Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 29, 2016 | Jun. 30, 2015 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | HERITAGE COMMERCE CORP | ||
Entity Central Index Key | 1,053,352 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2015 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 149.7 | ||
Entity Common Stock, Shares Outstanding | 32,121,885 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Assets | ||
Cash and due from banks | $ 24,112 | $ 23,256 |
Interest-bearing deposits in other financial institutions | 319,980 | 99,147 |
Total cash and cash equivalents | 344,092 | 122,403 |
Securities available-for-sale, at fair value | 385,079 | 206,335 |
Securities held-to-maturity, at amortized cost (fair value of $109,821 at December 31, 2015 and $94,953 at December 31, 2014) | 109,311 | 95,362 |
Loans held-for-sale - SBA, at lower of cost or market, including deferred costs | 7,297 | 1,172 |
Loans, net of deferred fees | 1,358,716 | 1,088,643 |
Allowance for loan losses | (18,926) | (18,379) |
Loans, net | 1,339,790 | 1,070,264 |
Federal Home Loan Bank stock, Federal Reserve Bank stock and other investments, at cost | 12,694 | 10,598 |
Company owned life insurance | 60,021 | 51,257 |
Premises and equipment | 7,773 | 7,451 |
Goodwill | 45,664 | 13,044 |
Other Intangible assets | 8,518 | 3,276 |
Accrued interest receivable and other assets | 41,340 | 35,941 |
Total assets | 2,361,579 | 1,617,103 |
Deposits: | ||
Demand, noninterest-bearing | 821,405 | 517,662 |
Demand, interest-bearing | 496,278 | 225,821 |
Savings and money market | 496,843 | 384,644 |
Time deposits-under $250 | 62,026 | 55,943 |
Time deposits-$250 and over | 160,815 | 164,952 |
Time deposits-brokered | 17,825 | 28,116 |
CDARS - money market and time deposits | 7,583 | 11,248 |
Total deposits | 2,062,775 | 1,388,386 |
Short-term borrowings | 3,000 | |
Accrued interest payable and other liabilities | 50,368 | 44,359 |
Total liabilities | $ 2,116,143 | $ 1,432,745 |
Commitments and contingencies (Notes 7 and 16) | ||
Shareholders' equity: | ||
Preferred stock, no par value; 10,000,000 shares authorized Series C convertible perpetual preferred stock, 21,004 shares issued and outstanding at December 31, 2015 and December 31, 2014 (liquidation preference of $21,004 at December 31, 2015 and December 31, 2014) | $ 19,519 | $ 19,519 |
Common stock, no par value; 60,000,000 shares authorized; 32,113,479 shares issued and outstanding at December 31, 2015 and 26,503,305 shares issued and outstanding at December 31, 2014 | 193,364 | 133,676 |
Retained earnings | 38,773 | 33,014 |
Accumulated other comprehensive loss | (6,220) | (1,851) |
Total shareholders' equity | 245,436 | 184,358 |
Total liabilities and shareholders' equity | $ 2,361,579 | $ 1,617,103 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Securities held-to-maturity | ||
Securities held-to-maturity, fair value (in dollars) | $ 109,821 | $ 94,953 |
Preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 21,004 | 21,004 |
Preferred stock, outstanding (in shares) | 21,004 | 21,004 |
Preferred stock, liquidation preference (in dollars) | $ 21,004 | $ 21,004 |
Common stock | ||
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 32,113,479 | 26,503,305 |
Common stock, shares outstanding | 32,113,479 | 26,503,305 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Interest income: | |||
Loans, including fees | $ 68,259 | $ 49,207 | $ 41,570 |
Securities, taxable | 6,707 | 7,117 | 8,937 |
Securities, exempt from Federal tax | 2,183 | 2,025 | 1,530 |
Other investments and interest-bearing deposits in other financial institutions | 1,594 | 907 | 749 |
Total interest income | 78,743 | 59,256 | 52,786 |
Interest expense: | |||
Deposits | 2,403 | 2,032 | 2,369 |
Subordinated debt | 229 | ||
Short-term borrowings | 19 | 121 | 2 |
Total interest expense | 2,422 | 2,153 | 2,600 |
Net interest income before provision for loan losses | 76,321 | 57,103 | 50,186 |
Provision (credit) for loan losses | 32 | (338) | (816) |
Net interest income after provision for loan losses | 76,289 | 57,441 | 51,002 |
Noninterest income: | |||
Service charges and fees on deposit accounts | 2,803 | 2,519 | 2,457 |
Increase in cash surrender value of life insurance | 1,697 | 1,600 | 1,654 |
Servicing income | 1,143 | 1,296 | 1,446 |
Gain on sales of SBA loans | 843 | 971 | 449 |
Gain on sales of securities | 642 | 97 | 38 |
Other | 1,857 | 1,263 | 1,170 |
Total noninterest income | 8,985 | 7,746 | 7,214 |
Noninterest expense: | |||
Salaries and employee benefits | 35,146 | 26,250 | 23,450 |
Occupancy and equipment | 4,300 | 4,053 | 4,043 |
Professional fees | 1,828 | 1,891 | 2,588 |
Other | 17,399 | 12,028 | 10,389 |
Total noninterest expense | 58,673 | 44,222 | 40,470 |
Income before income taxes | 26,601 | 20,965 | 17,746 |
Income tax expense | 10,104 | 7,538 | 6,206 |
Net income | 16,497 | 13,427 | 11,540 |
Dividends and discount accretion on preferred stock | (1,792) | (1,008) | (336) |
Net income available to common shareholders | $ 14,705 | $ 12,419 | $ 11,204 |
Earnings per common share: | |||
Basic (in dollars per share) | $ 0.48 | $ 0.42 | $ 0.36 |
Diluted (in dollars per share) | $ 0.48 | $ 0.42 | $ 0.36 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Net income | $ 16,497 | $ 13,427 | $ 11,540 |
Other comprehensive income (loss): | |||
Change in net unrealized holding gains (losses) on available-for-sale securities and I/O strips | (3,809) | 7,164 | (14,302) |
Deferred income taxes | 1,605 | (3,012) | 6,007 |
Change in net unamortized unrealized gain on securities available-for-sale that were reclassified to securities held-to-maturity | (55) | (54) | (54) |
Deferred income taxes | 23 | 23 | 23 |
Reclassification adjustment for gains realized in income | (642) | (97) | (38) |
Deferred income taxes | 270 | 41 | 16 |
Change in unrealized gains (losses) on securities and I/O strips, net of deferred income taxes | (2,608) | 4,065 | (8,348) |
Change in net pension and other benefit plan liability adjustment | (3,036) | (3,253) | 2,825 |
Deferred income taxes | 1,275 | 1,366 | (1,187) |
Change in pension and other benefit plan liability, net of deferred income taxes | (1,761) | (1,887) | 1,638 |
Other comprehensive income (loss) | (4,369) | 2,178 | (6,710) |
Total comprehensive income | $ 12,128 | $ 15,605 | $ 4,830 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Preferred Stock | Common Stock | Retained Earnings | Accumulated Other Comprehensive Income / (Loss) | Total |
Balance at Dec. 31, 2012 | $ 19,519 | $ 131,820 | $ 15,721 | $ 2,681 | $ 169,741 |
Balance (in shares) at Dec. 31, 2012 | 21,004 | 26,322,147 | |||
Increase (Decrease) in Shareholders' Equity | |||||
Net income | 11,540 | 11,540 | |||
Other comprehensive income (loss) | (6,710) | (6,710) | |||
Issuance of restricted stock awards, net (in shares) | 10,000 | ||||
Repurchase of warrant | $ (140) | (140) | |||
Amortization of restricted stock awards, net of forfeitures and taxes | 200 | 200 | |||
Cash dividend declared $0.32, $0.18 and $0.06 per share in 2015, 2014 and 2013, respectively | (1,916) | (1,916) | |||
Stock option expense, net of forfeitures and taxes | 593 | 593 | |||
Stock options exercised | $ 88 | 88 | |||
Stock options exercised (in shares) | 18,791 | ||||
Balance at Dec. 31, 2013 | $ 19,519 | $ 132,561 | 25,345 | (4,029) | 173,396 |
Balance (in shares) at Dec. 31, 2013 | 21,004 | 26,350,938 | |||
Increase (Decrease) in Shareholders' Equity | |||||
Net income | 13,427 | 13,427 | |||
Other comprehensive income (loss) | 2,178 | 2,178 | |||
Issuance of restricted stock awards, net (in shares) | 90,000 | ||||
Amortization of restricted stock awards, net of forfeitures and taxes | $ (9) | (9) | |||
Cash dividend declared $0.32, $0.18 and $0.06 per share in 2015, 2014 and 2013, respectively | (5,758) | (5,758) | |||
Stock option expense, net of forfeitures and taxes | 862 | 862 | |||
Stock options exercised | $ 262 | 262 | |||
Stock options exercised (in shares) | 62,567 | ||||
Balance at Dec. 31, 2014 | $ 19,519 | $ 133,676 | 33,014 | (1,851) | 184,358 |
Balance (in shares) at Dec. 31, 2014 | 21,004 | 26,503,505 | |||
Increase (Decrease) in Shareholders' Equity | |||||
Net income | 16,497 | 16,497 | |||
Other comprehensive income (loss) | (4,369) | (4,369) | |||
Issuance of 5,456,713 common shares to acquire Focus Business Bank, net of offering costs of $144 | $ 58,134 | 58,134 | |||
Issuance of 5,456,713 common shares to acquire Focus Business Bank, net of offering costs of $144 (in shares) | 5,456,713 | ||||
Issuance of restricted stock awards, net (in shares) | 98,855 | ||||
Amortization of restricted stock awards, net of forfeitures and taxes | $ 265 | 265 | |||
Cash dividend declared $0.32, $0.18 and $0.06 per share in 2015, 2014 and 2013, respectively | (10,738) | (10,738) | |||
Stock option expense, net of forfeitures and taxes | 974 | 974 | |||
Stock options exercised | $ 315 | 315 | |||
Stock options exercised (in shares) | 54,406 | ||||
Balance at Dec. 31, 2015 | $ 19,519 | $ 193,364 | $ 38,773 | $ (6,220) | $ 245,436 |
Balance (in shares) at Dec. 31, 2015 | 21,004 | 32,113,479 |
CONSOLIDATED STATEMENTS OF CHA7
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | |||
Cash dividend declared per share (in dollars per share) | $ 0.32 | $ 0.18 | $ 0.06 |
Issuance of 5,456,713 common shares to acquire Focus Business Bank, offering costs | $ 144 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income | $ 16,497 | $ 13,427 | $ 11,540 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Amortization of discounts and premiums on securities | 1,384 | 1,163 | 2,231 |
Gain on sales of securities available-for-sale | (642) | (97) | (38) |
Gain on sales of SBA loans | (843) | (971) | (449) |
Proceeds from sale of SBA loans originated for sale | 11,497 | 15,858 | 6,174 |
Net change in SBA loans originated for sale | (14,906) | (12,911) | (9,234) |
Provision (credit) for loan losses | 32 | (338) | (816) |
Increase in cash surrender value of life insurance | (1,697) | (1,600) | (1,654) |
Gain on proceeds from company owned life insurance | (51) | ||
Depreciation and amortization | 685 | 725 | 729 |
Amortization of other intangible assets | 1,043 | 510 | 473 |
Gains on sale of foreclosed assets, net | (106) | (243) | |
Stock option expense, net | 974 | 862 | 593 |
Amortization of restricted stock award, net | 265 | (9) | 200 |
Effect of changes in: | |||
Accrued interest receivable and other assets | 16,274 | (2,428) | 4,694 |
Accrued interest payable and other liabilities | (1,963) | 5,244 | 2,063 |
Net cash provided by operating activities | 28,494 | 19,384 | 16,263 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Purchase of securities available-for-sale | (232,644) | (53,292) | (17,844) |
Purchase of securities held-to-maturity | (9,482) | (4,595) | (51,044) |
Maturities/paydowns/calls of securities available-for-sale | 31,195 | 24,917 | 62,531 |
Maturities/paydowns/calls of securities held-to-maturity | 3,931 | 3,899 | 3,851 |
Proceeds from sale of securities available-for-sale | 71,832 | 108,603 | 26,944 |
Net change in loans | (97,898) | (131,648) | (97,910) |
Changes in Federal Home Loan Bank stock, Federal Reserve Bank stock and other investments | (1,788) | (163) | 293 |
Purchase of premises and equipment | (1,007) | (817) | (500) |
Proceeds from sale of foreclosed assets | 1,571 | 850 | |
Proceeds from company owned life insurance | 406 | ||
Cash paid in bank acquisition, net of cash received | 165,786 | (21,918) | |
Net cash used in investing activities | (68,504) | (74,608) | (72,829) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Net change in deposits | 269,266 | 102,165 | (193,147) |
Repurchase of warrant | (140) | ||
Exercise of stock options | 315 | 262 | 88 |
Offering costs | (144) | ||
Short-term borrowings | 3,000 | ||
Repayments of short-term borrowings | (31,647) | ||
Redemption of subordinated debt | (9,279) | ||
Payment of cash dividends | (10,738) | (5,758) | (1,916) |
Net cash provided by (used in) financing activities | 261,699 | 65,022 | (204,394) |
Net increase (decrease) in cash and cash equivalents | 221,689 | 9,798 | (260,960) |
Cash and cash equivalents, beginning of period | 122,403 | 112,605 | 373,565 |
Cash and cash equivalents, end of period | 344,092 | 122,403 | 112,605 |
Supplemental disclosures of cash flow information: | |||
Interest paid | 2,427 | 2,166 | 2,685 |
Income taxes paid | 6,904 | 4,280 | 2,021 |
Supplemental schedule of non-cash investing activity: | |||
Due to broker for securities purchased, settling after year-end | 961 | ||
Transfer of loans held-for-sale to loan portfolio | 2,543 | 3,770 | |
Loans transferred to foreclosed assets | $ 1,236 | $ 229 | $ 33 |
CONSOLIDATED STATEMENTS OF CAS9
CONSOLIDATED STATEMENTS OF CASH FLOWS - Summary of Assets Acquired and Liabilities Assumed Through Acquisition (Parenthetical) - USD ($) $ in Thousands | Aug. 20, 2015 | Nov. 01, 2014 |
Focus Business Bank | ||
Summary of assets acquired and liabilities assumed through acquisition: | ||
Cash and cash equivalents, net of cash paid for acquisition | $ 165,786 | |
Securities available-for-sale | 53,940 | |
Securities held-to-maturity | 8,665 | |
Loans held-for-sale--SBA | 4,416 | |
Net loans | 170,353 | |
Company owned life insurance | 7,067 | |
Goodwill and other intangible assets | 38,905 | |
Other assets, net | 20,250 | |
Deposits | (405,123) | |
Other liabilities | $ (5,981) | |
BVF/CSNK | ||
Summary of assets acquired and liabilities assumed through acquisition: | ||
Net loans | $ 42,300 | |
Premises and equipment | 119 | |
Goodwill and other intangible assets | 15,303 | |
Other assets, net | 738 | |
Borrowings | (31,647) | |
Other liabilities | $ (4,895) |
CONSOLIDATED STATEMENTS OF CA10
CONSOLIDATED STATEMENTS OF CASH FLOWS - Common Stock Issued to Acquire Focus Business Bank (Parenthetical) $ in Thousands | Aug. 20, 2015USD ($) |
Focus Business Bank | |
Supplemental schedule of non-cash investing activity: | |
Common stock issued to acquire Focus Business Bank | $ 58,278 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 1) Summary of Significant Accounting Policies Description of Business and Basis of Presentation Heritage Commerce Corp ("HCC") operates as a registered bank holding company for its wholly-owned subsidiary Heritage Bank of Commerce ("HBC" or the "Bank"), collectively referred to as the "Company". HBC was incorporated on November 23, 1993 and commenced operations on June 8, 1994. HBC is a California state chartered bank which offers a full range of commercial and personal banking services to residents and the business/professional community in Santa Clara, Alameda, and Contra Costa counties, California. On November 1, 2014, the Company acquired CSNK Working Capital Finance Corp. dba Bay View Funding ("Bay View Funding"), which provides business-essential working capital factoring financing to various industries throughout the United States. Bay View Funding's results of operations have been included in the Company's results of operations beginning November 1, 2014. As discussed in Note 8, the Company completed its acquisition of Focus Business Bank ("Focus") on August 20, 2015. Focus was merged with HBC, with HBC as the surviving bank. Focus' results of operations have been included in the Company's results of operations beginning August 21, 2015. The consolidated financial statements are prepared in accordance with accounting policies generally accepted in the United States of America and general practices in the banking industry. The financial statements include the accounts of the Company. All inter-company accounts and transactions have been eliminated in consolidation. The Company also established the following wholly-owned Delaware business trusts that were formed to issue trust preferred and related common securities: Heritage Statutory Trust II, formed in 2001, and Heritage Statutory Trust III, formed in 2002 ("Trusts"). During the third quarter of 2013, the Company dissolved the Heritage Statutory Trust II and the Heritage Statutory Trust III. The Trusts issued their preferred securities to investors, and used the proceeds to purchase subordinated debt issued by the Company. The subordinated debt payable to the Trusts was recorded as debt of the Company. The Company had fully and unconditionally guaranteed the trust preferred securities along with all obligations of the Trusts under the trust agreements. Interest income from the subordinated debt was the source of revenues for these Trusts. In accordance with generally accepted accounting principles, the Trusts were not consolidated in the Company's financial statements. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents include cash on hand, amounts due from banks, amounts held at the Federal Reserve Bank, and Federal funds sold. The Company is required to maintain reserves against certain of the deposit accounts with the Federal Reserve Bank. Federal funds are generally sold and purchased for one-day periods. Cash Flows Net cash flows are reported for customer loan and deposit transactions, notes payable, repurchase agreements and other short-term borrowings. Securities The Company classifies its securities as either available-for-sale or held-to-maturity at the time of purchase. Debt securities are classified as held-to-maturity and carried at amortized cost when management has the positive intent and ability to hold them to maturity. Debt securities not classified as held-to-maturity are classified as available-for-sale. Securities available-for-sale are carried at fair value, with unrealized holding gains and losses reported in other comprehensive income, net of taxes. A decline in the fair value of any available-for-sale or held- to-maturity security below amortized cost that is deemed other than temporary results in a charge to earnings and the corresponding establishment of a new cost basis for the security. In estimating other-than-temporary losses, management considers (1) the length of time and extent that fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, (3) whether the fair value decline was affected by macroeconomic conditions, and (4) whether the Company has the intention to sell the security or more likely than not will be required to sell the security before any anticipated recovery in fair value. Interest income includes amortization of purchase premiums or discounts. Premiums and discounts are amortized, or accreted, over the life of the related security as an adjustment to income using a method that approximates the interest method. Realized gains and losses are recorded on the trade date and determined using the specific identification method for the cost of securities sold. Loan Sales and Servicing The Company holds for sale the conditionally guaranteed portion of certain loans guaranteed by the Small Business Administration or the U.S. Department of Agriculture (collectively referred to as "SBA loans"). These loans are carried at the lower of aggregate cost or fair value. Net unrealized losses, if any, are recorded as a valuation allowance and charged to earnings. Gains or losses on SBA loans held-for-sale are recognized upon completion of the sale, based on the difference between the selling price and the carrying value of the related loan sold. SBA loans are sold with servicing retained. Servicing assets recognized separately upon the sale of SBA loans consist of servicing rights and, for loans sold prior to 2009, interest-only strip receivables ("I/O strips"). The Company accounts for the sale and servicing of SBA loans based on the financial and servicing assets it controls and liabilities it has incurred, reversing recognition of financial assets when control has been surrendered, and reversing recognition of liabilities when extinguished. Servicing rights are initially recorded at fair value with the income statement effect recorded in gains on sale of loans. Servicing rights are amortized in proportion to and over the period of net servicing income and are assessed for impairment on an ongoing basis. Impairment is determined by stratifying the servicing rights based on interest rates and terms. Any servicing assets in excess of the contractually specified servicing fees are reclassified at fair value as an I/O strip receivable and treated like an available for sale security. Fair value is determined using prices for similar assets with similar characteristics, when available, or based upon discounted cash flows using market-based assumptions. Impairment is recognized through a valuation allowance. The servicing rights, net of any required valuation allowance, and I/O strip receivable are included in other assets on the consolidated balance sheets. Servicing income, net of amortization of servicing rights, is recognized as noninterest income. The initial fair value of I/O strip receivables is amortized against interest income on loans. Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at the principal amount outstanding, net of deferred loan origination fees and costs on originated loans, or unamortized premiums or discounts on purchased or acquired loans, and an allowance for loan losses. The majority of the Company's loans have variable interest rates. Interest on loans is accrued on the unpaid principal balance and is credited to income using the effective yield interest method. Interest on purchased or acquired loans and the accretion (amortization) of the related purchase discount (premium) is also credited to income using the effective yield interest method. A loan portfolio segment is defined as the level at which the Company uses a systematic methodology to determine the allowance for loan losses. A loan portfolio class is defined as a group of loans having similar risk characteristics and methods for monitoring and assessing risk. For all loan classes, when a loan is classified as nonaccrual, the accrual of interest is discontinued, any accrued and unpaid interest is reversed, and the amortization of deferred loan fees and costs is discontinued. For all loan classes, loans are classified as nonaccrual when the payment of principal or interest is 90 days past due, unless the loan is well secured and in the process of collection. Nonaccrual loans and loans past due 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. In certain circumstances, loans that are under 90 days past due may also be classified as nonaccrual. Any interest or principal payments received on nonaccrual loans are applied toward reduction of principal. Nonaccrual loans generally are not returned to performing status until the obligation is brought current, the loan has performed in accordance with the contract terms for a reasonable period of time, and the ultimate collectability of the contractual principal and interest is no longer in doubt. Non-refundable loan fees and direct origination costs are deferred and recognized over the expected lives of the related loans using the effective yield interest method. Acquired Loans and Leases Loans and leases acquired through purchase or through a business combination are recorded at their fair value at the acquisition date. Credit discounts are included in the determination of fair value; therefore, an allowance for loan and lease losses is not recorded at the acquisition date. Should the Company's allowance for loan and lease losses methodology indicate that the credit discount associated with acquired, non-purchased credit impaired loans, is no longer sufficient to cover probable losses inherent in those loans, the Company will establish an allowance for those loans through a charge to provision for loan and lease losses. Acquired loans are evaluated upon acquisition for evidence of deterioration in credit quality since origination such that it is probable at acquisition that the Company will be unable to collect all contractually required payments. Such loans are classified as purchased credit impaired loans ("PCI loans"), while all other acquired loans are classified as non-PCI loans. The Company has elected to account for PCI loans on an individual loan level. The Company estimates the amount and timing of expected cash flows for each loan. The expected cash flow in excess of the loan's carrying value, which is fair value on the date of acquisition, is referred to as the accretable yield, and is recorded as interest income over the remaining expected life of the loan. The excess of the loan's contractual principal and interest over expected cash flows is referred to as the non-accretable difference, and is not recorded in the Company's Consolidated Financial Statements. Quarterly, management performs an evaluation of expected future cash flows for PCI loans. If current expectations of future cash flows are less than management's previous expectations, other than due to decreases in interest rates and prepayment assumptions, an allowance for loan and leases losses is recorded with a charge to current period earnings through provision for loan and lease losses. If there has been a probable and significant increase in expected future cash flows over that which was previously expected, the Company would first reduce any previously established allowance for loan and lease losses, and then record an adjustment to interest income through a prospective increase in the accretable yield. Allowance for Loan Losses The allowance for loan losses is an estimate of probable incurred losses in the loan portfolio. Loans are charged-off against the allowance when management believes the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance for loan losses. Management's methodology for estimating the allowance balance consists of several key elements, which include specific allowances on individual impaired loans and the formula driven allowances on pools of loans with similar risk characteristics. Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan that, in management's judgment, should be charged off. Specific allowances are established for impaired loans. Management considers a loan to be impaired when it is probable that the Company will be unable to collect all amounts due according to the original contractual terms of the loan agreement, including scheduled interest payments. Loans for which the terms have been modified with a concession granted, and for which the borrower is experiencing financial difficulties, are considered troubled debt restructurings and classified as impaired. When a loan is considered to be impaired, the amount of impairment is measured based on the fair value of the collateral, less costs to sell, if the loan is collateral dependent, or on the present value of expected future cash flows or values that are observable in the secondary market if the loan is not collateral dependent. The amount of any impairment will be charged off against the allowance for loan losses if the amount is a confirmed loss or, alternatively, a specific allocation within the allowance will be established. Loans that are considered impaired are specifically excluded from the formula portion of the allowance for loan losses analysis. The formula driven allowance on pools of loans covers all loans that are not impaired and is based on historical losses of each loan segment adjusted for current factors. In calculating the historical component of our allowance, we aggregate our loans into one of three loan segments: Commercial, Real Estate and Consumer. Each segment of loans in the portfolio possess varying degrees of risk, based on, among other things, the type of loan being made, the purpose of the loan, the type of collateral securing the loan, and the sensitivity the borrower has to changes in certain external factors such as economic conditions. The following provides a summary of the risks associated with various segments of the Company's loan portfolio, which are factors management regularly considers when evaluating the adequacy of the allowance: • Commercial loans consist primarily of commercial and industrial loans (business lines of credit), and other commercial purpose loans. Repayment of commercial and industrial loans is generally provided from the cash flows of the related business to which the loan was made. Adverse changes in economic conditions may result in a decline in business activity, which may impact a borrower's ability to continue to make scheduled payments. The factored receivables at Bay View Funding are included in the Company's commercial loan portfolio; however, they are evaluated for risk primarily based on the agings of the receivables. Faster turning receivables imply less risk and therefore warrant a lower associated allowance. Should the overall aging for the portfolio increase, this structure will by formula increase the allowance to reflect the increasing risk. Should the portfolio turn more quickly, it would reduce the associated allowance to reflect the reducing risk. • Real estate loans consist primarily of loans secured by commercial and residential real estate. Also included in this segment are land and construction loans and home equity lines of credit secured by real estate. As the majority of this segment is comprised of commercial real estate loans, risks associated with this segment lay primarily within these loan types. Adverse economic conditions may result in a decline in business activity and increased vacancy rates for commercial properties. These factors, in conjunction with a decline in real estate prices, may expose the Company to the potential for losses if a borrower cannot continue to service the loan with operating revenues, and the value of the property has declined to a level such that it no longer fully covers the Company's recorded investment in the loan. • Consumer loans consist primarily of a large number of small loans and lines of credit. The majority of installment loans are made for consumer and business purchases. Weakened economic conditions may result in an increased level of delinquencies within this segment, as economic pressures may impact the capacity of such borrowers to repay their obligations. As a result of the matters mentioned above, changes in the financial condition of individual borrowers, economic conditions, historical loss experience and the condition of the various markets in which collateral may be sold may all affect the required level of the allowance for loan losses and the associated provision for loan losses. The estimated loss factors for pools of loans that are not impaired are based on determining the probability of default and loss given default for loans within each segment of the portfolio, adjusted for significant factors that, in management's judgment, affect collectibility as of the evaluation date. The Company's historical delinquency experience and loss experience are utilized to determine the probability of default and loss given default for segments of the portfolio where the Company has experienced losses in the past. For segments of the portfolio where the Company has no significant prior loss experience, the Company uses quantifiable observable industry data to determine the probability of default and loss given default. Risk factors impacting loans in each of the portfolio segments include broad deterioration of property values, reduced consumer and business spending as a result of continued high unemployment and reduced credit availability and lack of confidence in a sustainable recovery. The historical loss experience is adjusted for management's estimate of the impact of other factors based on the risks present for each portfolio segment. These other factors include consideration of the following: the overall level of concentrations and trends of classified loans; loan concentrations within a portfolio segment or division of a portfolio segment; identification of certain loan types with higher risk than other loans; existing internal risk factors; and management's evaluation of the impact of local and national economic conditions on each of our loan types. Loan Commitments and Related Financial Instruments Financial instruments include off-balance sheet credit instruments, such as commitments to make loans and commercial letters of credit, issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded. Federal Home Loan Bank and Federal Reserve Bank Stock As a member of the Federal Home Loan Bank ("FHLB") system, the Bank is required to own common stock in the FHLB based on the Bank's level of borrowings and outstanding FHLB advances. FHLB stock is carried at cost and classified as a restricted security. Both cash and stock dividends are reported as income. As a member of the Federal Reserve Bank ("FRB") of San Francisco, the Bank is required to own stock in the FRB of San Francisco based on a specified ratio relative to our capital. FRB stock is carried at cost and may be sold back to the FRB at its carrying value. Cash dividends received are reported as income. Company Owned Life Insurance and Split-Dollar Life Insurance Benefit Plan The Company has purchased life insurance policies on certain directors and officers. Company owned life insurance is recorded at the amount that can be realized under the insurance contract at the balance sheet date, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement. The purchased insurance is subject to split-dollar insurance agreements with the insured participants, which continues after the participant's employment and retirement. Accounting guidance requires that a liability be recorded primarily over the participant's service period when a split-dollar life insurance agreement continues after a participant's employment or retirement. The required accrued liability is based on either the post-employment benefit cost for the continuing life insurance or the future death benefit depending on the contractual terms of the underlying agreement. Premises and Equipment Land is carried at cost. Premises and equipment are stated at cost. Depreciation and amortization are computed on the straight-line basis over the lesser of the respective lease terms or estimated useful lives. The Company owns one building which is being depreciated over 40 years. Furniture, equipment, and leasehold improvements are depreciated over estimated useful lives generally ranging from five to fifteen years. The Company evaluates the recoverability of long-lived assets on an ongoing basis. Business Combinations The Company accounts for acquisitions of businesses using the acquisition method of accounting. Under the acquisition method, assets acquired and liabilities assumed are recorded at their estimated fair values at the date of acquisition. Management utilizes various valuation techniques including discounted cash flow analyses to determine these fair values. Any excess of the purchase price over amounts allocated to the acquired assets, including identifiable intangible assets, and liabilities assumed is recorded as goodwill. Goodwill and Other Intangible Assets Goodwill resulted from the acquisition of Bay View Funding on November 1, 2014 and Focus on August 20, 2015. Goodwill represents the excess of the purchase price over the fair value of acquired tangible assets and liabilities and identifiable intangible assets. Goodwill is assessed at least annually for impairment and any such impairment is recognized in the period identified. Other intangible assets consist of core deposit and customer relationship intangible assets arising from the Diablo Valley Bank acquisition in June 2007, a core deposit intangible asset from the Focus acquisition in August 2015, and a below market value lease, customer relationship and non-compete agreement intangible assets arising from the Bay View Funding acquisition in November 2014. They are initially measured at fair value and then are amortized over their estimated useful lives. The core deposits intangible assets from the acquisitions of Diablo Valley Bank and Focus are being amortized on an accelerated method over ten years. The customer relationship intangible from the acquisition of Diablo Valley Bank was being amortized on an accelerated method over seven years, and was fully amortized at December 31, 2014. The below market value lease, customer relationship and non-compete agreement intangible assets from the acquisition of Bay View Funding are being amortized on the straight line method over three, ten, and three years, respectively. Foreclosed Assets Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. If fair value declines subsequent to foreclosure, a valuation allowance is recorded through operations. Operating costs after acquisition are expensed. Gains and losses on disposition are included in noninterest expense. The carrying value of foreclosed assets was $364,000 and $696,000 at December 31, 2015 and 2014, respectively, and is included in other assets on the consolidated balance sheets. Retirement Plans Expenses for the Company's non-qualified, unfunded defined benefits plan consists of service and interest cost and amortization of gains and losses not immediately recognized. Employee 401(k) and profit sharing plan expense is the amount of matching contributions. Deferred compensation and supplemental retirement plan expense allocates the benefits over years of service. Loss Contingencies Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. The Company's accounting policy for legal costs related to loss contingencies is to accrue for the probable fees that can be reasonably estimated. The Company's accounting policy for uncertain recoveries is to recognize the anticipated recovery when realization is deemed probable. Income Taxes The Company files consolidated Federal and combined state income tax returns. Income tax expense is the total of the current year income tax payable or refunded, the change in deferred tax assets and liabilities, and low income housing investment losses, net of tax benefits received. Some items of income and expense are recognized in different years for tax purposes when applying generally accepted accounting principles, leading to timing differences between the Company's actual tax liability and the amount accrued for this liability based on book income. These temporary differences comprise the "deferred" portion of the Company's tax expense or benefit, which is accumulated on the Company's books as a deferred tax asset or deferred tax liability until such time as they reverse. Realization of the Company's deferred tax assets is primarily dependent upon the Company generating sufficient taxable income to obtain benefit from the reversal of net deductible temporary differences and utilization of tax credit carryforwards for Federal and California state income tax purposes. The amount of deferred tax assets considered realizable is subject to adjustment in future periods based on estimates of future taxable income. Under generally accepted accounting principles, a valuation allowance is required to be recognized if it is "more likely than not" that a deferred tax asset will not be realized. The determination of the realizability of the deferred tax assets is highly subjective and dependent upon judgment concerning management's evaluation of both positive and negative evidence, including forecasts of future income, cumulative losses, applicable tax planning strategies, and assessments of current and future economic and business conditions. The Company had net deferred tax assets of $22,218,000 and $18,527,000 at December 31, 2015, and December 31, 2014, respectively. After consideration of the matters in the preceding paragraph, the Company determined that it is more likely than not that the net deferred tax asset at December 31, 2015 and 2014 will be fully realized in future years. A tax position is recognized as a benefit only if it is "more likely than not" that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the "more likely than not" test, no tax benefit is recorded. The Company recognizes interest and penalties related to uncertain tax positions as income tax expense. Stock-Based Compensation Compensation cost is recognized for stock options and restricted stock awards issued to employees, based on the fair value of these awards at the date of grant. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company's common stock at the date of grant is used for restricted stock awards. Compensation cost is recognized over the required service period, generally defined as the vesting period. For awards with graded vesting, compensation cost is recognized on a straight-line basis over the requisite service period for the entire award. Compensation cost recognized reflects estimated forfeitures, adjusted as necessary for actual forfeitures. Comprehensive Income (Loss) Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) refers to gains and losses that are included in comprehensive income (loss) but are excluded from net income (loss) because they have been recorded directly in equity under the provisions of certain accounting guidance. The Company's sources of other comprehensive income (loss) are unrealized gains and losses on securities available-for-sale, and I/O strips, which are treated like available-for-sale securities, and the liabilities related to the Company's defined benefit pension plan and the split-dollar life insurance benefit plan. Reclassification adjustments result from gains or losses on securities that were realized and included in net income (loss) of the current period that also had been included in other comprehensive income as unrealized holding gains and losses. Segment Reporting HBC is a commercial bank serving customers located in Santa Clara, Alameda, Contra Costa, and San Benito counties of California. Bay View Funding provides business essential working capital factoring financing to various industries throughout the United States. No customer accounts for more than 10 percent of revenue for HBC or the Company. With the acquisition of Bay View Funding, the Company now has two reportable segments consisting of Banking and Factoring. While the chief decision-makers monitor the revenue streams of the various products and services, operations are managed and financial performance is evaluated on a Company-wide basis. Operating segments are aggregated into one as operating results for all segments are similar. Accordingly, all of the financial service operations are considered by management to be aggregated in one reportable segment. Reclassifications Certain items in the consolidated financial statements for the years ended December 31, 2014 and 2013 were reclassified to conform to the 2015 presentation. These reclassifications did not affect previously reported net income or shareholders equity. Adoption of New Accounting Standards In January 2014, the Financial Accounting Standards Board ("FASB") amended existing guidance clarifying that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction. The amendments in this update are effective for public business entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. For entities other than public business entities, the amendments in this update are effective for annual periods beginning after December 15, 2014, and interim periods within annual periods beginning after December 15, 2015. The Company has evaluated the adoption of the new guidance and has determined it did not have a material impact on the consolidated financial statements. In January 2014, the FASB issued guidance for accounting for investments in qualified affordable housing projects, which represents a consensus of the Emerging Issues Task Force and sets forth new accounting for qualifying investments in flow through limited liability entities that invest in affordable housing projects. The new guidance allows a limited liability investor that meets certain conditions to amortize the cost of its investment in proportion to the tax credits and other tax benefits it receives. The new accounting method, referred to as the proportional amortization method, allows amortization of the tax credit investment to be reflected along with the primary benefits, the ta |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (''AOCI'') | 12 Months Ended |
Dec. 31, 2015 | |
Accumulated Other Comprehensive Income ("AOCI") | |
Accumulated Other Comprehensive Income ("AOCI") | 2) Accumulated Other Comprehensive Income ("AOCI") The following table reflects the changes in AOCI by component for the periods indicated: For the Years Ended December 31, 2015, 2014, and 2013 Unrealized Gains (Losses) on Available- for-Sale Securities and I/O Strips Unamortized Unrealized Gain on Available- for-Sale Securities Reclassified to Held-to- Maturity Defined Benefit Pension Plan Items Total (Dollars in thousands) Beginning balance January 1, 2015, net of taxes $ $ $ ) $ ) Other comprehensive (loss) before reclassification, net of taxes ) — ) ) Amounts reclassified from other comprehensive income (loss), net of taxes ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive income (loss), net of taxes ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ending balance December 31, 2015, net of taxes $ $ $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning balance January 1, 2014, net of taxes $ ) $ $ ) $ ) Other comprehensive (loss) before reclassification, net of taxes — ) Amounts reclassified from other comprehensive income (loss), net of taxes ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive income (loss), net of taxes ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ending balance December 31, 2014, net of taxes $ $ $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning balance January 1, 2013, net of taxes $ $ $ ) $ Other comprehensive (loss) before reclassification, net of taxes ) — ) Amounts reclassified from other comprehensive income (loss), net of taxes ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive income (loss), net of taxes ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ending balance December 31, 2013, net of taxes $ ) $ $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amounts Reclassified from AOCI For the Year Ended December 31, Affected Line Item Where Net Income is Presented Details About AOCI Components 2015 2014 2013 (Dollars in thousands) Unrealized gains on available-for-sale securities and I/O strips $ $ $ Realized gains on sale of securities ) ) ) Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net of tax ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of unrealized gain on securities available-for-sale that were reclassified to securities held-to-maturity Interest income on taxable securities ) ) ) Income tax (expense) benefit ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net of tax ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of defined benefit pension plan items(1) Prior transition obligation Actuarial losses ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ) ) ) Income before income tax Income tax benefit ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ) ) ) Net of tax ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total reclassification for the year $ $ $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) This AOCI component is included in the computation of net periodic benefit cost (see Note 14 — Benefit Plans). |
Securities
Securities | 12 Months Ended |
Dec. 31, 2015 | |
Securities | |
Securities | 3) Securities The amortized cost and estimated fair value of securities at year-end were as follows: 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Estimated Fair Value (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ $ $ ) $ U.S. Treasury — ) Trust preferred securities — U.S. Government sponsored entities ) Corporate bonds — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Securities held-to-maturity: Municipals — tax exempt $ $ $ ) $ Agency mortgage-backed securities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2014 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Estimated Fair Value (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ $ $ ) $ Corporate bonds ) Trust preferred securities — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Securities held-to-maturity: Municipals — tax exempt $ $ $ ) $ Agency mortgage-backed securities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Securities with unrealized losses at year end, aggregated by investment category and length of time that individual securities have been in an unrealized loss position, are as follows: Less Than 12 Months 12 Months or More Total 2015 Fair Value Unrealized (Losses) Fair Value Unrealized (Losses) Fair Value Unrealized (Losses) (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ $ ) $ $ ) $ $ ) U.S. Treasury ) — — ) U.S. Government sponsored entities ) — — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ) $ $ ) $ $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Securities held-to-maturity: Municipals — Tax Exempt $ $ ) $ $ ) $ $ ) Agency mortgage-backed securities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ) $ $ ) $ $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less Than 12 Months 12 Months or More Total 2014 Fair Value Unrealized (Losses) Fair Value Unrealized (Losses) Fair Value Unrealized (Losses) (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ $ ) $ $ ) $ $ ) Corporate bonds — — ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ) $ $ ) $ $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Securities held-to-maturity: Municipals — Tax Exempt $ $ ) $ $ ) $ $ ) Agency mortgage-backed securities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ) $ $ ) $ $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ There were no holdings of securities of any one issuer, other than the U.S. Government and its sponsored entities, in an amount greater than 10% of shareholders' equity. At December 31, 2015, the Company held 460 securities (193 available-for-sale and 267 held-to-maturity), of which 193 had fair values below amortized cost. At December 31, 2015, there were $2,165,000 of agency mortgage-backed securities available-for-sale, $4,409,000 of agency mortgage-backed securities held-to-maturity and $24,412,000 of municipals bonds held-to-maturity carried with an unrealized loss for 12 months or greater. The total unrealized loss for securities 12 months or greater was $910,000 at December 31, 2015. The unrealized losses were due to higher interest rates. The issuers are of high credit quality and all principal amounts are expected to be paid when securities mature. The fair value is expected to recover as the securities approach their maturity date and/or market rates decline. The Company does not believe that it is more likely than not that the Company will be required to sell a security in an unrealized loss position prior to recovery in value. The Company does not consider these securities to be other-than-temporarily impaired at December 31, 2015. The proceeds from sales of securities and the resulting gains and losses are listed below: 2015 2014 2013 (Dollars in thousands) Proceeds $ $ $ Gross gains Gross losses ) ) ) The amortized cost and fair value of debt securities as of December 31, 2015, by contractual maturity, are shown below. The expected maturities will differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately. Available-for-sale Amortized Cost Estimated Fair Value (Dollars in thousands) Due after 3 months through one year $ $ Due after one through five years Due after five through ten years Due after ten years Agency mortgage-backed securities ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Held-to-maturity Amortized Cost Estimated Fair Value (Dollars in thousands) Due less than 3 months $ $ Due after 3 months through one year Due after one through five years Due after five through ten years Due after ten years Agency mortgage-backed securities ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Securities with amortized cost of $134,235,000 and $147,497,000 as of December 31, 2015 and 2014 were pledged to secure public deposits and for other purposes as required or permitted by law or contract. |
Loans
Loans | 12 Months Ended |
Dec. 31, 2015 | |
Loans | |
Loans | 4) Loans Loans at year-end were as follows: 2015 2014 (Dollars in thousands) Loans held-for-investment: Commercial $ $ Real estate: Commercial and residential Land and construction Home equity Consumer ​ ​ ​ ​ ​ ​ ​ ​ Loans Deferred loan fees, net ) ) ​ ​ ​ ​ ​ ​ ​ ​ Loans, net of deferred fees Allowance for loan losses ) ) ​ ​ ​ ​ ​ ​ ​ ​ Loans, net $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, 2015, total net loans included in the table above include $141,343,000 of the non-PCI loans acquired in the Focus transaction. Changes in the allowance for loan losses were as follows: For the Year Ended December 31, 2015 Commercial Real Estate Consumer Total (Dollars in thousands) Balance, beginning of year $ $ $ $ Charge-offs ) ) ) ) Recoveries ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net recoveries Provision (credit) for loan losses ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, 2014 Commercial Real Estate Consumer Total (Dollars in thousands) Balance, beginning of year $ $ $ $ Charge-offs ) ) ) ) Recoveries — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net charge-offs ) ) ) ) Provision (credit) for loan losses ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, 2013 Commercial Real Estate Consumer Total (Dollars in thousands) Balance, beginning of year $ $ $ $ Charge-offs ) ) — ) Recoveries ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net recoveries Provision (credit) for loan losses ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment, based on the impairment method as follows at year-end: December 31, 2015 Commercial Real Estate Consumer Total (Dollars in thousands) Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ $ $ — $ Collectively evaluated for impairment Acquired with deterioriated credit quality — — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total allowance balance $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans: Individually evaluated for impairment $ $ $ $ Collectively evaluated for impairment Acquired with deterioriated credit quality — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total loan balance $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2014 Commercial Real Estate Consumer Total (Dollars in thousands) Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ $ — $ — $ Collectively evaluated for impairment ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total allowance balance $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans: Individually evaluated for impairment $ $ $ $ Collectively evaluated for impairment ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total loan balance $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchased Credit Impaired Loans: The Company has purchased loans, for which there was, at acquisition, evidence of credit quality since origination and it was probable, at acquisition, that all contractually required payments would not be collected. The carrying amount of these loans is as follows: 2015 (Dollars in thousands) Commercial $ Outstanding balance Carrying amount, net of discount of $639,000 For those purchased credit impaired loans discussed above, the Company increased the allowance for loan losses by $0 during 2015. No allowance for loan losses were reversed during 2015. For these purchased credit impaired loans, the Company cannot reasonably estimate the cash flows expected to be collected on the loans and therefore has continued to account for those loans using the cost recovery method of income recognition. As such, no portion of a purchase discount adjustment has been determined to meet the definition of an accretable yield adjustment on those loans accounted for using the cost recovery method. If, in the future, cash flows from the borrowers can be reasonably estimated, a portion of the purchase discount would be allocated to an accretable yield adjustment based upon the present value of the future estimated cash flows versus the current carrying value of the loan and the accretable yield portion would be recognized as interest income over the remaining life of the loan. Until such accretable yield can be calculated, under the cost recovery method of income recognition, all payments will be used to reduce the carrying value of the loan and no income will be recognized on the loan until the carrying value is reduced to zero. Any loan accounted for under the cost recovery method is also still included as a nonaccrual loan. The following table presents loans held-for-investment individually evaluated for impairment by class of loans as of December 31, 2015 and December 31, 2014. The recorded investment included in the following table represents loan principal net of any partial charge-offs recognized on the loans. The unpaid principal balance represents the recorded balance prior to any partial charge-offs. December 31, 2015 December 31, 2014 Unpaid Principal Balance Recorded Investment Allowance for Loan Losses Allocated Unpaid Principal Balance Recorded Investment Allowance for Loan Losses Allocated (Dollars in thousands) With no related allowance recorded: Commercial $ $ $ — $ $ $ — Real estate: Commercial and residential — — Land and construction — — Home Equity — — Consumer — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total with no related allowance recorded — — With an allowance recorded: Commercial Real estate: Home Equity — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total with an allowance recorded ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The following table presents interest recognized and cash-basis interest earned on impaired loans for the periods indicated: For the Year Ended December 31, 2015 Real Estate Commercial Commercial and Residential Land and Construction Home Equity Consumer Total (Dollars in thousands) Average of impaired loans during the period $ $ $ $ $ $ Interest income during impairment $ $ — $ — $ $ — $ Cash-basis interest earned $ — $ — $ — $ — $ — $ — For the Year Ended December 31, 2014 Real Estate Commercial Commercial and Residential Land and Construction Home Equity Consumer Total (Dollars in thousands) Average of impaired loans during the period $ $ $ $ $ $ Interest income during impairment $ $ — $ — $ — $ — $ Cash-basis interest earned $ — $ — $ — $ — $ — $ — Nonperforming loans include both smaller dollar balance homogenous loans that are collectively evaluated for impairment and individually classified loans. Nonperforming loans were as follows at year-end: 2015 2014 (Dollars in thousands) Nonaccrual loans — held-for-investment $ $ Restructured and loans over 90 days past due and still accruing — ​ ​ ​ ​ ​ ​ ​ ​ Total nonperforming loans $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other restructured loans $ $ Impaired loans, excluding loans held-for-sale $ $ The following table presents the nonperforming loans by class at year-end: 2015 2014 Nonaccrual Restructured and Loans over 90 Days Past Due and Still Accruing Total Nonaccrual Restructured and Loans over 90 Days Past Due and Still Accruing Total (Dollars in thousands) Commercial $ $ $ $ $ — $ Real estate: Commercial and residential — — Land and construction — — Home equity — Consumer — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The following table presents the aging of past due loans as of December 31, 2015 by class of loans: 30 - 59 Days Past Due 60 - 89 Days Past Due 90 Days or Greater Past Due Total Past Due Loans Not Past Due Total (Dollars in thousands) Commercial $ $ $ $ $ $ Real estate: Commercial and residential — — — — Land and construction — — Home equity — — Consumer — — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The following table presents the aging of past due loans as of December 31, 2014 by class of loans: 30 - 59 Days Past Due 60 - 89 Days Past Due 90 Days or Greater Past Due Total Past Due Loans Not Past Due Total (Dollars in thousands) Commercial $ $ $ $ $ $ Real estate: Commercial and residential — — Land and construction — — — — Home equity — — — — Consumer — — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Past due loans 30 days or greater totaled $5,754,000 and $6,240,000 at December 31, 2015 and December 31, 2014, respectively, of which $591,000 and $3,130,000 were on nonaccrual. At December 31, 2015, there were also $4,125,000 loans less than 30 days past due included in nonaccrual loans held-for-investment. At December 31, 2014, there were also $2,725,000 loans less than 30 days past due included in nonaccrual loans held- for-investment. Management's classification of a loan as "nonaccrual" is an indication that there is reasonable doubt as to the full recovery of principal or interest on the loan. At that point, the Company stops accruing interest income, and reverses any uncollected interest that had been accrued as income. The Company begins recognizing interest income only as cash interest payments are received and it has been determined the collection of all outstanding principal is not in doubt. The loans may or may not be collateralized, and collection efforts are pursued. Credit Quality Indicators Concentrations of credit risk arise when a number of clients are engaged in similar business activities, or activities in the same geographic region, or have similar features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions. The Company's loan portfolio is concentrated in commercial (primarily manufacturing, wholesale, and service) and real estate lending, with the balance in consumer loans. While no specific industry concentration is considered significant, the Company's lending operations are located in the Company's market areas that are dependent on the technology and real estate industries and their supporting companies. Thus, the Company's borrowers could be adversely impacted by a continued downturn in these sectors of the economy which could reduce the demand for loans and adversely impact the borrowers' ability to repay their loans. The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information; historical payment experience; credit documentation; public information; and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis is performed on a quarterly basis. Nonclassified loans generally include those loans that are expected to be repaid in accordance with contractual loans terms. Classified loans are those loans that are assigned a substandard, substandard-nonaccrual, or doubtful risk rating using the following definitions: Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Substandard-Nonaccrual. Loans classified as substandard-nonaccrual are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any, and it is probable that the Company will not receive payment of the full contractual principal and interest. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. In addition, the Company no longer accrues interest on the loan because of the underlying weaknesses. Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Loss. Loans classified as loss are considered uncollectable or of so little value that their continuance as assets is not warranted. This classification does not necessarily mean that a loan has no recovery or salvage value; but rather, there is much doubt about whether, how much, or when the recovery would occur. Loans classified as loss are immediately charged off against the allowance for loan losses. Therefore, there is no balance to report at December 31, 2015 or 2014. The following table provides a summary of the loan portfolio by loan type and credit quality classification for the periods indicated: December 31, 2015 December 31, 2014 Nonclassified Classified* Total Nonclassified Classified* Total (Dollars in thousands) Commercial $ $ $ $ $ $ Real estate: Commercial and residential Land and construction Home equity Consumer ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ * Classified loans in the table above include SBA guarantees. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under the Company's underwriting policy. For the year ended December 31, 2015, the terms of certain loans were modified as troubled debt restructurings. The modification of the terms of such loans included a reduction of the stated interest rate of the loan, or an extension of maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk. The book balance of troubled debt restructurings at December 31, 2015 was $153,000, which included $4,000 of nonaccrual loans and $149,000 of accruing loans. The book balance of troubled debt restructurings at December 31, 2014 was $1,083,000, which included $916,000 of nonaccrual loans and $167,000 of accruing loans. Approximately $3,000 and $113,000 in specific reserves were established with respect to these loans as of December 31, 2015 and December 31, 2014. As of December 31, 2015 and December 31, 2014, the Company had no additional amounts committed on any loan classified as a troubled debt restructuring. There were no loans by class modified as troubled debt restructurings during the twelve month period ended December 31, 2015 and 2014. A loan is considered to be in payment default when it is 30 days contractually past due under the modified terms. There were no defaults on troubled debt restructurings within twelve months following the modification during the years ended December 31, 2015 and 2014. HBC makes loans to executive officers, directors, and their affiliates. The following table presents the loans outstanding to these related parties for the periods indicated: 2015 2014 (Dollars in thousands) Balance, beginning of year $ $ Advances on loans during the year — Repayment on loans during the year ) ) ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Loan Servicing
Loan Servicing | 12 Months Ended |
Dec. 31, 2015 | |
Loan Servicing | |
Loan Servicing | 5) Loan Servicing At December 31, 2015 and 2014, the Company serviced SBA loans sold to the secondary market of approximately $175,457,000 and $130,611,000, respectively. Servicing assets represent the servicing spread generated from the sold guaranteed portions of SBA loans. The weighted average servicing rate for all loans serviced was 1.16% and 1.20% at December 31, 2015 and 2014, respectively. Servicing rights are included in "accrued interest receivable and other assets" on the consolidated balance sheets. Activity for loan servicing rights follows: 2015 2014 2013 (Dollars in thousands) Balance, beginning of year $ $ $ Additions Amortization ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ There was no valuation allowance for servicing rights at December 31, 2015 and 2014, because the estimated fair value of the servicing rights was greater than the carrying value. The increase in loan servicing rights for the year ended December 31, 2015, compared to the prior year was primarily due to the Focus acquisition of $1,976,000 at fair value. The estimated fair value of loan servicing rights was $3,650,000 and $2,426,000 at December 31, 2015 and 2014, respectively. The fair value of servicing rights at December 31, 2015, was estimated using a weighted average constant prepayment rate ("CPR") assumption of 7.42%, and a weighted average discount rate assumption of 12.52%. The fair value of servicing rights at December 31, 2014 was estimated using a weighted average constant prepayment rate ("CPR") assumption of 7.32%, and a weighted average discount rate assumption of 12.11%. The weighted average discount rate and CPR assumptions used to estimate the fair value of the I/O strip receivables are the same as for the servicing rights. Management reviews the key economic assumptions used to estimate the fair value of I/O strip receivables on a quarterly basis. The fair value of the I/O strip can be adversely impacted by a significant increase in either the prepayment speed of the portfolio or the discount rate. I/O strip receivables are included in "accrued interest receivable and other assets" on the consolidated balance sheets. Activity for I/O strip receivables follows: 2015 2014 2013 (Dollars in thousands) Balance, beginning of year $ $ $ Unrealized loss ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Premises and Equipment
Premises and Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Premises and Equipment | |
Premises and Equipment | 6) Premises and Equipment Premises and equipment at year-end were as follows: 2015 2014 (Dollars in thousands) Building $ $ Land Furniture and equipment Leasehold improvements ​ ​ ​ ​ ​ ​ ​ ​ Accumulated depreciation and amortization ) ) ​ ​ ​ ​ ​ ​ ​ ​ Premises and equipment, net $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation and amortization expense was $685,000, $725,000, and $729,000 in 2015, 2014, and 2013, respectively. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2015 | |
Leases | |
Leases | 7) Leases Operating Leases The Company owns one of its offices and leases the others under non-cancelable operating leases with terms, including renewal options, ranging from five to fifteen years. Future minimum payments under the agreements are as follows: Year ending December 31, (Dollars in thousands) 2016 2017 2018 2019 2020 Thereafter ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Rent expense under operating leases was $2,997,000, $2,692,000, and $2,719,000 in 2015, 2014, and 2013, respectively. |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations | |
Business Combinations | 8) Business Combinations Bay View Funding On October 8, 2014, HBC entered into a Stock Purchase Agreement ("Purchase Agreement") with BVF/CSNK Acquisition Corp., a Delaware corporation ("BVF/CSNK") pursuant to which HBC agreed to acquire all of the outstanding common stock from the stockholders of BVF/CSNK for an aggregate purchase price of $22,520,000 ("Acquisition"). The Acquisition closed on November 1, 2014. At the closing, the Bank paid in cash $20,268,000 of the total purchase price to the BVF/CSNK shareholders, and $2,252,000, or 10% of the purchase price, was deposited into an 18 month escrow account. CSNK Working Capital Finance Corp. dba Bay View Funding ("Bay View Funding") its wholly-owned subsidiary provides business essential working capital factoring financing to various industries throughout the United States. BVF/CSNK was subsequently merged into Bay View Funding and Bay View Funding became a wholly owned subsidiary of HBC. Bay View Funding's results of operations have been included in the Company's results beginning November 1, 2014. The fair values of assets acquired and liabilities assumed are subject to adjustment during the first twelve months after the acquisition date if additional information becomes available to indicate more accurate or appropriate values for the assets acquired and liabilities assumed, which may be reflective of conditions or events that existed at the acquisition date. As of December 31, 2015, adjustments to the fair value of assets acquired and liabilities assumed in the Bay View Funding transaction were complete. The Acquisition purchase agreement contains customary representations and warranties by Bay View Funding and the Bay View Funding stockholders, covenants by Bay View Funding regarding the operation of its business between the date of signing of the purchase agreement and the closing date of the Acquisition, and indemnification provisions whereby the BVF/CSNK stockholders agreed to indemnify Bay View Funding and HBC and their affiliated parties for breaches of representations and warranties, breaches of covenants and certain other matters. Of the total purchase price, $2,252,000, or 10%, was deposited into an escrow account with an independent escrow agent to support the indemnification obligations, if any, of indemnification claims against the BVF/CSNK stockholders. Any amounts remaining in the escrow account will be released to the BVF/CSNK stockholders after 18 months following the closing date of the Acquisition, net of any indemnification payments made from the escrow or amounts reserved for pending claims pursuant to any indemnification claims under the purchase agreement. Because it is uncertain whether any claims will be made against the escrow account the Company has assumed the entire amount will be paid to the BVF/CSNK stockholders. The following table presents pro forma financial information as if the acquisition had occurred on January 1, 2013, which includes the pre-acquisition period for BVF/CSNK. The historical unaudited pro forma financial information has been adjusted to reflect supportable items that are directly attributable to the acquisition and expected to have a continuing impact on consolidated results of operations, as such, one-time acquisition costs are not included. The unaudited pro forma financial information is provided for informational purposes only. The unaudited pro forma financial information is not necessarily, and should not be assumed to be, an indication of the results that would have been achieved had the acquisition been completed as of the dates indicated or that may be achieved in the future. The preparation of the unaudited pro forma combined consolidated financial statements and related adjustments required management to make certain assumptions and estimates. UNAUDITED 2014 2013 (Dollars in thousands, except per share amounts) Net interest income $ $ Noninterest income ​ ​ ​ ​ ​ ​ ​ ​ Total revenue $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income $ $ Net income per share — basic $ $ Net income per share — diluted $ $ Focus Business Bank On April 23, 2015, the Company and Focus entered into a definitive agreement and plan of merger and reorganization whereby Focus would merge into HBC. The Company completed the merger of its wholly-owned bank subsidiary HBC with Focus on August 20, 2015 for an aggregate transaction value of $66,558,000. Shareholders of Focus received a fixed exchange ratio at closing of 1.8235 shares of the Company's common stock for each share of Focus common stock. Upon closing of the transaction, the Company issued 5,456,713 shares of the Company's common stock to Focus shareholders for a total value of $58,278,000, based on the Company's closing stock price of $10.68 on August 20, 2015. In addition, the Company paid cash to the Focus holders of in-the-money stock options on August 20, 2015 totaling $8,280,000. Focus's results of operations have been included in the Company's results of operations beginning August 21, 2015. Pre-tax severance, retention, acquisition and integration costs totaled $6,398,000 for the year ended December 31, 2015. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition. The Company is in the process of finalizing the purchase accounting for the acquisition. (Dollars in thousands) Assets acquired: Cash and cash item $ Federal funds sold and deposits in other financial institutions Securities available-for-sale Securities held-to-maturity Loans held-for-sale Net loans Goodwill Core deposit intangible asset Corporate owned life insurance Other assets, net ​ ​ ​ ​ ​ Total assets acquired Liabilities asssumed: Deposits Other liabilities ​ ​ ​ ​ ​ Total liabilities ​ ​ ​ ​ ​ Net assets acquired $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The fair value of net assets acquired includes fair value adjustments to certain receivables of which some were considered impaired and some were not considered impaired as of the acquisition date. The fair value adjustments were determined using discounted contractual cash flows, adjusted for expected losses and prepayments, where appropriate. The gross contractual amount of four purchased credit impaired loans as of the acquisition date totaled $1,124,000. As of that date, contractual cash flows not expected to be collected on the purchased credit impaired loans totaled $819,000, which represents 72.9% of their gross outstanding principal balances. The receivables that were not considered impaired at the acquisition date were not subject to the guidance relating to purchased credit impaired loans, which have shown evidence of credit deterioration since origination. Receivables acquired that were not subject to these requirements include nonimpaired loans with a fair value and gross contractual amounts receivable of $170,048,000 and $174,660,000 respectively, on the date of acquisition. As of that date, the purchase discount on these nonimpaired loans totaled $4,612,000, which represents 2.6% of their gross outstanding principal balances. Goodwill of $32,620,000 arising from the acquisition is largely attributable to synergies and cost savings resulting from combining the operations of the companies. As this transaction was structured as a taxfree exchange, the goodwill will not be deductible for tax purposes. The fair values of assets acquired and liabilities assumed are subject to adjustment during the first twelve months after the acquisition date if additional information becomes available to indicate a more accurate or appropriate value for an asset or liability. The loans with a fair value of $170,353,000 and $1,758,000 of income tax attributes, on the acquisition date, related to the purchase accounting adjustments and Focus' legacy deferred tax assets are subject to change pending receipt of the final valuations and analyses. Loan valuations may be adjusted based on new information obtained by the Company in future periods that may reflect conditions or events that existed on the acquisition date. Deferred tax assets may be adjusted for purchase accounting adjustments on open areas such as loans or upon filing Focus' final August 20, 2015 "stub" period tax returns. The following table summarizes the consideration paid for Focus: August 20, 2015 (Dollars in thousands) Cash paid for Focus in-the-money stock options $ Common stock issued to Focus shareholders at $10.68 per share ​ ​ ​ ​ ​ Total consideration $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The following table presents pro forma financial information as if the acquisition had occurred on January 1, 2014, which includes the pre-acquisition period for Focus. The historical unaudited pro forma financial information has been adjusted to reflect supportable items that are directly attributable to the acquisition and expected to have a continuing impact on consolidated results of operations, as such, one-time acquisition costs are not included. The unaudited pro forma financial information is provided for informational purposes only. The unaudited pro forma financial information is not necessarily, and should not be assumed to be, an indication of the results that would have been achieved had the acquisition been completed as of the dates indicated or that may be achieved in the future. The preparation of the unaudited pro forma combined consolidated financial statements and related adjustments required management to make certain assumptions and estimates. UNAUDITED For the Year Ended December 31, 2015 For the Year Ended December 31, 2014 (Dollars in thousands, except per share amounts) Net interest income $ $ Provision (credit) for loan losses ) Noninterest income Noninterest expense ​ ​ ​ ​ ​ ​ ​ ​ Income before income taxes Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ Net income $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income per share — basic $ $ Net income per share — diluted $ $ |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Other Intangible Assets | |
Goodwill and Other Intangible Assets | 9) Goodwill and Other Intangible Assets Goodwill At December 31, 2015, the carrying value of goodwill was $45,664,000. The Company recognized $13,044,000 of goodwill upon its acquisition of Bay View Funding on November 1, 2014, and $32,620,000 from its acquisition of Focus on August 20, 2015. During the fourth quarter of 2015, adjustments were made to the purchase price allocations for the Focus transaction that affected the amounts allocated to goodwill and other assets. Goodwill impairment exists when a reporting unit's carrying value exceeds its fair value, which is determined through a a qualitative assessment whether it is more likely than not that the fair value of equity of the reporting unit exceeds the carrying value ("Step Zero"). If the qualitative assessment indicates it is more likely than not that the fair value of equity of a reporting unit is less than book value, than a quantitative two-step impairment test is required. Step 1 includes the determination of the carrying value of the Company's single reporting unit, including the existing goodwill and intangible assets, and estimating the fair value of the reporting unit. If the carrying amount of a reporting unit exceeds its fair value, the Company is required to perform a second step to the impairment test. Step 2 requires that the implied fair value of the reporting unit goodwill be compared to the carrying amount of that goodwill. If the carrying amount of the reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss shall be recognized in an amount equal to that excess. The Company completed its annual impairment analysis on the goodwill from the Bay View Funding acquisition as of November 30, 2015 with the assistance of an independent valuation firm. Based on the Step Zero qualitative analysis performed, the Company determined that it is more likely than not that the fair value of the reporting unit exceeded its reported book value of equity at November 30, 2015. As such, no impairment was indicated and no further testing was required. Other Intangible Assets Core deposit and customer relationship intangible assets acquired in the 2007 acquisition of Diablo Valley Bank were $5,049,000 and $276,000, respectively. These assets are amortized over their estimated useful lives of 10 years and 7 years, respectively. The customer relationship intangible asset was fully amortized at December 31, 2014. Accumulated amortization of these intangible assets was $4,703,000 and $4,257,000 at December 31, 2015 and December 31, 2014, respectfully. The core deposit intangible asset acquired in the acquisition of Focus in August 2015 was $6,285,000. This asset is amortized over its estimated useful lives of 10 years. Accumulated amortization of this intangible asset was $288,000 at December 31, 2015. Other intangible assets acquired in the acquisition of Bay View Funding in November 2014 included: a below market value lease intangible asset of $109,000 (amortized over 3 years), customer relationship and brokered relationship intangible assets of $1,900,000, (amortized over the 10 year estimated useful lives), and a non compete agreement intangible asset of $250,000 (amortized over 3 years). Accumulated amortization of these intangible assets was $360,000 and $51,000 at December 31, 2015 and December 31, 2014, respectfully. Estimated amortization expense for each of the next five years follows: Bay View Funding Year Diablo Valley Bank Core Deposit Intangible Focus Core Deposit Intangible Below Market Value Lease Intangible Customer & Brokered Relationship Intangible Non-Compete Agreement Intangible Total Amortization Expense (Dollars in thousands) 2016 $ $ $ $ $ $ 2017 2018 — — — 2019 — — — 2020 — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Impairment testing of the intangible assets is performed at the individual asset level. The Company's intangibles are tested for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If such events or changes in circumstances are identified, an impairment loss is recognized only if the carrying amount of the intangible asset is not recoverable and exceeds its fair value. For intangible assets, estimates of expected future cash flows (cash inflows less cash outflows) that are directly associated with an intangible asset are used to determine the fair value of that asset. Management makes certain estimates and assumptions in determining the expected future cash flows from core deposit and customer relationship intangibles including account attrition, expected lives, discount rates, interest rates, servicing costs and other factors. Significant changes in these estimates and assumptions could adversely impact the valuation of these intangible assets. If an impairment loss exists, the carrying amount of the intangible asset is adjusted to a new cost basis. The new cost basis is then amortized over the remaining useful life of the asset. Based on its assessment, management did not identify any events or changes in circumstances indicating that such intangible assets may not be recoverable at December 31, 2015 or 2014. |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2015 | |
Deposits | |
Deposits | 10) Deposits Time deposits of $250,000 and over, including time deposits within the Certificate of Deposit Account Registry Service ("CDARS") and brokered deposits of $250,000 and over, were $178,640,000 and $193,068,000 at December 31, 2015 and 2014, respectively. The following table presents the scheduled maturities of all time deposits and brokered deposits for the next five years: (Dollars in thousands) 2016 $ 2017 2018 2019 2020 ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, 2015, total CDARS deposits of $7,583,000 include money market deposits of $3,388,000, which have no scheduled maturity date, and therefore, are excluded from the table above. At December 31, 2015, the Company had securities pledged with a fair value of $93,042,000 for $78,026,000 in certificates of deposits (including accrued interest) with the State of California. At December 31, 2014, the Company had securities pledged with a fair value of $109,764,000 for $98,019,000 in certificates of deposits (including accrued interest) with the State of California. The CDARS program allows customers with deposits in excess of FDIC- insured limits to obtain full coverage on time deposits through a network of banks within the CDARS program. Deposits gathered through these programs are considered brokered deposits under current regulatory reporting guidelines. CDARS deposits were comprised of $3,388,000 of money market accounts and $4,195,000 of time deposits at December 31, 2015. CDARS deposits were comprised of $4,036,000 of money market accounts and $7,212,000 of time deposits at December 31, 2014. Deposits from executive officers, directors, and their affiliates were $13,426,000 and $2,593,000 at December 31, 2015 and 2014, respectively. |
Borrowing Arrangements
Borrowing Arrangements | 12 Months Ended |
Dec. 31, 2015 | |
Borrowing Arrangements | |
