tables present the activity in the allowance for credit losses for securities available-for-sale by major type for the three and nine months ended September 30, 2023 (in thousands). We had no allowance for credit losses for securities available-for-sale during three and nine months ended September 30, 2022.
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LOANS RECEIVABLE AND THE ALLOWANCE FOR CREDIT LOSSES |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOANS RECEIVABLE AND THE ALLOWANCE FOR LOAN LOSSES | The following table presents the loans receivable at September 30, 2023 and December 31, 2022 by class (dollars in thousands).
(1) Includes $4.1 million and $7.6 million of U.S. Small Business Administration (SBA) Paycheck Protection Program (PPP) loans as of September 30, 2023 and December 31, 2022, respectively. (2) Includes no SBA PPP loans as of September 30, 2023, and $334,000 as of December 31, 2022. Loan amounts are net of unearned loan fees in excess of unamortized costs of $11.2 million as of September 30, 2023, and $8.1 million as of December 31, 2022. Net loans include net discounts on acquired loans of $5.1 million and $6.6 million as of September 30, 2023 and December 31, 2022, respectively. Net loans does not include accrued interest receivable. Accrued interest receivable on loans was $45.5 million as of September 30, 2023, and $39.8 million as of December 31, 2022 and was reported in accrued interest receivable on the Consolidated Statements of Financial Condition. The Company had pledged $7.2 billion and $6.5 billion of loans as collateral for FHLB and other borrowings at September 30, 2023 and December 31, 2022, respectively. Purchased credit-deteriorated and purchased non-credit-deteriorated loans. Loans acquired in business combinations are recorded at their fair value at the acquisition date. Acquired loans are evaluated upon acquisition and classified as either purchased credit-deteriorated (PCD) or purchased non-credit-deteriorated. There were no PCD loans acquired during the nine months ended September 30, 2023 or September 30, 2022. Troubled Loan Modifications. Occasionally, the Company offers modifications of loans to borrowers experiencing financial difficulty by providing principal forgiveness, interest rate reductions, other-than-insignificant payment delays, term extensions or any combination of these. When principal forgiveness is provided, the amount of the forgiveness is charged-off against the allowance for credit losses - loans. Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is charged off. Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses - loans is adjusted by the same amount. The following tables present the Company’s portfolio of risk-rated loans by class and by grade as of September 30, 2023 and December 31, 2022 (in thousands). In addition, the tables include the gross charge-offs for the nine months ended September 30, 2023. Revolving loans that are converted to term loans are treated as new originations in the table below and are presented by year of origination. Term loans that are renewed or extended for periods longer than 90 days are presented as a new origination in the year of the most recent renewal or extension.
The following tables present the Company’s portfolio of non-risk-rated loans by class and delinquency status as of September 30, 2023 and December 31, 2022 (in thousands). In addition, the tables include the gross charge-offs for the nine months ended September 30, 2023. Revolving loans that are converted to term loans are treated as new originations in the table below and are presented by year of origination. Term loans that are renewed or extended for periods longer than 90 days are presented as a new origination in the year of the most recent renewal or extension.
The following tables provide the amortized cost basis of collateral-dependent loans as of September 30, 2023 and December 31, 2022 (in thousands). Our collateral dependent loans presented in the tables below have no significant concentrations by property type or location.
The following tables provide additional detail on the age analysis of the Company’s past due loans as of September 30, 2023 and December 31, 2022 (in thousands):
(1) The Company did not recognize any interest income on non-accrual loans during the nine months ended September 30, 2023, or the year ended December 31, 2022. The following tables provide the activity in the allowance for credit losses by portfolio segment for the three and nine months ended September 30, 2023 and 2022 (in thousands):
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GOODWILL, OTHER INTANGIBLE ASSETS AND MORTGAGE SERVICING RIGHTS |
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GOODWILL, OTHER INTANGIBLE ASSETS AND MORTGAGE SERVICING RIGHTS | Goodwill and Other Intangible Assets: At September 30, 2023, intangible assets are comprised of goodwill and core deposit intangibles (CDI) acquired in business combinations. Goodwill represents the excess of the purchase consideration paid over the fair value of the assets acquired, net of the fair values of liabilities assumed in a business combination, and is not amortized but is reviewed at least annually for impairment. The Company has identified one reporting unit for the purpose of evaluating goodwill for impairment. The Company completed an assessment of qualitative factors as of December 31, 2022 and concluded that no further analysis was required as it is more likely than not that the fair value of Banner Bank, the reporting unit, exceeds the carrying value. CDI represents the value of transaction-related deposits and the value of the client relationships associated with the deposits. The Company amortizes CDI assets over their estimated useful lives and reviews them at least annually for events or circumstances that could impair their value. The following table summarizes the changes in the Company’s goodwill and other intangibles for the nine months ended September 30, 2023, and the year ended December 31, 2022 (in thousands):
(1) Acquired CDI was adjusted for the sale of branches in 2022. The following table presents the estimated amortization expense with respect to CDI as of September 30, 2023, for the periods indicated (in thousands):
Mortgage Servicing Rights: Mortgage and SBA servicing rights are reported in other assets. SBA servicing rights are initially recorded and carried at fair value. Mortgage servicing rights are initially recognized at fair value and are amortized in proportion to, and over the period of, the estimated future net servicing income of the underlying financial assets. Mortgage servicing rights are subsequently evaluated for impairment based upon the fair value of the rights compared to the amortized cost (remaining unamortized initial fair value). If the fair value is less than the amortized cost, a valuation allowance is created through an impairment charge to servicing fee income. However, if the fair value is greater than the amortized cost, the amount above the amortized cost is not recognized in the carrying value. During the three and nine months ended September 30, 2023 and 2022, the Company did not record any impairment charges or recoveries against mortgage servicing rights. The unpaid principal balance of loans for which mortgage and SBA servicing rights have been recognized totaled $2.76 billion and $2.77 billion at September 30, 2023 and December 31, 2022, respectively. Custodial accounts maintained in connection with this servicing totaled $29.1 million and $11.2 million at September 30, 2023 and December 31, 2022, respectively. An analysis of the mortgage and SBA servicing rights for the three and nine months ended September 30, 2023 and 2022 is presented below (in thousands):
(1) Amortization of mortgage servicing rights is recorded as a reduction of loan servicing income within mortgage banking operations and any unamortized balance is fully amortized if the loan repays in full. (2) There was no valuation allowance on mortgage servicing rights as of both September 30, 2023 and 2022. (3) Fair value adjustments relate to SBA servicing rights. These adjustments are estimated based on an independent dealer analysis by discounting estimated net future cash flows from servicing SBA loans.
