Loans and Allowance for Credit Losses on Loans HFI

9 Months Ended

Sep. 30, 2026

Loans and Allowance for Credit Losses on Loans HFI

Loans and allowance for credit losses on loans HFI

Loans outstanding as of September 30, 2026 and December 31, 2025, by class of financing receivable are as follows:


	September 30,		December 31,

	2026		2025
Commercial and industrial	$	2,258,655	$	2,181,935
Construction	1,177,433		1,188,494
Residential real estate:
1-to-4 family mortgage	2,051,105		1,838,122
Residential line of credit	812,771		741,309
Multi-family mortgage	809,083		745,360
Commercial real estate:
Owner-occupied	2,282,155		2,148,870
Non-owner occupied	3,079,035		2,900,499
Consumer and other	709,327		639,037
Gross loans	13,179,564		12,383,626
Less: Allowance for credit losses on loans HFI	(193,960)		(185,983)
Net loans	$	12,985,604	$	12,197,643

As of September 30, 2026 and December 31, 2025, $1,041,198 and $988,111, respectively, of qualifying residential mortgage loans (including loans held for sale) and $2,855,012 and $2,829,765, respectively, of qualifying commercial mortgage loans were pledged to the FHLB system securing advances against the Bank’s line of credit. Additionally, as of September 30, 2026 and December 31, 2025, qualifying commercial and industrial, construction and consumer loans, of $2,695,429 and $2,879,586, respectively, were pledged to the Federal Reserve under the Borrower-in-Custody program.

The amortized cost of loans HFI on the consolidated balance sheets excludes accrued interest receivable as the Company presents accrued interest receivable separately on the consolidated balance sheets. As of September 30, 2026 and December 31, 2025, accrued interest receivable on loans HFI amounted to $50,887 and $50,140, respectively.

Credit Quality - Commercial Type Loans

The Company categorizes commercial loan types into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans that share similar risk characteristics collectively. Loans that do not share similar risk characteristics may be evaluated individually.

The Company uses the following definitions for risk ratings:


			Pass.			Loans rated Pass include those that are adequately collateralized performing loans which management believes do not have conditions that have occurred or may occur that would result in the loan being downgraded into an inferior category. The Pass category also includes commercial loans rated as Watch, which include those that management believes have conditions that have occurred, or may occur, which could result in the loan being downgraded to an inferior category.




			Special Mention.			Loans rated Special Mention are those that have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution’s credit position at some future date. Management does not believe there will be a loss of principal or interest. These loans require intensive servicing and may possess more than normal credit risk.




			Classified.			Loans included in the Classified category include loans rated as Substandard and Doubtful. Loans rated as Substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Substandard loans have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Doubtful loans have all the weaknesses inherent in those classified as Substandard, with the added characteristic that the weakness or weaknesses make collection or liquidation in full, based on currently existing facts, conditions, and values, highly questionable and improbable.

Risk ratings are updated on an ongoing basis and are subject to change by continuous loan monitoring processes.

The following tables present the credit quality of the Company’s commercial type loan portfolio as of September 30, 2026 and December 31, 2025 and the gross charge-offs for the nine months ended September 30, 2026 and the year ended December 31, 2025 by year of origination. Revolving loans are presented separately. Management considers the guidance in ASC 310-20 when determining whether a modification, extension, or renewal constitutes a current period origination.





As of and for the nine months ended September 30, 2026	2026		2025		2024		2023		2022		Prior		Revolving Loans Amortized Cost Basis		Total
Commercial and industrial
Pass	$	300,796	$	228,635	$	148,022	$	159,119	$	77,284	$	118,489	$	1,146,637	$	2,178,982
Special Mention	209		1,585		2,377		3,987		1,762		2,939		28,804		41,663
Classified	1,625		791		2,457		3,361		1,003		5,686		23,087		38,010

