| Allowance for Credit Losses (ACL) |
Note 7 — Allowance for Credit Losses (ACL) See Note 2 — Summary of Significant Accounting Policies for further detailed descriptions of our estimation process and methodology related to the allowance for credit losses. The following tables present a disaggregated analysis of activity in the allowance for credit losses for the three and six months ended June 30, 2025 and 2024: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Residential | | Residential | | | | Residential | | Comm Constr. | | | | | | | | CRE Owner- | | Non-Owner- | | | | | | (Dollars in thousands) | | Mortgage Sr. | | Mortgage Jr. | | HELOC | | Construction | | & Dev. | | Consumer | | Multifamily | | Municipal | | Occupied | | Occupied CRE | | C & I | | Total | Three Months Ended June 30, 2025 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Allowance for credit losses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Balance at end of period March 31, 2025 | | $ | 54,326 | | $ | 793 | | $ | 14,868 | | $ | 12,555 | | $ | 78,541 | | $ | 16,304 | | $ | 33,960 | | $ | 1,107 | | $ | 101,656 | | $ | 172,334 | | $ | 137,246 | | $ | 623,690 | Allowance Adjustment - FMV for Independent merger | | | — | | | — | | | — | | | — | | | — | | | — | | | 16,798 | | | — | | | — | | | — | | | — | | | 16,798 | Independent Day 1 Loan Net Charge-offs PCD (1) | | | — | | | — | | | — | | | — | | | — | | | — | | | (18,065) | | | — | | | 286 | | | 520 | | | — | | | (17,259) | Charge-offs | | | (385) | | | (1) | | | — | | | — | | | (16) | | | (2,184) | | | — | | | — | | | (772) | | | — | | | (8,607) | | | (11,965) | Recoveries | | | 194 | | | 65 | | | 125 | | | — | | | 315 | | | 529 | | | — | | | — | | | 67 | | | 247 | | | 3,176 | | | 4,718 | Net (charge-offs) recoveries | | | (191) | | | 64 | | | 125 | | | — | | | 299 | | | (1,655) | | | (18,065) | | | — | | | (419) | | | 767 | | | (5,431) | | | (24,506) | Provision (recovery) (2) | | | 69 | | | 11 | | | (1,109) | | | (5,405) | | | (2,543) | | | 4,036 | | | 18,395 | | | 1,172 | | | (13,014) | | | (7,908) | | | 11,360 | | | 5,064 | Balance at end of period June 30, 2025 | | $ | 54,204 | | $ | 868 | | $ | 13,884 | | $ | 7,150 | | $ | 76,297 | | $ | 18,685 | | $ | 51,088 | | $ | 2,279 | | $ | 88,223 | | $ | 165,193 | | $ | 143,175 | | $ | 621,046 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended June 30, 2024 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Allowance for credit losses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Balance at end of period March 31, 2024 | | $ | 87,484 | | $ | 1,230 | | $ | 11,724 | | $ | 4,552 | | $ | 60,860 | | $ | 23,353 | | $ | 17,012 | | $ | 876 | | $ | 72,597 | | $ | 134,698 | | $ | 55,268 | | $ | 469,654 | Charge-offs | | | (36) | | | — | | | — | | | — | | | (687) | | | (2,198) | | | — | | | — | | | (393) | | | (176) | | | (5,100) | | | (8,590) | Recoveries | | | 92 | | | 50 | | | 277 | | | 15 | | | 144 | | | 825 | | | 41 | | | — | | | 408 | | | 89 | | | 2,424 | | | 4,365 | Net (charge-offs) recoveries | | | 56 | | | 50 | | | 277 | | | 15 | | | (543) | | | (1,373) | | | 41 | | | — | | | 15 | | | (87) | | | (2,676) | | | (4,225) | Provision (recovery) (2) | | | (27,988) | | | (852) | | | 6,928 | | | 5,458 | | | 16,902 | | | (9,752) | | | 2,708 | | | 903 | | | 18,811 | | | (35,596) | | | 29,347 | | | 6,869 | Balance at end of period June 30, 2024 | | $ | 59,552 | | $ | 428 | | $ | 18,929 | | $ | 10,025 | | $ | 77,219 | | $ | 12,228 | | $ | 19,761 | | $ | 1,779 | | $ | 91,423 | | $ | 99,015 | | $ | 81,939 | | $ | 472,298 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | Day 1 loan net charge-offs for Independent loans recorded during the measurement period to conform with the Company’s charge-off policies and practices. |