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DEPOSITS |
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Banking and Thrift, Other Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DEPOSITS | Deposits consisted of the following at September 30, 2023 and December 31, 2022 (in thousands):
Scheduled maturities and weighted average interest rates of certificates of deposit at September 30, 2023 are as follows (dollars in thousands):
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FAIR VALUE OF FINANCIAL INSTRUMENTS |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE ACCOUNTING AND MEASUREMENT | The following table presents estimated fair values of the Company’s financial instruments as of September 30, 2023 and December 31, 2022, whether or not recognized or recorded in the Consolidated Statements of Financial Condition (dollars in thousands):
The Company measures and discloses certain assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (that is, not a forced liquidation or distressed sale). When measuring fair value, management will maximize the use of observable inputs and minimize the use of unobservable inputs whenever possible. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s estimates for market assumptions. The estimated fair value amounts of financial instruments have been determined by the Company using available market information and appropriate valuation methodologies. However, considerable judgment is required to interpret data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize at a future date. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. In addition, reasonable comparability between financial institutions may not be likely due to the wide range of permitted valuation techniques and numerous estimates that must be made given the absence of active secondary markets for many of the financial instruments. This lack of uniform valuation methodologies also introduces a greater degree of subjectivity to these estimated fair values. Items Measured at Fair Value on a Recurring Basis: The following tables present financial assets and liabilities measured at fair value on a recurring basis and the level within the fair value hierarchy of the fair value measurements for those assets and liabilities as of September 30, 2023 and December 31, 2022 (in thousands):
(1) The unpaid principal balance of residential mortgage loans held for sale carried at fair value on a recurring basis was $11.5 million and $2.2 million at September 30, 2023 and December 31, 2022, respectively. The following methods were used to estimate the fair value of each class of financial instruments above: Securities: The estimated fair values of investment securities and mortgage-backed securities are priced using current active market quotes, if available, which are considered Level 1 measurements. For most of the portfolio, matrix pricing based on the securities’ relationship to other benchmark quoted prices is used to establish the fair value. These measurements are considered Level 2. Due to the continued limited activity in the trust preferred markets that have limited the observability of market spreads for some of the Company’s trust preferred securities (TPS), management has classified these securities as a Level 3 fair value measure. Management periodically reviews the pricing information received from third-party pricing services and tests those prices against other sources to validate the reported fair values. Loans Held for Sale: Fair values for residential mortgage loans held for sale are determined by comparing actual loan rates to current secondary market prices for similar loans. Equity Securities: Equity securities are invested in a publicly traded stock. The fair value of these securities is based on daily quoted market prices. SBA Servicing Rights: Fair values are estimated based on an independent dealer analysis by discounting estimated net future cash flows from servicing. The evaluation utilizes assumptions market participants would use in determining fair value including prepayment speeds, delinquency and foreclosure rates, the discount rate, servicing costs, and the timing of cash flows. The SBA servicing portfolio is stratified by loan type and fair value estimates are adjusted up or down based on the serviced loan interest rates versus current rates on new loan originations since the most recent independent analysis. Junior Subordinated Debentures: The fair value of junior subordinated debentures is estimated using an income approach technique. The significant inputs included in the estimation of fair value are the credit risk adjusted spread and three month SOFR (Secured Overnight Financing Rate). The credit risk adjusted spread represents the nonperformance risk of the liability. The Company utilizes an external valuation firm to validate the reasonableness of the credit risk adjusted spread used to determine the fair value. The junior subordinated debentures are carried at fair value which represents the estimated amount that would be paid to transfer these liabilities in an orderly transaction amongst market participants. Due to inactivity in the trust preferred markets that have limited the observability of market spreads, management has classified this as a Level 3 fair value measurement. Derivatives: Derivatives include interest rate swap agreements, interest rate lock commitments to originate loans held for sale, forward sales contracts to sell loans and securities related to mortgage banking activities and risk participation agreements. Fair values for these instruments, which generally change as a result of changes in the level of market interest rates, are estimated based on dealer quotes and secondary market sources. As the interest rate lock commitments use a pull-through rate that is considered an unobservable input, these derivatives are classified as a level 3 fair value measurement. Off-Balance Sheet Items: Off-balance sheet financial instruments include unfunded commitments to extend credit, including standby letters of credit, and commitments to purchase investment securities. The fair value of these instruments is not considered to be material. Limitations: The fair value estimates presented herein are based on pertinent information available to management as of September 30, 2023 and December 31, 2022. The factors used in the fair value estimates are subject to change subsequent to the dates the fair value estimates are completed, therefore, current estimates of fair value may differ significantly from the amounts presented herein. Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3): The following table provides a description of the valuation technique, unobservable inputs, and quantitative and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a recurring and non-recurring basis at September 30, 2023 and December 31, 2022:
Trust preferred securities: Management believes that the credit risk-adjusted spread used to develop the discount rate utilized in the fair value measurement of TPS is indicative of the risk premium a willing market participant would require under current market conditions for instruments with similar contractual rates and terms and conditions and issuers with similar credit risk profiles and with similar expected probability of default. Management attributes the change in fair value of these instruments, compared to their par value, primarily to perceived general market adjustments to the risk premiums for these types of assets subsequent to their issuance. Junior subordinated debentures: Similar to the TPS discussed above, management believes that the credit risk-adjusted spread utilized in the fair value measurement of the junior subordinated debentures is indicative of the risk premium a willing market participant would require under current market conditions for an issuer with Banner’s credit risk profile. Management attributes the change in fair value of the junior subordinated debentures, compared to their par value, primarily to perceived general market adjustments to the risk premiums for these types of liabilities subsequent to their issuance. Future contractions in the risk adjusted spread relative to the spread currently utilized to measure the Company’s junior subordinated debentures at fair value as of September 30, 2023, or the passage of time, will result in negative fair value adjustments. At September 30, 2023, the discount rate utilized was based on a credit spread of 551 basis points and three-month SOFR of 540 basis points. Interest rate lock commitments: The fair value of the interest rate lock commitments is based on secondary market sources adjusted for an estimated pull-through rate. The pull-through rate is based on historical loan closing rates for similar interest rate lock commitments. An increase or decrease in the pull-through rate would have a corresponding, positive or negative fair value adjustment. SBA servicing asset: The constant prepayment rate (CPR) is set based on industry data. An increase in the CPR would result in a negative fair value adjustment, where a decrease in CPR would result in a positive fair value adjustment. The following tables provide a reconciliation of the assets and liabilities measured at fair value using significant unobservable inputs (Level 3) on a recurring basis during the three and nine months ended September 30, 2023 and 2022 (in thousands):
