QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
☒ | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Indiana | 35-1562417 | |||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||
515 Franklin Street, Michigan City, Indiana | 46360 | |||
(Address of principal executive offices) | (Zip Code) |
Large Accelerated Filer | ☒ | Accelerated Filer | ☐ | |||||
Non-accelerated Filer | ☐ | Smaller Reporting Company | ☐ | |||||
Emerging growth company | ☐ |
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Item 5. | 6 6 | |||||||
Item 6. | 6 7 | |||||||
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69 |
ITEM 1. | FINANCIAL STATEMENTS |
March 31 2019 | December 31 2018 | |||||||
Assets | ||||||||
Cash and due from banks | $ | 86,131 | $ | 58,492 | ||||
Interest-earning time deposits | 15,987 | 15,744 | ||||||
Investment securities, available for sale | 687,142 | 600,348 | ||||||
Investment securities, held to maturity (fair value of $210,106 and $208,273) | 206,327 | 210,112 | ||||||
Loans held for sale | 1,979 | 1,038 | ||||||
Loans, net of allowance for loan losses of $17,821 and $17,820 | 3,603,236 | 2,995,512 | ||||||
Premises and equipment, net | 93,822 | 74,331 | ||||||
Federal Home Loan Bank stock | 22,447 | 18,073 | ||||||
Goodwill | 145,690 | 119,880 | ||||||
Other intangible assets | 31,174 | 10,390 | ||||||
Interest receivable | 17,423 | 14,239 | ||||||
Cash value of life insurance | 94,449 | 88,062 | ||||||
Other assets | 45,832 | 40,467 | ||||||
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Total assets | $ | 5,051,639 | $ | 4,246,688 | ||||
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Liabilities | ||||||||
Deposits | ||||||||
Non-interest bearing | $ | 811,768 | $ | 642,129 | ||||
Interest bearing | 3,076,255 | 2,497,247 | ||||||
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Total deposits | 3,888,023 | 3,139,376 | ||||||
Borrowings | 457,788 | 550,384 | ||||||
Subordinated debentures | 55,310 | 37,837 | ||||||
Interest payable | 2,471 | 2,031 | ||||||
Other liabilities | 38,579 | 25,068 | ||||||
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Total liabilities | 4,442,171 | 3,754,696 | ||||||
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Commitments and contingent liabilities | ||||||||
Stockholders’ Equity | ||||||||
Preferred stock, Authorized, 1,000,000 shares, Issued 0 shares | — | — | ||||||
Common stock, no par value, Authorized 99,000,000 shares (Restated - See Note 1) | ||||||||
Issued 45,077,816 and 38,400,476 shares (Restated - See Note 1), | ||||||||
Outstanding 45,052,747 and 38,375,407 shares (Restated - See Note 1) | — | — | ||||||
Additionalpaid-in capital | 378,963 | 276,101 | ||||||
Retained earnings | 230,327 | 224,035 | ||||||
Accumulated other comprehensive income (loss) | 178 | (8,144 | ) | |||||
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Total stockholders’ equity | 609,468 | 491,992 | ||||||
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Total liabilities and stockholders’ equity | $ | 5,051,639 | $ | 4,246,688 | ||||
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September 30 | December 31 | |||||||
2019 | 2018 | |||||||
Assets | ||||||||
Cash and due from b a nks | $ | 91,279 | $ | 58,492 | ||||
Interest-earning time deposits | 8,455 | 15,744 | ||||||
Investment securities, available for sale | 767,230 | 600,348 | ||||||
Investment securities, held to maturity (fair value of $217,718 and $208,273) | 210,306 | 210,112 | ||||||
Loans held for sale | 1,060 | 1,038 | ||||||
Loans, net of allowance for loan losses of $17,956 and $17,820 | 3,648,669 | 2,995,512 | ||||||
Premises and equipment, net | 92,800 | 74,331 | ||||||
Federal Home Loan Bank stock | 22,447 | 18,073 | ||||||
Goodwill | 151,238 | 119,880 | ||||||
Other intangible assets | 27,658 | 10,390 | ||||||
Interest receivable | 18,282 | 14,239 | ||||||
Cash value of life insurance | 95,011 | 88,062 | ||||||
Other assets | 52,279 | 40,467 | ||||||
Total assets | $ | 5,186,714 | $ | 4,246,688 | ||||
Liabilities | ||||||||
Deposits | ||||||||
Non-interest bearing | $ | 756,707 | $ | 642,129 | ||||
Interest bearing | 3,159,250 | 2,497,247 | ||||||
Total deposits | 3,915,957 | 3,139,376 | ||||||
Borrowings | 516,591 | 550,384 | ||||||
Subordinated debentures | 56,250 | 37,837 | ||||||
Interest payable | 2,725 | 2,031 | ||||||
Other liabilities | 52,480 | 25,068 | ||||||
Total liabilities | 4,544,003 | 3,754,696 | ||||||
Commitments and contingent liabilities | ||||||||
Stockholders’ Equity | ||||||||
Preferred stock, Authorized, 1,000,000 shares, Issued 0 shares | — | — | ||||||
Common stock, 0 par value, Authorized 99,000,000 shares | ||||||||
Issued 44,994,090 and 38,400,476 shares, Outstanding 44,969,021 and 38,375,407 shares | — | — | ||||||
Additional paid-in capital | 379,448 | 276,101 | ||||||
Retained earnings | 256,617 | 224,035 | ||||||
Accumulated other comprehensive income (loss) | 6,646 | (8,144 | ) | |||||
Total stockholders’ equity | 642,711 | 491,992 | ||||||
Total liabilities and stockholders’ equity | $ | 5,186,714 | $ | 4,246,688 | ||||
Three Months Ended March 31 | ||||||||
2019 | 2018 | |||||||
Interest Income | ||||||||
Loans receivable | $ | 39,623 | $ | 35,131 | ||||
Investment securities | ||||||||
Taxable | 3,122 | 2,430 | ||||||
Tax exempt | 2,628 | 1,865 | ||||||
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Total interest income | 45,373 | 39,426 | ||||||
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Interest Expense | ||||||||
Deposits | 6,876 | 2,871 | ||||||
Borrowed funds | 3,621 | 2,572 | ||||||
Subordinated debentures | 596 | 572 | ||||||
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Total interest expense | 11,093 | 6,015 | ||||||
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Net Interest Income | 34,280 | 33,411 | ||||||
Provision for loan losses | 364 | 567 | ||||||
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Net Interest Income after Provision for Loan Losses | 33,916 | 32,844 | ||||||
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Non-interest Income | ||||||||
Service charges on deposit accounts | 1,877 | 1,888 | ||||||
Wire transfer fees | 118 | 150 | ||||||
Interchange fees | 1,361 | 1,328 | ||||||
Fiduciary activities | 2,089 | 1,925 | ||||||
Gains on sale of investment securities (includes $15 and $11 for the three months ended March 31, 2019 and 2018, respectively, related to accumulated other comprehensive earnings | 15 | 11 | ||||||
Gain on sale of mortgage loans | 1,309 | 1,423 | ||||||
Mortgage servicing income net of impairment | 606 | 349 | ||||||
Increase in cash value of bank owned life insurance | 513 | 435 | ||||||
Other income | 824 | 809 | ||||||
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Totalnon-interest income | 8,712 | 8,318 | ||||||
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Non-interest Expense | ||||||||
Salaries and employee benefits | 14,466 | 14,373 | ||||||
Net occupancy expenses | 2,772 | 2,966 | ||||||
Data processing | 1,966 | 1,696 | ||||||
Professional fees | 493 | 501 | ||||||
Outside services and consultants | 3,530 | 1,264 | ||||||
Loan expense | 1,949 | 1,257 | ||||||
FDIC insurance expense | 160 | 310 | ||||||
Other losses | 104 | 146 | ||||||
Other expense | 4,298 | 3,324 | ||||||
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Totalnon-interest expense | 29,738 | 25,837 | ||||||
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Income Before Income Taxes | 12,890 | 15,325 | ||||||
Income tax expense (includes $3 and $2 for the three months ended March 31, 2019 and 2018, respectively, related to income tax expense from reclassification items) | 2,074 | 2,521 | ||||||
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Net Income | $ | 10,816 | $ | 12,804 | ||||
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Basic Earnings Per Share (Restated - See Note 1) | $ | 0.28 | $ | 0.33 | ||||
Diluted Earnings Per Share (Restated - See Note 1) | 0.28 | 0.33 |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30 | September 30 | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Interest Income | ||||||||||||||||
Loans receivable | $ | 49,455 | $ | 37,522 | $ | 136,862 | $ | 108,961 | ||||||||
Investment securities | ||||||||||||||||
Taxable | 3,157 | 2,739 | 9,552 | 7,732 | ||||||||||||
Tax exempt | 3,099 | 2,010 | 8,520 | 5,745 | ||||||||||||
Total interest income | 55,711 | 42,271 | 154,934 | 122,438 | ||||||||||||
Interest Expense | ||||||||||||||||
Deposits | 9,109 | 5,023 | 24,923 | 11,814 | ||||||||||||
Borrowed funds | 2,275 | 2,876 | 8,391 | 8,127 | ||||||||||||
Subordinated debentures | 864 | 600 | 2,348 | 1,764 | ||||||||||||
Total interest expense | 12,248 | 8,499 | 35,662 | 21,705 | ||||||||||||
Net Interest Income | 43,463 | 33,772 | 119,272 | 100,733 | ||||||||||||
Provision for loan losses | 376 | 1,176 | 1,636 | 2,378 | ||||||||||||
Net Interest Income after Provision for Loan Losses | 43,087 | 32,596 | 117,636 | 98,355 | ||||||||||||
Non-interest Income | ||||||||||||||||
Service charges on deposit accounts | 2,836 | 2,009 | 7,193 | 5,804 | ||||||||||||
Wire transfer fees | 189 | 160 | 474 | 490 | ||||||||||||
Interchange fees | 2,138 | 1,410 | 5,659 | 4,293 | ||||||||||||
Fiduciary activities | 1,834 | 1,855 | 5,986 | 5,598 | ||||||||||||
Gains (losses) on sale of investment securities (includes $0 and $(122) for the three months ended September 30, 2019 and 2018, respectively, and $(85) and $(111) for the nine months ended September 30, 2019 and nine months ended September 30, 2018 related to accumulated other comprehensive earnings reclassifications) | — | (122 | ) | (85 | ) | (111 | ) | |||||||||
Gain on sale of mortgage loans | 2,702 | 1,839 | 6,089 | 5,158 | ||||||||||||
Mortgage servicing income net of impairment | 444 | 563 | 1,620 | 1,423 | ||||||||||||
Increase in cash value of bank owned life insurance | 556 | 503 | 1,624 | 1,380 | ||||||||||||
Death benefit on bank owned life insurance | 213 | — | 580 | 154 | ||||||||||||
Other income | 602 | 469 | 1,984 | 1,747 | ||||||||||||
Total non-interest income | 11,514 | 8,686 | 31,124 | 25,936 | ||||||||||||
Non-interest Expense | ||||||||||||||||
Salaries and employee benefits | 16,948 | 14,343 | 48,365 | 42,525 | ||||||||||||
Net occupancy expenses | 3,131 | 2,495 | 9,051 | 7,981 | ||||||||||||
Data processing | 2,140 | 1,759 | 6,245 | 5,062 | ||||||||||||
Professional fees | 335 | 437 | 1,426 | 1,314 | ||||||||||||
Outside services and consultants | 1,552 | 1,204 | 6,737 | 3,735 | ||||||||||||
Loan expense | 2,198 | 1,722 | 6,195 | 4,504 | ||||||||||||
FDIC insurance expense | (273 | ) | 396 | 252 | 1,051 | |||||||||||
Other losses | 90 | 161 | 363 | 576 | ||||||||||||
Other expense | 3,939 | 3,103 | 12,748 | 9,651 | ||||||||||||
Total non-interest expense | 30,060 | 25,620 | 91,382 | 76,399 | ||||||||||||
Income Before Income Taxes | 24,541 | 15,662 | 57,378 | 47,892 | ||||||||||||
Income tax expense (includes $0 and $(25) for the three months ended September 30, 2019 and 2018, respectively, and $(18) and $(23) for the nine months ended September 30, 2019 and nine months ended September 30, 2018 related to income tax expense (benefit) from reclassification items) | 4,004 | 2,597 | 9,383 | 7,908 | ||||||||||||
Net Income | $ | 20,537 | $ | 13,065 | $ | 47,995 | $ | 39,984 | ||||||||
Basic Earnings Per Share | $ | 0.46 | $ | 0.34 | $ | 1.12 | $ | 1.04 | ||||||||
Diluted Earnings Per Share | 0.46 | 0.34 | 1.11 | 1.04 |
Three Months Ended March 31 | ||||||||
2019 | 2018 | |||||||
Net Income | $10,816 | $ | 12,804 | |||||
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Other Comprehensive Income (Loss) | ||||||||
Change in fair value of derivative instruments: | ||||||||
Change in fair value of derivative instruments for the period | (1,106 | ) | 759 | |||||
Income tax effect | 232 | (159 | ) | |||||
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Changes from derivative instruments | (874 | ) | 600 | |||||
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Change in securities: | ||||||||
Unrealized appreciation (depreciation) for the period on AFS securities | 11,694 | (8,114 | ) | |||||
Amortization from transfer of securities from available for sale to held to maturity securities | (38 | ) | (52 | ) | ||||
Reclassification adjustment for securities (gains) losses realized in income | (15 | ) | (11 | ) | ||||
Income tax effect | (2,445 | ) | 1,716 | |||||
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Unrealized gains (losses) on securities | 9,196 | (6,461 | ) | |||||
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Other Comprehensive Income (Loss), Net of Tax | 8,322 | (5,861 | ) | |||||
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Comprehensive Income | $ | 19,138 | $ | 6,943 | ||||
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Three Months Ended | Nine Months Ended | |||||||||||||||
September 30 | September 30 | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Net Income | $ | 20,537 | $ | 13,065 | $ | 47,995 | $ | 39,984 | ||||||||
Other Comprehensive Income (Loss) | ||||||||||||||||
Change in fair value of derivative instruments: | ||||||||||||||||
Change in fair value of derivative instruments for the period | (864 | ) | 639 | (3,871 | ) | 1,752 | ||||||||||
Income tax effect | 182 | (134 | ) | 813 | (368 | ) | ||||||||||
Changes from derivative instruments | (682 | ) | 505 | (3,058 | ) | 1,384 | ||||||||||
Change in securities: | ||||||||||||||||
Unrealized appreciation (depreciation) for the period on AFS securities | 3,963 | (3,712 | ) | 22,591 | (12,655 | ) | ||||||||||
Amortization from transfer of securities from available for sale to held to maturity securities | (15 | ) | (55 | ) | (83 | ) | (153 | ) | ||||||||
Reclassification adjustment for securities (gains) losses realized in income | — | 122 | 85 | 111 | ||||||||||||
Income tax effect | (827 | ) | 764 | (4,745 | ) | 2,667 | ||||||||||
Unrealized gains (losses) on securities | 3,121 | (2,881 | ) | 17,848 | (10,030 | ) | ||||||||||
Other Comprehensive Income (Loss), Net of Tax | 2,439 | (2,376 | ) | 14,790 | (8,646 | ) | ||||||||||
Comprehensive Income | $ | 22,976 | $ | 10,689 | $ | 62,785 | $ | 31,338 | ||||||||
Accumulated | ||||||||||||||||||||||||
Additional | Other | |||||||||||||||||||||||
Preferred | Common | Paid-in | Retained | Comprehensive | ||||||||||||||||||||
Stock | Stock | Capital | Earnings | Loss | Total | |||||||||||||||||||
Balances, January 1, 2018 | $ | — | $ | — | $ | 275,059 | $ | 185,570 | $ | (3,551 | ) | $ | 457,078 | |||||||||||
Net income | — | — | — | 12,804 | — | 12,804 | ||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | (5,861 | ) | (5,861 | ) | ||||||||||||||||
Amortization of unearned compensation | — | — | 61 | — | — | 61 | ||||||||||||||||||
Exercise of stock options | — | — | 100 | — | — | 100 | ||||||||||||||||||
Stock option expense | — | — | 82 | — | — | 82 | ||||||||||||||||||
Reclassification of tax adjustment on accumulated other comprehensive loss | — | — | — | 766 | (766 | ) | — | |||||||||||||||||
Cash dividends on common stock ($0.10 per share) | — | — | — | (3,848 | ) | — | (3,848 | ) | ||||||||||||||||
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Balances, March 31, 2018 | $ | — | $ | — | $ | 275,302 | $ | 195,292 | $ | (10,178 | ) | $ | 460,416 | |||||||||||
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Balances, January 1, 2019 | $ | — | $ | — | $ | 276,101 | $ | 224,035 | $ | (8,144 | ) | $ | 491,992 | |||||||||||
Net income | — | — | — | 10,816 | — | 10,816 | ||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | 8,322 | 8,322 | ||||||||||||||||||
Amortization of unearned compensation | — | — | 91 | — | — | 91 | ||||||||||||||||||
Exercise of stock options | — | — | 117 | — | — | 117 | ||||||||||||||||||
Stock option expense | — | — | 57 | — | — | 57 | ||||||||||||||||||
Stock issued stock plans | — | — | (125 | ) | — | — | (125 | ) | ||||||||||||||||
Stock issued in Salin acquisition | — | — | 102,722 | — | — | 102,722 | ||||||||||||||||||
Cash dividends on common stock ($0.10 per share) | — | — | — | (4,524 | ) | — | (4,524 | ) | ||||||||||||||||
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Balances, March 31, 2019 | $ | — | $ | — | $ | 378,963 | $ | 230,327 | $ | 178 | $ | 609,468 | ||||||||||||
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Three Months Ended | ||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||||||||||||
Balances, July 1, 2018 | $ | $ | $ | 275,587 | $ | 205,535 | $ | (10,587 | ) | $ | 470,535 | |||||||||||||
Net income | — | — | — | 13,065 | — | 13,065 | ||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | (2,376 | ) | (2,376 | ) | ||||||||||||||||
Amortization of unearned compensation | — | — | 124 | — | — | 124 | ||||||||||||||||||
Exercise of stock options | — | — | 49 | — | — | 49 | ||||||||||||||||||
Stock option expense | — | — | 44 | — | — | 44 | ||||||||||||||||||
Cash dividends on common stock ($0.10 per share) | — | — | — | (3,847 | ) | — | (3,847 | ) | ||||||||||||||||
Balances, September 30, 2018 | $ | — | $ | — | $ | 275,804 | $ | 214,753 | $ | (12,963 | ) | $ | 477,594 | |||||||||||
Balances, July 1, 2019 | $ | — | $ | — | $ | 380,735 | $ | 241,519 | $ | 4,207 | $ | 626,461 | ||||||||||||
Net income | — | — | — | 20,537 | — | 20,537 | ||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | 2,439 | 2,439 | ||||||||||||||||||
Amortization of unearned compensation | — | — | 202 | — | — | 202 | ||||||||||||||||||
Exercise of stock options | — | — | 7 | — | — | 7 | ||||||||||||||||||
Stock option expense | — | — | 50 | — | — | 50 | ||||||||||||||||||
Stock issued stock plans | — | — | 49 | — | — | 49 | ||||||||||||||||||
Repurchase of outstanding stock | — | — | (1,595 | ) | — | — | (1,595 | ) | ||||||||||||||||
Cash dividends on common stock ($0.12 per share) | — | — | — | (5,439 | ) | — | (5,439 | ) | ||||||||||||||||
Balances, September 30, 2019 | $ | — | $ | — | $ | 379,448 | $ | 256,617 | $ | 6,646 | $ | 642,711 | ||||||||||||
Nine Months Ended | ||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||||||||||||
Balances, January 1, 2018 | $ | — | $ | — | $ | 275,059 | $ | 185,570 | $ | (3,551 | ) | $ | 457,078 | |||||||||||
Net income | — | — | — | 39,984 | — | 39,984 | ||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | (8,646 | ) | (8,646 | ) | ||||||||||||||||
Amortization of unearned compensation | — | — | 45 | — | — | 45 | ||||||||||||||||||
Exercise of stock options | — | — | 493 | — | — | 493 | ||||||||||||||||||
Stock option expense | — | — | 207 | — | — | 207 | ||||||||||||||||||
Reclassification of tax adjustment on accumulated other comprehensive loss | — | — | — | 766 | (766 | ) | — | |||||||||||||||||
Cash dividends on common stock ($0.30 per share) (Restated - See Note 1) | — | — | — | (11,567 | ) | — | (11,567 | ) | ||||||||||||||||
Balances, September 30, 2018 | $ | — | $ | — | $ | 275,804 | $ | 214,753 | $ | (12,963 | ) | $ | 477,594 | |||||||||||
Balances, January 1, 2019 | $ | — | $ | — | $ | 276,101 | $ | 224,035 | $ | (8,144 | ) | $ | 491,992 | |||||||||||
Net income | — | — | — | 47,995 | — | 47,995 | ||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | 14,790 | 14,790 | ||||||||||||||||||
Amortization of unearned compensation | — | — | 503 | — | — | 503 | ||||||||||||||||||
Exercise of stock options | — | — | 162 | — | — | 162 | ||||||||||||||||||
Stock option expense | — | — | 165 | — | — | 165 | ||||||||||||||||||
Stock issued stock plans | — | — | 1,390 | — | — | 1,390 | ||||||||||||||||||
Stock issued in Salin acquisition | — | — | 102,722 | — | — | 102,722 | ||||||||||||||||||
Repurchase of outstanding stock | — | — | (1,595 | ) | — | — | (1,595 | ) | ||||||||||||||||
Cash dividends on common stock ($0.34 per share) | — | — | — | (15,413 | ) | — | (15,413 | ) | ||||||||||||||||
Balances, September 30, 2019 | $ | — | $ | — | $ | 379,448 | $ | 256,617 | $ | 6,646 | $ | 642,711 | ||||||||||||
Three Months Ended March 31 | ||||||||
2019 | 2018 | |||||||
Operating Activities | ||||||||
Net income | $ | 10,816 | $ | 12,804 | ||||
Items not requiring (providing) cash | ||||||||
Provision for loan losses | 364 | 567 | ||||||
Depreciation and amortization | 1,549 | 1,814 | ||||||
Share based compensation | 57 | 82 | ||||||
Mortgage servicing rights, net impairment | (14 | ) | 6 | |||||
Premium amortization on securities, net | 1,285 | 1,476 | ||||||