Borrowing Arrangements | 11) Borrowing Arrangements Federal Home Loan Bank Borrowings, Federal Reserve Bank Borrowings, and Available Lines of Credit HBC maintains a collateralized line of credit with the FHLB of San Francisco. Under this line, the Company can borrow from the FHLB on a short-term (typically overnight) or long-term (over one year) basis. As of December 31, 2015, and December 31, 2014, HBC had no overnight borrowings from the FHLB. HBC had $245,607,000 of loans and no securities pledged to the FHLB as collateral on a line of credit of $141,875,000 at December 31, 2015. HBC had $246,635,000 of loans and no securities pledged to the FHLB as collateral on a line of credit of $139,990,000 at December 31, 2014. HBC can also borrow from the FRB's discount window. HBC had approximately $395,006,000 of loans pledged to the FRB as collateral on an available line of credit of approximately $243,156,000 at December 31, 2015, none of which was outstanding. HBC had approximately $387,972,000 of loans pledged to the FRB as collateral on an available line of credit of approximately $260,439,000 at December 31, 2014, none of which was outstanding. At December 31, 2015, HBC had Federal funds purchase arrangements available of $55.0 million. There were no Federal funds purchased outstanding at December 31, 2015 and 2014. HCC has a $5.0 million line of credit with a correspondent bank, of which $3.0 million was outstanding at December 31, 2015. HBC may also utilize securities sold under repurchase agreements to manage our liquidity position. There were no securities sold under agreements to repurchase at December 31, 2015, and 2014. Subordinated Debt The Company supported its growth through the issuance of trust preferred securities from special purpose trusts and accompanying sales of subordinated debt to these trusts. The subordinated debt issued to the trusts was senior to the outstanding shares of common stock and Series C Preferred Stock. As a result, payments were required on the subordinated debt before any dividends could be paid on the common stock and Series C Preferred Stock. Under the terms of the subordinated debt, the Company could defer interest payments for up to five years. Interest payments on the subordinated notes payable to the Company's subsidiary grantor Trusts were deductible for tax purposes. During the third quarter of 2013, the Company redeemed its Company's variable rate subordinated debentures in the amount of $5,000,000 issued to Heritage Statutory Trust II and the Company's variable rate subordinated debentures in the amount of $4,000,000 issued to Heritage Statutory Trust III. The related trust securities issued by Statutory Trust II and Statutory Trust III were also redeemed in connection with the subordinated debt redemption and the trusts were dissolved. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes | |
Income Taxes | 12) Income Taxes Income tax (benefit) consisted of the following for the year ended December 31, as follows: 2015 2014 2013 (Dollars in thousands) Currently payable tax: Federal $ $ $ State ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total currently payable Deferred tax (benefit): Federal ) State ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total deferred tax ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income tax expense $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The effective tax rate differs from the Federal statutory rate for the years ended December 31, as follows: 2015 2014 2013 Statutory Federal income tax rate % % % State income taxes, net of federal tax benefit % % % Low income housing credits, net of investment losses % % % Increase in cash surrender value of life insurance –2.2 % –2.7 % –3.5 % Non-taxable interest income –2.7 % –3.2 % –2.9 % Split-dollar term insurance % % % Other, net % –0.5 % % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effective tax rate % % % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Deferred tax assets and liabilities that result from the tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes at December 31, are as follows: 2015 2014 (Dollars in thousands) Deferred tax assets: Defined postretirement benefit obligation $ $ Allowance for loan losses Federal net operating loss carryforwards — Stock compensation Accrued expenses State income taxes Premises and equipment California net operating loss carryforwards — Split-dollar life insurance benefit plan Tax credit carryforwards Loans — Nonaccrual interest — Other ​ ​ ​ ​ ​ ​ ​ ​ Total deferred tax assets Deferred tax liabilities: Intangible assets ) ) Loan fees ) ) Prepaid expenses ) ) I/O strips ) ) Securities available-for-sale ) ) FHLB stock ) ) Other ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total deferred tax liabilities ) ) ​ ​ ​ ​ ​ ​ ​ ​ Net deferred tax assets $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, 2015, the Company's federal net operating loss carryforwards were $6,850,000 and the Company's California net operating loss carryforwards were $8,389,000. These amounts are attributable to the Focus transaction. The Company did not have any net operating loss carryforwards as of December 31, 2014. These Federal and State net operating loss carryforwards will expire in 2035. The realization of these net operating loss carryforwards for federal and state tax purposes is limited under current tax law with limitations placed on the amount of net operating losses that can be utilized annually. The Company does not, however, believe that these annual limitations will impact the ultimate deductibility of the net operating loss carry-forwards. The State tax credit carryforwards, net of Federal tax effects, were $57,000 as of December 31, 2015, which will begin to expire in 2019. The Company has Federal and State net operating loss carryforwards that arose from the acquisition of Focus. There is an Internal Revenue Code Section 382 annual limit of $1,877,000. As the Company will be able to fully utilize the net operating loss carryforwards before they expire in 2035, no valuation allowance is required against the deferred tax assets. Under generally accepted accounting principles, a valuation allowance is required if it is "more likely than not" that a deferred tax asset will not be realized. The determination of the realizability of the deferred tax assets is highly subjective and dependent upon judgment concerning management's evaluation of both positive and negative evidence, including forecasts of future income, cumulative losses, applicable tax planning strategies, and assessments of current and future economic and business conditions. In accordance with Accounting Standards Codification (ASC) 740-10 Accounting for Uncertainty in Income Taxes, the Company estimated the need for a reserve for income taxes of $130,000, net of Federal benefit, for uncertain state income tax positions of Bay View Funding. The Company does not expect this amount to significantly increase or decrease in the next twelve months. At December 31, 2015, and December 31, 2014, the Company had net deferred tax assets of $22,218,000 and $18,527,000, respectively. At December 31, 2015, the Company determined that a valuation allowance for deferred tax assets was not necessary. The Company and its subsidiaries are subject to U.S. Federal income tax as well as income tax of the State of California. The Company is no longer subject to examination by Federal and state taxing authorities for years before 2012 and 2011, respectively. The Company adopted the proportional amortization method of accounting for its low income housing investments in the third quarter of 2014. The Company quantified the impact of adopting the proportional amortization method compared to the equity method to its current year and prior period financial statements. The Company determined that the adoption of the proportional amortization method did not have a material impact to its financial statements. The low income housing investment losses, net of the tax benefits received, are included in income tax expense for all periods reflected on the consolidated income statements. The following table reflects the carry amounts of the low income housing investments included in accrued interest receivable and other assets, and the future commitments as of December 31, 2015 and 2014: December 31, 2015 December 31, 2014 (Dollars in thousands) Low income housing investments $ $ Future commitments $ $ The Company expects $550,000 of the future commitments to be paid in 2016, $14,000 in 2017, and $707,000 in 2018 through 2023. For tax purposes, the Company had low income housing tax credits of $685,000 and $581,000 for the years ended December 31, 2015 and December 2014, respectively, and low income housing investment losses of $916,000 and $338,000, respectively. The Company recognized low income housing investment expense as a component of income tax expense. |
Equity Plan
Equity Plan | 12 Months Ended |
Dec. 31, 2015 | |
Equity Plan | |
Equity Plan | 13) Equity Plan The Company maintained an Amended and Restated 2004 Equity Plan (the "2004 Plan") for directors, officers, and key employees. The 2004 Plan was terminated on May 23, 2013. On May 23, 2013, the Company's shareholders approved the 2013 Equity Incentive Plan (the "2013 Plan"). The equity plans provide for the grant of incentive and nonqualified stock options and restricted stock. The equity plans provide that the option price for both incentive and nonqualified stock options will be determined by the Board of Directors at no less than the fair value at the date of grant. Options granted vest on a schedule determined by the Board of Directors at the time of grant. Generally options vest over four years. All options expire no later than ten years from the date of grant. Restricted stock is subject to time vesting. In 2015, the Company granted 243,000 shares of nonqualified stock options and 103,855 shares of restricted stock subject to time vesting requirements. There were 940,985 shares available for the issuance of equity awards under the 2013 Plan as of December 31, 2015. Stock option activity under the equity plans is as follows: Total Stock Options Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at January 1, 2015 $ Granted $ Exercised ) $ Forfeited or expired ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Outstanding at December 31, 2015 $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Vested or expected to vest $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Exercisable at December 31, 2015 $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Information related to the equity plans for each of the last three years: 2015 2014 2013 Intrinsic value of options exercised $ $ $ Cash received from option exercise $ $ $ Tax benefit realized from option exercises $ $ $ Weighted average fair value of options granted $ $ $ As of December 31, 2015, there was $1,842,000 of total unrecognized compensation cost related to nonvested stock options granted under the equity plans. That cost is expected to be recognized over a weighted-average period of approximately 2.48 years. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model that uses the assumptions noted in the following table, including the weighted average assumptions for the option grants in each year. 2015 2014 2013 Expected life in months(1) Volatility(1) % % % Weighted average risk-free interest rate(2) % % % Expected dividends(3) % % % (1) The expected life of employee stock options represents the weighted average period the stock options are expected to remain outstanding based on historical experience. Volatility is based on the historical volatility of the stock price over the same period of the expected life of the option. (2) Based on the U.S. Treasury constant maturity interest rate with a term consistent with the expected life of the option granted. (3) Each grant's dividend yield is calculated by annualizing the most recent quarterly cash dividend and dividing that amount by the market price of the Company's common stock as of the grant date. The Company estimates the impact of forfeitures based on historical experience. Should the Company's current estimate change, additional expense could be recognized or reversed in future periods. The Company issues authorized shares of common stock to satisfy stock option exercises. Restricted stock activity under the equity plans is as follows: Total Restricted Stock Award Number of Shares Weighted Average Grant Date Fair Value Nonvested shares at January 1, 2015 $ Granted $ Vested ) $ Forfeited or expired ) $ ​ ​ ​ ​ ​ ​ ​ ​ Nonvested shares at December 31, 2015 $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, 2015, there was $1,363,000 of total unrecognized compensation cost related to nonvested restricted stock awards granted under the 2004 Plan and 2013 Plan. The cost is expected to be recognized over a weighted-average period of approximately 3.16 years. |
Benefit Plans
Benefit Plans | 12 Months Ended |
Dec. 31, 2015 | |
Benefit Plans | |
Benefit Plans | 14) Benefit Plans 401(k) Savings Plan The Company offers a 401(k) savings plan that allows employees to contribute up to a maximum percentage of their compensation, as established by the Internal Revenue Code. The Company made a discretionary matching contribution of up to $1,500 for each employee's contributions in 2015. The Company made a discretionary matching contribution of up to $1,000 for each employee's contributions in 2014 and 2013. Contribution expense was $342,000, $206,000, and $196,000 in 2015, 2014 and 2013, respectively. Employee Stock Ownership Plan The Company sponsors a non-contributory employee stock ownership plan. To participate in this plan, an employee must have worked at least 1,000 hours during the year and must be employed by the Company at year-end. Employer contributions to the ESOP are discretionary. The Company has suspended contributions to the ESOP since 2010. At December 31, 2015, the ESOP owned 123,707 shares of the Company's common stock. Deferred Compensation Plan The Company has a nonqualified deferred compensation plan for its directors ("Deferral Agreements"). Under the Deferral Agreements, a participating director may defer up to 100% of his or her board fees into a deferred account. The director may elect a distribution schedule of up to ten years. Amounts deferred earn interest. The Company's deferred compensation obligation of $20,000 and $50,000 as of December 31, 2015 and 2014 is included in "Accrued interest payable and other liabilities." The Company has purchased life insurance policies on the life of one of its former directors who has a Deferral Agreement. It is expected that the earnings on these policies will offset the cost of the program. In addition, the Company will receive death benefit payments upon the death of the former director. The proceeds will permit the Company to "complete" the deferral program as the former director originally intended if he dies prior to the completion of the deferral program. The disbursement of deferred fees is accelerated at death and commences one month after the former director dies. In the event of the former director's disability prior to attainment of his benefit eligibility date, the former director may request that the Board permit him to receive an immediate disability benefit equal to the annualized value of the director's deferral account. Nonqualified Defined Benefit Pension Plan The Company has a supplemental retirement plan covering some current and some former key executives and directors ("SERP"). The SERP is an unfunded, nonqualified defined benefit plan. The combined number of active and retired/terminated participants in the SERP was 53 at December 31, 2015. The defined benefit represents a stated amount for key executives and directors that generally vests over nine years and is reduced for early retirement. The projected benefit obligation is included in "Accrued interest payable and other liabilities" on the consolidated balance sheets. The SERP has no assets and the entire projected benefit obligation is unfunded. The measurement date of the SERP is December 31. The following table sets forth the SERP's status at December 31: 2015 2014 (Dollars in thousands) Change in projected benefit obligation: Projected benefit obligation at beginning of year $ $ Service cost Actuarial loss (gain) Interest cost Benefits paid ) ) ​ ​ ​ ​ ​ ​ ​ ​ Projected benefit obligation at end of year $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amounts recognized in accumulated other comprehensive loss: Net actuarial loss $ $ Weighted-average assumptions used to determine the benefit obligation at year-end: 2015 2014 Discount rate % % Rate of compensation increase N/A N/A Estimated benefit payments over the next ten years, which reflect anticipated future events, service and other assumptions, are as follows: Year Estimated Benefit Payments (Dollars in thousands) 2016 $ 2017 2018 2019 2020 2021 to 2025 The components of pension cost for the SERP follow: 2015 2014 (Dollars in thousands) Components of net periodic benefit cost: Service cost $ $ Interest cost Amortization of net actuarial loss ​ ​ ​ ​ ​ ​ ​ ​ Net periodic benefit cost $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The estimated net actuarial loss and prior service cost for the SERP that will be amortized from Accumulated Other Comprehensive Loss into net periodic benefit cost over the next fiscal year are $239,000 and $386,000 as of December 31, 2015 and 2014, respectively. Net periodic benefit cost was determined using the following assumption: 2015 2014 Discount rate % % Rate of compensation increase N/A N/A Split-Dollar Life Insurance Benefit Plan The Company maintains life insurance policies for some current and some former directors and officers that are subject to split-dollar life insurance agreements, which continues after the participant's employment and retirement. All participants are fully vested in their split-dollar life insurance benefits. The accrued benefit liability for the split-dollar insurance agreements represents either the present value of the future death benefits payable to the participants' beneficiaries or the present value of the estimated cost to maintain life insurance, depending on the contractual terms of the participant's underlying agreement. The split-dollar life insurance projected benefit obligation is included in "Accrued interest payable and other liabilities" on the consolidated balance sheets. The measurement date of the split-dollar life insurance benefit plan is December 31. The following sets forth the funded status of the split dollar life insurance benefits. 2015 2014 (Dollars in thousands) Change in projected benefit obligation: Projected benefit obligation at beginning of year $ $ Interest cost Actuarial loss. ​ ​ ​ ​ ​ ​ ​ ​ Projected benefit obligation at end of year $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amounts recognized in accumulated other comprehensive loss at December 31 consist of: 2015 2014 (Dollars in thousands) Net actuarial loss $ $ Prior transition obligation ​ ​ ​ ​ ​ ​ ​ ​ Accumulated other comprehensive loss $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average assumption used to determine the benefit obligation at year-end follow: 2015 2014 Discount rate % % Components of net periodic benefit cost during the year are: 2015 2014 (Dollars in thousands) Amortization of prior transition obligation $ ) $ ) Interest cost ​ ​ ​ ​ ​ ​ ​ ​ Net periodic benefit cost $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The estimated net actuarial loss and prior transition obligation for the split-dollar life insurance benefit plan that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal year are $90,000 as of December 31, 2015 and 2014. Weighted-average assumption used to determine the net periodic benefit cost: 2015 2014 Discount rate % % |
Fair Value
Fair Value | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value | |
Fair Value | 15) Fair Value Accounting guidance establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date. Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data (for example, interest rates and yield curves observable at commonly quoted intervals, prepayment speeds, credit risks, and default rates). Level 3: Significant unobservable inputs that reflect a reporting entity's own assumptions about the assumptions that market participants would use in pricing an asset or liability. Financial Assets and Liabilities Measured on a Recurring Basis The fair values of securities available-for-sale are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs) or matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities, but rather by relying on the securities' relationship to other benchmark quoted securities (Level 2 inputs). The Company uses matrix pricing (Level 2 inputs) to establish the fair value of its securities available-for-sale. The fair value of interest-only ("I/O") strip receivable assets is based on a valuation model used by a third party. The Company is able to compare the valuation model inputs and results to widely available published industry data for reasonableness (Level 2 inputs). Fair Value Measurements Using Balance Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Obeservable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (Dollars in thousands) Assets at December 31, 2015: Available-for-sale securities: Agency mortgage-backed securities $ — $ — U.S. Treasury $ $ $ — — Trust preferred securities $ — $ — U.S. Government sponsored entities $ — $ Corporate bonds $ — $ I/O strip receivables $ — $ — Assets at December 31, 2014: Available-for-sale securities: Agency mortgage-backed securities $ — $ — Corporate bonds $ — $ — Trust preferred securities $ — $ — I/O strip receivables $ — $ — There were no transfers between Level 1 and Level 2 during the year for assets measured at fair value on a recurring basis. Financial Assets and Liabilities Measured on a Non-Recurring Basis The fair value of impaired loans with specific allocations of the allowance for loan losses is generally based on recent real estate appraisals. The appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. Foreclosed assets are valued at the time the loan is foreclosed upon and the asset is transferred to foreclosed assets. The fair value is based primarily on third party appraisals, less costs to sell. The appraisals may utilize a single valuation approach or a combination of approaches including the comparable sales and income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value. Fair Value Measurements Using Balance Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (Dollars in thousands) Assets at December 31, 2015: Impaired loans — held-for-investment: Commercial $ — — $ Real estate: Commercial and residential — — Land and construction — — Home equity ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ — — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Assets at December 31, 2014: Impaired loans — held-for-investment: Commercial $ — — $ Real estate: Commercial and residential — — Land and construction — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ — — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Foreclosed assets: Land and construction $ — — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The following table shows the detail of the impaired loans held-for- investment and the impaired loans held-for-investment carried at fair value for the periods indicated: December 31, 2015 December 31, 2014 (Dollars in thousands) Impaired loans held-for-investment: Book value of impaired loans held-for-investment carried at fair value $ $ Book value of impaired loans held-for-investment carried at cost ​ ​ ​ ​ ​ ​ ​ ​ Total impaired loans held-for-investment $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Impaired loans held-for-investment carried at fair value: Book value of impaired loans held-for-investment carried at fair value $ $ Specific valuation allowance ) ) ​ ​ ​ ​ ​ ​ ​ ​ Impaired loans held-for-investment carried at fair value, net $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Impaired loans held-for-investment were $6,527,000 at December 31, 2015. There were no partial charge-offs at December 31, 2015. In addition, these loans had a specific valuation allowance of $286,000 at December 31, 2015. Impaired loans held-for-investment totaling $2,988,000 at December 31, 2015 were carried at fair value as a result of the aforementioned partial charge-offs and specific valuation allowances at year-end. The remaining $3,539,000 of impaired loans were carried at cost at December 31, 2015, as the fair value of the collateral exceeded the cost basis of each respective loan. Partial charge-offs and changes in specific valuation allowances during 2015 on impaired loans held-for-investment carried at fair value at December 31, 2015 resulted in an additional provision for loan losses of $156,000. At December 31, 2015, foreclosed assets had a carrying amount of $364,000, with no valuation allowance at December 31, 2015. Impaired loans held for investment of $6,022,000 at December 31, 2014, after partial charge offs of $107,000 in 2014, were analyzed for additional impairment primarily using the fair value of collateral. In addition, these loans had a specific valuation allowance of $404,000 at December 31, 2014. Impaired loans held for investment totaling $3,026,000 at December 31, 2014 were carried at fair value as a result of the aforementioned partial charge offs and specific valuation allowances at year end. The remaining $2,996,000 of impaired loans were carried at cost at December 31, 2014, as the fair value of the collateral exceeded the cost basis of each respective loan. Partial charge offs and changes in specific valuation allowances during 2014 on impaired loans held for investment carried at fair value at December 31, 2014 resulted in a credit to the provision for loan losses of $100,000. At December 31, 2014, foreclosed assets had a carrying amount of $696,000, with no valuation allowance at December 31, 2014. The following table presents quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis, except for consumer loans, at December 31, 2015 and 2014: December 31, 2015 Fair Value Valuation Techniques Unobservable Inputs Range (Weighted Average) (Dollars in thousands) Impaired loans — held-for-investment: Commercial $ Market Approach Discount adjustment for differences between comparable sales 0% to 5% (5%) Real estate: Commercial and residential Market Approach Discount adjustment for differences between comparable sales 0% to 3% (3%) Land and construction Market Approach Discount adjustment for differences between comparable sales Less than 1% Home equity Market Approach Discount adjustment for differences between comparable sales 0% to 2% (2%) December 31, 2014 Fair Value Valuation Techniques Unobservable Inputs Range (Weighted Average) (Dollars in thousands) Impaired loans — held-for-investment: Commercial $ Market Approach Discount adjustment for differences between comparable sales 0% to 3% (3%) Real estate: Commercial and residential Market Approach Discount adjustment for differences between comparable sales 0% to 3% (3%) Land and construction Market Approach Discount adjustment for differences between comparable sales 1% to 2% (2%) Foreclosed assets: Land and construction Market Approach Discount adjustment for differences between comparable sales Less than 1% The Company obtains third party appraisals on its impaired loans held- for-investment and foreclosed assets to determine fair value. Generally, the third party appraisals apply the "market approach," which is a valuation technique that uses prices and other relevant information generated by market transactions involving identical or comparable (that is, similar) assets, liabilities, or a group of assets and liabilities, such as a business. Adjustments are then made based on the type of property, age of appraisal, current status of property and other related factors to estimate the current value of collateral. The carrying amounts and estimated fair values of the Company's financial instruments, at year-end were as follows: December 31, 2015 Estimated Fair Value Carrying Amounts Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total (Dollars in thousands) Assets: Cash and cash equivalents $ $ $ — $ — $ Securities available-for-sale — Securities held-to-maturity — — Loans (including loans held-for-sale), net — FHLB stock, FRB stock, and other investments — — — N/A Accrued interest receivable — I/O strips receivables — — Liabilities: Time deposits $ $ — $ $ — $ Other deposits — — Short-term borrowings — Accrued interest payable — — December 31, 2014 Estimated Fair Value Carrying Amounts Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total (Dollars in thousands) Assets: Cash and cash equivalents $ $ $ — $ — $ Securities available-for-sale — — Securities held-to-maturity — — Loans (including loans held-for-sale), net — FHLB and FRB stock — — — N/A Accrued interest receivable — I/O strips receivables — — Liabilities: Time deposits $ $ — $ $ — $ Other deposits — — Accrued interest payable — — The methods and assumptions, not previously discussed, used to estimate the fair value are described as follows: Cash and Cash Equivalents The carrying amounts of cash on hand, noninterest and interest bearing due from bank accounts approximate fair values and are classified as Level 1. Loans The fair value of loans held-for-sale is estimated based upon binding contracts and quotes from third party investors resulting in a Level 2 classification. Fair values of loans, excluding loans held for sale, are estimated as follows: For variable rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values resulting in a Level 3 classification. Fair values for other loans are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality resulting in a Level 3 classification. Impaired loans are valued at the lower of cost or fair value as described previously. The methods utilized to estimate the fair value of loans do not necessarily represent an exit price. FHLB and FRB Stock It was not practical to determine the fair value of FHLB and FRB stock due to the restrictions placed on transferability. Accrued Interest Receivable/Payable The carrying amounts of accrued interest approximate fair value resulting in a Level 2 or Level 3 classification. Deposits The fair values disclosed for demand deposits (e.g., interest and noninterest checking, passbook savings, and certain types of money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amount) resulting in a Level 2 classification. The carrying amounts of variable rate, fixed-term money market accounts approximate their fair values at the reporting date resulting in a Level 2 classification. The carrying amounts of variable rate, certificates of deposit approximate their fair values at the reporting date resulting in a Level 2 classification. Fair values for fixed rate certificates of deposit are estimated using a discounted cash flows calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits resulting in a Level 2 classification. Off-Balance Sheet Items Fair values for off-balance sheet, credit-related financial instruments are based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties' credit standing. The fair value of commitments is not material. Limitations Fair value estimates are made at a specific point in time, based on relevant market information about the financial instruments. These estimates do not reflect any premium or discount that could result from offering for sale at one time the entire holdings of a particular financial instrument. Fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies | |
Commitments and Contingencies | 16) Commitments and Contingencies Financial Instruments with Off-Balance Sheet Risk HBC is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its clients. These financial instruments include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the balance sheets. HBC's exposure to credit loss in the event of non-performance of the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. HBC uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. Credit risk is the possibility that a loss may occur because a party to a transaction failed to perform according to the terms of the contract. HBC controls the credit risk of these transactions through credit approvals, limits, and monitoring procedures. Management does not anticipate any significant losses as a result of these transactions. Commitments to extend credit were as follows: December 31, 2015 December 31, 2014 Fixed Rate Variable Rate Fixed Rate Variable Rate (Dollars in thousands) Unused lines of credit and commitments to make loans $ $ $ $ Standby letters of credit ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commitments generally expire within one year. Standby letters of credit are written with conditional commitments issued by HBC to guarantee the performance of a client to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to clients. The Company is required to maintain interest-bearing reserves. Reserve requirements are based on a percentage of certain deposits. As of December 31, 2015, the Company maintained reserves of $29,015,000 in the form of vault cash and balances at the Federal Reserve Bank of San Francisco, which satisfied the regulatory requirements. Loss Contingencies The Company's policy is to accrue for legal costs associated with both asserted and unasserted claims when it is probable that such costs will be incurred and such costs can be reasonably estimated. A number of parties have filed complaints in the Superior Court of California for the County of Santa Clara asserting certain claims against the Company arising from the transfer of funds. One complaint composed of numerous claims has been set for trial in late 2016. Three of the remaining complaints are in the pleading stage and in mid-discovery. One other complaint is in mid-discovery. As to all claims, it is not possible to determine the amount of the loss, if any, arising from the claim in excess of the legal expenses expected to be incurred in defense of the litigation. The Company intends to vigorously defend the litigation. |
Shareholders' Equity and Earnin
Shareholders' Equity and Earnings Per Share | 12 Months Ended |
Dec. 31, 2015 | |
Shareholders' Equity and Earnings Per Share | |
Shareholders' Equity and Earnings Per Share | 17) Shareholders' Equity and Earnings Per Share Series A Preferred Stock —On November 21, 2008, the Company issued 40,000 shares of Series A Fixed Rate Cumulative Perpetual Preferred Stock ("Series A Preferred Stock") to the U.S. Treasury under the terms of the U.S. Treasury Capital Purchase Program for $40,000,000 with a liquidation preference of $1,000 per share. On March 7, 2012, in accordance with approvals received from the U.S. Treasury and the Federal Reserve Board, the Company repurchased all of the Series A Preferred Stock and paid all of the related accrued and unpaid dividends. Warrants —On November 21, 2008, in conjunction with the issuance of the Series A Preferred Stock, the Company issued a warrant to the U.S Treasury with an initial exercise price of $12.96 per share of common stock, with an allocated fair value of $1,979,000. The warrant was exercisable at any time on or before November 21, 2018. The warrant was transferable at any time. On June 12, 2013, the Company completed the repurchase of the common stock warrant for $140,000. Series C Preferred Stock —On June 21, 2010, the Company issued to various institutional investors 21,004 shares of Series C Convertible Perpetual Preferred Stock ("Series C Preferred Stock"). The Series C Preferred Stock is mandatorily convertible into 5,601,000 shares of common stock at a conversion price of $3.75 per share upon a subsequent transfer of the Series C Preferred Stock to third parties not affiliated with the holder in a widely dispersed offering. The Series C Preferred Stock is non-voting except in the case of certain transactions that would affect the rights of the holders of the Series C Preferred Stock or applicable law. The holders of Series C Preferred Stock receive dividends on an as converted basis when dividends are also declared for holders of common stock. The Series C Preferred Stock is not redeemable by the Company or by the holders and has a liquidation preference of $1,000 per share. The Series C Preferred Stock ranks senior to the Company's common stock. Dividends —On January 28, 2016, the Company announced that its Board of Directors declared a $0.09 per share quarterly cash dividend to holders of common stock and Series C preferred stock (on an as converted basis). The dividend was paid on February 25, 2016, to shareholders of record on February 10, 2016. Earnings Per Share —Basic earnings per common share is computed by dividing net income, less dividends and discount accretion on preferred stock, by the weighted average common shares outstanding. The Series C Preferred Stock participates in the earnings of the Company and, therefore, the shares issued on the conversion of the Series C Preferred Stock are considered outstanding under the two-class method of computing basic earnings per common share during periods of earnings. Diluted earnings per share reflect potential dilution from outstanding stock options and common stock warrants, using the treasury stock method. The common stock warrant was antidilutive at December 31, 2013. The Company repurchased the warrant for $140,000 in the second quarter of 2013. A reconciliation of these factors used in computing basic and diluted earnings per common share is as follows: Year ended December 31, 2015 2014 2013 (Dollars in thousands, except per share amounts) Net income available to common shareholders $ $ $ Less: undistributed earnings allocated to Series C Preferred Stock ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Distributed and undistributed earnings allocated to common shareholders $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average common shares outstanding for basic earnings per common share Dilutive effect of stock options oustanding, using the treasury stock method ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Shares used in computing diluted earnings per common share ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic earnings per share $ $ $ Diluted earnings per share $ $ $ |
Capital Requirements
Capital Requirements | 12 Months Ended |
Dec. 31, 2015 | |
Capital Requirements | |
Capital Requirements | 18) Capital Requirements The Company and its subsidiary bank are subject to various regulatory capital requirements administered by the banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory — and possibly additional discretionary — actions by regulators that, if undertaken, could have a direct material effect on the Company's financial statements and operations. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and HBC must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off balance sheet items as calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. As of January 1, 2015, HCC and HBC along with other community banking organizations became subject to new capital requirements on January 1, 2015 and certain provisions of the new rules will be phased in from 2015 through 2019. The Federal Banking regulators approved the new rules to implement the revised capital adequacy standards of the Basel Committee on Banking Supervision, commonly called Basel III, and address relevant provisions of The Dodd Frank Wall Street Reform and Consumer Protection Act of 2010, as amended. The Company's consolidated capital ratios and the Bank's capital ratios exceeded the regulatory guidelines for a well-capitalized financial institution under the Basel III regulatory requirements at December 31, 2015. Quantitative measures established by regulation to help ensure capital adequacy require the Company and HBC to maintain minimum amounts and ratios (set forth in the tables below) of total, Tier 1 capital, and common equity Tier 1 capital (as defined in the regulations) to risk weighted assets (as defined), and of Tier 1 capital to average assets (as defined). Management believes that, as of December 31, 2015 and December 31, 2014, the Company and HBC met all capital adequacy guidelines to which they were subject. The Company's consolidated capital amounts and ratios are presented in the following table, together with capital adequacy requirements, under the Basel III regulatory requirements as of December 31, 2015, and under the Basel I regulatory requirements as of December 31, 2014. Actual Required For Capital Adequacy Purposes Under Basel III Amount Ratio Amount Ratio (Dollars in thousands) As of December 31, 2015: Total Capital $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % (to risk-weighted assets) Common Equity Tier 1 Capital $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % (to average assets) Actual To Be Well-Capitalized Under Basel I Regulatory Requirements Required For Capital Adequacy Purposes Under Basel I Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) As of December 31, 2014: Total Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % N/A N/A $ % (to average assets) HBC's actual capital amounts and ratios are presented in the following table, together with capital adequacy requirements, under the Basel III regulatory requirements as of December 31, 2015, and under the Basel I regulatory requirements as of December 31, 2014. Actual To Be Well-Capitalized Under Basel III Regulatory Requirements Required For Capital Adequacy Purposes Under Basel III Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) As of December 31, 2015: Total Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % $ % (to risk-weighted assets) Common Equity Tier 1 Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % $ % (to average assets) Actual To Be Well-Capitalized Under Basel I Regulatory Requirements Required For Capital Adequacy Purposes Under Basel I Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) As of December 31, 2014: Total Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % $ % (to average assets) HCC is dependent upon dividends from HBC. Under California General Corporation Law, the holders of common stock are entitled to receive dividends when and as declared by the Board of Directors, out of funds legally available. The California Financial Code provides that a state licensed bank may not make a cash distribution to its shareholders in excess of the lesser of the following: (i) the bank's retained earnings; or (ii) the bank's net income for its last three fiscal years, less the amount of any distributions made by the bank to its shareholders during such period. However, a bank, with the prior approval of the Commissioner of the California Department of Business Oversight — Division of Financial Institutions ("DBO") may make a distribution to its shareholders of an amount not to exceed the greater of (i) a bank's retained earnings; (ii) its net income for its last fiscal year; or (iii) its net income for the current fiscal year. Also with the prior approval of the Commissioner of the DBO and the shareholders of the bank, the bank may make a distribution to its shareholders, as a reduction in capital of the bank. In the event that the Commissioner determines that the shareholders' equity of a bank is inadequate or that the making of a distribution by a bank would be unsafe or unsound, the Commissioner may order a bank to refrain from making such a proposed distribution. As of December 31, 2015, HBC would be required to obtain regulatory approval from the DBO for a dividend or other distribution to HCC, however, commencing January 1, 2016 HBC will not be required to obtain regulatory approval. The amount available for cash dividened is $22,361,000 as of January 1, 2016. Similar restrictions applied to the amount and sum of loan advances and other transfers of funds from HBC to the parent company. |
Noninterest Expense
Noninterest Expense | 12 Months Ended |
Dec. 31, 2015 | |
Noninterest Expense | |
Noninterest Expense | 19) Noninterest Expense The following table indicates the percentage of noninterest expense in each category for the periods indicated: Year Ended December 31, 2015 2014 2013 (Dollars in thousands) Salaries and employee benefits $ $ $ Occupancy and equipment Acquisition and integration related costs(1) — Professional fees Data processing Software subscriptions Insurance expense FDIC deposit insurance premiums Correspondent bank charges Amortization on intangible assets Foreclosed assets ) ) Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Does not include pre-tax severance and retention cost of $2,887,000, which is included in salaries and employee benefits for the year ended December 31, 2015. |
Business Segment Information
Business Segment Information | 12 Months Ended |
Dec. 31, 2015 | |
Business Segment Reporting | |
Business Segment Information | 20) Business Segment Information The following presents the Company's operating segments. The Company operates through two business segments: Banking segment and Factoring segment. Transactions between segments consist primarily of borrowed funds. Intersegment interest expense is allocated to the Factoring segment based on the Company's prime rate and funding costs. The provision for loan loss is allocated based on the segment's allowance for loan loss determination which considers the effects of charge-offs. Noninterest income and expense directly attributable to a segment are assigned to it. Taxes are paid on a consolidated basis and allocated for segment purposes. The Factoring segment includes only factoring originated by Bay View Funding, which has been included in the results of operations since the acquisition on November 1, 2014. For the Twelve Months Ended Deember 31, 2015 Banking(1) Factoring Consolidated (Dollars in thousands) Interest income $ $ $ Intersegment interest allocations ) — Total interest expense — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income Provision (credit) for loan losses ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income after provision Noninterest income Noninterest expense Intersegment expense allocations ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before income taxes Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ $ Loans, net of deferred fees $ $ $ Goodwill $ $ $ (1) Includes the holding company's results of operations For the Twelve Months Ended Deember 31, 2014 Banking(1) Factoring(2) Consolidated (Dollars in thousands) Interest income $ $ $ Intersegment interest allocations ) — Total interest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income Provision (credit) for loan losses ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income after provision Noninterest income Noninterest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before income taxes Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ $ Loans, net of deferred fees $ $ $ Goodwill $ — $ $ (1) Includes the holding company's results of operations (2) Includes two months of Bay View Funding's results of operations |
Parent Company only Condensed F
Parent Company only Condensed Financial Information | 12 Months Ended |
Dec. 31, 2015 | |
Parent Company only Condensed Financial Information | |
Parent Company only Condensed Financial Information | 21) Parent Company only Condensed Financial Information The condensed financial statements of Heritage Commerce Corp (parent company only) are as follows: Condensed Balance Sheets December 31, 2015 2014 (Dollars in thousands) Assets Cash and cash equivalents $ $ Investment in subsidiary bank Other assets ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities and Shareholder's Equity Short-term borrowings — Other liabilities Shareholder's equity ​ ​ ​ ​ ​ ​ ​ ​ Total liabilities and shareholder's equity $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Condensed Statements of Operations For the Year Ended December 31, 2015 2014 2013 (Dollars in thousands) Dividend from subsidiary bank $ — $ — $ Interest expense ) — ) Other expenses ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income (loss) before income taxes and equity in net income of subsidiary bank ) ) Equity in net income of subsidiary bank: Reduction in contributed capital and distribution from subsidiary bank — — ) Net income of subsidiary bank Income tax benefit ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income Dividends and discount accretion on preferred stock ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income available to common shareholders $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Condensed Statements of Cash Flows For the Year Ended December 31, 2015 2014 2013 (Dollars in thousands) Cash flows from operating activities: Net Income $ $ $ Adjustments to reconcile net income to net cash provided by (used in) operations: Amortization of restricted stock award, net of forfeitures and taxes ) Equity in undistributed loss/(net income) of subsidiary bank ) ) Net change in other assets and liabilities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash (used in) provided by operating activities ) ) Cash flows from financing activities: Repayment of subordinated debt — — ) Net change in purchased funds and other short-term borrowings — — Payment of cash dividends ) ) ) Proceeds from issuance of common stock, net of issuance costs Payment of repurchase of common stock warrant — — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in financing activities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net (decrease) increase in cash and cash equivalents ) ) Cash and cash equivalents, beginning of year ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents, end of year $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data (Unaudited) | |
Quarterly Financial Data (Unaudited) | 22) Quarterly Financial Data (Unaudited) The following table discloses the Company's selected unaudited quarterly financial data: For the Quarter Ended(1) 12/31/15 09/30/15 06/30/15 03/31/15 (Dollars in thousands, except per share amounts) Interest income $ $ $ $ Interest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income Provision (credit) for loan losses ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income after provision for loan losses Noninterest income Noninterest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before income taxes Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income Dividends on preferred stock ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income available to common shareholders Undistributed earnings allocated to Series C Preferred Stock ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Distributed and undistributed earnings allocated to common shareholders $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Earnings per common share Basic $ $ $ $ Diluted $ $ $ $ (1) Pre-tax severance, retention and acquisition and integration costs included in noninterest expense were $2,991,000, $2,865,000, $423,000, and $119,000, for the fourth, third, second, and first quarters of 2015, respectively. For the Quarter Ended 12/31/2014(1) 9/30/2014(2) 06/30/14 03/31/14 (Dollars in thousands, except per share amounts) Interest income $ $ $ $ Interest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income Provision (credit) for loan losses ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income after provision for loan losses Noninterest income Noninterest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before income taxes Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income Dividends on preferred stock ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income available to common shareholders Undistributed earnings allocated to Series C Preferred Stock ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Distributed and undistributed earnings allocated to common shareholders $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Earnings per common share Basic $ $ $ $ Diluted $ $ $ $ (1) The Company's selected unaudited quarterly financial data for the quarter ended December 31, 2014 includes Bay View Funding acquisition and integration costs of $609,000, and the results of operations for Bay View Funding for the months of November and December 2014. (2) The Company's selected unaudited quarterly financial data for the quarter ended September 30, 2014 includes Bay View Funding acquisition and integration costs of $234,000. |
Summary of Significant Accoun33
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies | |
Description of Business and Basis of Presentation | Description of Business and Basis of Presentation Heritage Commerce Corp ("HCC") operates as a registered bank holding company for its wholly-owned subsidiary Heritage Bank of Commerce ("HBC" or the "Bank"), collectively referred to as the "Company". HBC was incorporated on November 23, 1993 and commenced operations on June 8, 1994. HBC is a California state chartered bank which offers a full range of commercial and personal banking services to residents and the business/professional community in Santa Clara, Alameda, and Contra Costa counties, California. On November 1, 2014, the Company acquired CSNK Working Capital Finance Corp. dba Bay View Funding ("Bay View Funding"), which provides business-essential working capital factoring financing to various industries throughout the United States. Bay View Funding's results of operations have been included in the Company's results of operations beginning November 1, 2014. As discussed in Note 8, the Company completed its acquisition of Focus Business Bank ("Focus") on August 20, 2015. Focus was merged with HBC, with HBC as the surviving bank. Focus' results of operations have been included in the Company's results of operations beginning August 21, 2015. The consolidated financial statements are prepared in accordance with accounting policies generally accepted in the United States of America and general practices in the banking industry. The financial statements include the accounts of the Company. All inter-company accounts and transactions have been eliminated in consolidation. The Company also established the following wholly-owned Delaware business trusts that were formed to issue trust preferred and related common securities: Heritage Statutory Trust II, formed in 2001, and Heritage Statutory Trust III, formed in 2002 ("Trusts"). During the third quarter of 2013, the Company dissolved the Heritage Statutory Trust II and the Heritage Statutory Trust III. The Trusts issued their preferred securities to investors, and used the proceeds to purchase subordinated debt issued by the Company. The subordinated debt payable to the Trusts was recorded as debt of the Company. The Company had fully and unconditionally guaranteed the trust preferred securities along with all obligations of the Trusts under the trust agreements. Interest income from the subordinated debt was the source of revenues for these Trusts. In accordance with generally accepted accounting principles, the Trusts were not consolidated in the Company's financial statements. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash on hand, amounts due from banks, amounts held at the Federal Reserve Bank, and Federal funds sold. The Company is required to maintain reserves against certain of the deposit accounts with the Federal Reserve Bank. Federal funds are generally sold and purchased for one-day periods. |
Cash Flows | Cash Flows Net cash flows are reported for customer loan and deposit transactions, notes payable, repurchase agreements and other short-term borrowings. |
Securities | Securities The Company classifies its securities as either available-for-sale or held-to-maturity at the time of purchase. Debt securities are classified as held-to-maturity and carried at amortized cost when management has the positive intent and ability to hold them to maturity. Debt securities not classified as held-to-maturity are classified as available-for-sale. Securities available-for-sale are carried at fair value, with unrealized holding gains and losses reported in other comprehensive income, net of taxes. A decline in the fair value of any available-for-sale or held- to-maturity security below amortized cost that is deemed other than temporary results in a charge to earnings and the corresponding establishment of a new cost basis for the security. In estimating other-than-temporary losses, management considers (1) the length of time and extent that fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, (3) whether the fair value decline was affected by macroeconomic conditions, and (4) whether the Company has the intention to sell the security or more likely than not will be required to sell the security before any anticipated recovery in fair value. Interest income includes amortization of purchase premiums or discounts. Premiums and discounts are amortized, or accreted, over the life of the related security as an adjustment to income using a method that approximates the interest method. Realized gains and losses are recorded on the trade date and determined using the specific identification method for the cost of securities sold. |
Loan Sales and Servicing | Loan Sales and Servicing The Company holds for sale the conditionally guaranteed portion of certain loans guaranteed by the Small Business Administration or the U.S. Department of Agriculture (collectively referred to as "SBA loans"). These loans are carried at the lower of aggregate cost or fair value. Net unrealized losses, if any, are recorded as a valuation allowance and charged to earnings. Gains or losses on SBA loans held-for-sale are recognized upon completion of the sale, based on the difference between the selling price and the carrying value of the related loan sold. SBA loans are sold with servicing retained. Servicing assets recognized separately upon the sale of SBA loans consist of servicing rights and, for loans sold prior to 2009, interest-only strip receivables ("I/O strips"). The Company accounts for the sale and servicing of SBA loans based on the financial and servicing assets it controls and liabilities it has incurred, reversing recognition of financial assets when control has been surrendered, and reversing recognition of liabilities when extinguished. Servicing rights are initially recorded at fair value with the income statement effect recorded in gains on sale of loans. Servicing rights are amortized in proportion to and over the period of net servicing income and are assessed for impairment on an ongoing basis. Impairment is determined by stratifying the servicing rights based on interest rates and terms. Any servicing assets in excess of the contractually specified servicing fees are reclassified at fair value as an I/O strip receivable and treated like an available for sale security. Fair value is determined using prices for similar assets with similar characteristics, when available, or based upon discounted cash flows using market-based assumptions. Impairment is recognized through a valuation allowance. The servicing rights, net of any required valuation allowance, and I/O strip receivable are included in other assets on the consolidated balance sheets. Servicing income, net of amortization of servicing rights, is recognized as noninterest income. The initial fair value of I/O strip receivables is amortized against interest income on loans. |