Interest income and dividends from TPS are recorded as a component of interest income. Interest expense related to the junior subordinated debentures is measured based on contractual interest rates and reported in interest expense. The change in fair value of the junior subordinated debentures, which represents changes in instrument specific credit risk, is recorded in other comprehensive income. The change in fair value of TPS securities, investments in limited partnerships and the SBA servicing asset are recorded as a component of non-interest income. The change in fair value of the interest rate lock and forward sales commitments are included in mortgage banking operations in non-interest income. Items Measured at Fair Value on a Non-recurring Basis: The following tables present financial assets and liabilities measured at fair value on a non-recurring basis and the level within the fair value hierarchy of the fair value measurements for those assets as of September 30, 2023 and December 31, 2022 (in thousands):
The following table presents the gains and losses resulting from non-recurring fair value adjustments for the three and nine months ended September 30, 2023 and September 30, 2022 (in thousands):
Loans individually evaluated: Expected credit losses for loans evaluated individually are measured based on the present value of expected future cash flows discounted at the loan’s original effective interest rate or when the Bank determines that foreclosure is probable, the expected credit loss is measured based on the fair value of the collateral as of the reporting date, less estimated selling costs, as applicable. As a practical expedient, the Bank measures the expected credit loss for a loan using the fair value of the collateral, if repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty based on the Bank’s assessment as of the reporting date. In both cases, if the fair value of the collateral is less than the amortized cost basis of the loan, the Bank will recognize an allowance as the difference between the fair value of the collateral, less costs to sell (if applicable) and the amortized cost basis of the loan. If the fair value of the collateral exceeds the amortized cost basis of the loan, any expected recovery added to the amortized cost basis will be limited to the amount previously charged-off. Subsequent changes in the expected credit losses for loans evaluated individually are included within the provision for credit losses in the same manner in which the expected credit loss initially was recognized or as a reduction in the provision that would otherwise be reported. REO: The Company records REO (acquired through a lending relationship) at fair value on a non-recurring basis. Fair value adjustments on REO are based on updated real estate appraisals which are based on current market conditions. All REO properties are recorded at the lower of the estimated fair value of the real estate, less expected selling costs, or the carrying amount of the defaulted loans. From time to time, non-recurring fair value adjustments to REO are recorded to reflect partial write-downs based on an observable market price or current appraised value of property. Banner considers any valuation inputs related to REO to be Level 3 inputs. The individual carrying values of these assets are reviewed for impairment at least annually and any additional impairment charges are expensed. Loans held for sale: The multifamily held for sale loans are carried at the lower of cost or market value. Lower of cost or market adjustments for multifamily loans held for sale are calculated based on discounted cash flows using a discount rate that is a combination of market spreads for similar loan types added to selected index rates. If the fair value of the multifamily held for sale loans is lower than the amortized cost basis of the loans, a net unrealized loss is recognized through the valuation allowance as a charge against income.
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INCOME TAXES AND DEFERRED TAXES |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES AND DEFERRED TAXES | The Company files a consolidated income tax return including all of its wholly-owned subsidiaries on a calendar year basis. Income taxes are accounted for using the asset and liability method. Under this method, a deferred tax asset or liability is determined based on the enacted tax rates which will be in effect when the differences between the financial statement carrying amounts and tax basis of existing assets and liabilities are expected to be reported in the Company’s income tax returns. The effect on deferred taxes of a change in tax rates is recognized in income in the period of change. A valuation allowance is recognized as a reduction to deferred tax assets when management determines it is more likely than not that deferred tax assets will not be available to offset future income tax liabilities. Accounting standards for income taxes prescribe a recognition threshold and measurement process for financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in a tax return, and also provide guidance on the de-recognition of previously recorded benefits and their classification, as well as the proper recording of interest and penalties, accounting in interim periods, disclosures and transition. The Company periodically reviews its income tax positions based on tax laws and regulations and financial reporting considerations, and records adjustments as appropriate. This review takes into consideration the status of current taxing authorities’ examinations of the Company’s tax returns, recent positions taken by the taxing authorities on similar transactions, if any, and the overall tax environment. As of September 30, 2023, the Company has recognized $1.6 million of unrecognized tax benefits for uncertain tax positions. The Company does not anticipate that there are additional uncertain tax positions or that any uncertain tax position which has not been recognized would materially affect the effective tax rate if recognized. The Company’s policy is to recognize interest and penalties on unrecognized tax benefits in income tax expense. The Company files consolidated income tax returns in the U.S. federal jurisdiction and in the Oregon, California, Utah, Idaho and Montana state jurisdictions. Tax credit investments: The Company invests in low income housing tax credit funds that are designed to generate a return primarily through the realization of federal tax credits. The Company accounts for these investments by amortizing the cost of tax credit investments over the life of the investment using a proportional amortization method and tax credit investment amortization expense is a component of the provision for income taxes. The following table presents the balances of the Company’s tax credit investments and related unfunded commitments at September 30, 2023 and December 31, 2022 (in thousands):
The following table presents other information related to the Company’s tax credit investments for the three and nine months ended September 30, 2023 and 2022 (in thousands):
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CALCULATION OF WEIGHTED AVERAGE SHARES OUTSTANDING FOR EARNINGS PER SHARE (EPS) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
CALCULATION OF WEIGHTED AVERAGE SHARES OUTSTANDING FOR EARNINGS PER SHARE (EPS) | The following table reconciles basic to diluted weighted average shares outstanding used to calculate earnings per share data for the three and nine months ended September 30, 2023 and 2022 (in thousands, except shares and per share data):
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STOCK-BASED COMPENSATION PLANS |
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Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION PLANS AND STOCK OPTIONS | The Company operates the 2014 Omnibus Incentive Plan (the 2014 Plan), the 2018 Omnibus Incentive Plan (the 2018 Plan) and the 2023 Omnibus Incentive Plan (the 2023 Plan), all of which were approved by its shareholders. The 2023 Plan was approved by shareholders on May 24, 2023. The purpose of these plans is to promote the success and enhance the value of the Company by providing a means for attracting and retaining highly skilled employees, officers and directors of the Company and linking their personal interests with those of the Company’s shareholders. Under these plans, the Company currently has outstanding awards of restricted stock shares and restricted stock units. The Company reserved 900,000 shares of its common stock for issuance under the 2014 Plan in connection with the exercise of awards. As of September 30, 2023, 277,304 restricted stock shares and 441,806 restricted stock units have been granted under the 2014 Plan of which 4,809 restricted stock shares and 23,143 restricted stock units were unvested. The Company reserved 900,000 shares of common stock for issuance under the 2018 Plan in connection with the exercise of awards. As of September 30, 2023, 735,744 restricted stock units have been granted under the 2018 Plan of which 336,986 restricted stock units were unvested. The Company reserved 625,000 shares of common stock for issuance under the 2023 Plan in connection with the exercise of awards. As of September 30, 2023, no shares had been granted under the 2023 Plan. The expense associated with all restricted stock grants (including restricted stock shares and restricted stock units) was $2.4 million and $6.8 million for the three and nine month periods ended September 30, 2023, and was $2.3 million and $6.6 million for the three and nine month periods ended September 30, 2022, respectively. Unrecognized compensation expense for these awards as of September 30, 2023, was $14.2 million and will be recognized over a weighted average period of 12 months.