Total	302,630		231,011		152,856		166,467		80,049		127,114		1,198,528		2,258,655

Current-period gross charge-offs	—		74		54		233		603		862		979		2,805
Construction
Pass	282,690		322,780		127,645		16,782		92,425		77,667		210,763		1,130,752
Special Mention	—		151		360		68		3,128		240		—		3,947
Classified	—		934		338		316		11,169		29,977		—		42,734

Total	282,690		323,865		128,343		17,166		106,722		107,884		210,763		1,177,433

Current-period gross charge-offs	—		—		62		—		253		—		—		315
Residential real estate:

Multi-family mortgage
Pass	104,809		37,259		29,625		36,877		235,846		310,692		25,217		780,325
Special Mention	—		—		—		—		8,892		2,797		—		11,689
Classified	—		—		—		—		9,651		7,418		—		17,069

Total	104,809		37,259		29,625		36,877		254,389		320,907		25,217		809,083


Current-period gross charge-offs	—		—		—		—		—		—		—		—
Commercial real estate:
Owner-occupied
Pass	296,586		346,329		297,823		173,329		302,968		656,897		122,517		2,196,449
Special Mention	—		771		1,348		10,058		3,304		14,877		778		31,136
Classified	—		5,570		4,647		4,443		13,085		18,772		8,053		54,570

Total	296,586		352,670		303,818		187,830		319,357		690,546		131,348		2,282,155

Current-period gross charge-offs	—		—		—		—		—		—		—		—
Non-owner occupied
Pass	427,678		300,284		214,287		128,115		643,196		1,181,235		105,789		3,000,584
Special Mention	—		—		—		—		15,438		29,216		—		44,654
Classified	—		—		1,440		10,425		3,500		18,432		—		33,797

Total	427,678		300,284		215,727		138,540		662,134		1,228,883		105,789		3,079,035




Current-period gross charge-offs	—		—		—		—		—		—		—		—
Total commercial loan types
Pass	1,412,559		1,235,287		817,402		514,222		1,351,719		2,344,980		1,610,923		9,287,092
Special Mention	209		2,507		4,085		14,113		32,524		50,069		29,582		133,089
Classified	1,625		7,295		8,882		18,545		38,408		80,285		31,140		186,180

Total	$	1,414,393	$	1,245,089	$	830,369	$	546,880	$	1,422,651	$	2,475,334	$	1,671,645	$	9,606,361
Current-period gross charge-offs	$	—	$	74	$	116	$	233	$	856	$	862	$	979	$	3,120





As of and for the year ended December 31, 2025	2025		2024		2023		2022		2021		Prior		Revolving Loans Amortized Cost Basis		Total
Commercial and industrial
Pass	$	272,440	$	198,802	$	195,571	$	99,265	$	43,851	$	108,067	$	1,162,291	$	2,080,287
Special Mention	64		1,934		5,223		5,911		1,052		7,634		20,994		42,812
Classified	255		2,138		419		14,972		300		6,981		33,771		58,836

Total	272,759		202,874		201,213		120,148		45,203		122,682		1,217,056		2,181,935
Current-period gross charge-offs	—		—		54		—		—		2,478		604		3,136

Construction
Pass	343,056		201,130		36,715		171,803		71,877		74,429		221,953		1,120,963
Special Mention	—		396		3,167		9,456		10,108		—		—		23,127
Classified	—		152		3,351		21,303		230		5,451		13,917		44,404

Total	343,056		201,678		43,233		202,562		82,215		79,880		235,870		1,188,494
Current-period gross charge-offs	—		—		—		—		—		399		—		399

Residential real estate:

Multi-family mortgage
Pass	65,268		34,872		38,022		234,272		196,870		144,904		22,953		737,161
Special Mention	—		—		—		—		—		—		—		—
Classified	—		—		—		569		7,613		17		—		8,199

Total	65,268		34,872		38,022		234,841		204,483		144,921		22,953		745,360
Current-period gross charge-offs	—		—		—		—		—		—		—		—