Loans | Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at the principal amount outstanding, net of deferred loan origination fees and costs on originated loans, or unamortized premiums or discounts on purchased or acquired loans, and an allowance for loan losses. The majority of the Company's loans have variable interest rates. Interest on loans is accrued on the unpaid principal balance and is credited to income using the effective yield interest method. Interest on purchased or acquired loans and the accretion (amortization) of the related purchase discount (premium) is also credited to income using the effective yield interest method. A loan portfolio segment is defined as the level at which the Company uses a systematic methodology to determine the allowance for loan losses. A loan portfolio class is defined as a group of loans having similar risk characteristics and methods for monitoring and assessing risk. For all loan classes, when a loan is classified as nonaccrual, the accrual of interest is discontinued, any accrued and unpaid interest is reversed, and the amortization of deferred loan fees and costs is discontinued. For all loan classes, loans are classified as nonaccrual when the payment of principal or interest is 90 days past due, unless the loan is well secured and in the process of collection. Nonaccrual loans and loans past due 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. In certain circumstances, loans that are under 90 days past due may also be classified as nonaccrual. Any interest or principal payments received on nonaccrual loans are applied toward reduction of principal. Nonaccrual loans generally are not returned to performing status until the obligation is brought current, the loan has performed in accordance with the contract terms for a reasonable period of time, and the ultimate collectability of the contractual principal and interest is no longer in doubt. Non-refundable loan fees and direct origination costs are deferred and recognized over the expected lives of the related loans using the effective yield interest method. |
Acquired Loans and Leases | Acquired Loans and Leases Loans and leases acquired through purchase or through a business combination are recorded at their fair value at the acquisition date. Credit discounts are included in the determination of fair value; therefore, an allowance for loan and lease losses is not recorded at the acquisition date. Should the Company's allowance for loan and lease losses methodology indicate that the credit discount associated with acquired, non-purchased credit impaired loans, is no longer sufficient to cover probable losses inherent in those loans, the Company will establish an allowance for those loans through a charge to provision for loan and lease losses. Acquired loans are evaluated upon acquisition for evidence of deterioration in credit quality since origination such that it is probable at acquisition that the Company will be unable to collect all contractually required payments. Such loans are classified as purchased credit impaired loans ("PCI loans"), while all other acquired loans are classified as non-PCI loans. The Company has elected to account for PCI loans on an individual loan level. The Company estimates the amount and timing of expected cash flows for each loan. The expected cash flow in excess of the loan's carrying value, which is fair value on the date of acquisition, is referred to as the accretable yield, and is recorded as interest income over the remaining expected life of the loan. The excess of the loan's contractual principal and interest over expected cash flows is referred to as the non-accretable difference, and is not recorded in the Company's Consolidated Financial Statements. Quarterly, management performs an evaluation of expected future cash flows for PCI loans. If current expectations of future cash flows are less than management's previous expectations, other than due to decreases in interest rates and prepayment assumptions, an allowance for loan and leases losses is recorded with a charge to current period earnings through provision for loan and lease losses. If there has been a probable and significant increase in expected future cash flows over that which was previously expected, the Company would first reduce any previously established allowance for loan and lease losses, and then record an adjustment to interest income through a prospective increase in the accretable yield. |
Allowance for Loan Losses | Allowance for Loan Losses The allowance for loan losses is an estimate of probable incurred losses in the loan portfolio. Loans are charged-off against the allowance when management believes the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance for loan losses. Management's methodology for estimating the allowance balance consists of several key elements, which include specific allowances on individual impaired loans and the formula driven allowances on pools of loans with similar risk characteristics. Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan that, in management's judgment, should be charged off. Specific allowances are established for impaired loans. Management considers a loan to be impaired when it is probable that the Company will be unable to collect all amounts due according to the original contractual terms of the loan agreement, including scheduled interest payments. Loans for which the terms have been modified with a concession granted, and for which the borrower is experiencing financial difficulties, are considered troubled debt restructurings and classified as impaired. When a loan is considered to be impaired, the amount of impairment is measured based on the fair value of the collateral, less costs to sell, if the loan is collateral dependent, or on the present value of expected future cash flows or values that are observable in the secondary market if the loan is not collateral dependent. The amount of any impairment will be charged off against the allowance for loan losses if the amount is a confirmed loss or, alternatively, a specific allocation within the allowance will be established. Loans that are considered impaired are specifically excluded from the formula portion of the allowance for loan losses analysis. The formula driven allowance on pools of loans covers all loans that are not impaired and is based on historical losses of each loan segment adjusted for current factors. In calculating the historical component of our allowance, we aggregate our loans into one of three loan segments: Commercial, Real Estate and Consumer. Each segment of loans in the portfolio possess varying degrees of risk, based on, among other things, the type of loan being made, the purpose of the loan, the type of collateral securing the loan, and the sensitivity the borrower has to changes in certain external factors such as economic conditions. The following provides a summary of the risks associated with various segments of the Company's loan portfolio, which are factors management regularly considers when evaluating the adequacy of the allowance: • Commercial loans consist primarily of commercial and industrial loans (business lines of credit), and other commercial purpose loans. Repayment of commercial and industrial loans is generally provided from the cash flows of the related business to which the loan was made. Adverse changes in economic conditions may result in a decline in business activity, which may impact a borrower's ability to continue to make scheduled payments. The factored receivables at Bay View Funding are included in the Company's commercial loan portfolio; however, they are evaluated for risk primarily based on the agings of the receivables. Faster turning receivables imply less risk and therefore warrant a lower associated allowance. Should the overall aging for the portfolio increase, this structure will by formula increase the allowance to reflect the increasing risk. Should the portfolio turn more quickly, it would reduce the associated allowance to reflect the reducing risk. • Real estate loans consist primarily of loans secured by commercial and residential real estate. Also included in this segment are land and construction loans and home equity lines of credit secured by real estate. As the majority of this segment is comprised of commercial real estate loans, risks associated with this segment lay primarily within these loan types. Adverse economic conditions may result in a decline in business activity and increased vacancy rates for commercial properties. These factors, in conjunction with a decline in real estate prices, may expose the Company to the potential for losses if a borrower cannot continue to service the loan with operating revenues, and the value of the property has declined to a level such that it no longer fully covers the Company's recorded investment in the loan. • Consumer loans consist primarily of a large number of small loans and lines of credit. The majority of installment loans are made for consumer and business purchases. Weakened economic conditions may result in an increased level of delinquencies within this segment, as economic pressures may impact the capacity of such borrowers to repay their obligations. As a result of the matters mentioned above, changes in the financial condition of individual borrowers, economic conditions, historical loss experience and the condition of the various markets in which collateral may be sold may all affect the required level of the allowance for loan losses and the associated provision for loan losses. The estimated loss factors for pools of loans that are not impaired are based on determining the probability of default and loss given default for loans within each segment of the portfolio, adjusted for significant factors that, in management's judgment, affect collectibility as of the evaluation date. The Company's historical delinquency experience and loss experience are utilized to determine the probability of default and loss given default for segments of the portfolio where the Company has experienced losses in the past. For segments of the portfolio where the Company has no significant prior loss experience, the Company uses quantifiable observable industry data to determine the probability of default and loss given default. Risk factors impacting loans in each of the portfolio segments include broad deterioration of property values, reduced consumer and business spending as a result of continued high unemployment and reduced credit availability and lack of confidence in a sustainable recovery. The historical loss experience is adjusted for management's estimate of the impact of other factors based on the risks present for each portfolio segment. These other factors include consideration of the following: the overall level of concentrations and trends of classified loans; loan concentrations within a portfolio segment or division of a portfolio segment; identification of certain loan types with higher risk than other loans; existing internal risk factors; and management's evaluation of the impact of local and national economic conditions on each of our loan types. |
Loan Commitments and Related Financial Instruments | Loan Commitments and Related Financial Instruments Financial instruments include off-balance sheet credit instruments, such as commitments to make loans and commercial letters of credit, issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded. |
Federal Home Loan Bank and Federal Reserve Bank Stock | Federal Home Loan Bank and Federal Reserve Bank Stock As a member of the Federal Home Loan Bank ("FHLB") system, the Bank is required to own common stock in the FHLB based on the Bank's level of borrowings and outstanding FHLB advances. FHLB stock is carried at cost and classified as a restricted security. Both cash and stock dividends are reported as income. As a member of the Federal Reserve Bank ("FRB") of San Francisco, the Bank is required to own stock in the FRB of San Francisco based on a specified ratio relative to our capital. FRB stock is carried at cost and may be sold back to the FRB at its carrying value. Cash dividends received are reported as income. |
Company Owned Life Insurance and Split-Dollar Life Insurance Benefit Plan | Company Owned Life Insurance and Split-Dollar Life Insurance Benefit Plan The Company has purchased life insurance policies on certain directors and officers. Company owned life insurance is recorded at the amount that can be realized under the insurance contract at the balance sheet date, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement. The purchased insurance is subject to split-dollar insurance agreements with the insured participants, which continues after the participant's employment and retirement. Accounting guidance requires that a liability be recorded primarily over the participant's service period when a split-dollar life insurance agreement continues after a participant's employment or retirement. The required accrued liability is based on either the post-employment benefit cost for the continuing life insurance or the future death benefit depending on the contractual terms of the underlying agreement. |
Premises and Equipment | Premises and Equipment Land is carried at cost. Premises and equipment are stated at cost. Depreciation and amortization are computed on the straight-line basis over the lesser of the respective lease terms or estimated useful lives. The Company owns one building which is being depreciated over 40 years. Furniture, equipment, and leasehold improvements are depreciated over estimated useful lives generally ranging from five to fifteen years. The Company evaluates the recoverability of long-lived assets on an ongoing basis. |
Business Combination | Business Combinations The Company accounts for acquisitions of businesses using the acquisition method of accounting. Under the acquisition method, assets acquired and liabilities assumed are recorded at their estimated fair values at the date of acquisition. Management utilizes various valuation techniques including discounted cash flow analyses to determine these fair values. Any excess of the purchase price over amounts allocated to the acquired assets, including identifiable intangible assets, and liabilities assumed is recorded as goodwill. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill resulted from the acquisition of Bay View Funding on November 1, 2014 and Focus on August 20, 2015. Goodwill represents the excess of the purchase price over the fair value of acquired tangible assets and liabilities and identifiable intangible assets. Goodwill is assessed at least annually for impairment and any such impairment is recognized in the period identified. Other intangible assets consist of core deposit and customer relationship intangible assets arising from the Diablo Valley Bank acquisition in June 2007, a core deposit intangible asset from the Focus acquisition in August 2015, and a below market value lease, customer relationship and non-compete agreement intangible assets arising from the Bay View Funding acquisition in November 2014. They are initially measured at fair value and then are amortized over their estimated useful lives. The core deposits intangible assets from the acquisitions of Diablo Valley Bank and Focus are being amortized on an accelerated method over ten years. The customer relationship intangible from the acquisition of Diablo Valley Bank was being amortized on an accelerated method over seven years, and was fully amortized at December 31, 2014. The below market value lease, customer relationship and non-compete agreement intangible assets from the acquisition of Bay View Funding are being amortized on the straight line method over three, ten, and three years, respectively. |
Foreclosed Assets | Foreclosed Assets Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. If fair value declines subsequent to foreclosure, a valuation allowance is recorded through operations. Operating costs after acquisition are expensed. Gains and losses on disposition are included in noninterest expense. The carrying value of foreclosed assets was $364,000 and $696,000 at December 31, 2015 and 2014, respectively, and is included in other assets on the consolidated balance sheets. |
Retirement Plans | Retirement Plans Expenses for the Company's non-qualified, unfunded defined benefits plan consists of service and interest cost and amortization of gains and losses not immediately recognized. Employee 401(k) and profit sharing plan expense is the amount of matching contributions. Deferred compensation and supplemental retirement plan expense allocates the benefits over years of service. |
Loss Contingencies | Loss Contingencies Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. The Company's accounting policy for legal costs related to loss contingencies is to accrue for the probable fees that can be reasonably estimated. The Company's accounting policy for uncertain recoveries is to recognize the anticipated recovery when realization is deemed probable. |
Income Taxes | Income Taxes The Company files consolidated Federal and combined state income tax returns. Income tax expense is the total of the current year income tax payable or refunded, the change in deferred tax assets and liabilities, and low income housing investment losses, net of tax benefits received. Some items of income and expense are recognized in different years for tax purposes when applying generally accepted accounting principles, leading to timing differences between the Company's actual tax liability and the amount accrued for this liability based on book income. These temporary differences comprise the "deferred" portion of the Company's tax expense or benefit, which is accumulated on the Company's books as a deferred tax asset or deferred tax liability until such time as they reverse. Realization of the Company's deferred tax assets is primarily dependent upon the Company generating sufficient taxable income to obtain benefit from the reversal of net deductible temporary differences and utilization of tax credit carryforwards for Federal and California state income tax purposes. The amount of deferred tax assets considered realizable is subject to adjustment in future periods based on estimates of future taxable income. Under generally accepted accounting principles, a valuation allowance is required to be recognized if it is "more likely than not" that a deferred tax asset will not be realized. The determination of the realizability of the deferred tax assets is highly subjective and dependent upon judgment concerning management's evaluation of both positive and negative evidence, including forecasts of future income, cumulative losses, applicable tax planning strategies, and assessments of current and future economic and business conditions. The Company had net deferred tax assets of $22,218,000 and $18,527,000 at December 31, 2015, and December 31, 2014, respectively. After consideration of the matters in the preceding paragraph, the Company determined that it is more likely than not that the net deferred tax asset at December 31, 2015 and 2014 will be fully realized in future years. A tax position is recognized as a benefit only if it is "more likely than not" that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the "more likely than not" test, no tax benefit is recorded. The Company recognizes interest and penalties related to uncertain tax positions as income tax expense. |
Stock-Based Compensation | Stock-Based Compensation Compensation cost is recognized for stock options and restricted stock awards issued to employees, based on the fair value of these awards at the date of grant. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company's common stock at the date of grant is used for restricted stock awards. Compensation cost is recognized over the required service period, generally defined as the vesting period. For awards with graded vesting, compensation cost is recognized on a straight-line basis over the requisite service period for the entire award. Compensation cost recognized reflects estimated forfeitures, adjusted as necessary for actual forfeitures. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) refers to gains and losses that are included in comprehensive income (loss) but are excluded from net income (loss) because they have been recorded directly in equity under the provisions of certain accounting guidance. The Company's sources of other comprehensive income (loss) are unrealized gains and losses on securities available-for-sale, and I/O strips, which are treated like available-for-sale securities, and the liabilities related to the Company's defined benefit pension plan and the split-dollar life insurance benefit plan. Reclassification adjustments result from gains or losses on securities that were realized and included in net income (loss) of the current period that also had been included in other comprehensive income as unrealized holding gains and losses. |
Segment Reporting | Segment Reporting HBC is a commercial bank serving customers located in Santa Clara, Alameda, Contra Costa, and San Benito counties of California. Bay View Funding provides business essential working capital factoring financing to various industries throughout the United States. No customer accounts for more than 10 percent of revenue for HBC or the Company. With the acquisition of Bay View Funding, the Company now has two reportable segments consisting of Banking and Factoring. While the chief decision-makers monitor the revenue streams of the various products and services, operations are managed and financial performance is evaluated on a Company-wide basis. Operating segments are aggregated into one as operating results for all segments are similar. Accordingly, all of the financial service operations are considered by management to be aggregated in one reportable segment. |
Reclassifications | Reclassifications Certain items in the consolidated financial statements for the years ended December 31, 2014 and 2013 were reclassified to conform to the 2015 presentation. These reclassifications did not affect previously reported net income or shareholders equity. |
Adoption of New Accounting Standards | Adoption of New Accounting Standards In January 2014, the Financial Accounting Standards Board ("FASB") amended existing guidance clarifying that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction. The amendments in this update are effective for public business entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. For entities other than public business entities, the amendments in this update are effective for annual periods beginning after December 15, 2014, and interim periods within annual periods beginning after December 15, 2015. The Company has evaluated the adoption of the new guidance and has determined it did not have a material impact on the consolidated financial statements. In January 2014, the FASB issued guidance for accounting for investments in qualified affordable housing projects, which represents a consensus of the Emerging Issues Task Force and sets forth new accounting for qualifying investments in flow through limited liability entities that invest in affordable housing projects. The new guidance allows a limited liability investor that meets certain conditions to amortize the cost of its investment in proportion to the tax credits and other tax benefits it receives. The new accounting method, referred to as the proportional amortization method, allows amortization of the tax credit investment to be reflected along with the primary benefits, the tax credits and other tax benefits, on a net basis in the income statement within the income tax expense (benefit) line. For public business entities, the guidance is effective for interim and annual periods beginning after December 15, 2014. For all other entities, the guidance is effective for annual periods beginning after December 15, 2014, and interim periods within annual periods beginning after December 15, 2015. If elected, the proportional amortization method is required to be applied retrospectively. Early adoption is permitted in the annual period for which financial statements have not been issued. The Company adopted the proportional amortization method of accounting for its low income housing investments in the third quarter of 2014. The Company quantified the impact of adopting the proportional amortization method compared to the equity method to its current year and prior period financial statements. The Company determined that the adoption of the proportional amortization method did not have a material impact to its financial statements. The low income housing investment losses, net of the tax benefits received, are included in income tax expense for all periods reflected on the consolidated income statements. See Note 12 — Income Taxes for more information on the adoption of the proportional method of accounting for low income housing investments. In May 2014, the FASB issued an update to the guidance for accounting for revenue from contracts with customers. The guidance in this update affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets unless those contracts are within the scope of other standards (for example, insurance contracts or lease contracts). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance provides steps to follow to achieve the core principle. An entity should disclose sufficient information to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Qualitative and quantitative information is required about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. The amendments in this update become effective for annual periods and interim periods within those annual periods beginning after December 15, 2017. We are evaluating the impact of adopting the new guidance on the consolidated financial statements. In September 2015, the FASB issued an update simplifying the accounting for measurement-period adjustments. This update applies to all entities that have reported provisional amounts for items in a business combination for which the accounting is incomplete by the end of the reporting period in which the combination occurs and during the measurement period have an adjustment to provisional amounts recognized. The amendments in this update require that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments in this update require that the acquirer record, in the same period's financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. The amendments in this update require an entity to present separately on the face of the income statement or disclose in the notes the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. The amendments in this update are effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. The amendments in this update should be applied prospectively to adjustments to provisional amounts that occur after the effective date of this update with earlier application permitted for financial statements that have not been issued. We are currently evaluating the impact of adopting the new guidance on the consolidated financial statements, but it is not expected to have a material impact. On January 5, 2016, the FASB issued an update (ASU No. 2016-01, Financial Instruments — Recognition and Measurement of Financial Assets and Liabilities). The new guidance is intended to improve the recognition and measurement of financial instruments by requiring: equity investments (other than equity method or consolidation) to be measured at fair value with changes in fair value recognized in net income; public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; separate presentation of financial assets and financial liabilities by measurement category and form of financial assets (i.e. securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements; eliminating the requirement to disclose the fair value of financial instruments measured at amortized cost for organizations that are not public business entities; eliminating the requirement for non-public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is to be required to be disclosed for financial instruments measured at amortized cost on the balance sheet; and requiring a reporting organization to present separately in other comprehensive income the portion of the total change in fair value of a liability resulting from the change in the instrument-specific credit risk (also referred to as "own credit") when the organization has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. The new guidance is effective for public business entities for fiscal years beginning after December 15, 2017. We are currently evaluating the impact of adopting the new guidance on the consolidated financial statements. |
Accumulated Other Comprehensi34
Accumulated Other Comprehensive Income (''AOCI'') (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Accumulated Other Comprehensive Income ("AOCI") | |