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COMMITMENTS AND CONTINGENCIES |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES | Financial Instruments with Off-Balance-Sheet Risk — The Company has financial instruments with off-balance-sheet risk generated in the normal course of business to meet the financing needs of our clients. These financial instruments include commitments to extend credit, commitments related to standby letters of credit, commitments to originate loans, commitments to sell loans and commitments to buy or sell securities. These instruments involve, to varying degrees, elements of credit and interest rate risk similar to the risk involved in on-balance-sheet items. Our exposure to credit loss in the event of nonperformance by the other party to the financial instrument from commitments to extend credit and standby letters of credit is represented by the contractual notional amount of those instruments. We use the same credit policies in making commitments and conditional obligations as for on-balance-sheet instruments. Outstanding commitments for which no asset or liability for the notional amount has been recorded consisted of the following at the dates indicated (in thousands):
In addition to the commitments disclosed in the table above, the Company is committed to funding its’ unfunded tax credit investments. The Company has also entered into agreements to invest in several limited partnerships. As of September 30, 2023 and December 31, 2022, the funded balances and remaining outstanding commitments of these limited partnership investments were as follows (in thousands):
Commitments to extend credit are agreements to lend to a client, as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Many of the commitments may expire without being drawn upon; therefore, the total commitment amounts do not necessarily represent future cash requirements. Each client’s creditworthiness is evaluated on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon extension of credit, is based on management’s credit evaluation of the client. Collateral held varies, but may include accounts receivable, inventory, property, plant and equipment, and income producing commercial properties. The Company’s allowance for credit losses - unfunded loan commitments at September 30, 2023 and December 31, 2022 was $15.0 million and $14.7 million, respectively. Standby letters of credit are conditional commitments issued to guarantee a client’s performance or payment to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to clients. Under a risk participation agreement, the Bank guarantees the financial performance of a borrower on the participated portion of an interest rate swap on a loan. Interest rates on residential one- to four-family mortgage loan applications are typically rate locked (committed) to clients during the application stage for periods ranging from 30 to 60 days, the most typical period being 45 days. Traditionally, these loan applications with rate lock commitments had the pricing for the sale of these loans locked with various qualified investors under a best-efforts delivery program at or near the time the interest rate is locked with the client. The Bank then attempts to deliver these loans before their rate locks expired. This arrangement generally required delivery of the loans prior to the expiration of the rate lock. Delays in funding the loans would require a lock extension. The cost of a lock extension at times was borne by the client and at times by the Bank. These lock extension costs have not had a material impact to the Company’s operations. For mandatory delivery commitments the Company enters into forward commitments at specific prices and settlement dates to deliver either: (1) residential mortgage loans for purchase by secondary market investors (i.e., Freddie Mac or Fannie Mae), or (2) mortgage-backed securities to broker/dealers. The purpose of these forward commitments is to offset the movement in interest rates between the execution of its residential mortgage rate lock commitments with borrowers and the sale of those loans to the secondary market investor. There were no counterparty default losses on forward contracts during the three and nine months ended September 30, 2023 or September 30, 2022. Market risk with respect to forward contracts arises principally from changes in the value of contractual positions due to changes in interest rates. The Company limits its exposure to market risk by monitoring differences between commitments to clients and forward contracts with market investors and securities broker/dealers. In the event the Company has forward delivery contract commitments in excess of available mortgage loans, the transaction is completed by either paying or receiving a fee to or from the investor or broker/dealer equal to the increase or decrease in the market value of the forward contract. In the normal course of business, the Company and/or its subsidiaries have various legal proceedings and other contingent matters outstanding. These proceedings and the associated legal claims are often contested and the outcome of individual matters is not always predictable. These claims and counter-claims typically arise during the course of collection efforts on problem loans or with respect to action to enforce liens on properties in which the Bank holds a security interest. Based upon the information known to management at this time, the Company has accrued $14.8 million related to outstanding legal proceedings. There are no other legal proceedings that management believes would have a material adverse effect on the results of operations or consolidated financial position at September 30, 2023. In connection with certain asset sales, the Bank typically makes representations and warranties about the underlying assets conforming to specified guidelines. If the underlying assets do not conform to the specifications, the Bank may have an obligation to repurchase the assets or indemnify the purchaser against any loss. The Bank believes that the potential for material loss under these arrangements is remote. Accordingly, the fair value of such obligations is not material.