Gain on sale of investment securities | (15 | ) | (11 | ) | ||||
Gain on sale of mortgage loans | (1,309 | ) | (1,423 | ) | ||||
Proceeds from sales of loans | 30,801 | 43,307 | ||||||
Loans originated for sale | (30,433 | ) | (35,770 | ) | ||||
Change in cash value life insurance | (513 | ) | (435 | ) | ||||
(Gain)/loss on sale of other real estate owned | 26 | — | ||||||
Net change in: | ||||||||
Interest receivable | (696 | ) | 4,200 | |||||
Interest payable | (386 | ) | 330 | |||||
Other assets | 97,788 | 6,595 | ||||||
Other liabilities | 2,246 | (3,556 | ) | |||||
|
|
|
| |||||
Net cash provided by operating activities | 111,566 | 29,986 | ||||||
|
|
|
| |||||
Investing Activities | ||||||||
Purchases of securities available for sale | (63,574 | ) | (36,389 | ) | ||||
Proceeds from sales, maturities, calls and principal repayments of securities available for sale | 42,715 | 30,415 | ||||||
Purchases of securities held to maturity | — | (8,703 | ) | |||||
Proceeds from maturities of securities held to maturity | 2,927 | 721 | ||||||
Net change in interest-earning time deposits | (243 | ) | (289 | ) | ||||
Change in Federal Reserve and FHLB stock | (803 | ) | — | |||||
Net change in loans | (37,028 | ) | (33,312 | ) | ||||
Proceeds on the sale of OREO and repossessed assets | 487 | 392 | ||||||
Change in premises and equipment, net | 3,260 | (1,074 | ) | |||||
Net cash received in acquisition, Salin | 128,745 | — | ||||||
|
|
|
| |||||
Net cash used in investing activities | 76,486 | (48,239 | ) | |||||
|
|
|
| |||||
Financing Activities | ||||||||
Net change in: | ||||||||
Deposits | 7,180 | 52,673 | ||||||
Borrowings | (163,061 | ) | (43,811 | ) | ||||
Proceeds from issuance of stock | (8 | ) | 100 | |||||
Dividends paid on common stock | (4,524 | ) | (3,848 | ) | ||||
|
|
|
| |||||
Net cash provided by financing activities | (160,413 | ) | 5,114 | |||||
|
|
|
| |||||
Net Change in Cash and Cash Equivalents | 27,639 | (13,139 | ) | |||||
Cash and Cash Equivalents, Beginning of Period | 58,492 | 59,980 | ||||||
|
|
|
| |||||
Cash and Cash Equivalents, End of Period | $ | 86,131 | $ | 46,841 | ||||
|
|
|
| |||||
Additional Supplemental Information | ||||||||
Interest paid | $ | 10,653 | $ | 5,685 | ||||
Income taxes paid | — | — | ||||||
Transfer of loans to other real estate | 759 | 266 | ||||||
Right-of-use assets exchanged for lease obligations | 3,411 | — |
Nine Months Ended | ||||||||
September 30 | ||||||||
2019 | 2018 | |||||||
Operating Activities | ||||||||
Net income | $ | 47,995 | $ | 39,984 | ||||
Items not requiring (providing) cash | ||||||||
Provision for loan losses | 1,636 | 2,378 | ||||||
Depreciation and amortization | 7,064 | 5,045 | ||||||
Share based compensation | 165 | 207 | ||||||
Mortgage servicing rights, net impairment | 59 | 26 | ||||||
Premium amortization on securities, net | 4,119 | 4,436 | ||||||
Loss on sale of investment securities | 85 | 111 | ||||||
Gain on sale of mortgage loans | (6,089 | ) | (5,158 | ) | ||||
Proceeds from sales of loans | 192,163 | 157,353 | ||||||
Loans originated for sale | (186,096 | ) | (146,088 | ) | ||||
Change in cash value life insurance | (1,624 | ) | (1,380 | ) | ||||
Death benefit on bank owned life insurance | 580 | 154 | ||||||
Gain on sale of other real estate owned | (115 | ) | (167 | ) | ||||
Net change in: | ||||||||
Interest receivable | (1,555 | ) | 2,245 | |||||
Interest payable | (132 | ) | 802 | |||||
Other assets | 95,457 | (4,858 | ) | |||||
Other liabilities | 11,413 | 9,549 | ||||||
Net cash provided by operating activities | 165,125 | 64,639 | ||||||
Investing Activities | ||||||||
Purchases of securities available for sale | (301,426 | ) | (130,207 | ) | ||||
Proceeds from sales, maturities, calls and principal repayments of securities available for sale | 200,067 | 79,188 | ||||||
Purchases of securities held to maturity | — | (28,374 | ) | |||||
Proceeds from maturities of securities held to maturity | 6,990 | 6,109 | ||||||
Net change in interest-earning time deposits | 7,289 | (530 | ) | |||||
Change in FHLB stock | (803 | ) | 32 | |||||
Net change in loans | (87,905 | ) | (137,864 | ) | ||||
Proceeds on the sale of OREO and repossessed assets | 2,935 | 3,298 | ||||||
Change in premises and equipment, net | (3,760 | ) | (3,292 | ) | ||||
Purchases of bank owned life insurance | — | (10,450 | ) | |||||
Repurchase of outstanding stock | (1,595 | ) | — | |||||
Net cash received in acquisition, Salin | 128,745 | — | ||||||
Net cash used in investing activities | (49,463 | ) | (222,090 | ) | ||||
Financing Activities | ||||||||
Net change in: | ||||||||
Deposits | 35,237 | 247,551 | ||||||
Borrowings | (104,251 | ) | (86,300 | ) | ||||
Proceeds from issuance of stock | 1,552 | 493 | ||||||
Dividends paid on common stock | (15,413 | ) | (11,567 | ) | ||||
Net cash provided by (used in) financing activities | (82,875 | ) | 150,177 | |||||
Net Change in Cash and Cash Equivalents | 32,787 | (7,274 | ) | |||||
Cash and Cash Equivalents, Beginning of Period | 58,492 | 59,980 | ||||||
Cash and Cash Equivalents, End of Period | $ | 91,279 | $ | 52,706 | ||||
Additional Supplemental Information | ||||||||
Interest paid | $ | 34,968 | $ | 20,903 | ||||
Income taxes paid | 1,319 | 6,661 | ||||||
Transfer of loans to other real estate and repossessed assets | 2,030 | 2,398 | ||||||
Transfer of premises to other real estate | 1,705 | — | ||||||
Right-of-use assets exchanged for lease obligations | 3,411 | — |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30 | September 30 | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Basic earnings per share | ||||||||||||||||
Net income | $ | 20,537 | $ | 13,065 | $ | 47,995 | $ | 39,984 | ||||||||
Weighted average common shares outstanding (1) | 45,038,021 | 38,365,379 | 42,995,082 | 38,340,012 | ||||||||||||
Basic earnings per share | $ | 0.46 | $ | 0.34 | $ | 1.12 | $ | 1.04 | ||||||||
Diluted earnings per share | ||||||||||||||||
Net income available to common shareholders | $ | 20,537 | $ | 13,065 | $ | 47,995 | $ | 39,984 | ||||||||
Weighted average common shares outstanding (1) | 45,038,021 | 38,365,379 | 42,995,082 | 38,340,012 | ||||||||||||
Effect of dilutive securities: | ||||||||||||||||
Restricted stock | — | 47,603 | — | 43,926 | ||||||||||||
Stock options | 75,709 | 121,988 | 75,013 | 119,465 | ||||||||||||
Weighted average common shares outstanding | 45,113,730 | 38,534,970 | 43,070,095 | 38,503,403 | ||||||||||||
$ | 0.46 | $ | 0.34 | $ | 1.11 | $ | 1.04 | |||||||||
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
Three Months Ended March 31 | ||||||||
2019 | 2018 | |||||||
Basic earnings per share | ||||||||
Net income | $ | 10,816 | $ | 12,804 | ||||
Weighted average common shares outstanding(1) | 38,822,543 | 38,306,395 | ||||||
Basic earnings per share | $ | 0.28 | $ | 0.33 | ||||
|
|
|
| |||||
Diluted earnings per share | ||||||||
Net income available to common shareholders | $ | 10,816 | $ | 12,804 | ||||
Weighted average common shares outstanding(1) | 38,822,543 | 38,306,395 | ||||||
Effect of dilutive securities: | ||||||||
Restricted stock | — | 35,356 | ||||||
Stock options | 83,629 | 127,059 | ||||||
|
|
|
| |||||
Weighted average common shares outstanding | 38,906,172 | 38,468,810 | ||||||
$ | 0.28 | $ | 0.33 | |||||
|
|
|
|
(1) | Adjusted for 3:2 stocks split on June 15, 2018 |
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting forHedging ActivitiesThe FASB has issued ASUNo. 2017-12,
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
no
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
Under the acquisition method of accounting, the total purchase price is allocated to net tangible and intangible assets based on their current estimated fair values on the date of the acquisition. Based on preliminary valuations of the fair value of tangible and intangible assets acquired and liabilities assumed, which are based on estimates and assumptions that are subject to change, the preliminary purchase price for the Salin acquisition is detailed in the following table. Final estimates of fair value on the date of acquisition have not been received yet. Prior to the end of the one year
Assets | ||||
Cash and due from banks | $ | 152,745 | ||
Investment securities, available for sale | 54,706 | |||
Loans | ||||
Commercial | 350,916 | |||
Residential mortgage | 136,089 | |||
Consumer | 84,814 | |||
|
| |||
Total loans | 571,819 | |||
Premises and equipment, net | 23,882 | |||
FRB and FHLB stock | 3,571 | |||
Goodwill | 25,810 | |||
Core deposit intangible | 21,111 | |||
Interest receivable | 2,488 | |||
Other assets | 107,611 | |||
|
| |||
Total assets purchased | $ | 963,743 | ||
|
| |||
Common shares issued | $ | 102,722 | ||
Cash paid | 24,000 | |||
|
| |||
Total purchase price | $ | 126,722 | ||
|
|
Liabilities | ||||
Deposits | ||||
Non-interest bearing | $ | 188,744 | ||
NOW accounts | 207,567 | |||
Savings and money market | 274,504 | |||
Certificates of deposit | 70,652 | |||
|
| |||
Total deposits | 741,467 | |||
Borrowings | 70,495 | |||
Subordinated debentures | 17,443 | |||
Interest payable | 826 | |||
Other liabilities | 6,790 | |||
|
| |||
Total liabilities assumed | $ | 837,021 | ||
|
|
Assets | ||||
Cash and due from banks | $ | 152,745 | ||
Investment securities, available for sale | 54,319 | |||
Loans | ||||
Commercial | 352,798 | |||
Residential mortgage | 131,008 | |||
Consumer | 85,112 | |||
Total loans | 568,918 | |||
Premises and equipment, net | 20,425 | |||
FRB and FHLB stock | 3,571 | |||
Goodwill | 31,358 | |||
Core deposit intangible | 19,818 | |||
Interest receivable | 2,488 | |||
Other assets | 112,880 | |||
Total assets purchased | $ | 966,522 | ||
Common shares issued | $ | 102,722 | ||
Cash paid | 24,000 | |||
Total purchase price | $ | |||
Liabilities | ||||
Deposits | ||||
Non-interest bearing | $ | 188,744 | ||
NOW accounts | 207,567 | |||
Savings and money market | 274,504 | |||
Certificates of deposit | 70,529 | |||
Total deposits | 741,344 | |||
Borrowings | 70,495 | |||
Subordinated debentures | 18,376 | |||
Interest payable | 826 | |||
Other liabilities | 8,759 | |||
Total liabilities assumed | $ | |||
Contractually required principal and interest at acquisition | $ | 22,209 | ||
Contractual cash flows not expected to be collected (nonaccretable differences) | 8,632 | |||
|
| |||
Expected cash flows at acquisition | 13,577 | |||
Interest component of expected cash flows (accretable discount) | 1,333 | |||
|
| |||
Fair value of acquired loans accounted for under ASC310-30 | $ | 12,244 | ||
|
|
Contractually required principal and interest at acquisition | $ | 22,672 | ||
Contractual cash flows not expected to be collected (nonaccretable differences) | 6,694 | |||
Expected cash flows at acquisition | 15,978 | |||
Interest component of expected cash flows (accretable discount) | 735 | |||
Fair value of acquired loans accounted for under ASC 310-30 | $ | 15,243 | ||
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
The results of operations of Salin have been included in the Company’s consolidated financial statements since the acquisition date. The following schedule includespro-forma results for the three and nine months ended March 31,September 30, 2019 and 2018 as if the Salin acquisition had occurred as of the beginning of the comparable prior reporting periods.
Three Months Ended | ||||||||
March 31 | March 31 | |||||||
2019 | 2018 | |||||||
Summary of Operations: | ||||||||
Net Interest Income | $ | 42,182 | $ | 40,619 | ||||
Provision for Loan Losses | 664 | 1,167 | ||||||
|
|
|
| |||||
Net Interest Income after Provision for Loan Losses | 41,518 | 39,452 | ||||||
Non-interest Income | 9,126 | 9,999 | ||||||
Non-interest Expense | 42,152 | 33,169 | ||||||
|
|
|
| |||||
Income before Income Taxes | 8,492 | 16,282 | ||||||
Income Tax Expense | 2,017 | 2,465 | ||||||
|
|
|
| |||||
Net Income | 6,475 | 13,817 | ||||||
|
|
|
| |||||
Net Income Available to Common Shareholders | $ | 6,475 | $ | 13,817 | ||||
|
|
|
| |||||
Basic Earnings per Share | $ | 0.17 | $ | 0.36 | ||||
Diluted Earnings per Share | $ | 0.17 | $ | 0.36 |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30 | September 30 | September 30 | ||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Summary of Operations: | ||||||||||||||||
Net Interest Income | $ | 43,463 | $ | 41,673 | $ | 127,174 | $ | 123,358 | ||||||||
Provision for Loan Losses | 376 | 1,176 | 1,936 | 3,178 | ||||||||||||
Net Interest Income after Provision for Loan Losses | 43,087 | 40,497 | 125,238 | 120,180 | ||||||||||||
Non-interest Income | 11,514 | 10,600 | 31,538 | 31,441 | ||||||||||||
Non-interest Expense | 30,060 | 32,978 | 103,796 | 98,557 | ||||||||||||
Income before Income Taxes | 24,541 | 18,119 | 52,980 | 53,064 | ||||||||||||
Income Tax Expense | 4,004 | 2,540 | 9,326 | 7,738 | ||||||||||||
Net Income | 20,537 | 15,579 | 43,654 | 45,326 | ||||||||||||
Net Income Available to Common Shareholders | $ | 20,537 | $ | 15,579 | $ | 43,654 | $ | 45,326 | ||||||||
Basic Earnings per Share | $ | 0.46 | $ | 0.41 | $ | 0.97 | $ | 1.18 | ||||||||
Diluted Earnings per Share | $ | 0.46 | $ | 0.40 | $ | 0.97 | $ | 1.18 |
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
Note 3 – Securities
The fair value
September 30, 2019 | ||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||
Available for sale | ||||||||||||||||
U.S. Treasury and federal agencies | $ | 9,915 | $ | 2 | $ | (8 | ) | $ | 9,909 | |||||||
State and municipal | 337,336 | 11,374 | (1,609 | ) | 347,101 | |||||||||||
Federal agency collateralized mortgage obligations | 243,366 | 3,141 | (424 | ) | 246,083 | |||||||||||
Federal agency mortgage-backed pools | 144,880 | 1,125 | (408 | ) | 145,597 | |||||||||||
Corporate notes | 17,618 | 922 | — | 18,540 | ||||||||||||
Total available for sale investment securities | $ | 753,115 | $ | 16,564 | $ | (2,449 | ) | $ | 767,230 | |||||||
Held to maturity | ||||||||||||||||
State and municipal | $ | 192,736 | $ | 7,335 | $ | (99 | ) | $ | 199,972 | |||||||
Federal agency collateralized mortgage obligations | 4,714 | 11 | (9 | ) | 4,716 | |||||||||||
Federal agency mortgage-backed pools | 12,856 | 200 | (26 | ) | 13,030 | |||||||||||
Total held to maturity investment securities | $ | 210,306 | $ | 7,546 | $ | (134 | ) | $ | 217,718 | |||||||
December 31, 2018 | ||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||
Available for sale | ||||||||||||||||
U.S. Treasury and federal agencies | $ | 16,815 | $ | 1 | $ | (208 | ) | $ | 16,608 | |||||||
State and municipal | 210,386 | 1,495 | (2,578 | ) | 209,303 | |||||||||||
Federal agency collateralized mortgage obligations | 187,563 | 625 | (3,185 | ) | 185,003 | |||||||||||
Federal agency mortgage-backed pools | 183,479 | 80 | (4,823 | ) | 178,736 | |||||||||||
Corporate notes | 10,666 | 107 | (75 | ) | 10,698 | |||||||||||
Total available for sale investment securities | $ | 608,909 | $ | 2,308 | $ | (10,869 | ) | $ | 600,348 | |||||||
Held to maturity | ||||||||||||||||
State and municipal | $ | 191,269 | $ | 1,773 | $ | (3,366 | ) | $ | 189,676 | |||||||
Federal agency collateralized mortgage obligations | 5,144 | 6 | (120 | ) | 5,030 | |||||||||||
Federal agency mortgage-backed pools | 13,699 | 74 | (206 | ) | 13,567 | |||||||||||
Total held to maturity investment securities | $ | 210,112 | $ | 1,853 | $ | (3,692 | ) | $ | 208,273 | |||||||
March 31, 2019 | December 31, 2018 | |||||||||||||||
Amortized | Fair | Amortized | Fair | |||||||||||||
Cost | Value | Cost | Value | |||||||||||||
Available for sale | ||||||||||||||||
Within one year | $ | 29,589 | $ | 29,552 | $ | 20,532 | $ | 20,448 | ||||||||
One to five years | 52,250 | 51,759 | 42,476 | 41,705 | ||||||||||||
Five to ten years | 100,190 | 102,334 | 107,839 | 107,107 | ||||||||||||
After ten years | 95,233 | 98,189 | 67,020 | 67,349 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
277,262 | 281,834 | 237,867 | 236,609 | |||||||||||||
Federal agency collateralized mortgage obligations | 212,829 | 213,043 | 187,563 | 185,003 | ||||||||||||
Federal agency mortgage-backed pools | 193,932 | 192,265 | 183,479 | 178,736 | ||||||||||||
Private labeled mortgage-backed pools | — | — | — | — | ||||||||||||
Total available for sale investment securities | ||||||||||||||||
|
|
|
|
|
|
|
| |||||||||
$ | 684,023 | $ | 687,142 | $ | 608,909 | $ | 600,348 | |||||||||
|
|
|
|
|
|
|
| |||||||||
Held to maturity | ||||||||||||||||
Within one year | $ | 150 | $ | 150 | $ | 70 | $ | 70 | ||||||||
One to five years | 50,317 | 51,152 | 48,732 | 49,324 | ||||||||||||
Five to ten years | 99,413 | 101,178 | 101,809 | 101,533 | ||||||||||||
After ten years | 37,967 | 37,207 | 40,658 | 38,749 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
187,847 | 189,687 | 191,269 | 189,676 | |||||||||||||
Federal agency collateralized mortgage obligations | 5,019 | 4,979 | 5,144 | 5,030 | ||||||||||||
Federal agency mortgage-backed pools | 13,461 | 13,557 | 13,699 | 13,567 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total held to maturity investment securities | $ | 206,327 | $ | 208,223 | $ | 210,112 | $ | 208,273 | ||||||||
|
|
|
|
|
|
|
|
September 30, 2019 | December 31, 2018 | |||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||
Available for sale | ||||||||||||||||
Within one year | $ | 40,283 | $ | 40,168 | $ | 20,532 | $ | 20,448 | ||||||||
One to five years | 41,593 | 41,671 | 42,476 | 41,705 | ||||||||||||
Five to ten years | 102,753 | 107,719 | 107,839 | 107,107 | ||||||||||||
After ten years | 180,240 | 185,992 | 67,020 | 67,349 | ||||||||||||
364,869 | 375,550 | 237,867 | 236,609 | |||||||||||||
Federal agency collateralized mortgage obligations | 243,366 | 246,083 | 187,563 | 185,003 | ||||||||||||
Federal agency mortgage-backed pools | 144,880 | 145,597 | 183,479 | 178,736 | ||||||||||||
Total available for sale investment securities | $ | 753,115 | $ | 767,230 | $ | 608,909 | $ | 600,348 | ||||||||
Held to maturity | ||||||||||||||||
Within one year | $ | 6,413 | $ | 6,479 | $ | 70 | $ | 70 | ||||||||
One to five years | 54,558 | 55,545 | 48,732 | 49,324 | ||||||||||||
Five to ten years | 98,134 | 101,776 | 101,809 | 101,533 | ||||||||||||
After ten years | 33,631 | 36,172 | 40,658 | 38,749 | ||||||||||||
192,736 | 199,972 | 191,269 | 189,676 | |||||||||||||
Federal agency collateralized mortgage obligations | 4,714 | 4,716 | 5,144 | 5,030 | ||||||||||||
Federal agency mortgage-backed pools | 12,856 | 13,030 | 13,699 | 13,567 | ||||||||||||
Total held to maturity investment securities | $ | 210,306 | $ | 217,718 | $ | 210,112 | $ | 208,273 | ||||||||
March 31, 2019 | ||||||||||||||||||||||||
Less than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
Investment Securities | ||||||||||||||||||||||||
U.S. Treasury and federal agencies | $ | — | $ | — | $ | 9,823 | $ | (92 | ) | $ | 9,823 | $ | (92 | ) | ||||||||||
State and municipal | 65,265 | (697 | ) | 44,783 | (2,500 | ) | 110,048 | (3,197 | ) | |||||||||||||||
Federal agency collateralized mortgage obligations | 431 | (1 | ) | 100,886 | (1,607 | ) | 101,317 | (1,608 | ) | |||||||||||||||
Federal agency mortgage-backed pools | — | — | 152,582 | (2,017 | ) | 152,582 | (2,017 | ) | ||||||||||||||||
Corporate notes | — | — | — | — | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total temporarily impaired securities | $ | 65,696 | $ | (698 | ) | $ | 308,074 | $ | (6,216 | ) | $ | 373,770 | $ | (6,914 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
December 31, 2018 | ||||||||||||||||||||||||
Less than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
Investment Securities | ||||||||||||||||||||||||
U.S. Treasury and federal agencies | $ | — | $ | — | $ | 9,707 | $ | (208 | ) | $ | 9,707 | $ | (208 | ) | ||||||||||
State and municipal | 75,163 | (1,628 | ) | 106,335 | (4,316 | ) | 181,498 | (5,944 | ) | |||||||||||||||
Federal agency collateralized mortgage obligations | 6,450 | (25 | ) | 106,257 | (3,280 | ) | 112,707 | (3,305 | ) | |||||||||||||||
Federal agency mortgage-backed pools | 5,739 | (39 | ) | 175,865 | (4,990 | ) | 181,604 | (5,029 | ) | |||||||||||||||
Corporate notes | 5,263 | (75 | ) | — | — | 5,263 | (75 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total temporarily impaired securities | $ | 92,615 | $ | (1,767 | ) | $ | 398,164 | $ | (12,794 | ) | $ | 490,779 | $ | (14,561 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2019 | ||||||||||||||||||||||||