| (2) | A provision for credit losses for unfunded commitments of $2.4 million in the second quarter of 2025, compared to a negative provision for credit losses of ($3.0) million recorded during the second quarter of 2024 for the allowance for credit losses for unfunded commitments that is not included in the above table. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Residential | | Residential | | | | Residential | | Comm Constr. | | | | | | | | CRE Owner- | | Non-Owner- | | | | | | (Dollars in thousands) | | Mortgage Sr. | | Mortgage Jr. | | HELOC | | Construction | | & Dev. | | Consumer | | Multifamily | | Municipal | | Occupied | | Occupied CRE | | C & I | | Total | Six Months Ended June 30, 2025 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Allowance for credit losses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Balance at end of period December 31, 2024 | | $ | 42,687 | | $ | 432 | | $ | 14,845 | | $ | 9,298 | | $ | 65,553 | | $ | 17,484 | | $ | 22,279 | | $ | 1,197 | | $ | 78,753 | | $ | 111,538 | | $ | 101,214 | | $ | 465,280 | Allowance Adjustment - FMV for Independent merger | | | 1,852 | | | — | | | — | | | — | | | 6,448 | | | 114 | | | 20,359 | | | — | | | 8,075 | | | 93,820 | | | 4,773 | | | 135,441 | Initial Allowance for Non-PCD loans acquired during period | | | 8,910 | | | 85 | | | 91 | | | 4,700 | | | 11,751 | | | 254 | | | 3,805 | | | 1,947 | | | 3,186 | | | 31,557 | | | 13,685 | | | 79,971 | Independent Day 1 Loan Net Charge-offs PCD (1) | | | (61) | | | — | | | — | | | — | | | — | | | (2,323) | | | (18,065) | | | — | | | (1,016) | | | (13,036) | | | (22,187) | | | (56,688) | Charge-offs | | | (892) | | | (14) | | | (229) | | | — | | | (16) | | | (3,989) | | | — | | | — | | | (976) | | | — | | | (13,271) | | | (19,387) | Recoveries | | | 394 | | | 89 | | | 505 | | | — | | | 413 | | | 1,359 | | | — | | | — | | | 117 | | | 343 | | | 4,480 | | | 7,700 | Net (charge-offs) recoveries | | | (559) | | | 75 | | | 276 | | | — | | | 397 | | | (4,953) | | | (18,065) | | | — | | | (1,875) | | | (12,693) | | | (30,978) | | | (68,375) | Provision (recovery) (2) | | | 1,314 | | | 276 | | | (1,328) | | | (6,848) | | | (7,852) | | | 5,786 | | | 22,710 | | | (865) | | | 84 | | | (59,029) | | | 54,481 | | | 8,729 | Balance at end of period June 30, 2025 | | $ | 54,204 | | $ | 868 | | $ | 13,884 | | $ | 7,150 | | $ | 76,297 | | $ | 18,685 | | $ | 51,088 | | $ | 2,279 | | $ | 88,223 | | $ | 165,193 | | $ | 143,175 | | $ | 621,046 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Six Months Ended June 30, 2024 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Allowance for credit losses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Balance at end of period December 31, 2023 | | $ | 78,052 | | $ | 745 | | $ | 10,942 | | $ | 5,024 | | $ | 65,772 | | $ | 23,331 | | $ | 13,766 | | $ | 900 | | $ | 71,580 | | $ | 137,055 | | $ | 49,406 | | $ | 456,573 | Charge-offs | | | (379) | | | — | | | (110) | | | (304) | | | (2,162) | | | (4,695) | | | — | | | — | | | (393) | | | (247) | | | (8,240) | | | (16,530) | Recoveries | | | 215 | | | 89 | | | 569 | | | 22 | | | 1,151 | | | 1,950 | | | 66 | | | — | | | 511 | | | 99 | | | 4,954 | | | 9,626 | Net recoveries (charge-offs) | | | (164) | | | 89 | | | 459 | | | (282) | | | (1,011) | | | (2,745) | | | 66 | | | — | | | 118 | | | (148) | | | (3,286) | | | (6,904) | Provision (recovery) (2) | | | (18,336) | | | (406) | | | 7,528 | | | 5,283 | | | 12,458 | | | (8,358) | | | 5,929 | | | 879 | | | 19,725 | | | (37,892) | | | 35,819 | | | 22,629 | Balance at end of period June 30, 2024 | | $ | 59,552 | | $ | 428 | | $ | 18,929 | | $ | 10,025 | | $ | 77,219 | | $ | 12,228 | | $ | 19,761 | | $ | 1,779 | | $ | 91,423 | | $ | 99,015 | | $ | 81,939 | | $ | 472,298 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | Day 1 loan net charge-offs for Independent loans, inclusive of measurement period adjustments, recorded to conform with the Company’s charge-off policies and practices. |
| (2) | A provision for credit losses of $19.4 million was recorded during the first six months of 2025, including $12.1 million for the initial provision for credit losses recorded for unfunded commitments acquired from Independent during the first quarter of 2025. This compares to a negative provision for credit losses of ($6.1) million during the first six months of 2024 for the allowance for credit losses for unfunded commitments that is not included in the above table. |
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