Schedule of changes in AOCI by component | For the Years Ended December 31, 2015, 2014, and 2013 Unrealized Gains (Losses) on Available- for-Sale Securities and I/O Strips Unamortized Unrealized Gain on Available- for-Sale Securities Reclassified to Held-to- Maturity Defined Benefit Pension Plan Items Total (Dollars in thousands) Beginning balance January 1, 2015, net of taxes $ $ $ ) $ ) Other comprehensive (loss) before reclassification, net of taxes ) — ) ) Amounts reclassified from other comprehensive income (loss), net of taxes ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive income (loss), net of taxes ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ending balance December 31, 2015, net of taxes $ $ $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning balance January 1, 2014, net of taxes $ ) $ $ ) $ ) Other comprehensive (loss) before reclassification, net of taxes — ) Amounts reclassified from other comprehensive income (loss), net of taxes ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive income (loss), net of taxes ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ending balance December 31, 2014, net of taxes $ $ $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning balance January 1, 2013, net of taxes $ $ $ ) $ Other comprehensive (loss) before reclassification, net of taxes ) — ) Amounts reclassified from other comprehensive income (loss), net of taxes ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive income (loss), net of taxes ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ending balance December 31, 2013, net of taxes $ ) $ $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of reclassifications out of AOCI into net income | Amounts Reclassified from AOCI For the Year Ended December 31, Affected Line Item Where Net Income is Presented Details About AOCI Components 2015 2014 2013 (Dollars in thousands) Unrealized gains on available-for-sale securities and I/O strips $ $ $ Realized gains on sale of securities ) ) ) Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net of tax ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of unrealized gain on securities available-for-sale that were reclassified to securities held-to-maturity Interest income on taxable securities ) ) ) Income tax (expense) benefit ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net of tax ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of defined benefit pension plan items(1) Prior transition obligation Actuarial losses ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ) ) ) Income before income tax Income tax benefit ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ) ) ) Net of tax ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total reclassification for the year $ $ $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) This AOCI component is included in the computation of net periodic benefit cost (see Note 14 — Benefit Plans). |
Securities (Tables)
Securities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Securities | |
Schedule of amortized cost and estimated fair value of securities | 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Estimated Fair Value (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ $ $ ) $ U.S. Treasury — ) Trust preferred securities — U.S. Government sponsored entities ) Corporate bonds — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Securities held-to-maturity: Municipals — tax exempt $ $ $ ) $ Agency mortgage-backed securities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2014 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Estimated Fair Value (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ $ $ ) $ Corporate bonds ) Trust preferred securities — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Securities held-to-maturity: Municipals — tax exempt $ $ $ ) $ Agency mortgage-backed securities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of securities with unrealized losses | Less Than 12 Months 12 Months or More Total 2015 Fair Value Unrealized (Losses) Fair Value Unrealized (Losses) Fair Value Unrealized (Losses) (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ $ ) $ $ ) $ $ ) U.S. Treasury ) — — ) U.S. Government sponsored entities ) — — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ) $ $ ) $ $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Securities held-to-maturity: Municipals — Tax Exempt $ $ ) $ $ ) $ $ ) Agency mortgage-backed securities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ) $ $ ) $ $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less Than 12 Months 12 Months or More Total 2014 Fair Value Unrealized (Losses) Fair Value Unrealized (Losses) Fair Value Unrealized (Losses) (Dollars in thousands) Securities available-for-sale: Agency mortgage-backed securities $ $ ) $ $ ) $ $ ) Corporate bonds — — ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ) $ $ ) $ $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Securities held-to-maturity: Municipals — Tax Exempt $ $ ) $ $ ) $ $ ) Agency mortgage-backed securities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ) $ $ ) $ $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of proceeds from sales of securities and the resulting gains and losses | 2015 2014 2013 (Dollars in thousands) Proceeds $ $ $ Gross gains Gross losses ) ) ) |
Schedule of amortized cost and estimated fair values of securities, by contractual maturity | Available-for-sale Amortized Cost Estimated Fair Value (Dollars in thousands) Due after 3 months through one year $ $ Due after one through five years Due after five through ten years Due after ten years Agency mortgage-backed securities ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Held-to-maturity Amortized Cost Estimated Fair Value (Dollars in thousands) Due less than 3 months $ $ Due after 3 months through one year Due after one through five years Due after five through ten years Due after ten years Agency mortgage-backed securities ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Loans (Tables)
Loans (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Loans | |
Schedule of loans | 2015 2014 (Dollars in thousands) Loans held-for-investment: Commercial $ $ Real estate: Commercial and residential Land and construction Home equity Consumer ​ ​ ​ ​ ​ ​ ​ ​ Loans Deferred loan fees, net ) ) ​ ​ ​ ​ ​ ​ ​ ​ Loans, net of deferred fees Allowance for loan losses ) ) ​ ​ ​ ​ ​ ​ ​ ​ Loans, net $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of changes in allowance for loan losses | For the Year Ended December 31, 2015 Commercial Real Estate Consumer Total (Dollars in thousands) Balance, beginning of year $ $ $ $ Charge-offs ) ) ) ) Recoveries ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net recoveries Provision (credit) for loan losses ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, 2014 Commercial Real Estate Consumer Total (Dollars in thousands) Balance, beginning of year $ $ $ $ Charge-offs ) ) ) ) Recoveries — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net charge-offs ) ) ) ) Provision (credit) for loan losses ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, 2013 Commercial Real Estate Consumer Total (Dollars in thousands) Balance, beginning of year $ $ $ $ Charge-offs ) ) — ) Recoveries ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net recoveries Provision (credit) for loan losses ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of balance in allowance for loan losses and recorded investment in loans by portfolio segment, based on impairment method | December 31, 2015 Commercial Real Estate Consumer Total (Dollars in thousands) Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ $ $ — $ Collectively evaluated for impairment Acquired with deterioriated credit quality — — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total allowance balance $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans: Individually evaluated for impairment $ $ $ $ Collectively evaluated for impairment Acquired with deterioriated credit quality — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total loan balance $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2014 Commercial Real Estate Consumer Total (Dollars in thousands) Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ $ — $ — $ Collectively evaluated for impairment ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total allowance balance $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans: Individually evaluated for impairment $ $ $ $ Collectively evaluated for impairment ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total loan balance $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of carrying amount of purchased credit impaired loans | 2015 (Dollars in thousands) Commercial $ Outstanding balance Carrying amount, net of discount of $639,000 |
Schedule of loans held-for-investment individually evaluated for impairment by class of loans | December 31, 2015 December 31, 2014 Unpaid Principal Balance Recorded Investment Allowance for Loan Losses Allocated Unpaid Principal Balance Recorded Investment Allowance for Loan Losses Allocated (Dollars in thousands) With no related allowance recorded: Commercial $ $ $ — $ $ $ — Real estate: Commercial and residential — — Land and construction — — Home Equity — — Consumer — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total with no related allowance recorded — — With an allowance recorded: Commercial Real estate: Home Equity — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total with an allowance recorded ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of average impaired loans with interest recognized and cash-basis interest earned on impaired loans | For the Year Ended December 31, 2015 Real Estate Commercial Commercial and Residential Land and Construction Home Equity Consumer Total (Dollars in thousands) Average of impaired loans during the period $ $ $ $ $ $ Interest income during impairment $ $ — $ — $ $ — $ Cash-basis interest earned $ — $ — $ — $ — $ — $ — For the Year Ended December 31, 2014 Real Estate Commercial Commercial and Residential Land and Construction Home Equity Consumer Total (Dollars in thousands) Average of impaired loans during the period $ $ $ $ $ $ Interest income during impairment $ $ — $ — $ — $ — $ Cash-basis interest earned $ — $ — $ — $ — $ — $ — |
Schedule of nonperforming loans | 2015 2014 (Dollars in thousands) Nonaccrual loans — held-for-investment $ $ Restructured and loans over 90 days past due and still accruing — ​ ​ ​ ​ ​ ​ ​ ​ Total nonperforming loans $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other restructured loans $ $ Impaired loans, excluding loans held-for-sale $ $ |
Schedule of nonperforming loans by class | 2015 2014 Nonaccrual Restructured and Loans over 90 Days Past Due and Still Accruing Total Nonaccrual Restructured and Loans over 90 Days Past Due and Still Accruing Total (Dollars in thousands) Commercial $ $ $ $ $ — $ Real estate: Commercial and residential — — Land and construction — — Home equity — Consumer — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of aging of past due loans by class of loans | The following table presents the aging of past due loans as of December 31, 2015 by class of loans: 30 - 59 Days Past Due 60 - 89 Days Past Due 90 Days or Greater Past Due Total Past Due Loans Not Past Due Total (Dollars in thousands) Commercial $ $ $ $ $ $ Real estate: Commercial and residential — — — — Land and construction — — Home equity — — Consumer — — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The following table presents the aging of past due loans as of December 31, 2014 by class of loans: 30 - 59 Days Past Due 60 - 89 Days Past Due 90 Days or Greater Past Due Total Past Due Loans Not Past Due Total (Dollars in thousands) Commercial $ $ $ $ $ $ Real estate: Commercial and residential — — Land and construction — — — — Home equity — — — — Consumer — — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Summary of loan portfolio by loan type and credit quality classification | December 31, 2015 December 31, 2014 Nonclassified Classified* Total Nonclassified Classified* Total (Dollars in thousands) Commercial $ $ $ $ $ $ Real estate: Commercial and residential Land and construction Home equity Consumer ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ * Classified loans in the table above include SBA guarantees. |
Schedule of loans outstanding to related parties | 2015 2014 (Dollars in thousands) Balance, beginning of year $ $ Advances on loans during the year — Repayment on loans during the year ) ) ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Loan Servicing (Tables)
Loan Servicing (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Loan Servicing | |
Schedule of activity for loan servicing rights | 2015 2014 2013 (Dollars in thousands) Balance, beginning of year $ $ $ Additions Amortization ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of activity for IO strip receivables | 2015 2014 2013 (Dollars in thousands) Balance, beginning of year $ $ $ Unrealized loss ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, end of year $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Premises and Equipment | |
Schedule of premises and equipment | 2015 2014 (Dollars in thousands) Building $ $ Land Furniture and equipment Leasehold improvements ​ ​ ​ ​ ​ ​ ​ ​ Accumulated depreciation and amortization ) ) ​ ​ ​ ​ ​ ​ ​ ​ Premises and equipment, net $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Leases | |
Schedule of future minimum payments under non-cancelable operating leases | Year ending December 31, (Dollars in thousands) 2016 2017 2018 2019 2020 Thereafter ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
BVF/CSNK | |
Business Combinations | |
Schedule of unaudited pro forma combined consolidated financial statements and related adjustments | UNAUDITED 2014 2013 (Dollars in thousands, except per share amounts) Net interest income $ $ Noninterest income ​ ​ ​ ​ ​ ​ ​ ​ Total revenue $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income $ $ Net income per share — basic $ $ Net income per share — diluted $ $ |
Focus Business Bank | |
Business Combinations | |
Summary of the estimated fair values of the assets acquired and liabilities assumed | (Dollars in thousands) Assets acquired: Cash and cash item $ Federal funds sold and deposits in other financial institutions Securities available-for-sale Securities held-to-maturity Loans held-for-sale Net loans Goodwill Core deposit intangible asset Corporate owned life insurance Other assets, net ​ ​ ​ ​ ​ Total assets acquired Liabilities asssumed: Deposits Other liabilities ​ ​ ​ ​ ​ Total liabilities ​ ​ ​ ​ ​ Net assets acquired $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Summary of consideration paid | August 20, 2015 (Dollars in thousands) Cash paid for Focus in-the-money stock options $ Common stock issued to Focus shareholders at $10.68 per share ​ ​ ​ ​ ​ Total consideration $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of unaudited pro forma combined consolidated financial statements and related adjustments | UNAUDITED For the Year Ended December 31, 2015 For the Year Ended December 31, 2014 (Dollars in thousands, except per share amounts) Net interest income $ $ Provision (credit) for loan losses ) Noninterest income Noninterest expense ​ ​ ​ ​ ​ ​ ​ ​ Income before income taxes Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ Net income $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income per share — basic $ $ Net income per share — diluted $ $ |
Goodwill and Other Intangible41
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Other Intangible Assets | |
Schedule of estimated amortization expense | Bay View Funding Year Diablo Valley Bank Core Deposit Intangible Focus Core Deposit Intangible Below Market Value Lease Intangible Customer & Brokered Relationship Intangible Non-Compete Agreement Intangible Total Amortization Expense (Dollars in thousands) 2016 $ $ $ $ $ $ 2017 2018 — — — 2019 — — — 2020 — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Deposits | |
Schedule of maturities of time deposits including brokered deposits | (Dollars in thousands) 2016 $ 2017 2018 2019 2020 ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes | |
Schedule of income tax (benefit) | 2015 2014 2013 (Dollars in thousands) Currently payable tax: Federal $ $ $ State ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total currently payable Deferred tax (benefit): Federal ) State ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total deferred tax ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income tax expense $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of effective tax rate differs from the federal statutory rate | 2015 2014 2013 Statutory Federal income tax rate % % % State income taxes, net of federal tax benefit % % % Low income housing credits, net of investment losses % % % Increase in cash surrender value of life insurance –2.2 % –2.7 % –3.5 % Non-taxable interest income –2.7 % –3.2 % –2.9 % Split-dollar term insurance % % % Other, net % –0.5 % % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effective tax rate % % % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of deferred tax assets and liabilities | 2015 2014 (Dollars in thousands) Deferred tax assets: Defined postretirement benefit obligation $ $ Allowance for loan losses Federal net operating loss carryforwards — Stock compensation Accrued expenses State income taxes Premises and equipment California net operating loss carryforwards — Split-dollar life insurance benefit plan Tax credit carryforwards Loans — Nonaccrual interest — Other ​ ​ ​ ​ ​ ​ ​ ​ Total deferred tax assets Deferred tax liabilities: Intangible assets ) ) Loan fees ) ) Prepaid expenses ) ) I/O strips ) ) Securities available-for-sale ) ) FHLB stock ) ) Other ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total deferred tax liabilities ) ) ​ ​ ​ ​ ​ ​ ​ ​ Net deferred tax assets $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Summary of carrying amount of income tax housing investment | December 31, 2015 December 31, 2014 (Dollars in thousands) Low income housing investments $ $ Future commitments $ $ |
Equity Plan (Tables)
Equity Plan (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Equity Plan | |
Schedule of stock option activity under the equity plans | Total Stock Options Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at January 1, 2015 $ Granted $ Exercised ) $ Forfeited or expired ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Outstanding at December 31, 2015 $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Vested or expected to vest $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Exercisable at December 31, 2015 $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of information related to the equity Plan | 2015 2014 2013 Intrinsic value of options exercised $ $ $ Cash received from option exercise $ $ $ Tax benefit realized from option exercises $ $ $ Weighted average fair value of options granted $ $ $ |
Schedule of assumptions used to estimate the fair value of each option grant on the date of grant | 2015 2014 2013 Expected life in months(1) Volatility(1) % % % Weighted average risk-free interest rate(2) % % % Expected dividends(3) % % % (1) The expected life of employee stock options represents the weighted average period the stock options are expected to remain outstanding based on historical experience. Volatility is based on the historical volatility of the stock price over the same period of the expected life of the option. (2) Based on the U.S. Treasury constant maturity interest rate with a term consistent with the expected life of the option granted. (3) Each grant's dividend yield is calculated by annualizing the most recent quarterly cash dividend and dividing that amount by the market price of the Company's common stock as of the grant date. |
Schedule of restricted stock activity under the equity plans | Total Restricted Stock Award Number of Shares Weighted Average Grant Date Fair Value Nonvested shares at January 1, 2015 $ Granted $ Vested ) $ Forfeited or expired ) $ ​ ​ ​ ​ ​ ​ ​ ​ Nonvested shares at December 31, 2015 $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Benefit Plans (Tables)
Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Supplemental Retirement Plan | |
Benefit plans | |
Schedule of change in projected benefit obligation | 2015 2014 (Dollars in thousands) Change in projected benefit obligation: Projected benefit obligation at beginning of year $ $ Service cost Actuarial loss (gain) Interest cost Benefits paid ) ) ​ ​ ​ ​ ​ ​ ​ ​ Projected benefit obligation at end of year $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of amounts recognized in accumulated other comprehensive loss | ​ ​ ​ ​ ​ ​ ​ ​ Amounts recognized in accumulated other comprehensive loss: Net actuarial loss $ $ |
Schedule of weighted-average assumptions used to determine the benefit obligation | 2015 2014 Discount rate % % Rate of compensation increase N/A N/A |
Schedule of estimated benefit payments over the next ten years, which reflect anticipated future events, service and other assumptions | Year Estimated Benefit Payments (Dollars in thousands) 2016 $ 2017 2018 2019 2020 2021 to 2025 |
Schedule of components of net periodic benefit cost | 2015 2014 (Dollars in thousands) Components of net periodic benefit cost: Service cost $ $ Interest cost Amortization of net actuarial loss ​ ​ ​ ​ ​ ​ ​ ​ Net periodic benefit cost $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of assumption used to determine the net periodic benefit cost | 2015 2014 Discount rate % % Rate of compensation increase N/A N/A |
Split-Dollar Life Insurance Benefit Plan | |
Benefit plans | |
Schedule of change in projected benefit obligation | 2015 2014 (Dollars in thousands) Change in projected benefit obligation: Projected benefit obligation at beginning of year $ $ Interest cost Actuarial loss. ​ ​ ​ ​ ​ ​ ​ ​ Projected benefit obligation at end of year $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of amounts recognized in accumulated other comprehensive loss | 2015 2014 (Dollars in thousands) Net actuarial loss $ $ Prior transition obligation ​ ​ ​ ​ ​ ​ ​ ​ Accumulated other comprehensive loss $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of weighted-average assumptions used to determine the benefit obligation | 2015 2014 Discount rate % % |
Schedule of components of net periodic benefit cost | 2015 2014 (Dollars in thousands) Amortization of prior transition obligation $ ) $ ) Interest cost ​ ​ ​ ​ ​ ​ ​ ​ Net periodic benefit cost $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of assumption used to determine the net periodic benefit cost | 2015 2014 Discount rate % % |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value | |
Schedule of financial assets and liabilities measured on a recurring basis | Fair Value Measurements Using Balance Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Obeservable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (Dollars in thousands) Assets at December 31, 2015: Available-for-sale securities: Agency mortgage-backed securities $ — $ — U.S. Treasury $ $ $ — — Trust preferred securities $ — $ — U.S. Government sponsored entities $ — $ Corporate bonds $ — $ I/O strip receivables $ — $ — Assets at December 31, 2014: Available-for-sale securities: Agency mortgage-backed securities $ — $ — Corporate bonds $ — $ — Trust preferred securities $ — $ — I/O strip receivables $ — $ — |
Schedule of assets and liabilities measured on a non-recurring basis | Fair Value Measurements Using Balance Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (Dollars in thousands) Assets at December 31, 2015: Impaired loans — held-for-investment: Commercial $ — — $ Real estate: Commercial and residential — — Land and construction — — Home equity ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ — — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Assets at December 31, 2014: Impaired loans — held-for-investment: Commercial $ — — $ Real estate: Commercial and residential — — Land and construction — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ — — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Foreclosed assets: Land and construction $ — — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of impaired loans held-for-investment and impaired loans held-for-investment carried at fair value | December 31, 2015 December 31, 2014 (Dollars in thousands) Impaired loans held-for-investment: Book value of impaired loans held-for-investment carried at fair value $ $ Book value of impaired loans held-for-investment carried at cost ​ ​ ​ ​ ​ ​ ​ ​ Total impaired loans held-for-investment $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Impaired loans held-for-investment carried at fair value: Book value of impaired loans held-for-investment carried at fair value $ $ Specific valuation allowance ) ) ​ ​ ​ ​ ​ ​ ​ ​ Impaired loans held-for-investment carried at fair value, net $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | December 31, 2015 Fair Value Valuation Techniques Unobservable Inputs Range (Weighted Average) (Dollars in thousands) Impaired loans — held-for-investment: Commercial $ Market Approach Discount adjustment for differences between comparable sales 0% to 5% (5%) Real estate: Commercial and residential Market Approach Discount adjustment for differences between comparable sales 0% to 3% (3%) Land and construction Market Approach Discount adjustment for differences between comparable sales Less than 1% Home equity Market Approach Discount adjustment for differences between comparable sales 0% to 2% (2%) December 31, 2014 Fair Value Valuation Techniques Unobservable Inputs Range (Weighted Average) (Dollars in thousands) Impaired loans — held-for-investment: Commercial $ Market Approach Discount adjustment for differences between comparable sales 0% to 3% (3%) Real estate: Commercial and residential Market Approach Discount adjustment for differences between comparable sales 0% to 3% (3%) Land and construction Market Approach Discount adjustment for differences between comparable sales 1% to 2% (2%) Foreclosed assets: Land and construction Market Approach Discount adjustment for differences between comparable sales Less than 1% |
Schedule of carrying amounts and estimated fair values of financial instruments | December 31, 2015 Estimated Fair Value Carrying Amounts Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total (Dollars in thousands) Assets: Cash and cash equivalents $ $ $ — $ — $ Securities available-for-sale — Securities held-to-maturity — — Loans (including loans held-for-sale), net — FHLB stock, FRB stock, and other investments — — — N/A Accrued interest receivable — I/O strips receivables — — Liabilities: Time deposits $ $ — $ $ — $ Other deposits — — Short-term borrowings — Accrued interest payable — — December 31, 2014 Estimated Fair Value Carrying Amounts Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total (Dollars in thousands) Assets: Cash and cash equivalents $ $ $ — $ — $ Securities available-for-sale — — Securities held-to-maturity — — Loans (including loans held-for-sale), net — FHLB and FRB stock — — — N/A Accrued interest receivable — I/O strips receivables — — Liabilities: Time deposits $ $ — $ $ — $ Other deposits — — Accrued interest payable — — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies | |
Schedule of commitments to extend credit | December 31, 2015 December 31, 2014 Fixed Rate Variable Rate Fixed Rate Variable Rate (Dollars in thousands) Unused lines of credit and commitments to make loans $ $ $ $ Standby letters of credit ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Shareholders' Equity and Earn48
Shareholders' Equity and Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share | |
Schedule of reconciliation of factors used in computing basic and diluted earnings per common share | Year ended December 31, 2015 2014 2013 (Dollars in thousands, except per share amounts) Net income available to common shareholders $ $ $ Less: undistributed earnings allocated to Series C Preferred Stock ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Distributed and undistributed earnings allocated to common shareholders $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average common shares outstanding for basic earnings per common share Dilutive effect of stock options oustanding, using the treasury stock method ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Shares used in computing diluted earnings per common share ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic earnings per share $ $ $ Diluted earnings per share $ $ $ |
Capital Requirements (Tables)
Capital Requirements (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Capital Requirements | |