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DERIVATIVES AND HEDGING |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DERIVATIVES AND HEDGING | Banner Bank is party to various derivative instruments that are used for asset and liability management and client financing needs. Derivative instruments are contracts between two or more parties that have a notional amount and an underlying variable, require no net investment and allow for the net settlement of positions. The notional amount serves as the basis for the payment provision of the contract and takes the form of units, such as shares or dollars. The underlying variable represents a specified interest rate, index, or other component. The interaction between the notional amount and the underlying variable determines the number of units to be exchanged between the parties and influences the market value of the derivative contract. The Company’s predominant derivative and hedging activities involve interest rate swaps related to certain term loans and forward sales contracts associated with mortgage banking activities. Generally, these instruments help the Company manage exposure to market risk and meet client financing needs. Market risk represents the possibility that economic value or net interest income will be adversely affected by fluctuations in external factors such as market-driven interest rates and prices or other economic factors. As of September 30, 2023 and December 31, 2022, the notional values or contractual amounts and fair values of the Company’s derivatives were as follows (in thousands):
The Company’s asset derivatives are included in other assets, while the liability derivatives are included in accrued expenses and other liabilities on the Consolidated Statements of Financial Condition. Interest Rate Swaps used in Cash Flow Hedges: The Company’s floating rate loans result in exposure to losses in value or net interest income as interest rates change. The risk management objectives in using interest rate derivatives are to reduce volatility in net interest income and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. During the fourth quarter of 2021, the Company entered into interest rate swaps designated as cash flow hedges to hedge the variable cash flows associated with existing floating rate loans. These hedge contracts involve the receipt of fixed-rate amounts from a counterparty in exchange for the Company making floating-rate payments over the life of the agreements without exchange of the underlying notional amount. For derivatives designated and that qualify as cash flow hedges of interest rate risk, the unrealized gain or loss on the derivative is recorded in AOCI and subsequently reclassified into interest income in the same period during which the hedged transaction affects earnings. Amounts reported in AOCI related to derivatives will be reclassified to interest income as interest payments are made on the Company’s variable-rate assets. During the next 12 months, the Company estimates that an additional $17.8 million will be reclassified as a decrease to interest income. The following table presents the effect of cash flow hedge accounting on AOCI for the three and nine months ended September 30, 2023 and 2022 (in thousands):
At September 30, 2023 and December 31, 2022, we recorded total net unrealized losses on cash flow hedges in AOCI of $15.2 million and $20.1 million, respectively. Interest Rate Swaps: The Bank uses an interest rate swap program for commercial loan clients that provides the client with a variable-rate loan and enters into an interest rate swap in which the client receives a variable-rate payment in exchange for a fixed-rate payment. The Bank offsets its risk exposure by entering into an offsetting interest rate swap with a dealer counterparty for the same notional amount and length of term as the client interest rate swap providing the dealer counterparty with a fixed-rate payment in exchange for a variable-rate payment. These swaps do not qualify as designated hedges; therefore, each swap is accounted for as a freestanding derivative. Risk Participation Agreements: In conjunction with the purchase or sale of participating interests in loans, the Company also participates in related swaps through risk participation agreements. The existing credit derivatives resulting from these participations are not designated as hedges as they are not used to manage interest rate risk in the Company’s assets or liabilities and are not speculative. Mortgage Loan Commitments: The Company sells originated one- to four-family mortgage loans into the secondary mortgage loan markets. During the period of loan origination and prior to the sale of the loans into the secondary market, the Company has exposure to movements in interest rates associated with written interest rate lock commitments with potential borrowers to originate one- to four-family loans that are intended to be sold and for closed one- to four-family mortgage loans held for sale for which fair value accounting has been elected, that are awaiting sale and delivery into the secondary market. The Company economically hedges the risk of changing interest rates associated with these mortgage loan commitments by entering into forward sales contracts to sell one- to four-family mortgage loans or mortgage-backed securities to broker/dealers at specific prices and dates. Gains (losses) recognized in income within mortgage banking operations on non-designated hedging instruments for the three and nine months ended September 30, 2023 and 2022, were as follows (in thousands):
The Company is exposed to credit-related losses in the event of nonperformance by the counterparty to these agreements. Credit risk of the financial contract is controlled through the credit approval, limits, and monitoring procedures and management does not expect the counterparties to fail their obligations. In connection with the interest rate swaps between the Bank and the dealer counterparties, the agreements contain a provision where if the Bank fails to maintain its status as a well/adequately capitalized institution, then the counterparty could terminate the derivative positions and the Bank would be required to settle its obligations. Similarly, the Bank could be required to settle its obligations under certain of its agreements if specific regulatory events occur, such as a publicly issued prompt corrective action directive, cease and desist order, or a capital maintenance agreement that required the Bank to maintain a specific capital level. If the Bank had breached any of these provisions at September 30, 2023 or December 31, 2022, it could have been required to settle its obligations under the agreements at the termination value. As of September 30, 2023 and December 31, 2022, the Company had no obligations to dealer counterparties related to these agreements. The Company generally posts collateral against derivative liabilities in the form of cash, government agency-issued bonds, mortgage-backed securities, or commercial mortgage-backed securities. Collateral posted against derivative liabilities was $19.3 million and $22.2 million as of September 30, 2023 and December 31, 2022, respectively. The collateral posted included restricted cash of $18.3 million and $15.9 million as of September 30, 2023 and 2022, respectively. Derivative assets and liabilities are recorded at fair value on the balance sheet. Master netting agreements allow the Company to settle all derivative contracts held with a single counterparty on a net basis and to offset net derivative positions with related collateral where applicable. In addition, some interest rate swap derivatives between the Company and the dealer counterparties are cleared through central clearing houses. These clearing houses characterize the variation margin payments as settlements of the derivative’s market exposure and not as collateral. The variation margin is treated as an adjustment to our cash collateral, as well as a corresponding adjustment to our derivative liability. The variation margin adjustment was a positive adjustment of $918,000 and a negative adjustment of $8.7 million as of September 30, 2023 and December 31, 2022, respectively. The following tables present additional information related to the Company’s derivative contracts, by type of financial instrument, as of September 30, 2023 and December 31, 2022 (in thousands):
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BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) |
9 Months Ended |
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Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting | The accompanying unaudited condensed consolidated financial statements include the accounts of Banner Corporation (the Company or Banner), a bank holding company incorporated in the State of Washington and its wholly-owned subsidiary, Banner Bank (the Bank). These unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X as promulgated by the SEC. In preparing these financial statements, the Company has evaluated events and transactions subsequent to September 30, 2023, for potential recognition or disclosure. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the financial position and results of operations for the periods presented have been included. Certain information and note disclosures have been condensed or omitted pursuant to the rules and regulations of the SEC and the accounting standards for interim financial statements. Certain reclassifications have been made to the 2022 Consolidated Financial Statements and/or schedules to conform to the 2023 presentation. These reclassifications may have affected certain ratios for the prior periods. The effect of these reclassifications is considered immaterial. All significant intercompany transactions and balances have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts reported in the financial statements. Various elements of the Company’s accounting policies, by their nature, are inherently subject to estimation techniques, valuation assumptions and other subjective assessments. The information included in this Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. Interim results are not necessarily indicative of results for a full year or any other interim period.
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SECURITIES (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Securities | The amortized cost, gross unrealized gains and losses and estimated fair value of securities at September 30, 2023 and December 31, 2022 are summarized as follows (in thousands):
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Schedule of Securities with Continuous Loss Position | At September 30, 2023 and December 31, 2022, the gross unrealized losses and the fair value for securities available-for-sale aggregated by the length of time that individual securities have been in a continuous unrealized loss position were as follows (in thousands):
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Schedule of Realized Gain (Loss) | The following table presents gross gains and losses on sales and partial calls of securities available-for-sale (in thousands):
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Schedule of Securities by Contractual Maturity Date | The following table presents the amortized cost and estimated fair value of securities at September 30, 2023, by contractual maturity and does not reflect any required periodic payments (in thousands). Expected maturities will differ from contractual maturities because some securities may be called or prepaid with or without call or prepayment penalties.