Commercial real estate:
Owner-occupied
Pass	356,246		309,181		199,470		335,067		266,328		517,046		124,340		2,107,678
Special Mention	—		403		4,407		1,351		6,183		14,256		239		26,839
Classified	—		1,622		1,024		7,389		100		3,182		1,036		14,353

Total	356,246		311,206		204,901		343,807		272,611		534,484		125,615		2,148,870
Current-period gross charge-offs	—		—		—		—		—		17		—		17

Non-owner occupied
Pass	297,096		237,840		144,572		714,151		558,116		788,545		122,713		2,863,033
Special Mention	—		10,341		—		6,135		4,568		6,018		—		27,062
Classified	—		1,167		1,008		2,249		4,602		1,378		—		10,404

Total	297,096		249,348		145,580		722,535		567,286		795,941		122,713		2,900,499
Current-period gross charge-offs	—		—		—		—		—		—		—		—

Total commercial loan types
Pass	1,334,106		981,825		614,350		1,554,558		1,137,042		1,632,991		1,654,250		8,909,122
Special Mention	64		13,074		12,797		22,853		21,911		27,908		21,233		119,840
Classified	255		5,079		5,802		46,482		12,845		17,009		48,724		136,196
Total	$	1,334,425	$	999,978	$	632,949	$	1,623,893	$	1,171,798	$	1,677,908	$	1,724,207	$	9,165,158
Current-period gross charge-offs	$	—	$	—	$	54	$	—	$	—	$	2,894	$	604	$	3,552

Credit Quality - Consumer Type Loans

For consumer and residential loan classes, the Company primarily evaluates credit quality based on delinquency and accrual status of the loan, credit documentation and by payment activity. The performing or nonperforming status is updated on an ongoing basis dependent upon improvement and deterioration in credit quality. Nonperforming loans include loans that are no longer accruing interest (nonaccrual loans) and loans past due ninety or more days and still accruing interest.

The following tables present the credit quality by classification of the Company’s consumer type loan portfolio as of September 30, 2026 and December 31, 2025 and the gross charge-offs for the nine months ended September 30, 2026 and the year ended December 31, 2025 by year of origination. Revolving loans are presented separately. Management considers the guidance in ASC 310-20 when determining whether a modification, extension, or renewal constitutes a current period origination.





As of and for the nine months ended September 30, 2026	2026		2025		2024		2023		2022		Prior		Revolving Loans Amortized Cost Basis		Total





Residential real estate:
1-to-4 family mortgage
Performing	$	469,628	$	282,424	$	183,613	$	108,389	$	374,000	$	601,705	$	—	$	2,019,759
Nonperforming	—		1,956		1,341		2,630		6,065		19,354		—		31,346
Total	469,628		284,380		184,954		111,019		380,065		621,059		—		2,051,105
Current-period gross charge-offs	—		3		50		60		566		267		—		946
Residential line of credit
Performing	—		—		—		—		—		—		811,354		811,354
Nonperforming	—		—		—		—		—		—		1,417		1,417
Total	—		—		—		—		—		—		812,771		812,771
Current-period gross charge-offs	—		—		—		—		—		—		28		28
Consumer and other
Performing	99,519		158,964		136,056		81,744		60,265		143,648		4,174		684,370
Nonperforming	320		5,348		4,629		3,916		1,527		9,216		1		24,957
Total	99,839		164,312		140,685		85,660		61,792		152,864		4,175		709,327
Current-period gross charge-offs	1,689		815		408		464		322		597		—		4,295
Total consumer type loans
Performing	569,147		441,388		319,669		190,133		434,265		745,353		815,528		3,515,483
Nonperforming	320		7,304		5,970		6,546		7,592		28,570		1,418		57,720
Total	$	569,467	$	448,692	$	325,639	$	196,679	$	441,857	$	773,923	$	816,946	$	3,573,203
Current-period gross charge-offs	$	1,689	$	818	$	458	$	524	$	888	$	864	$	28	$	5,269