Less than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||
Investment Securities | ||||||||||||||||||||||||
U.S. Treasury and federal agencies | $ | 4,407 | $ | (8 | ) | $ | — | $ | — | $ | 4,407 | $ | (8 | ) | ||||||||||
State and municipal | 109,512 | (1,531 | ) | 9,681 | (177 | ) | 119,193 | (1,708 | ) | |||||||||||||||
Federal agency collateralized mortgage obligations | 42,097 | (150 | ) | 24,652 | (283 | ) | 66,749 | (433 | ) | |||||||||||||||
Federal agency mortgage-backed pools | 25,463 | (77 | ) | 41,511 | (357 | ) | 66,974 | (434 | ) | |||||||||||||||
Total temporarily impaired securities | $ | 181,479 | $ | (1,766 | ) | $ | 75,844 | $ | (817 | ) | $ | 257,323 | $ | (2,583 | ) | |||||||||
December 31, 2018 | ||||||||||||||||||||||||
Less than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||
Investment Securities | ||||||||||||||||||||||||
U.S. Treasury and federal agencies | $ | — | $ | — | $ | 9,707 | $ | (208 | ) | $ | 9,707 | $ | (208 | ) | ||||||||||
State and municipal | 75,163 | (1,628 | ) | 106,335 | (4,316 | ) | 181,498 | (5,944 | ) | |||||||||||||||
Federal agency collateralized mortgage obligations | 6,450 | (25 | ) | 106,257 | (3,280 | ) | 112,707 | (3,305 | ) | |||||||||||||||
Federal agency mortgage-backed pools | 5,739 | (39 | ) | 175,865 | (4,990 | ) | 181,604 | (5,029 | ) | |||||||||||||||
Corporate notes | 5,263 | (75 | ) | — | — | 5,263 | (75 | ) | ||||||||||||||||
Total temporarily impaired securities | $ | 92,615 | $ | (1,767 | ) | $ | 398,164 | $ | (12,794 | ) | $ | 490,779 | $ | (14,561 | ) | |||||||||
Three Months Ended | ||||||||
March 31 | ||||||||
2019 | 2018 | |||||||
Sales of securities available for sale | ||||||||
Proceeds | $ | 17,587 | $ | 9,836 | ||||
Gross gains | 59 | 37 | ||||||
Gross losses | (44 | ) | (26 | ) |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30 | September 30 | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Sales of securities available for sale | ||||||||||||||||
Proceeds | $ | — | $ | 7,485 | $ | 91,635 | $ | 17,321 | ||||||||
Gross gains | — | — | 158 | 37 | ||||||||||||
Gross losses | — | (122 | ) | (243 | ) | (148 | ) |
March 31 | December 31 | |||||||
2019 | 2018 | |||||||
Commercial | ||||||||
Working capital and equipment | $ | 924,435 | $ | 804,083 | ||||
Real estate, including agriculture | 1,076,077 | 834,037 | ||||||
Tax exempt | 60,062 | 48,975 | ||||||
Other | 29,005 | 34,495 | ||||||
|
|
|
| |||||
Total | 2,089,579 | 1,721,590 | ||||||
Real estate | ||||||||
1-4 family | 808,401 | 659,754 | ||||||
Other | 11,423 | 8,387 | ||||||
|
|
|
| |||||
Total | 819,824 | 668,141 | ||||||
Consumer | ||||||||
Auto | 331,572 | 327,413 | ||||||
Recreation | 14,262 | 13,975 | ||||||
Real estate/home improvement | 40,998 | 39,587 | ||||||
Home equity | 245,940 | 163,209 | ||||||
Unsecured | 4,124 | 4,043 | ||||||
Other | 2,814 | 1,254 | ||||||
|
|
|
| |||||
Total | 639,710 | 549,481 | ||||||
Mortgage warehouse | 71,944 | 74,120 | ||||||
|
|
|
| |||||
Total loans | 3,621,057 | 3,013,332 | ||||||
Allowance for loan losses | (17,821 | ) | (17,820 | ) | ||||
Loans, net | ||||||||
|
|
|
| |||||
$ | 3,603,236 | $ | 2,995,512 | |||||
|
|
|
|
September 30 | December 31 | |||||||
2019 | | 2018 | ||||||
Commercial | ||||||||
Working capital and equipment | $ | 915,449 | $ | 804,083 | ||||
Real estate, including agriculture | 1,005,124 | 834,037 | ||||||
Tax exempt | 59,620 | 48,975 | ||||||
Other | 65,972 | 34,495 | ||||||
Total | 2,046,165 | 1,721,590 | ||||||
Real estate | ||||||||
1-4 family | 788,574 | 659,754 | ||||||
Other | 7,923 | 8,387 | ||||||
Total | 796,497 | 668,141 | ||||||
Consumer | ||||||||
Auto | 358,792 | 327,413 | ||||||
Recreation | 16,396 | 13,975 | ||||||
Real estate/home improvement | 44,105 | 39,587 | ||||||
Home equity | 239,041 | 163,209 | ||||||
Unsecured | 6,986 | 4,043 | ||||||
Other | 3,012 | 1,254 | ||||||
Total | 668,332 | 549,481 | ||||||
Mortgage warehouse | 155,631 | 74,120 | ||||||
Total loans | 3,666,625 | 3,013,332 | ||||||
Allowance for loan losses | (17,956 | ) | (17,820 | ) | ||||
Loans, net | $ | 3,648,669 | $ | 2,995,512 | ||||
March 31, 2019 | ||||||||||||||||
Loan | Interest | Deferred | Recorded | |||||||||||||
Balance | Due | Costs/(Fees) | Investment | |||||||||||||
Owner occupied real estate | $ | 676,517 | $ | 975 | $ | (1,687 | ) | $ | 675,805 | |||||||
Non-owner occupied real estate | 833,803 | 1,645 | (1,666 | ) | 833,782 | |||||||||||
Residential spec homes | 10,221 | 27 | (3 | ) | 10,245 | |||||||||||
Development & spec land | 75,079 | 249 | (16 | ) | 75,312 | |||||||||||
Commercial and industrial | 497,624 | 4,291 | (293 | ) | 501,622 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Total commercial | 2,093,244 | 7,187 | (3,665 | ) | 2,096,766 | |||||||||||
Residential mortgage | 797,174 | 2,346 | (1,943 | ) | 797,577 | |||||||||||
Residential construction | 24,593 | 43 | — | 24,636 | ||||||||||||
Mortgage warehouse | 71,944 | 480 | — | 72,424 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total real estate | 893,711 | 2,869 | (1,943 | ) | 894,637 | |||||||||||
Direct installment | 37,417 | 135 | 560 | 38,112 | ||||||||||||
Indirect installment | 317,629 | 750 | — | 318,379 | ||||||||||||
Home equity | 282,160 | 1,504 | 1,944 | 285,608 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total consumer | 637,206 | 2,389 | 2,504 | 642,099 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total loans | 3,624,161 | 12,445 | (3,104 | ) | 3,633,502 | |||||||||||
Allowance for loan losses | (17,821 | ) | — | — | (17,821 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net loans | $ | 3,606,340 | $ | 12,445 | $ | (3,104 | ) | $ | 3,615,681 | |||||||
|
|
|
|
|
|
|
| |||||||||
December 31, 2018 | ||||||||||||||||
Loan | Interest | Deferred | Recorded | |||||||||||||
Balance | Due | Costs/(Fees) | Investment | |||||||||||||
Owner occupied real estate | $ | 561,463 | $ | 1,240 | $ | (1,629 | ) | $ | 561,074 | |||||||
Non-owner occupied real estate | 717,814 | 1,063 | (1,839 | ) | 717,038 | |||||||||||
Residential spec homes | 5,199 | 13 | (2 | ) | 5,210 | |||||||||||
Development & spec land | 46,547 | 131 | (12 | ) | 46,666 | |||||||||||
Commercial and industrial | 394,346 | 3,149 | (297 | ) | 397,198 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Total commercial | 1,725,369 | 5,596 | (3,779 | ) | 1,727,186 | |||||||||||
Residential mortgage | 646,136 | 1,861 | (2,025 | ) | 645,972 | |||||||||||
Residential construction | 24,030 | 42 | — | 24,072 | ||||||||||||
Mortgage warehouse | 74,120 | 480 | — | 74,600 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total real estate | 744,286 | 2,383 | (2,025 | ) | 744,644 | |||||||||||
Direct installment | 38,173 | 103 | 566 | 38,842 | ||||||||||||
Indirect installment | 314,177 | 738 | — | 314,915 | ||||||||||||
Home equity | 194,766 | 973 | 1,799 | 197,538 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total consumer | 547,116 | 1,814 | 2,365 | 551,295 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total loans | 3,016,771 | 9,793 | (3,439 | ) | 3,023,125 | |||||||||||
Allowance for loan losses | (17,820 | ) | — | — | (17,820 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net loans | $ | 2,998,951 | $ | 9,793 | $ | (3,439 | ) | $ | 3,005,305 | |||||||
|
|
|
|
|
|
|
|
September 30, 2019 | ||||||||||||||||
Loan Balance | Interest Due | Deferred Costs/(Fees) | Recorded Investment | |||||||||||||
Owner occupied real estate | $ | 723,218 | $ | 1,735 | $ | (1,351 | ) | $ | 723,602 | |||||||
Non-owner occupied real estate | 766,574 | 1,336 | (390 | ) | 767,520 | |||||||||||
Residential spec homes | 10,813 | 20 | (33 | ) | 10,800 | |||||||||||
Development & spec land | 37,115 | 104 | (15 | ) | 37,204 | |||||||||||
Commercial and industrial | 510,315 | 4,333 | (81 | ) | 514,567 | |||||||||||
Total commercial | 2,048,035 | 7,528 | (1,870 | ) | 2,053,693 | |||||||||||
Residential mortgage | 773,444 | 2,377 | 12 | 775,833 | ||||||||||||
Residential construction | 23,041 | 50 | — | 23,091 | ||||||||||||
Mortgage warehouse | 155,631 | 194 | — | 155,825 | ||||||||||||
Total real estate | 952,116 | 2,621 | 12 | 954,749 | ||||||||||||
Direct installment | 42,048 | 137 | 678 | 42,863 | ||||||||||||
Indirect installment | 344,567 | 789 | — | 345,356 | ||||||||||||
Home equity | 278,577 | 1,407 | 2,462 | 282,446 | ||||||||||||
Total consumer | 665,192 | 2,333 | 3,140 | 670,665 | ||||||||||||
Total loans | 3,665,343 | 12,482 | 1,282 | 3,679,107 | ||||||||||||
Allowance for loan losses | (17,956 | ) | — | — | (17,956 | ) | ||||||||||
Net loans | $ | 3,647,387 | $ | 12,482 | $ | 1,282 | $ | 3,661,151 | ||||||||
December 31, 2018 | ||||||||||||||||
Loan Balance | Interest Due | Deferred Costs/(Fees) | Recorded Investment | |||||||||||||
Owner occupied real estate | $ | 563,929 | $ | 1,273 | $ | (1,368 | ) | $ | 563,834 | |||||||
Non-owner occupied real estate | 714,136 | 1,069 | (477 | ) | 714,728 | |||||||||||
Residential spec homes | 5,195 | 13 | — | 5,208 | ||||||||||||
Development & spec land | 46,523 | 131 | (15 | ) | 46,639 | |||||||||||
Commercial and industrial | 393,752 | 3,110 | (85 | ) | 396,777 | |||||||||||
Total commercial | 1,723,535 | 5,596 | (1,945 | ) | 1,727,186 | |||||||||||
Residential mortgage | 644,094 | 1,861 | 17 | 645,972 | ||||||||||||
Residential construction | 24,030 | 42 | — | 24,072 | ||||||||||||
Mortgage warehouse | 74,120 | 132 | — | 74,252 | ||||||||||||
Total real estate | 742,244 | 2,035 | 17 | 744,296 | ||||||||||||
Direct installment | 34,233 | 103 | 593 | 34,929 | ||||||||||||
Indirect installment | 314,177 | 738 | — | 314,915 | ||||||||||||
Home equity | 198,364 | 973 | 2,114 | 201,451 | ||||||||||||
Total consumer | 546,774 | 1,814 | 2,707 | 551,295 | ||||||||||||
Total loans | 3,012,553 | 9,445 | 779 | 3,022,777 | ||||||||||||
Allowance for loan losses | (17,820 | ) | — | — | (17,820 | ) | ||||||||||
Net loans | $ | 2,994,733 | $ | 9,445 | $ | 779 | $ | 3,004,957 | ||||||||
March 31, 2019 | ||||||||||||||||||||||||
Allowance | ||||||||||||||||||||||||
Outstanding | for Loan | Carrying | ||||||||||||||||||||||
Commercial | Real Estate | Consumer | Balance | Losses | Amount | |||||||||||||||||||
Heartland | $ | 229 | $ | 164 | $ | — | $ | 393 | $ | — | $ | 393 | ||||||||||||
Summit | 220 | 535 | — | 755 | — | 755 | ||||||||||||||||||
Peoples | 260 | 44 | — | 304 | — | 304 | ||||||||||||||||||
Kosciusko | 712 | 163 | — | 875 | 296 | 579 | ||||||||||||||||||
LaPorte | 708 | 836 | 26 | 1,570 | — | 1,570 | ||||||||||||||||||
Lafayette | 2,204 | — | — | 2,204 | — | 2,204 | ||||||||||||||||||
Wolverine | 5,736 | — | — | 5,736 | — | 5,736 | ||||||||||||||||||
Salin | 10,329 | 1,986 | 1,262 | 13,577 | — | 13,577 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | $ | 20,398 | $ | 3,728 | $ | 1,288 | $ | 25,414 | $ | 296 | $ | 25,118 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
December 31, 2018 | ||||||||||||||||||||||||
Allowance | ||||||||||||||||||||||||
Outstanding | for Loan | Carrying | ||||||||||||||||||||||
Commercial | Real Estate | Consumer | Balance | Losses | Amount | |||||||||||||||||||
Heartland | $ | 232 | $ | 175 | $ | — | $ | 407 | $ | — | $ | 407 | ||||||||||||
Summit | 323 | 555 | — | 878 | — | 878 | ||||||||||||||||||
Peoples | 270 | 58 | — | 328 | — | 328 | ||||||||||||||||||
Kosciusko | 746 | 155 | — | 901 | — | 901 | ||||||||||||||||||
LaPorte | 753 | 947 | 27 | 1,727 | 60 | 1,667 | ||||||||||||||||||
Lafayette | 3,080 | — | — | 3,080 | — | 3,080 | ||||||||||||||||||
Wolverine | 7,841 | — | — | 7,841 | — | 7,841 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | $ | 13,245 | $ | 1,890 | $ | 27 | $ | 15,162 | $ | 60 | $ | 15,102 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2019 | ||||||||||||||||||||||||
Commercial | Real Estate | Consumer | Outstanding Balance | Allowance for Loan Losses | Carrying Amount | |||||||||||||||||||
Heartland | $ | 205 | $ | 143 | $ | — | $ | 348 | $ | — | $ | 348 | ||||||||||||
Summit | 203 | 494 | — | 697 | — | 697 | ||||||||||||||||||
Peoples | 240 | 38 | — | 278 | — | 278 | ||||||||||||||||||
Kosciusko | 649 | 140 | — | 789 | — | 789 | ||||||||||||||||||
LaPorte | 378 | 805 | 22 | 1,205 | 10 | 1,195 | ||||||||||||||||||
Lafayette | 1,903 | — | — | 1,903 | — | 1,903 | ||||||||||||||||||
Wolverine | 2,347 | — | — | 2,347 | — | 2,347 | ||||||||||||||||||
Salin | 11,965 | 1,911 | 983 | 14,859 | — | 14,859 | ||||||||||||||||||
Total | $ | 17,890 | $ | 3,531 | $ | 1,005 | $ | 22,426 | $ | 10 | $ | 22,416 | ||||||||||||
December 31, 2018 | ||||||||||||||||||||||||
Commercial | Real Estate | Consumer | Outstanding Balance | Allowance for Loan Losses | Carrying Amount | |||||||||||||||||||
Heartland | $ | 232 | $ | 175 | $ | — | $ | 407 | $ | — | $ | 407 | ||||||||||||
Summit | 323 | 555 | — | 878 | — | 878 | ||||||||||||||||||
Peoples | 270 | 58 | — | 328 | — | 328 | ||||||||||||||||||
Kosciusko | 746 | 155 | — | 901 | — | 901 | ||||||||||||||||||
LaPorte | 753 | 947 | 27 | 1,727 | 60 | 1,667 | ||||||||||||||||||
Lafayette | 3,080 | — | — | 3,080 | — | 3,080 | ||||||||||||||||||
Wolverine | 7,841 | — | — | 7,841 | — | 7,841 | ||||||||||||||||||
Total | $ | 13,245 | $ | 1,890 | $ | 27 | $ | 15,162 | $ | 60 | $ | 15,102 | ||||||||||||
Three Months Ended March 31, 2019 | ||||||||||||||||||||||||
Reclassification | ||||||||||||||||||||||||
from | ||||||||||||||||||||||||
Beginning | nonaccretable | Ending | ||||||||||||||||||||||
balance | Additions | Accretion | difference | Disposals | balance | |||||||||||||||||||
Heartland | $ | 174 | $ | — | $ | (8 | ) | $ | — | $ | — | $ | 166 | |||||||||||
Summit | 42 | — | (3 | ) | — | (11 | ) | 28 | ||||||||||||||||
Kosciusko | 300 | — | (17 | ) | — | — | 283 | |||||||||||||||||
LaPorte | 829 | — | (29 | ) | — | — | 800 | |||||||||||||||||
Lafayette | 609 | — | (35 | ) | — | (171 | ) | 403 | ||||||||||||||||
Wolverine | 698 | — | (123 | ) | — | (8 | ) | 567 | ||||||||||||||||
Salin | — | 3,368 | — | — | — | 3,368 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | $ | 2,652 | $ | 3,368 | $ | (215 | ) | $ | — | $ | (190 | ) | $ | 5,615 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Three Months Ended March 31, 2018 | ||||||||||||||||||||||||
Reclassification | ||||||||||||||||||||||||
from | ||||||||||||||||||||||||
Beginning | nonaccretable | Ending | ||||||||||||||||||||||
balance | Additions | Accretion | difference | Disposals | balance | |||||||||||||||||||
Heartland | $ | 452 | $ | — | $ | (59 | ) | $ | — | $ | — | $ | 393 | |||||||||||
Summit | 147 | — | (18 | ) | — | (2 | ) | 127 | ||||||||||||||||
Kosciusko | 386 | — | (20 | ) | — | — | 366 | |||||||||||||||||
LaPorte | 980 | — | (40 | ) | — | (7 | ) | 933 | ||||||||||||||||
Lafayette | 933 | — | (118 | ) | — | (2 | ) | 813 | ||||||||||||||||
Wolverine | 2,267 | — | (387 | ) | — | (42 | ) | 1,838 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | $ | 5,165 | $ | — | $ | (642 | ) | $ | — | $ | (53 | ) | $ | 4,470 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, 2019 | ||||||||||||||||||||||||
Beginning balance | Additions | Accretion | Reclassification from nonaccretable difference | Disposals | Ending balance | |||||||||||||||||||
Heartland | $ | 174 | $ | — | $ | (24 | ) | $ | — | $ | — | $ | 150 | |||||||||||
Summit | 42 | — | (7 | ) | — | (11 | ) | 24 | ||||||||||||||||
Kosciusko | 300 | — | (49 | ) | — | (2 | ) | 249 | ||||||||||||||||
LaPorte | 829 | — | (85 | ) | — | 4 | 748 | |||||||||||||||||
Lafayette | 609 | — | (97 | ) | — | (193 | ) | 319 | ||||||||||||||||
Wolverine | 698 | — | (243 | ) | — | (306 | ) | 149 | ||||||||||||||||
Salin | — | 2,002 | (375 | ) | — | (30 | ) | 1,597 | ||||||||||||||||
Total | $ | 2,652 | $ | 2,002 | $ | (880 | ) | $ | — | $ | (538 | ) | $ | 3,236 | ||||||||||
Nine Months Ended September 30, 2018 | ||||||||||||||||||||||||
Beginning balance | Additions | Accretion | Reclassification from nonaccretable difference | Disposals | Ending balance | |||||||||||||||||||
Heartland | $ | 452 | $ | — | $ | (68 | ) | $ | — | $ | (193 | ) | $ | 191 | ||||||||||
Summit | 147 | — | (34 | ) | — | (6 | ) | 107 | ||||||||||||||||
Kosciusko | 386 | — | (40 | ) | — | — | 346 | |||||||||||||||||
LaPorte | 980 | — | (75 | ) | — | (7 | ) | 898 | ||||||||||||||||
Lafayette | 933 | — | (176 | ) | — | (2 | ) | 755 | ||||||||||||||||
Wolverine | 2,267 | — | (538 | ) | — | (680 | ) | 1,049 | ||||||||||||||||
Total | $ | 5,165 | $ | — | $ | (931 | ) | $ | — | $ | (888 | ) | $ | 3,346 | ||||||||||
Three Months Ended March 31 | ||||||||
2019 | 2018 | |||||||
(Unaudited) | (Unaudited) | |||||||
Balance at beginning of the period | $ | 17,820 | $ | 16,394 | ||||
Loanscharged-off: | ||||||||
Commercial | ||||||||
Owner occupied real estate | 1 | 13 | ||||||
Non-owner occupied real estate | 64 | — | ||||||
Residential spec homes | — | — | ||||||
Development & spec land | — | — | ||||||
Commercial and industrial | 12 | — | ||||||
|
|
|
| |||||
Total commercial | 77 | 13 | ||||||
Real estate | ||||||||
Residential mortgage | — | 12 | ||||||
Residential construction | — | — | ||||||
Mortgage warehouse | — | — | ||||||
|
|
|
| |||||
Total real estate | — | 12 | ||||||
Consumer | ||||||||
Direct installment | 28 | 55 | ||||||
Indirect installment | 540 | 505 | ||||||
Home equity | 16 | 131 | ||||||
|
|
|
| |||||
Total consumer | 584 | 691 | ||||||
|
|
|
| |||||
Total loanscharged-off | 661 | 716 | ||||||
Recoveries of loans previouslycharged-off: | ||||||||
Commercial | ||||||||
Owner occupied real estate | — | 12 | ||||||
Non-owner occupied real estate | 6 | 5 | ||||||
Residential spec homes | 2 | 2 | ||||||
Development & spec land | — | — | ||||||
Commercial and industrial | 8 | 32 | ||||||
|
|
|
| |||||
Total commercial | 16 | 51 | ||||||
Real estate | ||||||||
Residential mortgage | 27 | 6 | ||||||
Residential construction | — | — | ||||||
Mortgage warehouse | — | — | ||||||
|
|
|
| |||||
Total real estate | 27 | 6 | ||||||
Consumer | ||||||||
Direct installment | 11 | 11 | ||||||
Indirect installment | 201 | 139 | ||||||
Home equity | 43 | 22 | ||||||
|
|
|
| |||||
Total consumer | 255 | 172 | ||||||
|
|
|
| |||||
Total loan recoveries | 298 | 229 | ||||||
|
|
|
| |||||
Net loanscharged-off | 363 | 487 | ||||||
|
|
|
| |||||
Provision charged to operating expense | ||||||||
Commercial | 1,122 | (1,291 | ) | |||||
Real estate | (107 | ) | (252 | ) | ||||
Consumer | (651 | ) | 2,110 | |||||
|
|
|
| |||||
Total provision charged to operating expense | 364 | 567 | ||||||
|
|
|
| |||||
Balance at the end of the period | $ | 17,821 | $ | 16,474 | ||||
|
|
|
|
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30 | September 30 | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
Balance at beginning of the period | $ | 18,305 | $ | 17,071 | $ | 17,820 | $ | 16,394 | ||||||||
Loans charged-off: | ||||||||||||||||
Commercial | ||||||||||||||||
Owner occupied real estate | 9 | 97 | 346 | 110 | ||||||||||||
Non-owner occupied real estate | — | — | 64 | — | ||||||||||||
Residential spec homes | — | — | 3 | — | ||||||||||||
Development & spec land | — | — | — | — | ||||||||||||
Commercial and industrial | 215 | 109 | 227 | 109 | ||||||||||||
Total commercial | 224 | 206 | 640 | 219 | ||||||||||||
Real estate | ||||||||||||||||
Residential mortgage | — | 2 | 48 | 17 | ||||||||||||
Residential construction | — | — | — | — | ||||||||||||
Mortgage warehouse | — | — | — | — | ||||||||||||
Total real estate | — | 2 | 48 | 17 | ||||||||||||
Consumer | ||||||||||||||||
Direct installment | 69 | 20 | 134 | 124 | ||||||||||||
Indirect installment | 601 | 432 | 1,392 | 1,302 | ||||||||||||
Home equity | 88 | 11 | 143 | 142 | ||||||||||||
Total consumer | 758 | 463 | 1,669 | 1,568 | ||||||||||||
Total loans charged-off | 982 | 671 | 2,357 | 1,804 | ||||||||||||
Recoveries of loans previously charged-off: | ||||||||||||||||
Commercial | ||||||||||||||||
Owner occupied real estate | 9 | 7 | 9 | 19 | ||||||||||||
Non-owner occupied real estate | 5 | 5 | 15 | 22 | ||||||||||||
Residential spec homes | 2 | 2 | 5 | 6 | ||||||||||||
Development & spec land | — | — | — | — | ||||||||||||
Commercial and industrial | 16 | 13 | 93 | 71 | ||||||||||||
Total commercial | 32 | 27 | 122 | 118 | ||||||||||||
Real estate | ||||||||||||||||
Residential mortgage | 7 | 4 | 41 | 15 | ||||||||||||
Residential construction | — | — | — | — | ||||||||||||
Mortgage warehouse | — | — | — | — | ||||||||||||
Total real estate | 7 | 4 | 41 | 15 | ||||||||||||