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Schedule of Pledged Securities | The following table presents, as of September 30, 2023, investment securities which were pledged to secure borrowings, public deposits or other obligations as permitted or required by law (in thousands):
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Debt Instrument, Credit Rating | The Company monitors the credit quality of held-to-maturity debt securities through the use of credit ratings which are reviewed and updated quarterly. The Company’s non-rated held-to-maturity debt securities are primarily United States government sponsored enterprise debentures carrying minimal to no credit risk. The non-rated corporate bonds primarily consist of Community Reinvestment Act related bonds secured by loan instruments from low to moderate income borrowers. The remaining non-rated held-to-maturity debt securities balance is comprised of local municipal debt from within the Company’s geographic footprint and is monitored through quarterly or annual financial review. This municipal debt is predominately essential service or unlimited general obligation backed debt. The following tables summarize the amortized cost of held-to-maturity debt securities by credit rating at September 30, 2023 and December 31, 2022 (in thousands):
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Debt Securities, Available-for-Sale, Allowance for Credit Loss | The following tables present the activity in the allowance for credit losses for securities available-for-sale by major type for the three and nine months ended September 30, 2023 (in thousands). We had no allowance for credit losses for securities available-for-sale during three and nine months ended September 30, 2022.
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LOANS RECEIVABLE AND THE ALLOWANCE FOR CREDIT LOSSES (Tables) |
3 Months Ended | 9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans Receivable, Including Loans Held for Sale | The following table presents the loans receivable at September 30, 2023 and December 31, 2022 by class (dollars in thousands).
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Schedule of Troubled Debt Restructurings | The following table presents the amortized cost basis and financial effect of loans at September 30, 2023, that were both experiencing financial difficulty and modified during the nine months ended September 30, 2023 (in thousands):
The Company has committed to lend additional amounts totaling $195,000 to the borrowers included in the previous table. The Company closely monitors the performance of loans that are modified for borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table presents the performance of such loans that have been modified in the last 12 months at September 30, 2023 (in thousands):
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Schedule of Risk-Rated Loans and Non-Risk Rated Loans by Grade and Other Characteristics | The following tables present the Company’s portfolio of risk-rated loans by class and by grade as of September 30, 2023 and December 31, 2022 (in thousands). In addition, the tables include the gross charge-offs for the nine months ended September 30, 2023. Revolving loans that are converted to term loans are treated as new originations in the table below and are presented by year of origination. Term loans that are renewed or extended for periods longer than 90 days are presented as a new origination in the year of the most recent renewal or extension.
The following tables present the Company’s portfolio of non-risk-rated loans by class and delinquency status as of September 30, 2023 and December 31, 2022 (in thousands). In addition, the tables include the gross charge-offs for the nine months ended September 30, 2023. Revolving loans that are converted to term loans are treated as new originations in the table below and are presented by year of origination. Term loans that are renewed or extended for periods longer than 90 days are presented as a new origination in the year of the most recent renewal or extension.
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Loans, Collateral Dependent [Table Text Block] | The following tables provide the amortized cost basis of collateral-dependent loans as of September 30, 2023 and December 31, 2022 (in thousands). Our collateral dependent loans presented in the tables below have no significant concentrations by property type or location.
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Schedule of Age Analysis of the Company's Past Due Loans | The following tables present the Company’s portfolio of non-risk-rated loans by class and delinquency status as of September 30, 2023 and December 31, 2022 (in thousands). In addition, the tables include the gross charge-offs for the nine months ended September 30, 2023. Revolving loans that are converted to term loans are treated as new originations in the table below and are presented by year of origination. Term loans that are renewed or extended for periods longer than 90 days are presented as a new origination in the year of the most recent renewal or extension.
The following tables provide additional detail on the age analysis of the Company’s past due loans as of September 30, 2023 and December 31, 2022 (in thousands):
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Allowance for Credit Losses on Financing Receivables | The following tables provide the activity in the allowance for credit losses by portfolio segment for the three and nine months ended September 30, 2023 and 2022 (in thousands):
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GOODWILL, OTHER INTANGIBLE ASSETS AND MORTGAGE SERVICING RIGHTS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Changes in Goodwill and Intangible Assets | The following table summarizes the changes in the Company’s goodwill and other intangibles for the nine months ended September 30, 2023, and the year ended December 31, 2022 (in thousands):
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Schedule of Estimated Annual Amortization Expense | The following table presents the estimated amortization expense with respect to CDI as of September 30, 2023, for the periods indicated (in thousands):
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Schedule of Servicing Assets at Amortized Value | An analysis of the mortgage and SBA servicing rights for the three and nine months ended September 30, 2023 and 2022 is presented below (in thousands):
(1) Amortization of mortgage servicing rights is recorded as a reduction of loan servicing income within mortgage banking operations and any unamortized balance is fully amortized if the loan repays in full. (2) There was no valuation allowance on mortgage servicing rights as of both September 30, 2023 and 2022. (3) Fair value adjustments relate to SBA servicing rights. These adjustments are estimated based on an independent dealer analysis by discounting estimated net future cash flows from servicing SBA loans.