As of and for the year ended December 31, 2025	2025		2024		2023		2022		2021		Prior		Revolving Loans Amortized Cost Basis		Total





Residential real estate:
1-to-4 family mortgage
Performing	$	333,641	$	219,642	$	154,059	$	408,746	$	339,076	$	350,453	$	—	$	1,805,617
Nonperforming	520		1,063		1,274		10,396		6,853		12,399		—		32,505
Total	334,161		220,705		155,333		419,142		345,929		362,852		—		1,838,122
Current-period gross charge-offs	—		—		3		—		—		1,123		—		1,126
Residential line of credit
Performing	—		—		—		—		—		—		739,295		739,295
Nonperforming	—		—		—		—		—		—		2,014		2,014
Total	—		—		—		—		—		—		741,309		741,309
Current-period gross charge-offs	—		—		—		—		—		—		—		—
Consumer and other
Performing	149,560		153,638		80,874		68,023		30,289		128,726		5,874		616,984
Nonperforming	1,689		4,716		4,006		2,033		3,103		6,505		1		22,053
Total	151,249		158,354		84,880		70,056		33,392		135,231		5,875		639,037
Current-period gross charge-offs	2,101		110		76		104		86		1,715		4		4,196
Total consumer type loans
Performing	483,201		373,280		234,933		476,769		369,365		479,179		745,169		3,161,896
Nonperforming	2,209		5,779		5,280		12,429		9,956		18,904		2,015		56,572
Total	$	485,410	$	379,059	$	240,213	$	489,198	$	379,321	$	498,083	$	747,184	$	3,218,468
Current-period gross charge-offs	$	2,101	$	110	$	79	$	104	$	86	$	2,838	$	4	$	5,322

Nonaccrual and Past Due Loans

The following tables represent an analysis of the aging by class of financing receivable as of September 30, 2026 and December 31, 2025:


September 30, 2026	30-89 days past due and accruing interest		90 days or more and accruing interest		Nonaccrual loans		Loans current on payments and accruing interest		Total
Commercial and industrial	$	1,657	$	650	$	20,946	$	2,235,402	$	2,258,655
Construction	2,575		1,179		29,581		1,144,098		1,177,433
Residential real estate:
1-to-4 family mortgage	26,967		18,924		12,422		1,992,792		2,051,105
Residential line of credit	5,534		258		1,159		805,820		812,771
Multi-family mortgage	—		—		7,418		801,665		809,083
Commercial real estate:
Owner-occupied	15,507		—		15,707		2,250,941		2,282,155
Non-owner occupied	6,743		—		22,560		3,049,732		3,079,035
Consumer and other	18,020		10,373		14,584		666,350		709,327
Total	$	77,003	$	31,384	$	124,377	$	12,946,800	$	13,179,564


December 31, 2025	30-89 days past due and accruing interest		90 days or more and accruing interest		Nonaccrual loans		Loans current on payments and accruing interest		Total
Commercial and industrial	$	3,068	$	84	$	6,289	$	2,172,494	$	2,181,935
Construction	2,435		—		34,208		1,151,851		1,188,494
Residential real estate:
1-to-4 family mortgage	28,957		23,742		8,763		1,776,660		1,838,122
Residential line of credit	2,921		799		1,215		736,374		741,309
Multi-family mortgage	2,788		—		8,199		734,373		745,360
Commercial real estate:
Owner-occupied	4,961		—		10,606		2,133,303		2,148,870
Non-owner occupied	1,932		—		4,514		2,894,053		2,900,499
Consumer and other	19,744		8,126		13,927		597,240		639,037
Total	$	66,806	$	32,751	$	87,721	$	12,196,348	$	12,383,626

The following tables provide the amortized cost basis of loans on nonaccrual status, as well as any related allowance as of September 30, 2026 and December 31, 2025 by class of financing receivable.