Consumer | ||||||||||||||||
Direct installment | 24 | 10 | 47 | 42 | ||||||||||||
Indirect installment | 129 | 107 | 512 | 378 | ||||||||||||
Home equity | 65 | 74 | 135 | 277 | ||||||||||||
Total consumer | 218 | 191 | 694 | 697 | ||||||||||||
Total loan recoveries | 257 | 222 | 857 | 830 | ||||||||||||
Net loans charged-off | 725 | 449 | 1,500 | 974 | ||||||||||||
Provision charged to operating expense | ||||||||||||||||
Commercial | 393 | 1,895 | 2,105 | 1,589 | ||||||||||||
Real estate | (289 | ) | (243 | ) | (185 | ) | (612 | ) | ||||||||
Consumer | 272 | (476 | ) | (284 | ) | 1,401 | ||||||||||
Total provision charged to operating expense | 376 | 1,176 | 1,636 | 2,378 | ||||||||||||
Balance at the end of the period | $ | 17,956 | $ | 17,798 | $ | 17,956 | $ | 17,798 | ||||||||
March 31, 2019 | ||||||||||||||||||||
Mortgage | ||||||||||||||||||||
Commercial | Real Estate | Warehousing | Consumer | Total | ||||||||||||||||
Allowance For Loan Losses | ||||||||||||||||||||
Ending allowance balance attributable to loans: | ||||||||||||||||||||
Individually evaluated for impairment | $ | 915 | $ | — | $ | — | $ | — | $ | 915 | ||||||||||
Collectively evaluated for impairment | 10,641 | 1,588 | 1,014 | 3,663 | 16,906 | |||||||||||||||
Loans acquired with deteriorated credit quality | — | — | — | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total ending allowance balance | $ | 11,556 | $ | 1,588 | $ | 1,014 | $ | 3,663 | $ | 17,821 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Loans: | ||||||||||||||||||||
Individually evaluated for impairment | $ | 6,233 | $ | — | $ | — | $ | — | $ | 6,233 | ||||||||||
Collectively evaluated for impairment | 2,087,011 | 821,767 | 71,944 | 637,206 | 3,617,928 | |||||||||||||||
Loans acquired with deteriorated credit quality | — | — | — | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total ending loans balance | $ | 2,093,244 | $ | 821,767 | $ | 71,944 | $ | 637,206 | $ | 3,624,161 | ||||||||||
|
|
|
|
|
|
|
|
|
|
September 30, 2019 | ||||||||||||||||||||
Commercial | Real Estate | Mortgage Warehousing | Consumer | Total | ||||||||||||||||
Allowance For Loan Losses | ||||||||||||||||||||
Ending allowance balance attributable to loans: | ||||||||||||||||||||
Individually evaluated for impairment | $ | 906 | $ | — | $ | — | $ | — | $ | 906 | ||||||||||
Collectively evaluated for impairment | 11,176 | 1,449 | 1,041 | 3,384 | 17,050 | |||||||||||||||
Loans acquired with deteriorated credit quality | — | — | — | — | — | |||||||||||||||
Total ending allowance balance | $ | 12,082 | $ | 1,449 | $ | 1,041 | $ | 3,384 | $ | 17,956 | ||||||||||
Loans: | ||||||||||||||||||||
Individually evaluated for impairment | $ | 8,194 | $ | — | $ | — | $ | — | $ | 8,194 | ||||||||||
Collectively evaluated for impairment | 2,039,841 | 796,485 | 155,631 | 665,192 | 3,657,149 | |||||||||||||||
Loans acquired with deteriorated credit quality | — | — | — | — | — | |||||||||||||||
Total ending loans balance | $ | 2,048,035 | $ | 796,485 | $ | 155,631 | $ | 665,192 | $ | 3,665,343 | ||||||||||
December 31, 2018 | ||||||||||||||||||||
Mortgage | ||||||||||||||||||||
Commercial | Real Estate | Warehousing | Consumer | Total | ||||||||||||||||
Allowance For Loan Losses | ||||||||||||||||||||
Ending allowance balance attributable to loans: | ||||||||||||||||||||
Individually evaluated for impairment | $ | 1,035 | $ | — | $ | — | $ | — | $ | 1,035 | ||||||||||
Collectively evaluated for impairment | 9,460 | 1,676 | 1,006 | 4,643 | 16,785 | |||||||||||||||
Loans acquired with deteriorated credit quality | — | — | — | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total ending allowance balance | $ | 10,495 | $ | 1,676 | $ | 1,006 | $ | 4,643 | $ | 17,820 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Loans: | ||||||||||||||||||||
Individually evaluated for impairment | $ | 6,708 | $ | — | $ | — | $ | — | $ | 6,708 | ||||||||||
Collectively evaluated for impairment | 1,718,661 | 670,166 | 74,120 | 547,116 | 3,010,063 | |||||||||||||||
Loans acquired with deteriorated credit quality | — | — | — | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total ending loans balance | $ | 1,725,369 | $ | 670,166 | $ | 74,120 | $ | 547,116 | $ | 3,016,771 | ||||||||||
|
|
|
|
|
|
|
|
|
|
December 31, 2018 | ||||||||||||||||||||
Commercial | Real Estate | Mortgage Warehousing | Consumer | Total | ||||||||||||||||
Allowance For Loan Losses | ||||||||||||||||||||
Ending allowance balance attributable to loans: | ||||||||||||||||||||
Individually evaluated for impairment | $ | 1,035 | $ | — | $ | — | $ | — | $ | 1,035 | ||||||||||
Collectively evaluated for impairment | 9,460 | 1,676 | 1,006 | 4,643 | 16,785 | |||||||||||||||
Loans acquired with deteriorated credit quality | — | — | — | — | — | |||||||||||||||
Total ending allowance balance | $ | 10,495 | $ | 1,676 | $ | 1,006 | $ | 4,643 | $ | 17,820 | ||||||||||
Loans: | ||||||||||||||||||||
Individually evaluated for impairment | $ | 6,695 | $ | — | $ | — | $ | — | $ | 6,695 | ||||||||||
Collectively evaluated for impairment | 1,716,840 | 668,124 | 74,120 | 546,774 | 3,005,858 | |||||||||||||||
Loans acquired with deteriorated credit quality | — | — | — | — | — | |||||||||||||||
Total ending loans balance | $ | 1,723,535 | $ | 668,124 | $ | 74,120 | $ | 546,774 | $ | 3,012,553 | ||||||||||
March 31, 2019 | ||||||||||||||||||||
Loans Past | ||||||||||||||||||||
Due Over 90 | Total | |||||||||||||||||||
Days Still | Non-peforming | Performing | Non-performing | |||||||||||||||||
Non-accrual | Accruing | TDRs | TDRs | Loans | ||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | $ | 3,372 | $ | — | $ | 389 | $ | 139 | $ | 3,900 | ||||||||||
Non-owner occupied real estate | 3,041 | — | 404 | 314 | 3,759 | |||||||||||||||
Residential spec homes | 261 | — | — | — | 261 | |||||||||||||||
Development & spec land | 177 | — | — | — | 177 | |||||||||||||||
Commercial and industrial | 1,653 | — | — | — | 1,653 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total commercial | 8,504 | — | 793 | 453 | 9,750 | |||||||||||||||
Real estate | ||||||||||||||||||||
Residential mortgage | 3,691 | 140 | 416 | 1,748 | 5,995 | |||||||||||||||
Residential construction | — | — | — | — | — | |||||||||||||||
Mortgage warehouse | — | — | — | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total real estate | 3,691 | 140 | 416 | 1,748 | 5,995 | |||||||||||||||
Consumer | ||||||||||||||||||||
Direct installment | 55 | 17 | — | — | 72 | |||||||||||||||
Indirect installment | 986 | 30 | — | — | 1,016 | |||||||||||||||
Home equity | 2,077 | 5 | 140 | 331 | 2,553 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total consumer | 3,118 | 52 | 140 | 331 | 3,641 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | $ | 15,313 | $ | 192 | $ | 1,349 | $ | 2,532 | $ | 19,386 | ||||||||||
|
|
|
|
|
|
|
|
|
|
September 30, 2019 | ||||||||||||||||||||
Non-accrual | Loans Past Due Over 90 Days Still Accruing | Non-peforming TDRs | Performing TDRs | Total Non-performing Loans | ||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | $ | 3,320 | $ | — | $ | 629 | $ | 139 | $ | 4,088 | ||||||||||
Non-owner occupied real estate | 168 | — | 385 | — | 553 | |||||||||||||||
Residential spec homes | — | — | — | — | — | |||||||||||||||
Development & spec land | 140 | — | — | — | 140 | |||||||||||||||
Commercial and industrial | 1,989 | — | — | 1,423 | 3,412 | |||||||||||||||
Total commercial | 5,617 | — | 1,014 | 1,562 | 8,193 | |||||||||||||||
Real estate | ||||||||||||||||||||
Residential mortgage | 5,031 | 1 | 573 | 1,607 | 7,212 | |||||||||||||||
Residential construction | — | — | — | — | — | |||||||||||||||
Mortgage warehouse | — | — | — | — | — | |||||||||||||||
Total real estate | 5,031 | 1 | 573 | 1,607 | 7,212 | |||||||||||||||
Consumer | ||||||||||||||||||||
Direct installment | 77 | — | — | — | 77 | |||||||||||||||
Indirect installment | 1,121 | 33 | — | — | 1,154 | |||||||||||||||
Home equity | 1,977 | — | 220 | 322 | 2,519 | |||||||||||||||
Total consumer | 3,175 | 33 | 220 | 322 | 3,750 | |||||||||||||||
Total | $ | 13,823 | $ | 34 | $ | 1,807 | $ | 3,491 | $ | 19,155 | ||||||||||
December 31, 2018 | ||||||||||||||||||||
Loans Past | ||||||||||||||||||||
Due Over 90 | Total | |||||||||||||||||||
Days Still | Non-peforming | Performing | Non-performing | |||||||||||||||||
Non-accrual | Accruing | TDRs | TDRs | Loans | ||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | $ | 3,413 | $ | — | $ | — | $ | 109 | $ | 3,522 | ||||||||||
Non-owner occupied real estate | 554 | — | 492 | — | 1,046 | |||||||||||||||
Residential spec homes | — | — | — | — | — | |||||||||||||||
Development & spec land | 68 | — | — | — | 68 | |||||||||||||||
Commercial and industrial | 2,059 | 208 | — | — | 2,267 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total commercial | 6,094 | 208 | 492 | 109 | 6,903 | |||||||||||||||
Real estate | ||||||||||||||||||||
Residential mortgage | 2,846 | 180 | 423 | 1,558 | 5,007 | |||||||||||||||
Residential construction | — | — | — | — | — | |||||||||||||||
Mortgage warehouse | — | — | — | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total real estate | 2,846 | 180 | 423 | 1,558 | 5,007 | |||||||||||||||
Consumer | ||||||||||||||||||||
Direct installment | 35 | — | — | — | 35 | |||||||||||||||
Indirect installment | 916 | 173 | — | — | 1,089 | |||||||||||||||
Home equity | 1,657 | 7 | 142 | 335 | 2,141 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total consumer | 2,608 | 180 | 142 | 335 | 3,265 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | $ | 11,548 | $ | 568 | $ | 1,057 | $ | 2,002 | $ | 15,175 | ||||||||||
|
|
|
|
|
|
|
|
|
|
December 31, 2018 | ||||||||||||||||||||
Non-accrual | Loans Past Due Over 90 Days Still Accruing | Non-peforming TDRs | Performing TDRs | Total Non-performing Loans | ||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | $ | 3,413 | $ | — | $ | — | $ | 109 | $ | 3,522 | ||||||||||
Non-owner occupied real estate | 554 | — | 492 | — | 1,046 | |||||||||||||||
Residential spec homes | — | — | — | — | — | |||||||||||||||
Development & spec land | 68 | — | — | — | 68 | |||||||||||||||
Commercial and industrial | 2,059 | 208 | — | — | 2,267 | |||||||||||||||
Total commercial | 6,094 | 208 | 492 | 109 | 6,903 | |||||||||||||||
Real estate | ||||||||||||||||||||
Residential mortgage | 2,846 | 180 | 423 | 1,558 | 5,007 | |||||||||||||||
Residential construction | — | — | — | — | — | |||||||||||||||
Mortgage warehouse | — | — | — | — | — | |||||||||||||||
Total real estate | 2,846 | 180 | 423 | 1,558 | 5,007 | |||||||||||||||
Consumer | ||||||||||||||||||||
Direct installment | 35 | — | — | — | 35 | |||||||||||||||
Indirect installment | 916 | 173 | — | — | 1,089 | |||||||||||||||
Home equity | 1,657 | 7 | 142 | 335 | 2,141 | |||||||||||||||
Total consumer | 2,608 | 180 | 142 | 335 | 3,265 | |||||||||||||||
Total | $ | 11,548 | $ | 568 | $ | 1,057 | $ | 2,002 | $ | 15,175 | ||||||||||
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
March 31, 2019 | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
Unpaid | Allowance for | Average Balance in | Cash/Accrual Interest | |||||||||||||||||
Principal | Recorded | Loan Loss | Impaired | Income | ||||||||||||||||
Balance | Investment | Allocated | Loans | Recognized | ||||||||||||||||
With no recorded allowance Commercial | ||||||||||||||||||||
Owner occupied real estate | $ | 3,275 | $ | 3,269 | $ | — | $ | 3,650 | $ | 60 | ||||||||||
Non-owner occupied real estate | 840 | 869 | — | 875 | 32 | |||||||||||||||
Residential spec homes | 261 | 261 | — | 261 | 3 | |||||||||||||||
Development & spec land | 66 | 64 | — | 65 | — | |||||||||||||||
Commercial and industrial | 656 | 648 | — | 668 | 7 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total commercial | 5,098 | 5,111 | — | 5,519 | 102 | |||||||||||||||
With an allowance recorded | ||||||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | 355 | 355 | 25 | 358 | — | |||||||||||||||
Non-owner occupied real estate | 135 | 135 | 40 | 135 | — | |||||||||||||||
Residential spec homes | — | — | — | — | — | |||||||||||||||
Development & spec land | — | — | — | — | — | |||||||||||||||
Commercial and industrial | 632 | 632 | 850 | 632 | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total commercial | 1,122 | 1,122 | 915 | 1,125 | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | $ | 6,220 | $ | 6,233 | $ | 915 | $ | 6,644 | $ | 102 | ||||||||||
|
|
|
|
|
|
|
|
|
|
September 30, 2019 | ||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
Unpaid Principal Balance | | Recorded Investment | | Allowance for Loan Loss Allocated | | Average Balance in Impaired Loans | Cash/Accrual Interest Income Recognized | | Average Balance in Impaired Loans | Cash/Accrual Interest Income Recognized | ||||||||||||||||||
With no recorded allowance | ||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||
Owner occupied real estate | $ | 3,718 | $ | 3,719 | $ | — | $ | 5,854 | $ | 83 | $ | 5,895 | $ | 259 | ||||||||||||||
Non-owner occupied real estate | 427 | 427 | — | 459 | 8 | 504 | 15 | |||||||||||||||||||||
Residential spec homes | — | — | — | — | — | — | — | |||||||||||||||||||||
Development & spec land | 140 | 140 | — | 225 | 1 | 224 | 3 | |||||||||||||||||||||
Commercial and industrial | 1,876 | 1,879 | — | 2,419 | 71 | 2,429 | 83 | |||||||||||||||||||||
Total commercial | 6,161 | 6,165 | — | 8,957 | 163 | 9,052 | 360 | |||||||||||||||||||||
With an allowance recorded | ||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||
Owner occupied real estate | 370 | 370 | 3 | 371 | 4 | 367 | 14 | |||||||||||||||||||||
Non-owner occupied real estate | 126 | 126 | 35 | 130 | — | 133 | — | |||||||||||||||||||||
Residential spec homes | — | — | — | — | — | — | — | |||||||||||||||||||||
Development & spec land | — | — | — | — | — | — | — | |||||||||||||||||||||
Commercial and industrial | 1,537 | 1,537 | 868 | 1,563 | 30 | 1,589 | 51 | |||||||||||||||||||||
Total commercial | 2,033 | 2,033 | 906 | 2,064 | 34 | 2,089 | 65 | |||||||||||||||||||||
Total | $ | 8,194 | $ | 8,198 | $ | 906 | $ | 11,021 | $ | 197 | $ | 11,141 | $ | 425 | ||||||||||||||
March 31, 2018 | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
Unpaid Principal Balance | Recorded Investment | Allowance for Loan Loss Allocated | Average Balance in Impaired Loans | Cash/Accrual Interest Income Rec Recognized | ||||||||||||||||
With no recorded allowance | ||||||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | $ | 4,038 | $ | 4,063 | $ | — | $ | 4,590 | $ | 37 | ||||||||||
Non-owner occupied real estate | 1,033 | 1,049 | — | 975 | 5 | |||||||||||||||
Residential spec homes | — | — | — | — | — | |||||||||||||||
Development & spec land | 76 | 74 | — | 75 | — | |||||||||||||||
Commercial and industrial | 737 | 745 | — | 1,447 | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total commercial | 5,884 | 5,931 | — | 7,087 | 42 | |||||||||||||||
With an allowance recorded | ||||||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | 893 | 893 | 184 | 900 | — | |||||||||||||||
Non-owner occupied real estate | — | — | — | — | — | |||||||||||||||
Residential spec homes | — | — | — | — | — | |||||||||||||||
Development & spec land | — | — | — | — | — | |||||||||||||||
Commercial and industrial | — | — | — | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total commercial | 893 | 893 | 184 | 900 | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | $ | 6,777 | $ | 6,824 | $ | 184 | $ | 7,987 | $ | 42 | ||||||||||
|
|
|
|
|
|
|
|
|
|
September 30, 2018 | ||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
Unpaid Principal Balance | Recorded Investment | Allowance for Loan Loss Allocated | Average Balance in Impaired Loans | Cash/Accrual Interest Income Recognized | Average Balance in Impaired Loans | Cash/Accrual Interest Income Recognized | ||||||||||||||||||||||
With no recorded allowance | ||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||
Owner occupied real estate | $ | 4,496 | $ | 4,490 | $ | — | $ | 5,014 | $ | (25 | ) | $ | 5,077 | $ | 71 | |||||||||||||
Non-owner occupied real estate | 841 | 857 | — | 936 | (5 | ) | 1,119 | 5 | ||||||||||||||||||||
Residential spec homes | — | — | — | — | — | — | — | |||||||||||||||||||||
Development & spec land | 71 | 69 | — | 69 | — | 72 | — | |||||||||||||||||||||
Commercial and industrial | 1,165 | 1,160 | — | 1,418 | 5 | 1,241 | 12 | |||||||||||||||||||||
Total commercial | 6,573 | 6,576 | — | 7,437 | (25 | ) | 7,509 | 88 | ||||||||||||||||||||
With an allowance recorded | ||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||
Owner occupied real estate | 845 | 845 | 145 | 852 | — | 874 | — | |||||||||||||||||||||
Non-owner occupied real estate | 187 | 187 | 30 | 189 | 4 | 178 | 4 | |||||||||||||||||||||
Residential spec homes | — | — | — | — | — | — | — | |||||||||||||||||||||
Development & spec land | — | — | — | — | — | — | — | |||||||||||||||||||||
Commercial and industrial | 750 | 750 | 749 | 750 | 4 | 750 | 4 | |||||||||||||||||||||
Total commercial | 1,782 | 1,782 | 924 | 1,791 | 8 | 1,802 | 8 | |||||||||||||||||||||
Total | $ | 8,355 | $ | 8,358 | $ | 924 | $ | 9,228 | $ | (17 | ) | $ | 9,311 | $ | 96 | |||||||||||||
March 31, 2019 | ||||||||||||||||||||||||||||
Current | 30-59 Days Past Due | 60-89 Days Past Due | 90 Days or Greater Past Due | Non-accrual | Total Past Due & Non-accrual Loans | Total | ||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||
Owner occupied real estate | $ | 672,729 | $ | 27 | $ | — | $ | — | $ | 3,761 | $ | 3,788 | $ | 676,517 | ||||||||||||||
Non-owner occupied real estate | 827,610 | 2,386 | 362 | — | 3,445 | 6,193 | 833,803 | |||||||||||||||||||||
Residential spec homes | 9,469 | 491 | — | — | 261 | 752 | 10,221 | |||||||||||||||||||||
Development & spec land | 74,885 | 17 | — | — | 177 | 194 | 75,079 | |||||||||||||||||||||
Commercial and industrial | 493,723 | 1,616 | 632 | — | 1,653 | 3,901 | 497,624 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total commercial | 2,078,416 | 4,537 | 994 | — | 9,297 | 14,828 | 2,093,244 | |||||||||||||||||||||
Real estate | ||||||||||||||||||||||||||||
Residential mortgage | 790,848 | 1,910 | 169 | 140 | 4,107 | 6,326 | 797,174 | |||||||||||||||||||||
Residential construction | 24,593 | — | — | — | — | — | 24,593 | |||||||||||||||||||||
Mortgage warehouse | 71,944 | — | — | — | — | — | 71,944 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total real estate | 887,385 | 1,910 | 169 | 140 | 4,107 | 6,326 | 893,711 | |||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||
Direct installment | 37,345 | 67 | 48 | 17 | 55 | 72 | 37,417 | |||||||||||||||||||||
Indirect installment | 316,613 | 906 | 129 | 30 | 986 | 1,016 | 317,629 | |||||||||||||||||||||
Home equity | 279,938 | 956 | 264 | 5 | 2,217 | 2,222 | 282,160 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total consumer | 633,896 | 1,929 | 441 | 52 | 3,258 | 3,310 | 637,206 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total | $ | 3,599,697 | $ | 8,376 | $ | 1,604 | $ | 192 | $ | 16,662 | $ | 24,464 | $ | 3,624,161 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Percentage of total loans | 99.32 | % | 0.23 | % | 0.04 | % | 0.01 | % | 0.46 | % | 0.68 | % |
September 30, 2019 | ||||||||||||||||||||||||||||
Current | 30-59 DaysPast Due | 60-89 DaysPast Due | 90 Days or Greater Past Due | Non-accrual | Total Past Due & Non-accrual Loans | Total | ||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||
Owner occupied real estate | $ | 718,761 | $ | 508 | $ | — | $ | — | $ | 3,949 | $ | 4,457 | $ | 723,218 | ||||||||||||||
Non-owner occupied real estate | 764,987 | 778 | 256 | — | 553 | 1,587 | 766,574 | |||||||||||||||||||||
Residential spec homes | 10,813 | — | — | — | — | — | 10,813 | |||||||||||||||||||||
Development & spec land | 36,055 | 920 | — | — | 140 | 1,060 | 37,115 | |||||||||||||||||||||
Commercial and industrial | 506,893 | 767 | 666 | — | 1,989 | 3,422 | 510,315 | |||||||||||||||||||||
Total commercial | 2,037,509 | 2,973 | 922 | — | 6,631 | 10,526 | 2,048,035 | |||||||||||||||||||||
Real estate | ||||||||||||||||||||||||||||
Residential mortgage | 764,308 | 3,531 | — | 1 | 5,604 | 9,136 | 773,444 | |||||||||||||||||||||
Residential construction | 23,041 | — | — | — | — | — | 23,041 | |||||||||||||||||||||
Mortgage warehouse | 155,631 | — | — | — | — | — | 155,631 | |||||||||||||||||||||