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DEPOSITS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Banking and Thrift, Other Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Deposit Liabilities | Deposits consisted of the following at September 30, 2023 and December 31, 2022 (in thousands):
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Maturities of Certificates of Deposit | Scheduled maturities and weighted average interest rates of certificates of deposit at September 30, 2023 are as follows (dollars in thousands):
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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value of Financial Instruments, by Balance Sheet Grouping | The following table presents estimated fair values of the Company’s financial instruments as of September 30, 2023 and December 31, 2022, whether or not recognized or recorded in the Consolidated Statements of Financial Condition (dollars in thousands):
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Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following tables present financial assets and liabilities measured at fair value on a recurring basis and the level within the fair value hierarchy of the fair value measurements for those assets and liabilities as of September 30, 2023 and December 31, 2022 (in thousands):
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Schedule of Valuation Technique, Unobservable Input, and Qualitative Information for Unobservable Inputs | The following table provides a description of the valuation technique, unobservable inputs, and quantitative and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a recurring and non-recurring basis at September 30, 2023 and December 31, 2022:
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Schedule of Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following tables provide a reconciliation of the assets and liabilities measured at fair value using significant unobservable inputs (Level 3) on a recurring basis during the three and nine months ended September 30, 2023 and 2022 (in thousands):
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Schedule of Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis | The following tables present financial assets and liabilities measured at fair value on a non-recurring basis and the level within the fair value hierarchy of the fair value measurements for those assets as of September 30, 2023 and December 31, 2022 (in thousands):
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INCOME TAXES AND DEFERRED TAXES INCOME TAXES AND DEFERRED TAXES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Income Tax Expense (Benefit) | The following table presents the balances of the Company’s tax credit investments and related unfunded commitments at September 30, 2023 and December 31, 2022 (in thousands):
The following table presents other information related to the Company’s tax credit investments for the three and nine months ended September 30, 2023 and 2022 (in thousands):
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CALCULATION OF WEIGHTED AVERAGE SHARES OUTSTANDING FOR EARNINGS PER SHARE (EPS) (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Basic and Diluted Weighted Shares Outstanding | The following table reconciles basic to diluted weighted average shares outstanding used to calculate earnings per share data for the three and nine months ended September 30, 2023 and 2022 (in thousands, except shares and per share data):
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COMMITMENTS AND CONTINGENCIES (Tables) |
3 Months Ended | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 |
Sep. 30, 2023 |
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Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Financial Instruments With Off-Balance-Sheet Risks | Outstanding commitments for which no asset or liability for the notional amount has been recorded consisted of the following at the dates indicated (in thousands):
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Schedule of fair value, off balance sheet risks, limited partnerships, commitment | As of September 30, 2023 and December 31, 2022, the funded balances and remaining outstanding commitments of these limited partnership investments were as follows (in thousands):
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DERIVATIVES AND HEDGING (Tables) |
3 Months Ended | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 |
Sep. 30, 2023 |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivatives Designated in Hedge Relationships |
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Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | The following table presents the effect of cash flow hedge accounting on AOCI for the three and nine months ended September 30, 2023 and 2022 (in thousands):
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Schedule of Fair Value, Measured on Nonrecurring Basis, Gains (Losses) From Fair Value Adjustments [Table Text Block] | Gains (losses) recognized in income within mortgage banking operations on non-designated hedging instruments for the three and nine months ended September 30, 2023 and 2022, were as follows (in thousands):
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Offsetting Assets and Liabilities | as of September 30, 2023 and December 31, 2022 (in thousands):
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SECURITIES (Available-for-Sale Securities, Gross Gains and Losses on Sale) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
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Gain (Loss) on Securities [Line Items] | ||||
Debt Securities, Available-for-sale, Realized Gain | $ 0 | $ 6 | $ 377 | $ 522 |
Debt Securities, Available-for-sale, Realized Loss | 2,657 | 0 | 14,813 | 49 |
Debt Securities, Available-for-sale, Realized Gain (Loss) | $ (2,657) | $ 6 | $ (14,436) | $ 473 |
SECURITIES (Textual) (Details) |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023
USD ($)
numberOfSecurities
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Sep. 30, 2023
numberOfSecurities
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Sep. 30, 2022
USD ($)
numberOfSecurities
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Dec. 31, 2022
numberOfSecurities
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Investments, Debt and Equity Securities [Abstract] | ||||
Trading Securities, Number of Securities on Nonaccrual Status | 0 | 0 | 0 | |
Debt Securities, Available-for-sale [Abstract] | ||||
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions | 233 | 233 | 298 | |
Available-for-sale Securities, Number of Securities in Nonaccrual Status | 0 | 0 | 0 | |
Held-to-maturity Securities [Abstract] | ||||
Trading Securities, Number of Securities Sold | 0 | 0 | ||
Debt Securities, Trading, Unrealized Gain | $ | $ 1,400,000 | |||
Debt Securities, Trading, Unrealized Loss | $ | $ (3,400,000) |
LOANS RECEIVABLE AND THE ALLOWANCE FOR CREDIT LOSSES (Troubled Debt Restructuring) (Details) |
Sep. 30, 2023
USD ($)
Months
|
---|---|
Financing Receivable, Troubled Debt Restructuring [Line Items] | |
Financing Receivable, Troubled Debt Restructuring | $ 9,123,000 |
Financing Receivable, Modified, Commitment to Lend | 195,000 |
Extended Maturity | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | |
Financing Receivable, Troubled Debt Restructuring | 6,362,000 |
One- to four- family construction | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | |
Financing Receivable, Troubled Debt Restructuring | 6,362,000 |
One- to four- family construction | Extended Maturity | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | |
Financing Receivable, Troubled Debt Restructuring | $ 6,362,000 |
Financing Receivable, Modified, Weighted Average Term Increase in Months | Months | (11) |
GOODWILL, OTHER INTANGIBLE ASSETS AND MORTGAGE SERVICING RIGHTS (Finite-Lived Intangible Assets) (Details) - USD ($) $ in Thousands |
9 Months Ended | |||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
Dec. 31, 2021 |