September 30, 2026	Nonaccrual with no related allowance		Nonaccrual with related allowance
Commercial and industrial	$	13,570	$	7,376
Construction	1,653		27,928
Residential real estate:
1-to-4 family mortgage	—		12,422
Residential line of credit	—		1,159
Multi-family mortgage	7,408		10
Commercial real estate:
Owner-occupied	5,935		9,772
Non-owner occupied	9,586		12,974
Consumer and other	—		14,584
Total	$	38,152	$	86,225


December 31, 2025	Nonaccrual with no related allowance		Nonaccrual with related allowance

Commercial and industrial	$	862	$	5,427
Construction	14,617		19,591
Residential real estate:
1-to-4 family mortgage	—		8,763
Residential line of credit	—		1,215
Multi-family mortgage	7,613		586
Commercial real estate:
Owner-occupied	1,095		9,511
Non-owner occupied	2,032		2,482
Consumer and other	—		13,927
Total	$	26,219	$	61,502

The following presents interest income recognized on nonaccrual loans for the three and nine months ended September 30, 2026 and 2025:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
Commercial and industrial	$	1	$	179	$	28	$	209
Construction	—		365		—		867
Residential real estate:
1-to-4 family mortgage	—		70		4		76
Residential line of credit	14		65		52		96
Multi-family mortgage	—		5		—		171
Commercial real estate:
Owner-occupied	—		—		52		8
Non-owner occupied	—		8		35		120
Consumer and other	—		145		7		204
Total	$	15	$	837	$	178	$	1,751

Accrued interest receivable written off as an adjustment to interest income amounted to $1,124 and $1,767 for the three and nine months ended September 30, 2026, respectively, and $549 and $1,890 for the three and nine months ended September 30, 2025, respectively.

Loan Modifications to Borrowers Experiencing Financial Difficulty

Occasionally, the Company may make certain modifications of loans to borrowers experiencing financial difficulty. These modifications may be in the form of an interest rate reduction, a term extension, principal forgiveness, payment deferral or a combination thereof. Upon the Company’s determination that a modified loan has subsequently been deemed uncollectible, the portion of the loan deemed uncollectible is charged off against the allowance for credit losses on loans HFI. The Company closely monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. Tables within this section exclude loans that were paid off or are otherwise no longer in the loan portfolio as of period end.

The following table presents the amortized cost of FDM loans as of September 30, 2026 and 2025 by type of concession granted that were modified during the three and nine months ended September 30, 2026 and 2025.


	Term Extension		Payment deferral		Interest Rate Reduction		Combination(1)		Total		% of total class of financing receivables
Three Months Ended September 30, 2026
Commercial and industrial	$	—	$	3,531	$	—	$	—	$	3,531	0.2	%
Construction	9,778		—		—		—		9,778		0.8	%
Residential real estate:
1-to-4 family mortgage	1,012		—		—		—		1,012		—	%


Commercial real estate:
Owner-occupied	—		6,185		—		—		6,185		0.3	%


Total	$	10,790	$	9,716	$	—	$	—	$	20,506	0.2	%

Nine Months Ended September 30, 2026
Commercial and industrial	$	8,635	$	5,223	$	—	$	—	$	13,858	0.6	%
Construction	23,380		—		—		—		23,380		2.0	%
Residential real estate:
1-to-4 family mortgage	3,039		—		—		160		3,199		0.2	%

Multi-family mortgage	7,408		—		—		—		7,408		0.9	%
Commercial real estate:
Owner-occupied	—		6,185		—		—		6,185		0.3	%

Consumer and other	33		—		—		—		33		—	%
Total	$	42,495	$	11,408	$	—	$	160	$	54,063	0.4	%

Three Months Ended September 30, 2025
Commercial and industrial	$	6	$	—	$	—	$	—	$	6	—	%
Construction	787		—		—		—		787		0.1	%




Commercial real estate:
Owner-occupied	244		—		—		—		244		—	%
Non-owner occupied	—		4,594		—		—		4,594		0.2	%