Total real estate | 942,980 | 3,531 | — | 1 | 5,604 | 9,136 | 952,116 | |||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||
Direct installment | 41,843 | 124 | 4 | — | 77 | 205 | 42,048 | |||||||||||||||||||||
Indirect installment | 341,554 | 1,427 | 432 | 33 | 1,121 | 3,013 | 344,567 | |||||||||||||||||||||
Home equity | 275,589 | 600 | 191 | — | 2,197 | 2,988 | 278,577 | |||||||||||||||||||||
Total consumer | 658,986 | 2,151 | 627 | 33 | 3,395 | 6,206 | 665,192 | |||||||||||||||||||||
Total | $ | 3,639,475 | $ | 8,655 | $ | 1,549 | $ | 34 | $ | 15,630 | $ | 25,868 | $ | 3,665,343 | ||||||||||||||
Percentage of total loans | 99.29 | % | 0.24 | % | 0.04 | % | 0.00 | % | 0.43 | % | 0.71 | % | 100.00 | % |
December 31, 2018 | ||||||||||||||||||||||||||||
Current | 30-59 Days Past Due | 60-89 Days Past Due | 90 Days or Greater Past Due | Non-accrual | Total Past Due & Non-accrual Loans | Total | ||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||
Owner occupied real estate | $ | 556,516 | $ | 537 | $ | 997 | $ | — | $ | 3,413 | $ | 4,947 | $ | 561,463 | ||||||||||||||
Non-owner occupied real estate | 716,574 | 175 | 19 | — | 1,046 | 1,240 | 717,814 | |||||||||||||||||||||
Residential spec homes | 4,707 | 492 | — | — | — | 492 | 5,199 | |||||||||||||||||||||
Development & spec land | 46,479 | — | — | — | 68 | 68 | 46,547 | |||||||||||||||||||||
Commercial and industrial | 390,828 | 515 | 736 | 208 | 2,059 | 3,518 | 394,346 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total commercial | 1,715,104 | 1,719 | 1,752 | 208 | 6,586 | 10,265 | 1,725,369 | |||||||||||||||||||||
Real estate | ||||||||||||||||||||||||||||
Residential mortgage | 641,500 | 1,131 | 56 | 180 | 3,269 | 4,636 | 646,136 | |||||||||||||||||||||
Residential construction | 24,030 | — | — | — | — | — | 24,030 | |||||||||||||||||||||
Mortgage warehouse | 74,120 | — | — | — | — | — | 74,120 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total real estate | 739,650 | 1,131 | 56 | 180 | 3,269 | 4,636 | 744,286 | |||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||
Direct installment | 38,027 | 93 | 18 | — | 35 | 146 | 38,173 | |||||||||||||||||||||
Indirect installment | 311,494 | 1,396 | 198 | 173 | 916 | 2,683 | 314,177 | |||||||||||||||||||||
Home equity | 192,162 | 761 | 37 | 7 | 1,799 | 2,604 | 194,766 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total consumer | 541,794 | 2,250 | 253 | 180 | 2,750 | 5,433 | 547,116 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total | $ | 2,996,548 | $ | 5,100 | $ | 2,061 | $ | 568 | $ | 12,605 | $ | 20,334 | $ | 3,016,771 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Percentage of total loans | 99.33 | % | 0.17 | % | 0.07 | % | 0.02 | % | 0.42 | % | 0.67 | % |
December 31, 2018 | ||||||||||||||||||||||||||||
Current | 30-59 DaysPast Due | 60-89 DaysPast Due | 90 Days or Greater Past Due | Non-accrual | Total Past Due & Non-accrual Loans | Total | ||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||
Owner occupied real estate | $ | 558,982 | $ | 537 | $ | 997 | $ | — | $ | 3,413 | $ | 4,947 | $ | 563,929 | ||||||||||||||
Non-owner occupied real estate | 712,896 | 175 | 19 | — | 1,046 | 1,240 | 714,136 | |||||||||||||||||||||
Residential spec homes | 4,703 | 492 | — | — | — | 492 | 5,195 | |||||||||||||||||||||
Development & spec land | 46,455 | — | — | — | 68 | 68 | 46,523 | |||||||||||||||||||||
Commercial and industrial | 390,234 | 515 | 736 | 208 | 2,059 | 3,518 | 393,752 | |||||||||||||||||||||
Total commercial | 1,713,270 | 1,719 | 1,752 | 208 | 6,586 | 10,265 | 1,723,535 | |||||||||||||||||||||
Real estate | ||||||||||||||||||||||||||||
Residential mortgage | 639,458 | 1,131 | 56 | 180 | 3,269 | 4,636 | 644,094 | |||||||||||||||||||||
Residential construction | 24,030 | — | — | — | — | — | 24,030 | |||||||||||||||||||||
Mortgage warehouse | 74,120 | — | — | — | — | — | 74,120 | |||||||||||||||||||||
Total real estate | 737,608 | 1,131 | 56 | 180 | 3,269 | 4,636 | 742,244 | |||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||
Direct installment | 34,087 | 93 | 18 | — | 35 | 146 | 34,233 | |||||||||||||||||||||
Indirect installment | 311,494 | 1,396 | 198 | 173 | 916 | 2,683 | 314,177 | |||||||||||||||||||||
Home equity | 195,760 | 761 | 37 | 7 | 1,799 | 2,604 | 198,364 | |||||||||||||||||||||
Total consumer | 541,341 | 2,250 | 253 | 180 | 2,750 | 5,433 | 546,774 | |||||||||||||||||||||
Total | $ | 2,992,219 | $ | 5,100 | $ | 2,061 | $ | 568 | $ | 12,605 | $ | 20,334 | $ | 3,012,553 | ||||||||||||||
Percentage of total loans | 99.33 | % | 0.17 | % | 0.07 | % | 0.02 | % | 0.42 | % | 0.67 | % | 100.00 | % |
|
The loan has exhibited two or more years of satisfactory repayment with a reasonable reduction of the principal balance.
• | The loan has exhibited two or more years of satisfactory repayment with a reasonable reduction of the principal balance. |
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
September 30, 2019 | ||||||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | $ | 696,380 | $ | 7,776 | $ | 19,062 | $ | — | $ | 723,218 | ||||||||||
Non-owner occupied real estate | 751,995 | 5,654 | 8,925 | — | 766,574 | |||||||||||||||
Residential spec homes | 10,813 | — | — | — | 10,813 | |||||||||||||||
Development & spec land | 33,957 | — | 3,158 | — | 37,115 | |||||||||||||||
Commercial and industrial | 470,722 | 19,569 | 20,024 | — | 510,315 | |||||||||||||||
Total commercial | 1,963,867 | 32,999 | 51,169 | — | 2,048,035 | |||||||||||||||
Real estate | ||||||||||||||||||||
Residential mortgage | 766,233 | — | 7,211 | — | 773,444 | |||||||||||||||
Residential construction | 23,041 | — | — | — | 23,041 | |||||||||||||||
Mortgage warehouse | 155,631 | — | — | — | 155,631 | |||||||||||||||
Total real estate | 944,905 | — | 7,211 | — | 952,116 | |||||||||||||||
Consumer | ||||||||||||||||||||
Direct installment | 41,971 | — | 77 | — | 42,048 | |||||||||||||||
Indirect installment | 343,413 | — | 1,154 | — | 344,567 | |||||||||||||||
Home equity | 276,058 | — | 2,519 | — | 278,577 | |||||||||||||||
Total consumer | 661,442 | — | 3,750 | — | 665,192 | |||||||||||||||
Total | $ | 3,570,214 | $ | 32,999 | $ | 62,130 | $ | — | $ | 3,665,343 | ||||||||||
Percentage of total loans | 97.40 | % | 0.90 | % | 1.70 | % | 0.00 | % | 100.00 | % | ||||||||||
December 31, 2018 | ||||||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | $ | 540,643 | $ | 6,618 | $ | 16,668 | $ | — | $ | 563,929 | ||||||||||
Non-owner occupied real estate | 698,591 | 9,682 | 5,863 | — | 714,136 | |||||||||||||||
Residential spec homes | 5,195 | — | — | — | 5,195 | |||||||||||||||
Development & spec land | 46,358 | 97 | 68 | — | 46,523 | |||||||||||||||
Commercial and industrial | 379,013 | 6,655 | 8,084 | — | 393,752 | |||||||||||||||
Total commercial | 1,669,800 | 23,052 | 30,683 | — | 1,723,535 | |||||||||||||||
Real estate | ||||||||||||||||||||
Residential mortgage | 639,267 | — | 4,827 | — | 644,094 | |||||||||||||||
Residential construction | 24,030 | — | — | — | 24,030 | |||||||||||||||
Mortgage warehouse | 74,120 | — | — | — | 74,120 | |||||||||||||||
Total real estate | 737,417 | — | 4,827 | — | 742,244 | |||||||||||||||
Consumer | ||||||||||||||||||||
Direct installment | 34,198 | — | 35 | — | 34,233 | |||||||||||||||
Indirect installment | 313,088 | — | 1,089 | — | 314,177 | |||||||||||||||
Home equity | 196,223 | — | 2,141 | — | 198,364 | |||||||||||||||
Total consumer | 543,509 | — | 3,265 | — | 546,774 | |||||||||||||||
Total | $ | 2,950,726 | $ | 23,052 | $ | 38,775 | $ | — | $ | 3,012,553 | ||||||||||
Percentage of total loans | 97.95 | % | 0.77 | % | 1.29 | % | 0.00 | % | 100.00 | % |
The following table presents loans by credit grades.
March 31, 2019 | ||||||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | $ | 656,354 | $ | 5,046 | $ | 15,117 | $ | — | $ | 676,517 | ||||||||||
Non-owner occupied real estate | 815,974 | 9,048 | 8,781 | — | 833,803 | |||||||||||||||
Residential spec homes | 9,960 | — | 261 | — | 10,221 | |||||||||||||||
Development & spec land | 74,805 | 97 | 177 | — | 75,079 | |||||||||||||||
Commercial and industrial | 482,091 | 7,074 | 8,459 | — | 497,624 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total commercial | 2,039,184 | 21,265 | 32,795 | — | 2,093,244 | |||||||||||||||
Real estate | ||||||||||||||||||||
Residential mortgage | 791,663 | — | 5,511 | — | 797,174 | |||||||||||||||
Residential construction | 24,593 | — | — | — | 24,593 | |||||||||||||||
Mortgage warehouse | 71,944 | — | — | — | 71,944 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total real estate | 888,200 | — | 5,511 | — | 893,711 | |||||||||||||||
Consumer | ||||||||||||||||||||
Direct installment | 37,345 | — | 72 | — | 37,417 | |||||||||||||||
Indirect installment | 316,613 | — | 1,016 | — | 317,629 | |||||||||||||||
Home equity | 279,826 | — | 2,334 | — | 282,160 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total consumer | 633,784 | — | 3,422 | — | 637,206 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | $ | 3,561,168 | $ | 21,265 | $ | 41,728 | $ | — | $ | 3,624,161 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Percentage of total loans | 98.26 | % | 0.59 | % | 1.15 | % | 0.00 | % |
December 31, 2018 | ||||||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||
Commercial | ||||||||||||||||||||
Owner occupied real estate | $ | 538,177 | $ | 6,618 | $ | 16,668 | $ | — | $ | 561,463 | ||||||||||
Non-owner occupied real estate | 702,269 | 9,682 | 5,863 | — | 717,814 | |||||||||||||||
Residential spec homes | 5,199 | — | — | — | 5,199 | |||||||||||||||
Development & spec land | 46,382 | 97 | 68 | — | 46,547 | |||||||||||||||
Commercial and industrial | 379,607 | 6,655 | 8,084 | — | 394,346 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total commercial | 1,671,634 | 23,052 | 30,683 | — | 1,725,369 | |||||||||||||||
Real estate | ||||||||||||||||||||
Residential mortgage | 641,309 | — | 4,827 | — | 646,136 | |||||||||||||||
Residential construction | 24,030 | — | — | — | 24,030 | |||||||||||||||
Mortgage warehouse | 74,120 | — | — | — | 74,120 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total real estate | 739,459 | — | 4,827 | — | 744,286 | |||||||||||||||
Consumer | ||||||||||||||||||||
Direct installment | 38,138 | — | 35 | — | 38,173 | |||||||||||||||
Indirect installment | 313,088 | — | 1,089 | — | 314,177 | |||||||||||||||
Home equity | 192,625 | — | 2,141 | — | 194,766 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total consumer | 543,851 | — | 3,265 | — | 547,116 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | $ | 2,954,944 | $ | 23,052 | $ | 38,775 | $ | — | $ | 3,016,771 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Percentage of total loans | 97.95 | % | 0.76 | % | 1.29 | % | 0.00 | % |
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
Operating leases are recorded as a right-of-use (“ROU”) asset and operating lease liability, included in other assets and other liabilities, respectively, on the consolidated balance sheet beginning
Operating lease expense, which is comprised of amortization of the ROU asset and the implicit interest accreted on the operating liability, is recognized on a straight-line basis over the lease term, and is recorded primarily in net occupancy expense in the consolidated statements of income.
The
Year | Amount | |||
2020 | $ | 484 | ||
2021 | 476 | |||
2022 | 483 | |||
2023 | 504 | |||
2024 and thereafter | 1,483 | |||
|
| |||
Total lease payments | $ | 3,430 | ||
|
| |||
Less: Interest | (180 | ) | ||
|
| |||
Present value of lease liabilities | $ | 3,250 | ||
|
|
Year | Amount | |||
2019 | $ | 119 | ||
2020 | 476 | |||
2021 | 476 | |||
2022 | 504 | |||
2023 and thereafter | 1,609 | |||
Total lease payments | $ | 3,184 | ||
Less: Interest | (170 | ) | ||
Present value of lease liabilities | $ | 3,014 | ||
March 31, 2019 | ||||||||||||||||||||||||||||
Remaining Contractual Maturity of the Agreements | ||||||||||||||||||||||||||||
Overnight and Continuous | Up to one year | One to three years | Three to five years | Five to ten years | Beyond ten years | Total | ||||||||||||||||||||||
Repurchase Agreements andrepurchase-to-maturity transactions | ||||||||||||||||||||||||||||
Repurchase Agreements | $ | 90,885 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 90,885 | ||||||||||||||
Securities pledged for Repurchase Agreements | ||||||||||||||||||||||||||||
Federal agency collateralized mortgage obligations | $ | 33,798 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 33,798 | ||||||||||||||
Federal agency mortgage-backed pools | 87,795 | — | — | — | — | — | 87,795 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total | $ | 121,593 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 121,593 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2019 | ||||||||||||||||||||||||||||
Remaining Contractual Maturity of the Agreements | ||||||||||||||||||||||||||||
Overnight and Continuous | Up to one year | One to three years | Three to five years | Five to ten years | Beyond ten years | Total | ||||||||||||||||||||||
Repurchase Agreements and repurchase-to-maturity transactions | ||||||||||||||||||||||||||||
Repurchase Agreements | $ | 97,301 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 97,301 | ||||||||||||||
Securities pledged for Repurchase Agreements | ||||||||||||||||||||||||||||
Federal agency collateralized mortgage obligations | $ | 33,579 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 33,579 | ||||||||||||||
Federal agency mortgage-backed pools | 76,002 | — | — | — | — | — | 76,002 | |||||||||||||||||||||
Total | $ | 109,581 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 109,581 | ||||||||||||||
Asset Derivatives March 31, 2019 | Liability Derivatives March 31, 2019 | |||||||||||||||
Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||
Derivatives designated as hedging instruments | ||||||||||||||||
Interest rate contracts | Loans | $ | — | Loans | $ | 4,093 | ||||||||||
Interest rate contracts | Other Assets | 4,093 | Other liabilities | 2,866 | ||||||||||||
|
|
|
| |||||||||||||
Total derivatives desginated as hedging instruments | 4,093 | 6,959 | ||||||||||||||
|
|
|
| |||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||
Mortgage loan contracts | Other assets | 392 | Other liabilities | — | ||||||||||||
|
|
|
| |||||||||||||
Total derivatives not designated as hedging instruments | 392 | — | ||||||||||||||
|
|
|
| |||||||||||||
Total derivatives | $ | 4,485 | $ | 6,959 | ||||||||||||
|
|
|
| |||||||||||||
|
|
|
| |||||||||||||
Asset Derivatives | Liability Derivatives | |||||||||||||||
December 31, 2018 | December 31, 2018 | |||||||||||||||
Balance Sheet | Fair | Balance Sheet | Fair | |||||||||||||
Location | Value | Location | Value | |||||||||||||
Derivatives designated as hedging instruments | ||||||||||||||||
Interest rate contracts | Loans | $ | — | Loans | $ | 42 | ||||||||||
Interest rate contracts | Other Assets | 42 | Other liabilities | 1,760 | ||||||||||||
|
|
|
| |||||||||||||
Total derivatives desginated as hedging instruments | 42 | 1,802 | ||||||||||||||
|
|
|
| |||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||
Mortgage loan contracts | Other assets | 135 | Other liabilities | — | ||||||||||||
|
|
|
| |||||||||||||
Total derivatives not designated as hedging instruments | 135 | — | ||||||||||||||
|
|
|
| |||||||||||||
Total derivatives | $ | 177 | $ | 1,802 | ||||||||||||
|
|
|
| |||||||||||||
|
|
|
|
Asset Derivatives | Liability Derivatives | |||||||||||||||
September 30, 2019 | September 30, 2019 | |||||||||||||||
Balance Sheet Location | | Fair Value | | Balance Sheet Location | | Fair Value | ||||||||||
Derivatives designated as hedging instruments | ||||||||||||||||
Interest rate contracts | Loans | $ | 17,713 | Loans | $ | — | ||||||||||
Interest rate contracts | Other Assets | — | Other liabilities | 23,343 | ||||||||||||
Total derivatives desginated as hedging instruments | 17,713 | 23,343 | ||||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||
Mortgage loan contracts | Other assets | 266 | Other liabilities | 228 | ||||||||||||
Total derivatives not designated as hedging instruments | 266 | 228 | ||||||||||||||
Total derivatives | $ | 17,979 | $ | 23,571 | ||||||||||||
Asset Derivatives | Liability Derivatives | |||||||||||||||
December 31, 2018 | December 31, 2018 | |||||||||||||||
Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||
Derivatives designated as hedging instruments | ||||||||||||||||
Interest rate contracts | Loans | $ | — | Loans | $ | 42 | ||||||||||
Interest rate contracts | Other Assets | 42 | Other liabilities | 1,760 | ||||||||||||
Total derivatives desginated as hedging instruments | 42 | 1,802 | ||||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||
Mortgage loan contracts | Other assets | 135 | Other liabilities | — | ||||||||||||
Total derivatives not designated as hedging instruments | 135 | — | ||||||||||||||
Total derivatives | $ | 177 | $ | 1,802 | ||||||||||||
Amount of Loss Recognized in Other | ||||||||
Comprehensive Income on Derivative | ||||||||
(Effective Portion) | ||||||||
Three Months Ended | ||||||||
March 31, 2019 | March 31, 2018 | |||||||
Derivatives in cash flow hedging relationship | ||||||||
Interest rate contracts | $ | (874 | ) | $ | 358 |
Amount of Loss Recognized in Other Comprehensive Income on Derivative (Effective Portion) | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, 2019 | September 30, 2018 | September 30, 2019 | September 30, 2018 | |||||||||||||
Derivatives in cash flow hedging relationship | ||||||||||||||||
Interest rate contracts | $ | (682 | ) | $ | 505 | $ | (3,058 | ) | $ | 1,384 |
Location of gain (loss) recognized on derivative | Amount of Gain (Loss) Recognized on Derivative Three Months Ended | |||||||||||
March 31, 2019 | March 31, 2018 | |||||||||||
Derivative in fair value hedging relationship | ||||||||||||
Interest rate contracts | Interest income -loans | $ | (4,051 | ) | $ | 2,768 | ||||||
Interest rate contracts | Interest income -loans | 4,051 | (2,768 | ) | ||||||||
|
|
|
| |||||||||
Total | $ | — | $ | — | ||||||||
|
|
|
| |||||||||
Location of gain (loss) recognized on derivative | Amount of Gain (Loss) Recognized on Derivative Three Months Ended | |||||||||||
March 31, 2019 | March 31, 2018 | |||||||||||
Derivative not designated as hedging relationship | ||||||||||||
Mortgage contracts | | Other income - gain on sale of loans |
| $ | 257 | $ | 112 |
Location of gain (loss) | Amount of Gain (Loss) Recognized on Derivative | |||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||
recognized on derivative | September 30, 2019 | | September 30, 2018 | | September 30, 2019 | September 30, 2018 | ||||||||||||||
Derivative in fair value hedging relationship | ||||||||||||||||||||
Interest rate contracts | Interest income - loans | $ | (6,091 | ) | $ | 2,768 | $ | (17,671 | ) | $ | 574 | |||||||||
Interest rate contracts | Interest income - loans | 6,091 | (2,768 | ) | 17,671 | (574 | ) | |||||||||||||
Total | $ | — | $ | — | $ | — | $ | — | ||||||||||||
Location of gain (loss) | Amount of Gain (Loss) Recognized on Derivative | |||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||
recognized on derivative | September 30, 2019 | September 30, 2018 | September 30, 2019 | September 30, 2018 | ||||||||||||||||
Derivative not designated as hedging relationship | ||||||||||||||||||||
Mortgage contracts | Other income - gain on sale of loans | $ | (429 | ) | $ | 112 | $ | (97 | ) | $ | 195 |
Level 1 Quoted prices in active markets for identical assets or liabilities
Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities
Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities
Level 1 | Quoted prices in active markets for identical assets or liabilities | |
Level 2 | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities | |
Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities |
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
with similar characteristics and, because many fixed-income securities do not trade on a daily basis, apply available information through processes such as benchmark curves, benchmarking of like securities, sector grouping, and matrix pricing. In addition, model processes, such as an option adjusted spread model, is used to develop prepayment and interest rate scenarios for securities with prepayment features.