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Goodwill [Roll Forward] | ||||
Goodwill, beginning of period | $ 373,121 | $ 373,121 | ||
Goodwill, end of period | 373,121 | |||
Finite-lived Intangible Assets [Roll Forward] | ||||
Intangible Assets, Net (Including Goodwill) | 379,663 | $ 382,561 | $ 387,976 | |
Amortization | (2,898) | (5,279) | ||
Core Deposit Intangibles [Member] | ||||
Finite-lived Intangible Assets [Roll Forward] | ||||
Finite-Lived Intangible Assets, Net | 6,542 | $ 9,440 | $ 14,855 | |
finite-lived intangible assets, other changes | 136 | |||
Amortization | $ (2,898) | $ (5,279) |
GOODWILL, OTHER INTANGIBLE ASSETS AND MORTGAGE SERVICING RIGHTS (Estimated Annual Amortization Expense) (Details) - Core Deposit Intangibles [Member] - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|---|
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Asset, Expected Amortization, Remainder of Fiscal Year | $ 857 | ||
Finite-Lived Intangible Asset, Expected Amortization, Year One | 2,626 | ||
Finite-Lived Intangible Asset, Expected Amortization, Year Two | 1,567 | ||
Finite-Lived Intangible Asset, Expected Amortization, Year Three | 904 | ||
Finite-Lived Intangible Asset, Expected Amortization, Year Four | 426 | ||
Thereafter | 162 | ||
Finite lived assets, net | $ 6,542 | $ 9,440 | $ 14,855 |
GOODWILL, OTHER INTANGIBLE ASSETS AND MORTGAGE SERVICING RIGHTS (Mortgage Servicing Rights) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
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Servicing Asset at Amortized Value, Balance [Roll Forward] | |||||||||||
Additions—through purchase | $ 222 | $ 202 | |||||||||
Servicing Contracts [Member] | |||||||||||
Morgage Servicing Rights at Amortized Value [Line Items] | |||||||||||
Loans Serviced For Others | $ 2,760,000 | 2,760,000 | $ 2,770,000 | ||||||||
Custodial Accounts | 29,100 | 29,100 | $ 11,200 | ||||||||
Servicing Asset at Amortized Value, Balance [Roll Forward] | |||||||||||
Balance, net of valuation allowance, beginning of the period | 15,111 | $ 17,633 | 16,166 | 17,206 | |||||||
Additions—amounts capitalized | 638 | 296 | 1,123 | 3,053 | |||||||
Additions—through purchase | 98 | 57 | |||||||||
Amortization (1) | (851) | [1] | (985) | [1] | (2,525) | (3,331) | |||||
Servicing Asset at Fair Value, Other Changes in Fair Value | 128 | 72 | 118 | 201 | |||||||
Balance, net of valuation allowance, end of the period | [2] | 14,868 | $ 16,929 | 14,868 | $ 16,929 | ||||||
Valuation allowance, end of period | $ 0 | $ 0 | |||||||||
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DEPOSITS (Deposit Liabilities) (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Deposits: | ||
Non-interest-bearing accounts | $ 5,197,854 | $ 6,176,998 |
Interest-bearing checking | 2,006,866 | 1,811,153 |
Regular savings accounts | 2,751,453 | 2,710,090 |
Money market accounts | 1,760,066 | 2,198,288 |
Total interest-bearing transaction and savings accounts | 6,518,385 | 6,719,531 |
Certificates of Deposit Greater Than or Equal to $250,000 | 448,843 | 178,324 |
Certificates of Deposit Less Than $250,000 | 1,009,470 | 545,206 |
Total certificates of deposit | 1,458,313 | 723,530 |
Total deposits | 13,174,552 | 13,620,059 |
Included in total deposits: | ||
Public fund transaction and savings accounts | 357,889 | 392,859 |
Public fund interest-bearing certificates | 46,349 | 26,810 |
Total public deposits | 404,238 | 419,669 |
Total brokered certificates of deposit | $ 162,856 | $ 0 |
DEPOSITS DEPOSITS (Maturities and Weighted Average Interest Rates of Certificates of Deposit) (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Maturities of Time Deposits [Abstract] | ||
Maturing in one year or less | $ 1,373,905 | |
Maturing after one year through two years | 52,138 | |
Maturing after two years through three years | 23,152 | |
Maturing after three years through four years | 3,966 | |
Maturing after four years through five years | 4,310 | |
Maturing after five years | 842 | |
Total certificates of deposit | $ 1,458,313 | $ 723,530 |
Weighted Average Rate [Abstract] | ||
Maturing in one year or less | 3.45% | |
Maturing after one year through two years | 1.48% | |
Maturing after two years through three years | 0.70% | |
Maturing after three years through four years | 0.34% | |
Maturing after four years through five years | 0.65% | |
Maturing after five years | 0.78% | |
Total certificates of deposit | 3.32% |
FAIR VALUE OF FINANCIAL INSTRUMENTS (Assets Measured on Nonrecurring Basis) (Details) - Nonrecurring [Member] - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | $ (1,883) | |
REO | $ 546 | 340 |
Loans receivable held for sale | 40,063 | 49,474 |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | |
REO | 0 | 0 |
Loans receivable held for sale | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | |
REO | 0 | 0 |
Loans receivable held for sale | 40,063 | 49,474 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | (1,883) | |
REO | 546 | 340 |
Loans receivable held for sale | $ 0 | $ 0 |
INCOME TAXES AND DEFERRED TAXES INCOME TAXES AND DEFERRED TAXES (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
|
Income Tax Disclosure [Abstract] | |||||
Tax credit investments | $ 104,590 | $ 104,590 | $ 71,430 | ||
Unfunded commitments—tax credit investments | 65,035 | 65,035 | $ 44,563 | ||
Tax credits and other tax benefits recognized | 2,134 | $ 1,458 | 6,403 | $ 4,374 | |
Tax credit amortization expense included in provision for income taxes | 1,887 | $ 1,173 | 5,331 | $ 3,744 | |
Unrecognized Tax Benefits | $ 1,600 | $ 1,600 |
CALCULATION OF WEIGHTED AVERAGE SHARES OUTSTANDING FOR EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Dec. 31, 2022 |
Sep. 30, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Earnings Per Share [Abstract] | |||||||||
Net Income (Loss) Attributable to Parent | $ 45,854 | $ 39,591 | $ 55,555 | $ 54,380 | $ 49,070 | $ 47,965 | $ 43,963 | $ 141,000 | $ 140,998 |
Basic weighted average shares outstanding | 34,379,865 | 34,224,640 | 34,331,458 | 34,277,182 | |||||
Dilutive effect of unvested restricted stock | 49,861 | 191,377 | 107,756 | 222,064 | |||||
Diluted weighted shares outstanding | 34,429,726 | 34,416,017 | 34,439,214 | 34,499,246 | |||||
Earnings per common share | |||||||||
Basic | $ 1.33 | $ 1.43 | $ 4.11 | $ 4.11 | |||||
Diluted | $ 1.33 | $ 1.43 | $ 4.09 | $ 4.09 |
COMMITMENTS AND CONTINGENCIES (Fair value, off balance sheet risks, limited partnerships, commitment) (Details) - Limited Partner - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Schedule of Fair Value, Off-Balance Sheet Risks, Limited Partnerships, Commitment) [Line Items] | ||
Fair Value Disclosure, Off Balance Sheet Risk, Amount Funded, Commitment | $ 11,615 | $ 10,272 |
Fair Value Disclosure, Off Balance Sheet Risk, Unfunded Amount, Commitment | $ 10,885 | $ 12,228 |
DERIVATIVES AND HEDGING (Gain (Loss) On Derivatives Not Designated in Hedging Relationship) (Details) - Not Designated as Hedging Instrument [Member] - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in income, net | $ 357 | $ 210 | $ 666 | $ (901) |
Mortgage loan commitments [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in income, net | (165) | (472) | 65 | (1,582) |
Forward Contracts [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in income, net | $ 522 | $ 682 | $ 601 | $ 681 |
DERIVATIVES AND HEDGING (Narrative) (Details) - USD ($) |
Sep. 30, 2023 |
Dec. 31, 2022 |
Sep. 30, 2022 |
---|---|---|---|
Offsetting Assets and Liabilities [Line Items] | |||
Interest Rate Cash Flow Hedge Gain (Loss) to be Reclassified During Next 12 Months, Net | $ 17,800,000 | ||
AOCI, Cash Flow Hedge, Cumulative Gain (Loss), after Tax | 15,200,000 | $ 20,100,000 | |
Derivative net liability position | 0 | ||
Collateral posted | 19,300,000 | 22,200,000 | |
Derivative Liability, Collateral Posted, Restricted Cash | 18,300,000 | $ 15,900,000 | |
Interest rate swaps [Member] | |||
Offsetting Assets and Liabilities [Line Items] | |||
Variation Margin Adjustment, Derivative Liability | $ 918,000 | $ 8,700,000 |
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