Total	$	1,037	$	4,594	$	—	$	—	$	5,631	—	%

Nine Months Ended September 30, 2025
Commercial and industrial	$	152	$	—	$	—	$	—	$	152	—	%
Construction	1,326		—		142		3,305		4,773		0.4	%
Residential real estate:
1-to-4 family mortgage	461		1,832		—		—		2,293		0.1	%


Commercial real estate:
Owner-occupied	244		—		—		—		244		—	%
Non-owner occupied	—		4,594		—		—		4,594		0.2	%
Consumer and other	—		—		—		63		63		—	%
Total	$	2,183	$	6,426	$	142	$	3,368	$	12,119	0.1	%














(1) Includes FDM loans modified with a combination of term extension, payment deferral and interest rate reduction modifications.

The following tables describe the financial effect of the modifications made to borrowers experiencing financial difficulty:


Three Months Ended September 30, 2026	Weighted average term extension (in months)	Weighted average payment deferral (in months)	Weighted average interest rate reduction
Commercial and industrial	—	6	—%
Construction	4	—	—%
Residential real estate:
1-to-4 family mortgage	43	—	—%


Commercial real estate:
Owner-occupied	—	6	—%


Nine Months Ended September 30, 2026	Weighted average term extension (in months)	Weighted average payment deferral (in months)	Weighted average interest rate reduction
Commercial and industrial	6	14	—%
Construction	9	—	—%
Residential real estate:
1-to-4 family mortgage	33	—	1.76%

Multi-family mortgage	12	—	—%
Commercial real estate:
Owner-occupied	—	6	—%

Consumer and other	20	—	—%


Three Months Ended September 30, 2025	Weighted average term extension (in months)	Weighted average payment deferral (in months)	Weighted average interest rate reduction
Commercial and industrial	13	—	—%
Construction	2	—	—%




Commercial real estate:
Owner-occupied	3	—	—%
Non-owner occupied	—	7	—%


Nine Months Ended September 30, 2025	Weighted average term extension (in months)	Weighted average payment deferral (in months)	Weighted average interest rate reduction
Commercial and industrial	35	—	—%
Construction	4	4	2.50%
Residential real estate:
1-to-4 family mortgage	300	4	—%


Commercial real estate:
Owner-occupied	3	—	—%
Non-owner occupied	—	7	—%
Consumer and other	13	—	2.00%

For FDM loans, a subsequent payment default is defined as the earlier of the FDM loans being placed on nonaccrual status or reaching 30 days past due with respect to principal and/or interest payments. The following tables depict loans that defaulted during the three and nine months ended September 30, 2026 and 2025 that were previously modified in the prior 12 months.


	Term Extension		Payment deferral		Interest Rate Reduction		Combination(1)
Three Months Ended September 30, 2026
Commercial and industrial	$	54	$	2,386	$	—	$	—

Residential real estate:
1-to-4 family mortgage	1,328		938		—		—

Multi-family mortgage	7,408		—		—		—



Consumer and other	—		—		—		58

Nine Months Ended September 30, 2026
Commercial and industrial	54		2,386		—		—

Residential real estate:
1-to-4 family mortgage	1,461		938		—		—

Multi-family mortgage	7,408		—		—		—



Consumer and other	—		—		—		95

Three Months Ended September 30, 2025


Residential real estate:
1-to-4 family mortgage	—		—		—		313







Nine Months Ended September 30, 2025

Construction	—		—		142		—
Residential real estate:
1-to-4 family mortgage	461		—		—		313





Consumer and other	—		—		—		63
(1) Includes FDM loans modified with a combination of term extension, payment deferral and interest rate reduction modifications.

At September 30, 2026, the Company had $100 of commitments to lend additional funds to borrowers whose loans were classified as a FDM loan. There were no such commitments as of September 30, 2025.

The Company closely monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The tables below depict the performance of loans HFI as of September 30, 2026 and 2025 made to borrowers experiencing financial difficulty that were modified in the prior 12 months.