March 31, 2019 | ||||||||||||||||
Fair Value | Quoted Prices in for Identical | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Available for sale securities | ||||||||||||||||
U.S. Treasury and federal agencies | $ | 13,995 | $ | — | $ | 13,995 | $ | — | ||||||||
State and municipal | 249,760 | — | 249,760 | �� | — | |||||||||||
Federal agency collateralized mortgage obligations | 213,043 | — | 213,043 | — | ||||||||||||
Federal agency mortgage-backed pools | 192,265 | — | 192,265 | — | ||||||||||||
Corporate notes | 18,079 | — | 18,079 | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total available for sale securities | 687,142 | — | 687,142 | — | ||||||||||||
Hedged loans | 234,325 | — | 234,325 | — | ||||||||||||
Forward sale commitments | 392 | — | 392 | — | ||||||||||||
Interest rate swap agreements | (6,958 | ) | — | (6,958 | ) | — | ||||||||||
Commitments to originate loans | — | — | — | — |
September 30, 2019 | ||||||||||||||||
Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Available for sale securities | ||||||||||||||||
U.S. Treasury and federal agencies | $ | 9,909 | $ | — | $ | 9,909 | $ | — | ||||||||
State and municipal | 347,101 | — | 347,101 | — | ||||||||||||
Federal agency collateralized mortgage obligations | 246,083 | — | 246,083 | — | ||||||||||||
Federal agency mortgage-backed pools | 145,597 | — | 145,597 | — | ||||||||||||
Corporate notes | 18,540 | — | 18,540 | — | ||||||||||||
Total available for sale securities | 767,230 | — | 767,230 | — | ||||||||||||
Hedged loans | 320,306 | — | 320,306 | — | ||||||||||||
Forward sale commitments | 266 | — | 266 | — | ||||||||||||
Interest rate swap agreements | (23,343 | ) | — | (23,343 | ) | — | ||||||||||
Commitments to originate loans | (228 | ) | — | (228 | ) | — | ||||||||||
December 31, 2018 | ||||||||||||||||
Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Available for sale securities | ||||||||||||||||
U.S. Treasury and federal agencies | $ | 16,608 | $ | — | $ | 16,608 | $ | — | ||||||||
State and municipal | 209,303 | — | 209,303 | — | ||||||||||||
Federal agency collateralized mortgage obligations | 185,003 | — | 185,003 | — | ||||||||||||
Federal agency mortgage-backed pools | 178,736 | — | 178,736 | — | ||||||||||||
Corporate notes | 10,698 | — | 10,698 | — | ||||||||||||
Total available for sale securities | 600,348 | — | 600,348 | — | ||||||||||||
Hedged loans | 209,161 | — | 209,161 | — | ||||||||||||
Forward sale commitments | 135 | — | 135 | — | ||||||||||||
Interest rate swap agreements | (1,801 | ) | — | (1,801 | ) | — | ||||||||||
Commitments to originate loans | — | — | — | — |
December 31, 2018 | ||||||||||||||||
Quoted Prices in | Significant | |||||||||||||||
Active Markets | Other | Significant | ||||||||||||||
for Identical | Observable | Unobservable | ||||||||||||||
Assets | Inputs | Inputs | ||||||||||||||
Fair Value | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
Available for sale securities | ||||||||||||||||
U.S. Treasury and federal agencies | $ | 16,608 | $ | — | $ | 16,608 | $ | — | ||||||||
State and municipal | 209,303 | — | 209,303 | — | ||||||||||||
Federal agency collateralized mortgage obligations | 185,003 | — | 185,003 | — | ||||||||||||
Federal agency mortgage-backed pools | 178,736 | — | 178,736 | — | ||||||||||||
Corporate notes | 10,698 | — | 10,698 | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total available for sale securities | 600,348 | — | 600,348 | — | ||||||||||||
Hedged loans | 209,161 | — | 209,161 | — | ||||||||||||
Forward sale commitments | 135 | — | 135 | — | ||||||||||||
Interest rate swap agreements | (1,801 | ) | — | (1,801 | ) | — | ||||||||||
Commitments to originate loans | — | — | — | — |
Non-interest Income | Three Months Ended | |||||||
Total gains and losses from: | March 31, 2019 | March 31, 2018 | ||||||
Hedged loans | $ | (4,051 | ) | $ | 2,768 | |||
Fair value interest rate swap agreements | 4,051 | (2,768 | ) | |||||
Derivative loan commitments | 257 | 112 | ||||||
|
|
|
| |||||
$ | 257 | $ | 112 | |||||
|
|
|
|
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, 2019 | September 30, 2018 | September 30, 2019 | September 30, 2018 | |||||||||||||
Non-interest Income | ||||||||||||||||
Total gains and losses from: | ||||||||||||||||
Hedged loans | $ | (6,091 | ) | $ | 364 | $ | (17,671 | ) | $ | 4,108 | ||||||
Fair value interest rate swap agreements | 6,091 | (364 | ) | 17,671 | (4,108 | ) | ||||||||||
Derivative loan commitments | (429 | ) | (184 | ) | (97 | ) | (1 | ) | ||||||||
$ | (429 | ) | $ | (184 | ) | $ | (97 | ) | $ | (1 | ) | |||||
Quoted Prices in | Significant | |||||||||||||||
Active Markets | Other | Significant | ||||||||||||||
for Identical | Observable | Unobservable | ||||||||||||||
Assets | Inputs | Inputs | ||||||||||||||
Fair Value | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
March 31, 2019 | ||||||||||||||||
Impaired loans | $ | 5,318 | $ | — | $ | — | $ | 5,318 | ||||||||
Mortgage servicing rights | 13,366 | — | — | 13,366 | ||||||||||||
December 31, 2018 | ||||||||||||||||
Impaired loans | $ | 5,661 | $ | — | $ | — | $ | 5,661 | ||||||||
Mortgage servicing rights | 12,349 | — | — | 12,349 |
Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
September 30, 2019 | ||||||||||||||||
Impaired loans | $ | 7,288 | $ | — | $ | — | $ | 7,288 | ||||||||
Mortgage servicing rights | 14,114 | — | — | 14,114 | ||||||||||||
December 31, 2018 | ||||||||||||||||
Impaired loans | $ | 5,661 | $ | — | $ | — | $ | 5,661 | ||||||||
Mortgage servicing rights | 12,349 | — | — | 12,349 |
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
March 31, 2019 | ||||||||||
Fair Value | Valuation Technique | Unobservable Inputs | Range (Weighted Average) | |||||||
Impaired loans | $ | 5,318 | Collateral based measurement | Discount to reflect current market conditions and ultimate collectability | 0%-100% (14.7%) | |||||
Discount rate, | 9.7%-10.0% (9.7%), | |||||||||
Mortgage servicing rights | 13,366 | Discounted cash flows | Constant prepayment rate, | 8.9%-21.8% (9.0%), | ||||||
Probability of default | 0.1%-3.1% (0.6%) | |||||||||
December 31, 2018 | ||||||||||
Fair | Valuation | Unobservable | Range | |||||||
Value | Technique | Inputs | (Weighted Average) | |||||||
Impaired loans | $ | 5,661 | Collateral based measurement | Discount to reflect current market conditions and ultimate collectability | 0%-100% (15.5%) | |||||
Mortgage servicing rights | 12,349 | Discounted cash flows | Discount rate, Constant prepayment rate, Probability of default | 10.2%-11.0% (10.3%), 9.1%-21.9% (9.3%), 0.1%-2.8% (0.6%) |
September 30, 2019 | |||||||||||||||
Fair | Valuation | Unobservable | Range | ||||||||||||
Value | Technique | | Inputs | (Weighted Average) | |||||||||||
Impaired loans | $ | 7,288 | Collateral based measurement | Discount to reflect current market conditions and ultimatecollectability | 0%-100% (11.1%) | ||||||||||
Mortgage servicing rights | 14,114 | Discounted cash flows | Discount rate, Constant prepayment rate, Probability of default | 9.7%-10.0% (9.8%),10.0%-22.7% (11.3%),0.0%-1.5% (0.6%) | |||||||||||
December 31, 2018 | |||||||||||||||
Fair | Valuation | Unobservable | Range | ||||||||||||
Value | Technique | Inputs | (Weighted Average) | ||||||||||||
Impaired loans | $ | 5,661 | Collateral based measurement | Discount to reflect current market conditions and ultimate collectability | 0%-100% (15.5%) | ||||||||||
Mortgage servicing rights | 12,349 | Discounted cash flows | Discount rate, Constant prepayment rate, Probability of default | 10.2%-11.0% (10.3%),9.1%-21.9% (9.3%),0.1%-2.8% (0.6%) |
Held-to-Maturity
the FHLB.
September 30, 2019 | ||||||||||||||||
Carrying Amount | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Assets | ||||||||||||||||
Cash and due from banks | $ | 91,279 | $ | 91,279 | $ | — | $ | — | ||||||||
Interest-earning time deposits | 8,455 | — | 8,536 | — | ||||||||||||
Investment securities, held to maturity | 210,306 | — | 217,718 | — | ||||||||||||
Loans held for sale | 1,060 | — | — | 1,060 | ||||||||||||
Loans (excluding loan level hedges), net | 3,328,363 | — | — | 3,272,900 | ||||||||||||
Stock in FHLB | 22,447 | — | 22,447 | — | ||||||||||||
Interest receivable | 18,282 | — | 18,282 | — | ||||||||||||
Liabilities | ||||||||||||||||
Non-interest bearing deposits | $ | 756,707 | $ | 756,707 | $ | — | $ | — | ||||||||
Interest bearing deposits | 3,159,250 | — | 3,128,877 | — | ||||||||||||
Borrowings | 516,591 | — | 515,866 | — | ||||||||||||
Subordinated debentures | 56,250 | — | 50,938 | — | ||||||||||||
Interest payable | 2,725 | — | 2,725 | — | ||||||||||||
December 31, 2018 | ||||||||||||||||
Carrying Amount | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Assets | ||||||||||||||||
Cash and due from banks | $ | 58,492 | $ | 58,492 | $ | — | $ | — | ||||||||
Interest-earning time deposits | 15,744 | — | 15,542 | — | ||||||||||||
Investment securities, held to maturity | 210,112 | — | 208,273 | — | ||||||||||||
Loans held for sale | 1,038 | — | — | 1,038 | ||||||||||||
Loans (excluding loan level hedges), net | 2,786,351 | — | — | 2,681,741 | ||||||||||||
Stock in FHLB | 18,073 | — | 18,073 | — | ||||||||||||
Interest receivable | 14,239 | — | 14,239 | — | ||||||||||||
Liabilities | ||||||||||||||||
Non-interest bearing deposits | $ | 642,129 | $ | 642,129 | $ | — | $ | — | ||||||||
Interest bearing deposits | 2,497,247 | — | 2,377,274 | — | ||||||||||||
Borrowings | 550,384 | — | 542,311 | — | ||||||||||||
Subordinated debentures | 37,837 | — | 35,711 | —�� | ||||||||||||
Interest payable | 2,031 | — | 2,031 | — |
March 31, 2019 | ||||||||||||||||
Quoted Prices in | Significant | |||||||||||||||
Active Markets | Other | Significant | ||||||||||||||
for Identical | Observable | Unobservable | ||||||||||||||
Carrying | Assets | Inputs | Inputs | |||||||||||||
Amount | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
Assets | ||||||||||||||||
Cash and due from banks | $ | 86,131 | $ | 86,131 | $ | — | $ | — | ||||||||
Interest-earning time deposits | 15,987 | — | — | — | ||||||||||||
Investment securities, held to maturity | 206,327 | — | 210,106 | — | ||||||||||||
Loans held for sale | 1,979 | — | — | 1,979 | ||||||||||||
Loans (excluding loan level hedges), net | 3,368,911 | — | — | 3,267,463 | ||||||||||||
Stock in FHLB | 22,447 | — | 22,447 | — | ||||||||||||
Interest receivable | 17,423 | — | 17,423 | — | ||||||||||||
Liabilities | ||||||||||||||||
Non-interest bearing deposits | $ | 811,768 | $ | 811,768 | $ | — | $ | — | ||||||||
Interest bearing deposits | 3,076,255 | — | 3,005,839 | — | ||||||||||||
Borrowings | 457,788 | — | 412,884 | — | ||||||||||||
Subordinated debentures | 55,310 | — | 49,568 | — | ||||||||||||
Interest payable | 2,471 | — | 2,471 | — | ||||||||||||
December 31, 2018 | ||||||||||||||||
Quoted Prices in | Significant | |||||||||||||||
Active Markets | Other | Significant | ||||||||||||||
for Identical | Observable | Unobservable | ||||||||||||||
Carrying | Assets | Inputs | Inputs | |||||||||||||
Amount | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
Assets | ||||||||||||||||
Cash and due from banks | $ | 58,492 | $ | 58,492 | $ | — | $ | — | ||||||||
Interest-earning time deposits | 15,744 | — | 15,542 | — | ||||||||||||
Investment securities, held to maturity | 210,112 | — | 208,273 | — | ||||||||||||
Loans held for sale | 1,038 | — | — | 1,038 | ||||||||||||
Loans (excluding loan level hedges), net | 2,786,351 | — | — | 2,681,741 | ||||||||||||
Stock in FHLB | 18,073 | — | 18,073 | — | ||||||||||||
Interest receivable | 14,239 | — | 14,239 | — | ||||||||||||
Liabilities | ||||||||||||||||
Non-interest bearing deposits | $ | 642,129 | $ | 642,129 | $ | — | $ | — | ||||||||
Interest bearing deposits | 2,497,247 | — | 2,377,274 | — | ||||||||||||
Borrowings | 550,384 | — | 542,311 | — | ||||||||||||
Subordinated debentures | 37,837 | — | 35,711 | — | ||||||||||||
Interest payable | 2,031 | — | 2,031 | — |
HORIZON BANCORP, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Table Dollar Amounts in Thousands, Except Per Share Data)
March 31 | December 31 | |||||||
2019 | 2018 | |||||||
Unrealized gain (loss) on securities available for sale | $ | 3,118 | $ | (8,561 | ) | |||
Unamortized gain (loss) on securities held to maturity, previously transferred from AFS | (28 | ) | 10 | |||||
Unrealized loss on derivative instruments | (2,866 | ) | (1,760 | ) | ||||
Tax effect | (46 | ) | 2,167 | |||||
|
|
|
| |||||
Total accumulated other comprehensive income (loss) | $ | 178 | $ | (8,144 | ) | |||
|
|
|
|
September 30 2019 | December 31 2018 | |||||||
Unrealized gain (loss) on securities available for sale | $ | 14,115 | $ | (8,561 | ) | |||
Unamortized gain (loss) on securities held to maturity, previously transferred from AFS | (73 | ) | 10 | |||||
Unrealized loss on derivative instruments | (5,631 | ) | (1,760 | ) | ||||
Tax effect | (1,765 | ) | 2,167 | |||||
Total accumulated other comprehensive income (loss) | $ | 6,646 | $ | (8,144 | ) | |||
Quantitative measures established by regulation
To The minimum regulatory capital requirements are set forth in the table below.
Actual | Required for Capital1 Adequacy Purposes | Required For Capital1 Adequacy Purposes with Capital Buffer | Well Capitalized Under Prompt1 Corrective Action Provisions | |||||||||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||||||||
March 31, 2019 | ||||||||||||||||||||||||||||||||
Total capital1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | $ | 509,214 | 13.25 | % | $ | 307,362 | 8.00 | % | $ | 403,412 | 10.50 | % | N/A | N/A | ||||||||||||||||||
Bank | 472,621 | 12.30 | % | 307,361 | 8.00 | % | 403,411 | | 10.50 | % | $ | 384,201 | 10.00 | % | ||||||||||||||||||
Tier 1 capital1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | 491,302 | 12.79 | % | 230,521 | 6.00 | % | 326,572 | 8.50 | % | N/A | N/A | |||||||||||||||||||||
Bank | 454,709 | 11.84 | % | 230,520 | 6.00 | % | 326,570 | 8.50 | % | 307,360 | 8.00 | % | ||||||||||||||||||||
Common equity tier 1 capital1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | 433,809 | 11.29 | % | 172,890 | 4.50 | % | 268,941 | 7.00 | % | N/A | N/A | |||||||||||||||||||||
Bank | 454,709 | 11.84 | % | 172,890 | 4.50 | % | 268,940 | 7.00 | % | 249,730 | 6.50 | % | ||||||||||||||||||||
Tier 1 capital1 (to average assets) | ||||||||||||||||||||||||||||||||
Consolidated | 491,302 | 11.85 | % | 165,789 | 4.00 | % | 165,789 | 4.00 | % | N/A | N/A | |||||||||||||||||||||
Bank | 454,709 | 10.99 | % | 165,523 | 4.00 | % | 165,523 | 4.000 | % | 206,904 | 5.00 | % | ||||||||||||||||||||
December 31, 2018 | ||||||||||||||||||||||||||||||||
Total capital1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | $ | 427,616 | 13.39 | % | $ | 255,419 | 8.00 | % | $ | 315,283 | 9.875 | % | N/A | N/A | ||||||||||||||||||
Bank | 396,755 | 12.43 | % | 255,419 | 8.00 | % | 315,283 | 9.875 | % | $ | 319,274 | 10.00 | % | |||||||||||||||||||
Tier 1 capital1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | 409,760 | 12.83 | % | 191,565 | 6.00 | % | 251,429 | 7.875 | % | N/A | N/A | |||||||||||||||||||||
Bank | 378,899 | 11.87 | % | 191,565 | 6.00 | % | 251,429 | 7.875 | % | 255,420 | 8.00 | % | ||||||||||||||||||||
Common equity tier 1 capital1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | 371,297 | 11.63 | % | 143,673 | 4.50 | % | 203,537 | 6.375 | % | N/A | N/A | |||||||||||||||||||||
Bank | 378,899 | 11.87 | % | 143,674 | 4.50 | % | 203,537 | 6.375 | % | 207,528 | 6.50 | % | ||||||||||||||||||||
Tier 1 capital1 (to average assets) | ||||||||||||||||||||||||||||||||
Consolidated | 409,760 | 10.12 | % | 162,033 | 4.00 | % | 162,033 | 4.000 | % | N/A | N/A | |||||||||||||||||||||
Bank | 378,899 | 9.34 | % | 162,327 | 4.00 | % | 162,327 | 4.000 | % | 202,908 | 5.00 | % |
Actual | Required for Capital 1 Adequacy Purposes | Required For Capital 1 Adequacy Purposes with Capital Buffer | Well Capitalized Under 1 Corrective Action Provisions | |||||||||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||||||||
September 30, 2019 | ||||||||||||||||||||||||||||||||
Total capital 1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | $ | 534,701 | 13.53 | % | 316,157 | 8.00 | % | 414,956 | 10.50 | % | N/A | N/A | ||||||||||||||||||||
Bank | 477,150 | 12.08 | % | 316,012 | 8.00 | % | 414,765 | 10.50 | % | $ | 395,015 | 10.00 | % | |||||||||||||||||||
Tier 1 capital 1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | 516,692 | 13.07 | % | 237,196 | 6.00 | % | 336,028 | 8.50 | % | N/A | N/A | |||||||||||||||||||||
Bank | 459,140 | 11.62 | % | 237,010 | 6.00 | % | 335,764 | 8.50 | % | 316,014 | 8.00 | % | ||||||||||||||||||||
Common equity tier 1 capital 1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | 459,162 | 11.61 | % | 177,970 | 4.50 | % | 276,842 | 7.00 | % | N/A | N/A | |||||||||||||||||||||
Bank | 459,140 | 11.62 | % | 177,758 | 4.50 | % | 276,512 | 7.00 | % | 256,761 | 6.50 | % | ||||||||||||||||||||
Tier 1 capital 1 (to average assets) | ||||||||||||||||||||||||||||||||
Consolidated | 516,692 | 10.51 | % | 196,648 | 4.00 | % | 196,648 | 4.00 | % | N/A | N/A | |||||||||||||||||||||
Bank | 459,140 | 9.35 | % | 196,489 | 4.00 | % | 196,489 | 4.00 | % | 245,611 | 5.00 | % | ||||||||||||||||||||
December 31, 2018 | ||||||||||||||||||||||||||||||||
Total capital 1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | $ | 427,616 | 13.39 | % | $ | 255,419 | 8.00 | % | $ | 315,283 | 9.875 | % | N/A | N/A | ||||||||||||||||||
Bank | 396,755 | 12.43 | % | 255,419 | 8.00 | % | 315,283 | 9.875 | % | $ | 319,274 | 10.00 | % | |||||||||||||||||||
Tier 1 capital 1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | 409,760 | 12.83 | % | 191,565 | 6.00 | % | 251,429 | 7.875 | % | N/A | N/A | |||||||||||||||||||||
Bank | 378,899 | 11.87 | % | 191,565 | 6.00 | % | 251,429 | 7.875 | % | 255,420 | 8.00 | % | ||||||||||||||||||||
Common equity tier 1 capital 1 (to risk-weighted assets) | ||||||||||||||||||||||||||||||||
Consolidated | 371,297 | 11.63 | % | 143,673 | 4.50 | % | 203,537 | 6.375 | % | N/A | N/A | |||||||||||||||||||||
Bank | 378,899 | 11.87 | % | 143,674 | 4.50 | % | 203,537 | 6.375 | % | 207,528 | 6.50 | % | ||||||||||||||||||||
Tier 1 capital 1 (to average assets) | ||||||||||||||||||||||||||||||||
Consolidated | 409,760 | 10.12 | % | 162,033 | 4.00 | % | 162,033 | 4.000 | % | N/A | N/A | |||||||||||||||||||||
Bank | 378,899 | 9.34 | % | 162,327 | 4.00 | % | 162,327 | 4.000 | % | 202,908 | 5.00 | % |
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Core return on average assets for the first quarter of 2019 was 1.23% compared to 1.15% for the first quarternine months of 2018. (Please refer to the section captioned “Use oftisits most closely related GAAP measures.)
Total loans, excluding acquired loans, increased by an annualized rate of 5.0%, or $36.8 million, during the first quarter of 2019.
Net interest margin
Core net interest margin (defined as net interest margin excluding acquisition-related purchase accounting adjustments) was 3.46% for the three months ended March 31,of 2019 compared to 3.43%11.43% for the threefirst nine months ended December 31, 2018 and 3.55%of 2018.
