SIERRA BANCORP
For the period ended Sep 30, 2025. Filed Oct 31, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Oct 31, 2025
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Loan Portfolio
A distribution of the Company’s loans showing the balance and percentage of loans by type is presented for the noted periods in the table below. The balances in the table are after deferred or unamortized loan origination, extension, or commitment fees, and deferred origination costs. While not reflected in the loan totals and not currently comprising a material segment of lending activities, the Company also occasionally originates and sells, or participates out portions of loans to non-affiliated investors.
Loan Distribution
| | | | | | | | | | | |
|---|---|---|---|---|---|---|---|---|---|---|
| · September 30, 2025 · December 31, 2024 | ||||||||||
| · · Amount · · Percent · · Amount · · Percent | ||||||||||
| Real estate: | | | | | | | | | | |
| Residential real estate | | $364,277 | | 14.62% | | $382,507 | | 16.41% | ||
| Commercial real estate | | | 1,404,681 | | 56.37% | | | 1,357,833 | | 58.25% |
| Other construction/land | | | 13,420 | | 0.54% | | | 5,472 | | 0.23% |
| Farmland | | | 67,860 | | 2.72% | | | 77,547 | | 3.33% |
| Total real estate | | | 1,850,238 | | 74.25% | | | 1,823,359 | | 78.22% |
| Other commercial | | | 185,958 | | 7.46% | | | 178,331 | | 7.64% |
| Mortgage warehouse lines | | | 452,683 | | 18.17% | | | 326,400 | | 14.00% |
| Consumer loans | | | 2,909 | | 0.12% | | | 3,344 | | 0.14% |
| Total loans | | $2,491,788 | | 100.00% | | $2,331,434 | | 100.00% | ||
Gross loans held at amortized cost totaled $2.5 billion, an increase of $160.4 million, or 7%, during the first nine months of 2025. Organic loan growth contributed to increases of $46.8 million in commercial real estate loans, $7.9 million in construction loan balances, and $7.6 million in other commercial loans. Mortgage warehouse line utilization increased $126.3 million, or 39%. Consumer loans had a modest decline, while residential real estate loans decreased $18.2 million, and farmland loans decreased $9.7 million.
As indicated in the loan rollforward table below, new credit extended for the third quarter of 2025, remained flat on a linked-quarter basis, decreased $13.2 million over the same period in 2024, and increased $26.1 million for the year-to-date comparisons. The Company had $121.5 million in loan paydowns and maturities; however, mortgage warehouse utilization of $126.3 million had a positive impact in the first nine months of 2025.
| | | | | | | | | | | | | | | | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| LOAN ROLLFORWARD | | | | | | | | | | | | | | | |
| (Dollars in Thousands, Unaudited) | | | | | | | | | | | | | | | |
| · · For the three months ended: · · For the nine months ended: | |||||||||||||||
| | | | 9/30/2025 | | | 6/30/2025 | | | 9/30/2024 | | | 9/30/2025 | | | 9/30/2024 |
| Gross loans beginning balance | | $2,434,605 | | $2,306,762 | | $2,234,528 | | $2,331,341 | | $2,090,075 | |||||
| New credit extended | | | 48,065 | | | 48,147 | | | 61,239 | | | 162,582 | | | 136,518 |
| Changes in line of credit utilization (1) | | | 2,628 | | | 2,587 | | | 11,572 | | | (6,914) | | | (23,768) |
| Change in mortgage warehouse | | | 50,787 | | | 118,665 | | | 61,718 | | | 126,283 | | | 219,778 |
| Pay-downs, maturities, charge-offs and amortization | | | (44,306) | | | (41,556) | | | (48,428) | | | (121,513) | | | (101,974) |
| Gross loans ending balance | | $2,491,779 | | $2,434,605 | | $2,320,629 | | $2,491,779 | | $2,320,629 | |||||
| (1) | Change does not include new balances on lines of credit extended during the respective periods as such balances are included as part of “New credit extended” line above. |
At September 30, 2025, the total regulatory CRE concentration ratio of total CRE over Tier 1 Capital plus allowance was 242.7% as compared to 236.3% at December 31, 2024. The overall level of construction and land development lending was 2.9% of regulatory capital plus allowance for credit losses at September 30, 2025. At September 30, 2025, non-owner occupied commercial real estate includes $306.8 million of retail; $143.5 million of warehouse/industrial; $157.5 million of office; and $231.3 million of hospitality. Approximately $34.6 million, or 22% of the office real estate matures or reprices in less than two years.
Unused commitments, excluding mortgage warehouse and overdraft lines, were $263.1 million at September 30, 2025, compared to $256.9 million at December 31, 2024. Total line utilization, excluding mortgage warehouse and overdraft lines, was 57.9% at September 30, 2025, and 57.0% at December 31, 2024. Mortgage warehouse utilization increased to 59.4% at September 30, 2025, as compared to 51.2% at December 31, 2024.
The mortgage warehouse lines are structured as repurchase agreement lines. The repurchase agreement structure provides stronger credit protection to the Company, as well as more favorable regulatory capital treatment, as these repurchase lines are not considered off-balance sheet commitments for regulatory capital purposes as they are unconditionally cancellable.
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