September 30, 2026	30-89 days past due and accruing interest		90 days or more and accruing interest		Nonaccrual loans(1)		Loans current on payments and accruing interest		Total
Commercial and industrial	$	—	$	—	$	1,684	$	14,560	$	16,244
Construction	—		—		23,380		—		23,380
Residential real estate:
1-to-4 family mortgage	221		827		695		4,165		5,908

Multi-family mortgage	—		—		7,408		—		7,408
Commercial real estate:
Owner-occupied	—		—		—		6,185		6,185

Consumer and other	—		—		—		135		135
Total	$	221	$	827	$	33,167	$	25,045	$	59,260

(1) Loans were on nonaccrual when modified and subsequently classified as FDM.


September 30, 2025	30-89 days past due and accruing interest		90 days or more and accruing interest		Nonaccrual loans(1)		Loans current on payments and accruing interest		Total
Commercial and industrial	$	—	$	—	$	—	$	152	$	152
Construction	—		—		3,305		1,468		4,773
Residential real estate:
1-to-4 family mortgage	313		—		1,464		1,193		2,970
Residential line of credit	—		—		—		29		29

Commercial real estate:
Owner-occupied	—		—		244		—		244
Non-owner occupied	—		—		1,031		3,562		4,593
Consumer and other	—		63		—		—		63
Total	$	313	$	63	$	6,044	$	6,404	$	12,824

(1) Loans were on nonaccrual when modified and subsequently classified as FDM.

Collateral-Dependent Loans

For collateral-dependent loans, which are loans for which repayment is expected to be provided substantially through the operation or sale of the collateral and for which the borrower is experiencing financial difficulty, the following tables present the loans by class of financing receivable.


	September 30, 2026
	Type of Collateral
	Real Estate		Land		Business Assets		Total
Commercial and industrial	$	—	$	—	$	26,703	$	26,703
Construction	37,573		1,653		—		39,226
Residential real estate:
1-to-4 family mortgage	3,403		—		—		3,403
Residential line of credit	430		—		—		430
Multi-family mortgage	17,059		—		—		17,059
Commercial real estate:
Owner-occupied	40,581		7,018		—		47,599
Non-owner occupied	29,489		—		—		29,489

Total	$	128,535	$	8,671	$	26,703	$	163,909


	December 31, 2025
	Type of Collateral
	Real Estate		Land		Business Assets		Total
Commercial and industrial	$	—	$	—	$	27,222	$	27,222
Construction	35,297		5,497		—		40,794
Residential real estate:
1-to-4 family mortgage	3,488		—		—		3,488

Multi-family mortgage	7,613		—		—		7,613
Commercial real estate:
Owner-occupied	1,883		8,027		—		9,910
Non-owner occupied	10,171		—		—		10,171

Total	$	58,452	$	13,524	$	27,222	$	99,198

Allowance for Credit Losses on Loans HFI

Effective June 30, 2025, the Company changed certain estimation techniques, inputs, and assumptions used to estimate expected credit losses on loan portfolios and unfunded commitments. Following a periodic review of its credit loss estimation process, the Company adopted a discounted cash flow methodology, adjusted for current conditions and reasonable and supportable forecasts, for all loan segments except consumer and other loans, which utilize the weighted average remaining maturity methodology. The same methodologies are used to estimate expected credit losses on off- balance sheet commitments. Additional information regarding these changes is included in Note 1, “Basis of presentation and summary of significant accounting policies,” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

The Company performed evaluations within its updated qualitative framework, assessing for information not otherwise captured in the model loss estimation process. The Company considers the qualitative factors that are relevant to the institution as of the reporting date, which may include, but are not limited to: levels of and trends in delinquencies and performance of loans; levels of and trends in write-offs and recoveries collected; trends in volume and terms of loans; effects of any changes in reasonable and supportable economic forecasts; effects of any changes in risk selection and underwriting standards; other changes in lending policies, procedures, and practices; experience, ability, and depth of lending management and expertise; available relevant information sources that contradict the Company’s own forecast; effects of changes in prepayment expectations or other factors affecting assessments of loan contractual terms; industry conditions; and effects of changes in credit concentrations.