HORIZON BANCORP, INC. AND SUBSIDIARIES
Management’s DiscussionFinancial Measures” within this Item 2 for a description of the elements of core return on average equity and Analysis of Financial Condition
And Results of Operations
For the Three Months ended March 31, 2019 and 2018
HORIZON BANCORP, INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition
And Results of Operations
For the Three Months ended March 31, 2019 and 2018
impairment reserve is recognized so that each individual stratum is carried at the lower of its amortized book value or fair value. In periods of falling market interest rates, accelerated loan prepayment can adversely affect the fair value of these mortgage-servicing rights relative to their book value. In the event that the fair value of these assets was to increase in the future, Horizon can recognize the increased fair value to the extent of the impairment allowance but cannot recognize an asset in excess of its amortized book value. Future changes in management’s assessment of the impairment of these servicing assets, as a result of changes in observable market data relating to market interest rates, loan prepayment speeds, and other factors, could impact Horizon’s financial condition and results of operations either positively or negatively.
HORIZON BANCORP, INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition
And Results of Operations
For the Three Months ended March 31, 2019 and 2018
value for such assets and liabilities is determined. In addition, the outcomes of valuations have a direct bearing on the carrying amounts of goodwill, mortgage servicing rights, and pension and other post-retirement benefit obligations. To determine the values of these assets and liabilities, as well as the extent, to which related assets may be impaired, management makes assumptions and estimates related to discount rates, asset returns, prepayment speeds and other factors. The use of different discount rates or other valuation assumptions could produce significantly different results, which could affect Horizon’s results of operations.
March 31, 2019 | December 31, 2018 | |||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||
Available for sale | ||||||||||||||||
U.S. Treasury and federal agencies | $ | 14,087 | $ | 13,995 | $ | 16,815 | $ | 16,608 | ||||||||
State and municipal | 245,577 | 249,760 | 210,386 | 209,303 | ||||||||||||
Federal agency collateralized mortgage obligations | 212,829 | 213,043 | 187,563 | 185,003 | ||||||||||||
Federal agency mortgage-backed pools | 193,932 | 192,265 | 183,479 | 178,736 | ||||||||||||
Private labeled mortgage-backed pools | — | — | — | — | ||||||||||||
Corporate notes | 17,598 | 18,079 | 10,666 | 10,698 | ||||||||||||
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|
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| |||||||||
Total available for sale investment securities | $ | 684,023 | $ | 687,142 | $ | 608,909 | $ | 600,348 | ||||||||
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| |||||||||
Held to maturity | ||||||||||||||||
State and municipal | $ | 187,847 | $ | 191,570 | $ | 191,269 | $ | 189,676 | ||||||||
Federal agency collateralized mortgage obligations | 5,019 | 4,979 | 5,144 | 5,030 | ||||||||||||
Federal agency mortgage-backed pools | 13,461 | 13,557 | 13,699 | 13,567 | ||||||||||||
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| |||||||||
Total held to maturity investment securities | $ | 206,327 | $ | 210,106 | $ | 210,112 | $ | 208,273 | ||||||||
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September 30, 2019 | December 31, 2018 | |||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||
Available for sale | ||||||||||||||||
U.S. Treasury and federal agencies | $ | 9,915 | $ | 9,909 | $ | 16,815 | $ | 16,608 | ||||||||
State and municipal | 337,336 | 347,101 | 210,386 | 209,303 | ||||||||||||
Federal agency collateralized mortgage obligations | 243,366 | 246,083 | 187,563 | 185,003 | ||||||||||||
Federal agency mortgage-backed pools | 144,880 | 145,597 | 183,479 | 178,736 | ||||||||||||
Private labeled mortgage-backed pools | — | — | — | — | ||||||||||||
Corporate notes | 17,618 | 18,540 | 10,666 | 10,698 | ||||||||||||
Total available for sale investment securities | $ | 753,115 | $ | 767,230 | $ | 608,909 | $ | 600,348 | ||||||||
Held to maturity | ||||||||||||||||
State and municipal | $ | 192,736 | $ | 199,972 | $ | 191,269 | $ | 189,676 | ||||||||
Federal agency collateralized mortgage obligations | 4,714 | 4,716 | 5,144 | 5,030 | ||||||||||||
Federal agency mortgage-backed pools | 12,856 | 13,030 | 13,699 | 13,567 | ||||||||||||
Total held to maturity investment securities | $ | 210,306 | $ | 217,718 | $ | 210,112 | $ | 208,273 | ||||||||
$54.3 million, growth in direct municipal program and the investment of excess cash.
Analysis of Financial Condition
HORIZON BANCORP, INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition
And Results of Operations
For the Three Months ended March 31, 2019 and 2018
from the sale of its investments.
Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | |||||||||||||||||||||||
Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | |||||||||||||||||||
Assets | ||||||||||||||||||||||||
Interest-earning assets | ||||||||||||||||||||||||
Federal funds sold | $ | 7,843 | $ | 57 | 2.95 | % | $ | 3,714 | $ | 14 | 1.53 | % | ||||||||||||
Interest-earning deposits | 26,355 | 155 | 2.39 | % | 22,962 | 90 | 1.59 | % | ||||||||||||||||
Investment securities—taxable | 448,840 | 2,910 | 2.63 | % | 421,068 | 2,326 | 2.24 | % | ||||||||||||||||
Investmentsecurities—non-taxable(1) | 393,720 | 2,628 | 3.40 | % | 307,921 | 1,865 | 2.88 | % | ||||||||||||||||
Loans receivable(2)(3) | 3,052,538 | 39,623 | 5.27 | % | 2,824,478 | 35,131 | 5.04 | % | ||||||||||||||||
|
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|
|
|
|
| |||||||||||||||||
Total interest-earning assets(1) | 3,929,296 | 45,373 | 4.76 | % | 3,580,143 | 39,426 | 4.50 | % | ||||||||||||||||
Non-interest-earning assets | ||||||||||||||||||||||||
Cash and due from banks | 44,527 | 43,809 | ||||||||||||||||||||||
Allowance for loan losses | (17,836 | ) | (16,342 | ) | ||||||||||||||||||||
Other assets | 351,202 | 335,227 | ||||||||||||||||||||||
|
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| |||||||||||||||||||||
Total average assets | $ | 4,307,189 | $ | 3,942,837 | ||||||||||||||||||||
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| |||||||||||||||||||||
Liabilities and Stockholders’ Equity | ||||||||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||
Interest-bearing deposits | $ | 2,514,841 | $ | 6,876 | 1.11 | % | $ | 2,304,829 | $ | 2,871 | 0.51 | % | ||||||||||||
Borrowings | 577,199 | 3,621 | 2.54 | % | 528,066 | 2,572 | 1.98 | % | ||||||||||||||||
Subordinated debentures | 39,236 | 596 | 6.16 | % | 36,477 | 572 | 6.36 | % | ||||||||||||||||
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| |||||||||||||||||
Total interest-bearing liabilities | 3,131,276 | 11,093 | 1.44 | % | 2,869,372 | 6,015 | 0.85 | % | ||||||||||||||||
Non-interest-bearing liabilities | ||||||||||||||||||||||||
Demand deposits | 643,601 | 595,644 | ||||||||||||||||||||||
Accrued interest payable and other liabilities | 25,863 | 17,745 | ||||||||||||||||||||||
Stockholders’ equity | 506,449 | 460,076 | ||||||||||||||||||||||
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| |||||||||||||||||||||
Total average liabilities and stockholders’ equity | $ | 4,307,189 | $ | 3,942,837 | ||||||||||||||||||||
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Net interest income/spread | $34,280 | 3.32 | % | $33,411 | 3.65 | % | ||||||||||||||||||
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| |||||||||||||||||||||
Net interest income as a percent of average interest-earning assets(1) | 3.62 | % | 3.81 | % |
Three Months Ended | Three Months Ended | |||||||||||||||||||||||
September 30, 2019 | September 30, 2018 | |||||||||||||||||||||||
Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | |||||||||||||||||||
Assets | ||||||||||||||||||||||||
Interest-earning assets | ||||||||||||||||||||||||
Federal funds sold | $ | 18,133 | $ | 115 | 2.52 | % | $ | 3,840 | $ | 24 | 2.48 | % | ||||||||||||
Interest-earning deposits | 17,823 | 93 | 2.07 | % | 24,494 | 104 | 1.68 | % | ||||||||||||||||
Investment securities - taxable | 478,764 | 2,949 | 2.44 | % | 421,681 | 2,611 | 2.46 | % | ||||||||||||||||
Investment securities - non-taxable (1) | 462,997 | 3,099 | 3.36 | % | 324,289 | 2,010 | 3.11 | % | ||||||||||||||||
Loans receivable (2)(3) | 3,646,268 | 49,455 | 5.41 | % | 2,942,835 | 37,522 | 5.07 | % | ||||||||||||||||
Total interest-earning assets (1) | 4,623,985 | 55,711 | 4.87 | % | 3,717,139 | 42,271 | 4.58 | % | ||||||||||||||||
Non-interest-earning assets | ||||||||||||||||||||||||
Cash and due from banks | 66,970 | 45,864 | ||||||||||||||||||||||
Allowance for loan losses | (18,277 | ) | (17,090 | ) | ||||||||||||||||||||
Other assets | 434,581 | 359,183 | ||||||||||||||||||||||
Total average assets | $ | 5,107,259 | $ | 4,105,096 | ||||||||||||||||||||
Liabilities and Stockholders’ Equity | ||||||||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||
Interest-bearing deposits | $ | 3,132,852 | $ | 9,109 | 1.15 | % | $ | 2,438,450 | $ | 5,023 | 0.82 | % | ||||||||||||
Borrowings | 413,859 | 2,275 | 2.18 | % | 496,054 | 2,876 | 2.30 | % | ||||||||||||||||
Subordinated debentures | 54,433 | 864 | 6.30 | % | 36,570 | 600 | 6.51 | % | ||||||||||||||||
Total interest-bearing liabilities | 3,601,144 | 12,248 | 1.35 | % | 2,971,074 | 8,499 | 1.13 | % | ||||||||||||||||
Non-interest-bearing liabilities | ||||||||||||||||||||||||
Demand deposits | 818,164 | 640,983 | ||||||||||||||||||||||
Accrued interest payable and other liabilities | 47,181 | 16,080 | ||||||||||||||||||||||
Stockholders’ equity | 640,770 | 476,959 | ||||||||||||||||||||||
Total average liabilities and stockholders’ equity | $ | 5,107,259 | $ | 4,105,096 | ||||||||||||||||||||
Net interest income/spread | $ | 43,463 | 3.52 | % | $ | 33,772 | 3.44 | % | ||||||||||||||||
Net interest income as a percent of average interest-earning assets (1) | 3.82 | % | 3.67 | % |
(1) | Securities balances represent daily average balances for the fair value of securities. The average rate is calculated based on the daily average balance for the amortized cost of securities. The average rate is presented on a tax equivalent basis. |
(2) | Includes fees on loans. The inclusion of loan fees does not have a material effect on the average interest rate. |
(3) |
|
HORIZON BANCORP, INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition
And Results of Operations
For the Three Months ended March 31,September 30, 2019 and 2018
2018.
Nine Months Ended | Nine Months Ended | |||||||||||||||||||||||
September 30, 2019 | September 30, 2018 | |||||||||||||||||||||||
Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | |||||||||||||||||||
Assets | ||||||||||||||||||||||||
Interest-earning assets | ||||||||||||||||||||||||
Federal funds sold | $ | 14,778 | $ | 339 | 3.07 | % | $ | 2,845 | $ | 53 | 2.49 | % | ||||||||||||
Interest-earning deposits | 21,938 | 284 | 1.73 | % | 25,411 | 300 | 1.58 | % | ||||||||||||||||
Investment securities - taxable | 469,330 | 8,929 | 2.54 | % | 413,617 | 7,379 | 2.39 | % | ||||||||||||||||
Investment securities - non-taxable (1) | 423,141 | 8,520 | 3.37 | % | 313,168 | 5,745 | 3.00 | % | ||||||||||||||||
Loans receivable (2)(3) | 3,447,654 | 136,862 | 5.32 | % | 2,855,236 | 108,961 | 5.06 | % | ||||||||||||||||
Total interest-earning assets (1) | 4,376,841 | 154,934 | 4.81 | % | 3,610,277 | 122,438 | 4.55 | % | ||||||||||||||||
Non-interest-earning assets | ||||||||||||||||||||||||
Cash and due from banks | 58,890 | 44,605 | ||||||||||||||||||||||
Allowance for loan losses | (18,053 | ) | (16,686 | ) | ||||||||||||||||||||
Other assets | 405,923 | 383,615 | ||||||||||||||||||||||
Total average assets | $ | 4,823,601 | $ | 4,021,811 | ||||||||||||||||||||
Liabilities and Stockholders’ Equity | ||||||||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||
Interest-bearing deposits | $ | 2,924,433 | $ | 24,923 | 1.14 | % | $ | 2,382,864 | $ | 11,814 | 0.66 | % | ||||||||||||
Borrowings | 462,575 | 8,391 | 2.43 | % | 504,349 | 8,127 | 2.15 | % | ||||||||||||||||
Subordinated debentures | 48,666 | 2,348 | 6.45 | % | 36,524 | 1,764 | 6.46 | % | ||||||||||||||||
Total interest-bearing liabilities | 3,435,674 | 35,662 | 1.39 | % | 2,923,737 | 21,705 | 0.99 | % | ||||||||||||||||
Non-interest-bearing liabilities | ||||||||||||||||||||||||
Demand deposits | 760,717 | 613,866 | ||||||||||||||||||||||
Accrued interest payable and other liabilities | 37,444 | 16,341 | ||||||||||||||||||||||
Stockholders’ equity | 589,766 | 467,867 | ||||||||||||||||||||||
Total average liabilities and stockholders’ equity | $ | 4,823,601 | $ | 4,021,811 | ||||||||||||||||||||
Net interest income/spread | $ | 119,272 | 3.42 | % | $ | 100,733 | 3.55 | % | ||||||||||||||||
Net interest income as a percent of average interest-earning assets (1) | 3.72 | % | 3.74 | % |
(1) | Securities balances represent daily average balances for the fair value of securities. The average rate is calculated based on the daily average balance for the amortized cost of securities. The average rate is presented on a tax equivalent basis. |
(2) | Includes fees on loans. The inclusion of loan fees does not have a material effect on the average interest rate. |
(3) | Non-accruing loans for the purpose of the computations above are included in the daily average loan amounts outstanding. Loan totals are shown net of unearned income and deferred loan fees. The average rate is presented on a tax equivalent basis. |
and 2018
Pre-discount Loan Balance | Allowance for Loan Losses (ALLL) | Loan Discount | ALLL + Loan Discount | Loans, net | ALLL/ Pre-discount Loan Balance | Loan Discount/ Pre-discount Loan Balance | ALLL+Loan Discount/ Pre-discount Loan Balance | |||||||||||||||||||||||||
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Horizon Legacy | $ | 2,547,794 | $ | 17,525 | N/A | $ | 17,525 | $ | 2,530,269 | 0.69 | % | 0.00 | % | 0.69 | % | |||||||||||||||||
Heartland | 7,202 | — | 641 | 641 | 6,561 | 0.00 | % | 8.90 | % | 8.90 | % | |||||||||||||||||||||
Summit | 18,396 | — | 1,007 | 1,007 | 17,389 | 0.00 | % | 5.47 | % | 5.47 | % | |||||||||||||||||||||
Peoples | 81,713 | — | 1,861 | 1,861 | 79,852 | 0.00 | % | 2.28 | % | 2.28 | % | |||||||||||||||||||||
Kosciusko | 35,182 | 296 | 569 | 865 | 34,317 | 0.84 | % | 1.62 | % | 2.46 | % | |||||||||||||||||||||
LaPorte | 84,230 | — | 2,838 | 2,838 | 81,392 | 0.00 | % | 3.37 | % | 3.37 | % | |||||||||||||||||||||
CNB | 4,321 | — | 112 | 112 | 4,209 | 0.00 | % | 2.59 | % | 2.59 | % | |||||||||||||||||||||
Lafayette | 82,448 | — | 1,008 | 1,008 | 81,440 | 0.00 | % | 1.22 | % | 1.22 | % | |||||||||||||||||||||
Wolverine | 178,573 | — | 2,136 | 2,136 | 176,437 | 0.00 | % | 1.20 | % | 1.20 | % | |||||||||||||||||||||
Salin | 583,177 | — | 11,918 | 11,918 | 571,259 | 0.00 | % | 2.04 | % | 2.04 | % | |||||||||||||||||||||
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| |||||||||||||||||||||||
Total | $ | 3,623,036 | $ | 17,821 | $ | 22,090 | $ | 39,911 | $ | 3,583,125 | 0.49 | % | 0.61 | % | 1.10 | % | ||||||||||||||||
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Pre-discount Loan Balance | Allowance for Loan Losses (ALLL) | Loan Discount | ALLL + Loan Discount | Loans, net | ALLL/ Pre-discount Loan Balance | Loan Discount/ Pre-discount Loan Balance | ALLL+Loan Discount/ Pre-discount Loan Balance | |||||||||||||||||||||||||
Horizon Legacy | $ | 2,779,961 | $ | 17,946 | N/A | $ | 17,946 | $ | 2,762,015 | 0.65 | % | 0.00 | % | 0.65 | % | |||||||||||||||||
Heartland | 5,244 | — | 589 | 589 | 4,655 | 0.00 | % | 11.23 | % | 11.23 | % | |||||||||||||||||||||
Summit | 16,191 | — | 987 | 987 | 15,204 | 0.00 | % | 6.10 | % | 6.10 | % | |||||||||||||||||||||
Peoples | 71,941 | — | 1,669 | 1,669 | 70,272 | 0.00 | % | 2.32 | % | 2.32 | % | |||||||||||||||||||||
Kosciusko | 30,580 | — | 528 | 528 | 30,052 | 0.00 | % | 1.73 | % | 1.73 | % | |||||||||||||||||||||
LaPorte | 70,442 | 10 | 2,461 | 2,471 | 67,971 | 0.01 | % | 3.49 | % | 3.50 | % | |||||||||||||||||||||
CNB | 3,498 | — | 88 | 88 | 3,410 | 0.00 | % | 2.52 | % | 2.52 | % | |||||||||||||||||||||
Lafayette | 63,805 | — | 519 | 519 | 63,286 | 0.00 | % | 0.81 | % | 0.81 | % | |||||||||||||||||||||
Wolverine | 136,829 | — | 729 | 729 | 136,100 | 0.00 | % | 0.53 | % | 0.53 | % | |||||||||||||||||||||
Salin | 489,194 | — | 13,797 | 13,797 | 475,397 | 0.00 | % | 2.82 | % | 2.82 | % | |||||||||||||||||||||
Total | $ | 3,667,685 | $ | 17,956 | $ | 21,367 | $ | 39,323 | $ | 3,628,362 | 0.49 | % | 0.58 | % | 1.07 | % | ||||||||||||||||
HORIZON BANCORP, INC. AND SUBSIDIARIES
Management’s Discussion and Analysis
And Results of Operations
For the Three Months ended March 31,September 30, 2019, and 2018
Non-performing
Three Months Ended | ||||||||||||||||
Non-interest Income | March 31 2019 | March 31 2018 | Amount Change | Percent Change | ||||||||||||
Service charges on deposit accounts | $ | 1,877 | $ | 1,888 | $ | (11 | ) | -0.6 | % | |||||||
Wire transfer fees | 118 | 150 | (32 | ) | -21.3 | % | ||||||||||
Interchange fees | 1,361 | 1,328 | 33 | 2.5 | % | |||||||||||
Fiduciary activities | 2,089 | 1,925 | 164 | 8.5 | % | |||||||||||
Gain on sale of investment securities | 15 | 11 | 4 | 36.4 | % | |||||||||||
Gain on sale of mortgage loans | 1,309 | 1,423 | (114 | ) | -8.0 | % | ||||||||||
Mortgage servicing net of impairment | 606 | 349 | 257 | 73.6 | % | |||||||||||
Increase in cash surrender value of bank owned life insurance | 513 | 435 | 78 | 17.9 | % | |||||||||||
Other income | 824 | 809 | 15 | 1.9 | % | |||||||||||
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|
|
|
| |||||||||||
Totalnon-interest income | $ | 8,712 | $ | 8,318 | $ | 394 | 4.7 | % | ||||||||
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|
Three Months Ended | ||||||||||||||||
September 30 2019 | September 30 2018 | Amount Change | Percent Change | |||||||||||||
Non-interest Income | ||||||||||||||||
Service charges on deposit accounts | $ | 2,836 | $ | 2,009 | $ | 827 | 41.2 | % | ||||||||
Wire transfer fees | 189 | 160 | 29 | 18.1 | % | |||||||||||
Interchange fees | 2,138 | 1,410 | 728 | 51.6 | % | |||||||||||
Fiduciary activities | 1,834 | 1,855 | (21 | ) | -1.1 | % | ||||||||||
Loss on sale of investment securities | — | (122 | ) | 122 | -100.0 | % | ||||||||||
Gain on sale of mortgage loans | 2,702 | 1,839 | 863 | 46.9 | % | |||||||||||
Mortgage servicing net of impairment | 444 | 563 | (119 | ) | -21.1 | % | ||||||||||
Increase in cash surrender value of bank owned life insurance | 556 | 503 | 53 | 10.5 | % | |||||||||||
Death benefit on bank owned life insurance | 213 | — | 213 | 0.0 | % | |||||||||||
Other income | 602 | 469 | 133 | 28.4 | % | |||||||||||
Total non-interest income | $ | 11,514 | $ | 8,686 | $ | 2,828 | 32.6 | % | ||||||||
HORIZON BANCORP, INC. AND SUBSIDIARIES
Management’s Discussion and Analysis2018 due to a higher volume of Financial Condition
And Results of Operations
For the Three Months ended March 31, 2019 and 2018
Non-interest Expense
loans sold.
Three Months Ended | ||||||||||||||||||||||||||||||||
March 31 2019 | March 31 2018 | Adjusted | ||||||||||||||||||||||||||||||
Merger | Merger | Amount | Percent | |||||||||||||||||||||||||||||
Non-interest Expense | Actual | Expenses | Adjusted | Actual | Expenses | Adjusted | Change | Change | ||||||||||||||||||||||||
Salaries and employee benefits | $ | 14,466 | $ | (2 | ) | $ | 14,464 | $ | 14,373 | $ | — | $ | 14,373 | $ | 91 | 0.6 | % | |||||||||||||||
Net occupancy expenses | 2,772 | — | 2,772 | 2,966 | — | 2,966 | (194 | ) | -6.5 | % | ||||||||||||||||||||||
Data processing | 1,966 | (292 | ) | 1,674 | 1,696 | — | 1,696 | (22 | ) | -1.3 | % | |||||||||||||||||||||
Professional fees | 493 | (239 | ) | 254 | 501 | — | 501 | (247 | ) | -49.3 | % | |||||||||||||||||||||
Outside services and consultants | 3,530 | (2,290 | ) | 1,240 | 1,264 | — | 1,264 | (24 | ) | -1.9 | % | |||||||||||||||||||||
Loan expense | 1,949 | — | 1,949 | 1,257 | — | 1,257 | 692 | 55.1 | % | |||||||||||||||||||||||
FDIC deposit insurance | 160 | — | 160 | 310 | — | 310 | (150 | ) | -48.4 | % | ||||||||||||||||||||||
Other losses | 104 | (2 | ) | 102 | 146 | — | 146 | (44 | ) | -30.1 | % | |||||||||||||||||||||
Other expenses | 4,298 | (1,293 | ) | 3,005 | 3,324 | — | 3,324 | (319 | ) | -9.6 | % | |||||||||||||||||||||
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| |||||||||||||||||||
Totalnon-interest expense | $ | 29,738 | $ | (4,118 | ) | $ | 25,620 | $ | 25,837 | $ | — | $ | 25,837 | $ | (217 | ) | -0.8 | % | ||||||||||||||
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Nine Months Ended | ||||||||||||||||
September 30 2019 | September 30 2018 | Amount Change | Percent Change | |||||||||||||
Non-interest Income | ||||||||||||||||
Service charges on deposit accounts | $ | 7,193 | $ | 5,804 | $ | 1,389 | 23.9 | % | ||||||||
Wire transfer fees | 474 | 490 | (16 | ) | -3.3 | % | ||||||||||
Interchange fees | 5,659 | 4,293 | 1,366 | 31.8 | % | |||||||||||
Fiduciary activities | 5,986 | 5,598 | 388 | �� | 6.9 | % | ||||||||||
Loss on sale of investment securities | (85 | ) | (111 | ) | 26 | -23.4 | % | |||||||||
Gain on sale of mortgage loans | 6,089 | 5,158 | 931 | 18.0 | % | |||||||||||
Mortgage servicing net of impairment | 1,620 | 1,423 | 197 | 13.8 | % | |||||||||||
Increase in cash surrender value of bank owned life insurance | 1,624 | 1,380 | 244 | 17.7 | % | |||||||||||
Death benefit on bank owned life insurance | 580 | 154 | 426 | 276.6 | % | |||||||||||
Other income | 1,984 | 1,747 | 237 | 13.6 | % | |||||||||||
Total non-interest income | $ | 31,124 | $ | 25,936 | $ | 5,188 | 20.0 | % | ||||||||
Three Months Ended | ||||||||||||||||||||||||||||||||
September 30 | September 30 | |||||||||||||||||||||||||||||||
2019 | 2018 | Adjusted | ||||||||||||||||||||||||||||||
Actual | Merger Expenses | Adjusted | Actual | Merger Expenses | Adjusted | Amount Change | Percent Change | |||||||||||||||||||||||||
Non-interest Expense | ||||||||||||||||||||||||||||||||
Salaries and employee benefits | $ | 16,948 | $ | — | $ | 16,948 | $ | 14,343 | $ | — | $ | 14,343 | $ | 2,605 | 18.2 | % | ||||||||||||||||
Net occupancy expenses | 3,131 | — | 3,131 | 2,495 | — | 2,495 | 636 | 25.5 | % | |||||||||||||||||||||||
Data processing | 2,140 | — | 2,140 | 1,759 | — | 1,759 | 381 | 21.7 | % | |||||||||||||||||||||||
Professional fees | 335 | — | 335 | 437 | — | 437 | (102 | ) | -23.3 | % | ||||||||||||||||||||||
Outside services and consultants | 1,552 | — | 1,552 | 1,204 | — | 1,204 | 348 | 28.9 | % | |||||||||||||||||||||||
Loan expense | 2,198 | — | 2,198 | 1,722 | — | 1,722 | 476 | 27.6 | % | |||||||||||||||||||||||
FDIC deposit insurance | (273 | ) | — | (273 | ) | 396 | — | 396 | (669 | ) | -168.9 | % | ||||||||||||||||||||
Other losses | 90 | — | 90 | 161 | — | 161 | (71 | ) | -44.1 | % | ||||||||||||||||||||||
Other expenses | 3,939 | — | 3,939 | 3,103 | — | 3,103 | 836 | 26.9 | % | |||||||||||||||||||||||
Total non-interest expense | $ | 30,060 | $ | — | $ | 30,060 | $ | 25,620 | $ | — | $ | 25,620 | $ | 4,440 | 17.3 | % | ||||||||||||||||
Annualized Non-interest Exp. to Avg. Assets | 2.34 | % | 2.34 | % | 2.48 | % | 2.48 | % |
Nine Months Ended | ||||||||||||||||||||||||||||||||
September 30 | September 30 | |||||||||||||||||||||||||||||||
2019 | 2018 | Adjusted | ||||||||||||||||||||||||||||||
Actual | Merger Expenses | Adjusted | Actual | Merger Expenses | Adjusted | Amount Change | Percent Change | |||||||||||||||||||||||||
Non-interest Expense | ||||||||||||||||||||||||||||||||
Salaries and employee benefits | $ | 48,365 | $ | (484 | ) | $ | 47,881 | $ | 42,525 | $ | — | $ | 42,525 | $ | 5,356 | 12.6 | % | |||||||||||||||
Net occupancy expenses | 9,051 | (75 | ) | 8,976 | 7,981 | — | 7,981 | 995 | 12.5 | % | ||||||||||||||||||||||
Data processing | 6,245 | (360 | ) | 5,885 | 5,062 | — | 5,062 | 823 | 16.3 | % | ||||||||||||||||||||||
Professional fees | 1,426 | (392 | ) | 1,034 | 1,314 | — | 1,314 | (280 | ) | -21.3 | % | |||||||||||||||||||||
Outside services and consultants | 6,737 | (2,466 | ) | 4,271 | 3,735 | — | 3,735 | 536 | 14.4 | % | ||||||||||||||||||||||
Loan expense | 6,195 | (2 | ) | 6,193 | 4,504 | — | 4,504 | 1,689 | 37.5 | % | ||||||||||||||||||||||
FDIC deposit insurance | 252 | — | 252 | 1,051 | — | 1,051 | (799 | ) | -76.0 | % | ||||||||||||||||||||||
Other losses | 363 | (71 | ) | 292 | 576 | — | 576 | (284 | ) | -49.3 | % | |||||||||||||||||||||
Other expenses | 12,748 | (1,800 | ) | 10,948 | 9,651 | — | 9,651 | 1,297 | 13.4 | % | ||||||||||||||||||||||
Total non-interest expense | $ | 91,382 | $ | (5,650 | ) | $ | 85,732 | $ | 76,399 | $ | — | $ | 76,399 | $ | 9,333 | 12.2 | % | |||||||||||||||
Annualized Non-interest Exp. to Avg. Assets | 2.53 | % | 2.38 | % | 2.54 | % | 2.54 | % |
2019 and 2018, respectively. Annualized
HORIZON BANCORP, INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition
And Results of Operations
For the Three Months ended March 31, 2019 and 2018
Horizon declared common stock dividends in the amount of $0.10$0.34 per share during the first threenine months of 2019 and $0.30 per share for the same period of 2018. The dividend payout ratio (dividends as a percent of basic earnings per share) was 35.7%24.1% and 30.0%28.8% for the first threenine months of 2019 and 2018, respectively. For additional information regarding dividends, see Horizon’s Annual Report on Form
Three Months Ended | ||||||||||||
March 31 2019 | December 31 2018 | March 31 2018 | ||||||||||
Non-GAAP Reconciliation of Net Interest Margin | ||||||||||||
Net interest income as reported | $ | 34,280 | $ | 33,836 | $ | 33,411 | ||||||
Average interest-earning assets | 3,929,296 | 3,808,822 | 3,580,143 | |||||||||
Net interest income as a percentage of average interest-earning assets (“Net Interest Margin”) | 3.62 | % | 3.60 | % | 3.81 | % | ||||||
Acquisition-related purchase accounting adjustments (“PAUs”) | $ | (1,510 | ) | $ | (1,629 | ) | $ | (2,037 | ) | |||
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| |||||||
Core net interest income | $ | 32,770 | $ | 32,207 | $ | 31,374 | ||||||
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| |||||||
Core net interest margin | 3.46 | % | 3.43 | % | 3.55 | % | ||||||
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|
Three Months Ended | Nine Months Ended | |||||||||||||||||||
September 30 | June 30 | September 30 | September 30 | September 30 | ||||||||||||||||
2019 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||
Non-GAAP Reconciliation of Net Interest Margin | ||||||||||||||||||||
Net interest income as reported | $ | 43,463 | $ | 41,529 | $ | 33,772 | $ | 119,272 | $ | 100,733 | ||||||||||
Average interest-earning assets | 4,623,985 | 4,566,674 | 3,717,139 | 4,376,841 | 3,610,277 | |||||||||||||||
Net interest income as a percentage of average interest-earning assets (“Net Interest Margin”) | 3.82 | % | 3.73 | % | 3.67 | % | 3.72 | % | 3.74 | % | ||||||||||
Acquisition-related purchase accounting adjustments (“PAUs”) | $ | (1,739 | ) | $ | (1,299 | ) | $ | (789 | ) | $ | (4,548 | ) | $ | (4,460 | ) | |||||
Core net interest income | $ | 41,724 | $ | 40,230 | $ | 32,983 | $ | 114,724 | $ | 96,273 | ||||||||||
Core net interest margin | 3.67 | % | 3.61 | % | 3.59 | % | 3.58 | % | 3.58 | % | ||||||||||
Three Months Ended | ||||||||||||
March 31 2019 | December 31 2018 | March 31 2018 | ||||||||||
Non-GAAP Reconciliation of Net Income | ||||||||||||
Net income as reported | $ | 10,816 | $ | 13,133 | $ | 12,804 | ||||||
Merger expenses | 4,118 | 487 | — | |||||||||
Tax effect | (692 | ) | (102 | ) | — | |||||||
Net income excluding merger expenses | 14,242 | 13,518 | 12,804 | |||||||||
Loss (gain) on sale of investment securities | (15 | ) | 332 | (11 | ) | |||||||
Tax effect | 3 | (70 | ) | 2 | ||||||||
Net income excluding gain on sale of investment securities | 14,230 | 13,780 | 12,795 | |||||||||
Acquisition-related purchase accounting adjustments (“PAUs”) | (1,510 | ) | (1,629 | ) | (2,037 | ) | ||||||
Tax effect | 317 | 342 | 428 | |||||||||
Core Net Income | $ | 13,037 | $ | 12,493 | $ | 11,186 | ||||||
Non-GAAP Reconciliation of Diluted Earnings per Share | ||||||||||||
Diluted earnings per share (“EPS”) as reported | $ | 0.28 | $ | 0.34 | $ | 0.33 | ||||||
Merger expenses | 0.11 | 0.01 | — | |||||||||
Tax effect | (0.02 | ) | — | — | ||||||||
Diluted EPS excluding merger expenses | 0.37 | 0.35 | 0.33 | |||||||||
Loss (gain) on sale of investment securities | — | 0.01 | — | |||||||||
Tax effect | — | — | — | |||||||||
Diluted EPS excluding gain on sale of investment securities | 0.37 | 0.36 | 0.33 | |||||||||
Acquisition-related PAUs | (0.04 | ) | (0.04 | ) | (0.05 | ) | ||||||
Tax effect | 0.01 | 0.01 | 0.01 | |||||||||
Core Diluted EPS | $ | 0.34 | $ | 0.33 | $ | 0.29 |
Non-GAAP Reconciliation
Three Months Ended | Nine Months Ended | |||||||||||||||||||
September 30 | June 30 | September 30 | September 30 | September 30 | ||||||||||||||||
2019 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||
Non-GAAP Reconciliation of Net Income | ||||||||||||||||||||
Net income as reported | $ | 20,537 | $ | 16,642 | $ | 13,065 | $ | 47,995 | $ | 39,984 | ||||||||||
Merger expenses | — | 1,532 | — | 5,650 | — | |||||||||||||||
Tax effect | — | (295 | ) | — | (987 | ) | — | |||||||||||||
Net income excluding merger expenses | 20,537 | 17,879 | 13,065 | 52,658 | 39,984 | |||||||||||||||
Loss on sale of investment securities | — | 100 | 122 | 85 | 111 | |||||||||||||||
Tax effect | — | (21 | ) | (25 | ) | (18 | ) | (23 | ) | |||||||||||
Net income excluding loss on sale of investment securities | 20,537 | 17,958 | 13,162 | 52,725 | 40,072 | |||||||||||||||
Death benefit on bank owned life insurance (“BOLI”) | (213 | ) | (367 | ) | — | (580 | ) | (154 | ) | |||||||||||
Net income excluding death benefit on BOLI | 20,324 | 17,591 | 13,162 | 52,145 | 39,918 | |||||||||||||||
Core Net Income | $ | 20,324 | $ | 17,591 | $ | 13,162 | $ | 52,145 | $ | 39,918 | ||||||||||
Non-GAAP Reconciliation of Diluted Earnings per Share | ||||||||||||||||||||
Diluted earnings per share (“EPS”) as reported | $ | 0.46 | $ | 0.37 | $ | 0.34 | $ | 1.11 | $ | 1.04 | ||||||||||
Merger expenses | — | 0.03 | — | 0.13 | — | |||||||||||||||
Tax effect | — | — | — | (0.02 | ) | — | ||||||||||||||
Diluted EPS excluding merger expenses | 0.46 | 0.40 | 0.34 | 1.22 | 1.04 | |||||||||||||||
Loss on sale of investment securities | — | — | — | — | — | |||||||||||||||
Tax effect | — | — | — | — | — | |||||||||||||||
Diluted EPS excluding loss on sale of investment securities | 0.46 | 0.40 | 0.34 | 1.22 | 1.04 | |||||||||||||||
Death benefit on BOLI | (0.01 | ) | (0.01 | ) | — | (0.01 | ) | — | ||||||||||||
Diluted EPS excluding death benefit on BOLI | 0.45 | 0.39 | 0.34 | 1.21 | 1.04 | |||||||||||||||
Core Diluted EPS | $ | 0.45 | $ | 0.39 | $ | 0.34 | $ | 1.21 | $ | 1.04 | ||||||||||
Three Months Ended | ||||||||||||
March 31 2019 | December 31 2018 | March 31 2018 | ||||||||||
Non-GAAP Reconciliation of Return on Average Assets | ||||||||||||
Average assets | $ | 4,307,189 | $ | 4,179,140 | $ | 3,942,837 | ||||||
Return on average assets (“ROAA”) as reported | 1.02 | % | 1.25 | % | 1.32 | % | ||||||
Merger expenses | 0.39 | % | 0.05 | % | 0.00 | % | ||||||
Tax effect | -0.07 | % | -0.01 | % | 0.00 | % | ||||||
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| |||||||
ROAA excluding merger expenses | 1.34 | % | 1.29 | % | 1.32 | % | ||||||
Gain on sale of investment securities | 0.00 | % | 0.03 | % | 0.00 | % | ||||||
Tax effect | 0.00 | % | -0.01 | % | 0.00 | % | ||||||
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| |||||||
ROAA excluding gain on sale of investment securities | 1.34 | % | 1.31 | % | 1.32 | % | ||||||
Acquisition-related purchase accounting adjustments (“PAUs”) | -0.14 | % | -0.15 | % | -0.21 | % | ||||||
Tax effect | 0.03 | % | 0.03 | % | 0.04 | % | ||||||
|
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|
|
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| |||||||
Core ROAA | 1.23 | % | 1.19 | % | 1.15 | % | ||||||
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|
| |||||||
Non-GAAP Reconciliation of Return on Average Common Equity | ||||||||||||
Average Common Equity | $ | 506,449 | $ | 485,662 | $ | 460,076 | ||||||
Return on average common equity (“ROACE”) as reported | 8.66 | % | 10.73 | % | 11.29 | % | ||||||
Merger expenses | 3.30 | % | 0.40 | % | 0.00 | % | ||||||
Tax effect | -0.55 | % | -0.08 | % | 0.00 | % | ||||||
|
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| |||||||
ROACE excluding merger expenses | 11.41 | % | 11.05 | % | 11.29 | % | ||||||
Gain on sale of investment securities | -0.01 | % | 0.27 | % | -0.01 | % | ||||||
Tax effect | 0.00 | % | -0.06 | % | 0.00 | % | ||||||
|
|
|
|
|
| |||||||
ROACE excluding gain on sale of investment securities | 11.40 | % | 11.26 | % | 11.28 | % | ||||||
Acquisition-related purchase accounting adjustments (“PAUs”) | -1.21 | % | -1.33 | % | -1.80 | % | ||||||
Tax effect | 0.25 | % | 0.28 | % | 0.38 | % | ||||||
|
|
|
|
|
| |||||||
Core ROACE | 10.44 | % | 10.21 | % | 9.86 | % | ||||||
|
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|
Three Months Ended | Nine Months Ended | |||||||||||||||||||
September 30 | June 30 | September 30 | September 30 | September 30 | ||||||||||||||||
2019 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||
Non-GAAP Reconciliation of Return on Average Assets | ||||||||||||||||||||
Average assets | $ | 5,107,259 | $ | 5,047,365 | $ | 4,105,096 | $ | 4,823,601 | $ | 4,021,811 | ||||||||||
Return on average assets (“ROAA”) as reported | 1.60 | % | 1.32 | % | 1.26 | % | 1.33 | % | 1.33 | % | ||||||||||
Merger expenses | 0.00 | % | 0.12 | % | 0.00 | % | 0.16 | % | 0.00 | % | ||||||||||
Tax effect | 0.00 | % | -0.02 | % | 0.00 | % | -0.03 | % | 0.00 | % | ||||||||||
ROAA excluding merger expenses | 1.60 | % | 1.42 | % | 1.26 | % | 1.46 | % | 1.33 | % | ||||||||||
Loss on sale of investment securities | 0.00 | % | 0.01 | % | 0.01 | % | 0.00 | % | 0.00 | % | ||||||||||
Tax effect | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | ||||||||||
ROAA excluding loss on sale of investment securities | 1.60 | % | 1.43 | % | 1.27 | % | 1.46 | % | 1.33 | % | ||||||||||
Death benefit on bank owned life insurance (“BOLI”) | -0.02 | % | -0.03 | % | 0.00 | % | -0.02 | % | -0.01 | % | ||||||||||
ROAA excluding death benefit on BOLI | 1.58 | % | 1.40 | % | 1.27 | % | 1.44 | % | 1.32 | % | ||||||||||
Core ROAA | 1.58 | % | 1.40 | % | 1.27 | % | 1.44 | % | 1.32 | % | ||||||||||
Non-GAAP Reconciliation of Return on Average Common Equity | ||||||||||||||||||||
Average Common Equity | $ | 640,770 | $ | 622,028 | $ | 476,959 | $ | 589,766 | $ | 467,867 | ||||||||||
Return on average common equity (“ROACE”) as reported | 12.72 | % | 10.73 | % | 10.87 | % | 10.88 | % | 11.43 | % | ||||||||||
Merger expenses | 0.00 | % | 0.99 | % | 0.00 | % | 1.28 | % | 0.00 | % | ||||||||||
Tax effect | 0.00 | % | -0.19 | % | 0.00 | % | -0.22 | % | 0.00 | % | ||||||||||
ROACE excluding merger expenses | 12.72 | % | 11.53 | % | 10.87 | % | 11.94 | % | 11.43 | % | ||||||||||
Loss on sale of investment securities | 0.00 | % | 0.06 | % | 0.10 | % | 0.02 | % | 0.03 | % | ||||||||||
Tax effect | 0.00 | % | -0.01 | % | -0.02 | % | 0.00 | % | -0.01 | % | ||||||||||
ROACE excluding loss on sale of investment securities | 12.72 | % | 11.58 | % | 10.95 | % | 11.96 | % | 11.45 | % | ||||||||||
Death benefit on bank owned life insurance (“BOLI”) | -0.13 | % | -0.24 | % | 0.00 | % | -0.13 | % | -0.04 | % | ||||||||||
ROACE excluding death benefit on BOLI | 12.59 | % | 11.34 | % | 10.95 | % | 11.83 | % | 11.41 | % | ||||||||||
Core ROACE | 12.59 | % | 11.34 | % | 10.95 | % | 11.83 | % | 11.41 | % | ||||||||||
September 30 | June 30 | March 31 | December 31 | September 30 | ||||||||||||||||
2019 | 2019 | 2019 | 2018 | 2018 | ||||||||||||||||
Total stockholders’ equity | $ | 642,711 | $ | 626,461 | $ | 609,468 | $ | 491,992 | $ | 477,594 | ||||||||||
Less: Intangible assets | 178,896 | 179,776 | 176,864 | 130,270 | 130,755 | |||||||||||||||
Total tangible stockholders’ equity | $ | 463,815 | $ | 446,685 | $ | 432,604 | $ | 361,722 | $ | 346,839 | ||||||||||
Common shares outstanding | 44,969,021 | 45,061,372 | 45,052,747 | 38,375,407 | 38,367,890 | |||||||||||||||
Tangible book value per common share | $ | 10.31 | $ | 9.91 | $ | 9.60 | $ | 9.43 | $ | 9.04 |
Qualitative Disclosures About Market Risk
For the Three ended March 31, 2019 and 2018
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 4. CONTROLS AND PROCEDURES
ITEM 4. CONTROLS AND PROCEDURES March 31,September 30, 2019, Horizon’s Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of Horizon’s disclosure controls (as defined in Exchange Act RuleMarch 31,September 30, 2019, there have been no changes in Horizon’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, Horizon’s internal control over financial reporting.
For the Three Months ended March 31, 2019 and 2018
ITEM 1. | LEGAL PROCEEDINGS |
ITEM 1A. | RISK FACTORS |
ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
None not previously reported on a Current Report on Form8-K.
(a) | Unregistered Sales of Equity Securities: Not Applicable |
(b) | Use of Proceeds: Not Applicable |
(c) | Repurchase of Our Equity Securities |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as part of Publicly announced Plans or Programs (1) | Maximum Number of Shares that may yet be Purchased Under the Plans or Programs | ||||||||||||
July 16-31, 2019 | — | $ | — | — | 2,250,000 | |||||||||||
August 1-31, 2019 | 49,908 | 16.01 | 49,908 | 2,200,092 | ||||||||||||
September 1-30, 2019 | 49,499 | 16.08 | 49,499 | 2,150,593 | ||||||||||||
Total | 99,407 | $ | 16.04 | 99,407 | 2,150,593 | |||||||||||
(1) | On July 16, 2019, the Board of Directors authorized a stock repurchase program for up to 2,250,000 shares of Horizon common stock, without par value. Horizon announced the program publicly on July 17, 2019. The program will continue until otherwise modified, suspended or terminated by the Board of Directors in its sole discretion and without notice. |
ITEM 3. | DEFAULTS UPON SENIOR SECURITIES |
ITEM 4. | MINE SAFETY DISCLOSURES |
ITEM 5. | OTHER INFORMATION |
For the Three Months ended March 31, 2019 and 2018
ITEM 6. | EXHIBITS |
Exhibit No. | ||||||
Description | Location | |||||
31.1 | Attached | |||||
31.2 | Attached | |||||
32 | Attached | |||||
101 | Inline Interactive Data Files | Attached | ||||
104 | The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019, has been formatted in Inline XBRL |
HORIZON BANCORP, INC. | ||||||
Dated: November 7, 2019 | /s/ Craig M. Dwight | |||||
Craig M. Dwight | ||||||
Chief Executive Officer | ||||||
Dated: November 7, 2019 | ||||||
/s/ Mark E. Secor | ||||||
Mark E. Secor | ||||||
Chief Financial Officer |
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