The following tables provide the changes in the allowance for credit losses on loans HFI by class of financing receivable for the three and nine months ended September 30, 2026 and 2025:


	Commercial and industrial		Construction		1-to-4 family residential mortgage		Residential line of credit		Multi-family residential mortgage		Commercial real estate owner occupied		Commercial real estate non-owner occupied		Consumer and other		Total
Three Months Ended September 30, 2026
Beginning balance - June 30, 2026	$	26,275	$	27,457	$	33,846	$	10,186	$	11,566	$	19,961	$	42,003	$	22,716	$	194,010

Loans charged-off	—		—		(120)		(5)		—		—		—		(1,749)		(1,874)
Recoveries of loans previously charged-off	28		—		15		1		—		10		—		603		657
(Reversal of) provision for credit losses on loans HFI	(472)		(685)		2,282		(185)		159		(433)		(51)		552		1,167
Ending balance - September 30, 2026	$	25,831	$	26,772	$	36,023	$	9,997	$	11,725	$	19,538	$	41,952	$	22,122	$	193,960
Nine Months Ended September 30, 2026
Beginning balance - December 31, 2025	$	24,130	$	25,633	$	33,218	$	10,589	$	12,260	$	21,609	$	36,235	$	22,309	$	185,983

Loans charged-off	(2,805)		(315)		(946)		(28)		—		—		—		(4,295)		(8,389)
Recoveries of loans previously charged-off	277		27		81		2		—		39		—		1,296		1,722

Provision for (reversal of) credit losses on loans HFI	4,229		1,427		3,670		(566)		(535)		(2,110)		5,717		2,812		14,644
Ending balance - September 30, 2026	$	25,831	$	26,772	$	36,023	$	9,997	$	11,725	$	19,538	$	41,952	$	22,122	$	193,960


	Commercial and industrial		Construction		1-to-4 family residential mortgage		Residential line of credit		Multi-family residential mortgage		Commercial real estate owner occupied		Commercial real estate non-owner occupied		Consumer and other		Total
Three Months Ended September 30, 2025
Beginning balance - June 30, 2025	$	20,271	$	21,848	$	30,262	$	8,671	$	10,894	$	11,939	$	26,303	$	18,760	$	148,948
Initial allowance on loans purchased with deteriorated credit quality	1,959		298		64		31		159		1,515		3,418		74		7,518
Loans charged-off	(100)		(399)		(322)		—		—		—		—		(888)		(1,709)
Recoveries of loans previously charged-off	12		—		6		11		—		4		—		246		279

Provision for (reversal of) credit losses on loans HFI	3,933		6,110		3,049		1,745		762		6,902		4,352		3,104		29,957
Ending balance - September 30, 2025	$	26,075	$	27,857	$	33,059	$	10,458	$	11,815	$	20,360	$	34,073	$	21,296	$	184,993
Nine Months Ended September 30, 2025
Beginning balance - December 31, 2024	$	16,667	$	31,698	$	25,340	$	10,952	$	10,512	$	11,993	$	25,531	$	19,249	$	151,942
Initial allowance on loans purchased with deteriorated credit quality	1,959		298		64		31		159		1,515		3,418		74		7,518
Loans charged-off	(3,071)		(399)		(758)		—		—		(17)		—		(2,811)		(7,056)
Recoveries of loans previously charged-off	227		—		26		12		—		34		529		1,000		1,828
Impact of change in accounting estimate for current expected credit losses	3,504		(4,705)		2,717		(3,428)		258		(1,074)		(1,747)		(2,373)		(6,848)
Provision for credit losses on loans HFI	6,789		965		5,670		2,891		886		7,909		6,342		6,157		37,609
Ending balance - September 30, 2025	$	26,075	$	27,857	$	33,059	$	10,458	$	11,815	$	20,360	$	34,073	$	21,296	$	184,993