Schedule of actual capital and required amounts and ratios | Actual Required For Capital Adequacy Purposes Under Basel III Amount Ratio Amount Ratio (Dollars in thousands) As of December 31, 2015: Total Capital $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % (to risk-weighted assets) Common Equity Tier 1 Capital $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % (to average assets) Actual To Be Well-Capitalized Under Basel I Regulatory Requirements Required For Capital Adequacy Purposes Under Basel I Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) As of December 31, 2014: Total Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % N/A N/A $ % (to average assets) |
HBC (Wholly-owned Subsidiary) | |
Capital Requirements | |
Schedule of actual capital and required amounts and ratios | Actual To Be Well-Capitalized Under Basel III Regulatory Requirements Required For Capital Adequacy Purposes Under Basel III Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) As of December 31, 2015: Total Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % $ % (to risk-weighted assets) Common Equity Tier 1 Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % $ % (to average assets) Actual To Be Well-Capitalized Under Basel I Regulatory Requirements Required For Capital Adequacy Purposes Under Basel I Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) As of December 31, 2014: Total Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % $ % (to risk-weighted assets) Tier 1 Capital $ % $ % $ % (to average assets) |
Noninterest Expense (Tables)
Noninterest Expense (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Noninterest Expense | |
Schedule of noninterest expense | Year Ended December 31, 2015 2014 2013 (Dollars in thousands) Salaries and employee benefits $ $ $ Occupancy and equipment Acquisition and integration related costs(1) — Professional fees Data processing Software subscriptions Insurance expense FDIC deposit insurance premiums Correspondent bank charges Amortization on intangible assets Foreclosed assets ) ) Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Does not include pre-tax severance and retention cost of $2,887,000, which is included in salaries and employee benefits for the year ended December 31, 2015. |
Business Segment Information (T
Business Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Business Segment Reporting | |
Schedule of impaired loans held-for-investment and the impaired loans held for investment carried at fair value | For the Twelve Months Ended Deember 31, 2015 Banking(1) Factoring Consolidated (Dollars in thousands) Interest income $ $ $ Intersegment interest allocations ) — Total interest expense — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income Provision (credit) for loan losses ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income after provision Noninterest income Noninterest expense Intersegment expense allocations ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before income taxes Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ $ Loans, net of deferred fees $ $ $ Goodwill $ $ $ (1) Includes the holding company's results of operations For the Twelve Months Ended Deember 31, 2014 Banking(1) Factoring(2) Consolidated (Dollars in thousands) Interest income $ $ $ Intersegment interest allocations ) — Total interest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income Provision (credit) for loan losses ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income after provision Noninterest income Noninterest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before income taxes Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ $ Loans, net of deferred fees $ $ $ Goodwill $ — $ $ (1) Includes the holding company's results of operations (2) Includes two months of Bay View Funding's results of operations |
Parent Company only Condensed52
Parent Company only Condensed Financial Information (Tables) - HCC (Parent) | 12 Months Ended |
Dec. 31, 2015 | |
Condensed financial statements | |
Schedule of condensed balance sheets | Condensed Balance Sheets December 31, 2015 2014 (Dollars in thousands) Assets Cash and cash equivalents $ $ Investment in subsidiary bank Other assets ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities and Shareholder's Equity Short-term borrowings — Other liabilities Shareholder's equity ​ ​ ​ ​ ​ ​ ​ ​ Total liabilities and shareholder's equity $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of condensed statements of income | Condensed Statements of Operations For the Year Ended December 31, 2015 2014 2013 (Dollars in thousands) Dividend from subsidiary bank $ — $ — $ Interest expense ) — ) Other expenses ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income (loss) before income taxes and equity in net income of subsidiary bank ) ) Equity in net income of subsidiary bank: Reduction in contributed capital and distribution from subsidiary bank — — ) Net income of subsidiary bank Income tax benefit ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income Dividends and discount accretion on preferred stock ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income available to common shareholders $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of condensed statements of cash flows | Condensed Statements of Cash Flows For the Year Ended December 31, 2015 2014 2013 (Dollars in thousands) Cash flows from operating activities: Net Income $ $ $ Adjustments to reconcile net income to net cash provided by (used in) operations: Amortization of restricted stock award, net of forfeitures and taxes ) Equity in undistributed loss/(net income) of subsidiary bank ) ) Net change in other assets and liabilities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash (used in) provided by operating activities ) ) Cash flows from financing activities: Repayment of subordinated debt — — ) Net change in purchased funds and other short-term borrowings — — Payment of cash dividends ) ) ) Proceeds from issuance of common stock, net of issuance costs Payment of repurchase of common stock warrant — — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in financing activities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net (decrease) increase in cash and cash equivalents ) ) Cash and cash equivalents, beginning of year ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents, end of year $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Quarterly Financial Data (Una53
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data (Unaudited) | |
Schedule of the Company's selected unaudited quarterly financial data | For the Quarter Ended(1) 12/31/15 09/30/15 06/30/15 03/31/15 (Dollars in thousands, except per share amounts) Interest income $ $ $ $ Interest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income Provision (credit) for loan losses ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income after provision for loan losses Noninterest income Noninterest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before income taxes Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income Dividends on preferred stock ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income available to common shareholders Undistributed earnings allocated to Series C Preferred Stock ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Distributed and undistributed earnings allocated to common shareholders $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Earnings per common share Basic $ $ $ $ Diluted $ $ $ $ (1) Pre-tax severance, retention and acquisition and integration costs included in noninterest expense were $2,991,000, $2,865,000, $423,000, and $119,000, for the fourth, third, second, and first quarters of 2015, respectively. For the Quarter Ended 12/31/2014(1) 9/30/2014(2) 06/30/14 03/31/14 (Dollars in thousands, except per share amounts) Interest income $ $ $ $ Interest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income Provision (credit) for loan losses ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income after provision for loan losses Noninterest income Noninterest expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before income taxes Income tax expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income Dividends on preferred stock ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income available to common shareholders Undistributed earnings allocated to Series C Preferred Stock ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Distributed and undistributed earnings allocated to common shareholders $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Earnings per common share Basic $ $ $ $ Diluted $ $ $ $ (1) The Company's selected unaudited quarterly financial data for the quarter ended December 31, 2014 includes Bay View Funding acquisition and integration costs of $609,000, and the results of operations for Bay View Funding for the months of November and December 2014. (2) The Company's selected unaudited quarterly financial data for the quarter ended September 30, 2014 includes Bay View Funding acquisition and integration costs of $234,000. |
Summary of Significant Accoun54
Summary of Significant Accounting Policies - Cash and Cash Equivalents (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Cash and Cash Equivalents | |
Period for which federal funds are sold and purchased | 1 day |
Summary of Significant Accoun55
Summary of Significant Accounting Policies - Premises and Equipment (Details) | 12 Months Ended |
Dec. 31, 2015building | |
Premises and Equipment | |
Number of buildings owned | 1 |
Building | |
Premises and Equipment | |
Estimated useful life | 40 years |
Furniture | Minimum | |
Premises and Equipment | |
Estimated useful life | 5 years |
Furniture | Maximum | |
Premises and Equipment | |
Estimated useful life | 15 years |
Equipment | Minimum | |
Premises and Equipment | |
Estimated useful life | 5 years |
Equipment | Maximum | |
Premises and Equipment | |
Estimated useful life | 15 years |
Leasehold improvements | Minimum | |
Premises and Equipment | |
Estimated useful life | 5 years |
Leasehold improvements | Maximum | |
Premises and Equipment | |
Estimated useful life | 15 years |
Summary of Significant Accoun56
Summary of Significant Accounting Policies - Goodwill and Other Intangible Assets (Details) | Aug. 20, 2015 | Nov. 01, 2014 | Jun. 30, 2007 |
Focus Business Bank | |||
Goodwill and Other Intangible Assets | |||
Useful life, amortization period | 10 years | ||
Core deposit | Diablo Valley Bank | |||
Goodwill and Other Intangible Assets | |||
Useful life, amortization period | 10 years | ||
Core deposit | Focus Business Bank | |||
Goodwill and Other Intangible Assets | |||
Useful life, amortization period | 10 years | ||
Below market-value lease | BVF/CSNK | |||
Goodwill and Other Intangible Assets | |||
Useful life, amortization period | 3 years | ||
Customer relationship | Diablo Valley Bank | |||
Goodwill and Other Intangible Assets | |||
Useful life, amortization period | 7 years | ||
Customer relationship and brokered relationship | BVF/CSNK | |||
Goodwill and Other Intangible Assets | |||
Useful life, amortization period | 10 years | ||
Non-compete agreements | BVF/CSNK | |||
Goodwill and Other Intangible Assets | |||
Useful life, amortization period | 3 years |
Summary of Significant Accoun57
Summary of Significant Accounting Policies - Foreclosed Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Other assets | ||
Foreclosed Assets | ||
Foreclosed assets | $ 364 | $ 696 |
Summary of Significant Accoun58
Summary of Significant Accounting Policies - Income Taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Income Taxes | ||
Net deferred tax assets | $ 22,218 | $ 18,527 |
Summary of Significant Accoun59
Summary of Significant Accounting Policies - Segment Reporting (Details) | 12 Months Ended |
Dec. 31, 2015segmentcustomer | |
Segment Reporting | |
Number of customers accounting for more than 10 percent of revenue for HBC or the Company | customer | 0 |
Number of operating segments | segment | 2 |
Accumulated Other Comprehensi60
Accumulated Other Comprehensive Income (''AOCI'') - Changes in AOCI by Component (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Changes in AOCI by Component | |||
Balance at the beginning of the period, net of taxes | $ (1,851) | $ (4,029) | $ 2,681 |
Other comprehensive (loss) before reclassification, net of taxes | (4,123) | 2,242 | (6,777) |
Amounts reclassified from other comprehensive income (loss), net of taxes | (246) | (64) | 67 |
Net current period other comprehensive income (loss), net of taxes | (4,369) | 2,178 | (6,710) |
Balance at the end of the period, net of taxes | (6,220) | (1,851) | (4,029) |
Unrealized Gains (Losses) on Available-for-Sale Securities and I/O Strips | |||
Changes in AOCI by Component | |||
Balance at the beginning of the period, net of taxes | 3,666 | (430) | 7,887 |
Other comprehensive (loss) before reclassification, net of taxes | (2,204) | 4,152 | (8,295) |
Amounts reclassified from other comprehensive income (loss), net of taxes | (372) | (56) | (22) |
Net current period other comprehensive income (loss), net of taxes | (2,576) | 4,096 | (8,317) |
Balance at the end of the period, net of taxes | 1,090 | 3,666 | (430) |
Unamortized Unrealized Gain on Available-for-Sale Securities Reclassified to Held-to-Maturity | |||
Changes in AOCI by Component | |||
Balance at the beginning of the period, net of taxes | 435 | 466 | 497 |
Amounts reclassified from other comprehensive income (loss), net of taxes | (32) | (31) | (31) |
Net current period other comprehensive income (loss), net of taxes | (32) | (31) | (31) |
Balance at the end of the period, net of taxes | 403 | 435 | 466 |
Defined Benefit Pension Plan Items | |||
Changes in AOCI by Component | |||
Balance at the beginning of the period, net of taxes | (5,952) | (4,065) | (5,703) |
Other comprehensive (loss) before reclassification, net of taxes | (1,919) | (1,910) | 1,518 |
Amounts reclassified from other comprehensive income (loss), net of taxes | 158 | 23 | 120 |
Net current period other comprehensive income (loss), net of taxes | (1,761) | (1,887) | 1,638 |
Balance at the end of the period, net of taxes | $ (7,713) | $ (5,952) | $ (4,065) |
Accumulated Other Comprehensi61
Accumulated Other Comprehensive Income (''AOCI'') - Amount Reclassified from AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Amount Reclassified from AOCI | |||||||||||
Realized gains on sale of securities | $ 642 | $ 97 | $ 38 | ||||||||
Interest income on taxable securities | 6,707 | 7,117 | 8,937 | ||||||||
Income before income taxes | $ 7,235 | $ 5,631 | $ 7,167 | $ 6,568 | $ 5,595 | $ 5,394 | $ 5,161 | $ 4,815 | 26,601 | 20,965 | 17,746 |
Income tax (expense) benefit | (2,812) | (2,172) | (2,690) | (2,430) | (1,993) | (1,969) | (1,837) | (1,739) | (10,104) | (7,538) | (6,206) |
Net income | $ 4,423 | $ 3,459 | $ 4,477 | $ 4,138 | $ 3,602 | $ 3,425 | $ 3,324 | $ 3,076 | 16,497 | 13,427 | 11,540 |
Amount Reclassified from AOCI | |||||||||||
Amount Reclassified from AOCI | |||||||||||
Net income | 246 | 64 | (67) | ||||||||
Unrealized Gains (Losses) on Available-for-Sale Securities and I/O Strips | Amount Reclassified from AOCI | |||||||||||
Amount Reclassified from AOCI | |||||||||||
Realized gains on sale of securities | 642 | 97 | 38 | ||||||||
Income tax (expense) benefit | (270) | (41) | (16) | ||||||||
Net income | 372 | 56 | 22 | ||||||||
Unamortized Unrealized Gain on Available-for-Sale Securities Reclassified to Held-to-Maturity | Amount Reclassified from AOCI | |||||||||||
Amount Reclassified from AOCI | |||||||||||
Interest income on taxable securities | 55 | 54 | 54 | ||||||||
Income tax (expense) benefit | (23) | (23) | (23) | ||||||||
Net income | 32 | 31 | 31 | ||||||||
Defined Benefit Pension Plan Items | Amount Reclassified from AOCI | |||||||||||
Amount Reclassified from AOCI | |||||||||||
Prior transition obligation | 113 | 102 | 84 | ||||||||
Actuarial losses | (386) | (142) | (291) | ||||||||
Income before income taxes | (273) | (40) | (207) | ||||||||
Income tax (expense) benefit | 115 | 17 | 87 | ||||||||
Net income | $ (158) | $ (23) | $ (120) |
Securities - Amortized Cost and
Securities - Amortized Cost and Estimated Fair Value of Securities - Securities Available-for-sale (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Securities available-for-sale: | ||
Amortized Cost | $ 384,578 | $ 201,497 |
Gross Unrealized Gains | 2,863 | 5,126 |
Gross Unrealized Losses | (2,362) | (288) |
Securities available-for-sale | 385,079 | 206,335 |
Agency mortgage-backed securities | ||
Securities available-for-sale: | ||
Amortized Cost | 324,077 | 150,570 |
Gross Unrealized Gains | 2,457 | 3,867 |
Gross Unrealized Losses | (2,304) | (265) |
Securities available-for-sale | 324,230 | 154,172 |
U.S. Treasury | ||
Securities available-for-sale: | ||
Amortized Cost | 30,047 | |
Gross Unrealized Losses | (44) | |
Securities available-for-sale | 30,003 | |
Trust preferred securities | ||
Securities available-for-sale: | ||
Amortized Cost | 15,000 | 15,000 |
Gross Unrealized Gains | 132 | 300 |
Securities available-for-sale | 15,132 | 15,300 |
U.S. Government sponsored entities | ||
Securities available-for-sale: | ||
Amortized Cost | 9,042 | |
Gross Unrealized Gains | 13 | |
Gross Unrealized Losses | (14) | |
Securities available-for-sale | 9,041 | |
Corporate bonds | ||
Securities available-for-sale: | ||
Amortized Cost | 6,412 | 35,927 |
Gross Unrealized Gains | 261 | 959 |
Gross Unrealized Losses | (23) | |
Securities available-for-sale | $ 6,673 | $ 36,863 |
Securities - Amortized Cost a63
Securities - Amortized Cost and Estimated Fair Value of Securities - Securities Held-to-maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Securities held-to-maturity: | ||
Amortized Cost | $ 109,311 | $ 95,362 |
Gross Unrealized Gains | 1,541 | 1,055 |
Gross Unrealized Losses | (1,031) | (1,464) |
Securities held-to-maturity | 109,821 | 94,953 |
Municipals - tax exempt | ||
Securities held-to-maturity: | ||
Amortized Cost | 93,518 | 79,882 |
Gross Unrealized Gains | 1,517 | 1,011 |
Gross Unrealized Losses | (863) | (1,346) |
Securities held-to-maturity | 94,172 | 79,547 |
Agency mortgage-backed securities | ||
Securities held-to-maturity: | ||
Amortized Cost | 15,793 | 15,480 |
Gross Unrealized Gains | 24 | 44 |
Gross Unrealized Losses | (168) | (118) |
Securities held-to-maturity | $ 15,649 | $ 15,406 |
Securities - Securities with Un
Securities - Securities with Unrealized Losses at Year End - Securities Available-for-sale (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Available-for-sale, Fair Value | ||
Less Than 12 Months | $ 276,050 | $ 12,491 |
12 Months or More | 2,165 | 40,762 |
Total | 278,215 | 53,253 |
Available-for-sale, Unrealized Losses | ||
Less Than 12 Months | (2,316) | (27) |
12 Months or More | (46) | (261) |
Total | (2,362) | (288) |
Agency mortgage-backed securities | ||
Available-for-sale, Fair Value | ||
Less Than 12 Months | 241,067 | 12,491 |
12 Months or More | 2,165 | 35,614 |
Total | 243,232 | 48,105 |
Available-for-sale, Unrealized Losses | ||
Less Than 12 Months | (2,258) | (27) |
12 Months or More | (46) | (238) |
Total | (2,304) | (265) |
U.S. Treasury | ||
Available-for-sale, Fair Value | ||
Less Than 12 Months | 30,003 | |
Total | 30,003 | |
Available-for-sale, Unrealized Losses | ||
Less Than 12 Months | (44) | |
Total | (44) | |
U.S. Government sponsored entities | ||
Available-for-sale, Fair Value | ||
Less Than 12 Months | 4,980 | |
Total | 4,980 | |
Available-for-sale, Unrealized Losses | ||
Less Than 12 Months | (14) | |
Total | $ (14) | |
Corporate bonds | ||
Available-for-sale, Fair Value | ||
12 Months or More | 5,148 | |
Total | 5,148 | |
Available-for-sale, Unrealized Losses | ||
12 Months or More | (23) | |
Total | $ (23) |
Securities - Securities with 65
Securities - Securities with Unrealized Losses at Year End - Securities Held-to-maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Held-to-maturity, Fair Value | ||
Less Than 12 Months | $ 17,072 | $ 6,753 |
12 Months or More | 28,821 | 47,841 |
Total | 45,893 | 54,594 |
Held-to-maturity, Unrealized Losses | ||
Less Than 12 Months | (167) | (45) |
12 Months or More | (864) | (1,419) |
Total | (1,031) | (1,464) |
Municipals - tax exempt | ||
Held-to-maturity, Fair Value | ||
Less Than 12 Months | 9,920 | 1,884 |
12 Months or More | 24,412 | 42,867 |
Total | 34,332 | 44,751 |
Held-to-maturity, Unrealized Losses | ||
Less Than 12 Months | (78) | (16) |
12 Months or More | (785) | (1,330) |
Total | (863) | (1,346) |
Agency mortgage-backed securities | ||
Held-to-maturity, Fair Value | ||
Less Than 12 Months | 7,152 | 4,869 |
12 Months or More | 4,409 | 4,974 |
Total | 11,561 | 9,843 |
Held-to-maturity, Unrealized Losses | ||
Less Than 12 Months | (89) | (29) |
12 Months or More | (79) | (89) |
Total | $ (168) | $ (118) |
Securities - Additional Informa
Securities - Additional Information (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($)security | |
Additional Information | |
Holdings of securities as percentage of shareholders' equity, considered as threshold for disclosure purpose | 10.00% |
The number of holdings of securities of any one issuer other than the U.S. Government and its sponsored entities | 0 |
Number of securities held | 460 |
Number of available for sale securities held | 193 |
Number of held to maturity securities held | 267 |
Number of securities with fair values below amortized cost | 193 |
Total unrealized loss for securities over 12 months | $ | $ 910 |
Securities - Proceeds from Sale
Securities - Proceeds from Sales of Securities and the Resulting Gains and Losses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Proceeds from Sales of Securities and the Resulting Gains and Losses | |||
Proceeds | $ 71,832 | $ 108,603 | $ 26,944 |
Gross gains | 751 | 1,008 | 310 |
Gross losses | $ (109) | $ (911) | $ (272) |
Securities - Amortized Cost a68
Securities - Amortized Cost and Fair Value of Debt Securities by Contractual Maturity - Securities Available-for-sale (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Available-for-sale, Amortized Cost | ||
Due after 3 months through one year | $ 1,999 | |
Due after one through five years | 39,454 | |
Due after five through ten years | 4,048 | |
Due after ten years | 15,000 | |
Agency mortgage-backed securities | 324,077 | |
Total | 384,578 | |
Available-for-sale, Estimated Fair Value | ||
Due after 3 months through one year | 1,996 | |
Due after one through five years | 39,659 | |
Due after five through ten years | 4,062 | |
Due after ten years | 15,132 | |
Agency mortgage-backed securities | 324,230 | |
Estimated Fair Value | $ 385,079 | $ 206,335 |
Securities - Amortized Cost a69
Securities - Amortized Cost and Fair Value of Debt Securities by Contractual Maturity - Securities Held-to-maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Held-to-maturity, Amortized Cost | ||
Due after 3 months or less | $ 879 | |
Due after 3 months through one year | 1,353 | |
Due after one through five years | 5,554 | |
Due after five through ten years | 13,990 | |
Due after ten years | 71,742 | |
Agency mortgage-backed securities | 15,793 | |
Total | 109,311 | $ 95,362 |
Held-to-maturity, Estimated Fair Value | ||
Due less than 3 months | 882 | |
Due after 3 months through one year | 1,362 | |
Due after one through five years | 5,626 | |
Due after five through ten years | 14,608 | |
Due after ten years | 71,694 | |
Agency mortgage-backed securities | 15,649 | |
Estimated Fair Value | $ 109,821 | $ 94,953 |
Securities - Securities Pledged
Securities - Securities Pledged to Secure Public Deposits and for Other Purposes (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Securities Pledged to Secure Public Deposits and for Other Purposes | ||
Amortized cost of securities pledged to secure public deposits and for other purposes as required or permitted by law or contract | $ 134,235 | $ 147,497 |
Loans - Loans at Year End (Deta
Loans - Loans at Year End (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Loans held-for-investment: | ||||
Loans | $ 1,359,458 | $ 1,089,229 | ||
Deferred loan origination fees, net | (742) | (586) | ||
Loans, net of deferred fees | 1,358,716 | 1,088,643 | ||
Allowance for loan losses | (18,926) | (18,379) | $ (19,164) | $ (19,027) |
Loans, net | 1,339,790 | 1,070,264 | ||
Commercial | ||||
Loans held-for-investment: | ||||
Loans | 556,522 | 462,403 | ||
Allowance for loan losses | (10,748) | (11,187) | (12,533) | (12,866) |
Real estate | ||||
Loans held-for-investment: | ||||
Loans | 786,926 | 607,959 | ||
Allowance for loan losses | (8,076) | (7,070) | (6,548) | (6,034) |
Real estate | Commercial and residential | ||||
Loans held-for-investment: | ||||
Loans | 625,665 | 478,335 | ||
Real estate | Land and construction | ||||
Loans held-for-investment: | ||||
Loans | 84,428 | 67,980 | ||
Real estate | Home equity | ||||
Loans held-for-investment: | ||||
Loans | 76,833 | 61,644 | ||
Consumer | ||||
Loans held-for-investment: | ||||
Loans | 16,010 | 18,867 | ||
Allowance for loan losses | (102) | $ (122) | $ (83) | $ (127) |
Focus Business Bank | ||||
Loans held-for-investment: | ||||
Non-PCI loans acquired | $ 141,343 |
Loans - Changes in the Allowanc
Loans - Changes in the Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Changes in the Allowance for Loan Losses | |||||||||||
Balance, beginning of year | $ 18,379 | $ 19,164 | $ 18,379 | $ 19,164 | $ 19,027 | ||||||
Charge-offs | (538) | (927) | (1,952) | ||||||||
Recoveries | 1,053 | 480 | 2,905 | ||||||||
Net (charge-offs) recoveries | 515 | (447) | 953 | ||||||||
Provision (credit) for loan losses | $ 371 | $ (301) | $ 22 | (60) | $ (106) | $ (24) | $ (198) | (10) | 32 | (338) | (816) |
Balance, end of year | 18,926 | 18,379 | 18,926 | 18,379 | 19,164 | ||||||
Commercial | |||||||||||
Changes in the Allowance for Loan Losses | |||||||||||
Balance, beginning of year | 11,187 | 12,533 | 11,187 | 12,533 | 12,866 | ||||||
Charge-offs | (527) | (815) | (1,676) | ||||||||
Recoveries | 877 | 418 | 2,621 | ||||||||
Net (charge-offs) recoveries | 350 | (397) | 945 | ||||||||
Provision (credit) for loan losses | (789) | (949) | (1,278) | ||||||||
Balance, end of year | 10,748 | 11,187 | 10,748 | 11,187 | 12,533 | ||||||
Real estate | |||||||||||
Changes in the Allowance for Loan Losses | |||||||||||
Balance, beginning of year | 7,070 | 6,548 | 7,070 | 6,548 | 6,034 | ||||||
Charge-offs | (2) | (87) | (276) | ||||||||
Recoveries | 146 | 62 | 283 | ||||||||
Net (charge-offs) recoveries | 144 | (25) | 7 | ||||||||
Provision (credit) for loan losses | 862 | 547 | 507 | ||||||||
Balance, end of year | 8,076 | 7,070 | 8,076 | 7,070 | 6,548 | ||||||
Consumer | |||||||||||
Changes in the Allowance for Loan Losses | |||||||||||
Balance, beginning of year | $ 122 | $ 83 | 122 | 83 | 127 | ||||||
Charge-offs | (9) | (25) | |||||||||
Recoveries | 30 | 1 | |||||||||
Net (charge-offs) recoveries | 21 | (25) | 1 | ||||||||
Provision (credit) for loan losses | (41) | 64 | (45) | ||||||||
Balance, end of year | $ 102 | $ 122 | $ 102 | $ 122 | $ 83 |
Loans - Balance in the Allowanc
Loans - Balance in the Allowance for Loan Losses and the Recorded Investment in Loans by Portfolio Segment, Based on the Impairment Method (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Balance in the Allowance for Loan Losses and the Recorded Investment in Loans by Portfolio Segment, Based on the Impairment Method | ||||
Allowance for loan losses, Individually evaluated for impairment | $ 286 | $ 404 | ||
Allowance for loan losses, Collectively evaluated for impairment | 18,640 | 17,975 | ||
Total allowance balance | 18,926 | 18,379 | $ 19,164 | $ 19,027 |
Loans, Individually evaluated for impairment | 6,290 | 6,022 | ||
Loans, Collectively evaluated for impairment | 1,352,931 | 1,083,207 | ||
Loans, Acquired with deteriorated credit quality | 237 | |||
Total loan balance | 1,359,458 | 1,089,229 | ||
Commercial | ||||
Balance in the Allowance for Loan Losses and the Recorded Investment in Loans by Portfolio Segment, Based on the Impairment Method | ||||
Allowance for loan losses, Individually evaluated for impairment | 174 | 404 | ||
Allowance for loan losses, Collectively evaluated for impairment | 10,574 | 10,783 | ||
Total allowance balance | 10,748 | 11,187 | 12,533 | 12,866 |
Loans, Individually evaluated for impairment | 2,014 | 2,701 | ||
Loans, Collectively evaluated for impairment | 554,271 | 459,702 | ||
Loans, Acquired with deteriorated credit quality | 237 | |||
Total loan balance | 556,522 | 462,403 | ||
Real estate | ||||
Balance in the Allowance for Loan Losses and the Recorded Investment in Loans by Portfolio Segment, Based on the Impairment Method | ||||
Allowance for loan losses, Individually evaluated for impairment | 112 | |||
Allowance for loan losses, Collectively evaluated for impairment | 7,964 | 7,070 | ||
Total allowance balance | 8,076 | 7,070 | 6,548 | 6,034 |
Loans, Individually evaluated for impairment | 4,272 | 3,315 | ||
Loans, Collectively evaluated for impairment | 782,654 | 604,644 | ||
Total loan balance | 786,926 | 607,959 | ||
Consumer | ||||
Balance in the Allowance for Loan Losses and the Recorded Investment in Loans by Portfolio Segment, Based on the Impairment Method | ||||
Allowance for loan losses, Collectively evaluated for impairment | 102 | 122 | ||
Total allowance balance | 102 | 122 | $ 83 | $ 127 |
Loans, Individually evaluated for impairment | 4 | 6 | ||
Loans, Collectively evaluated for impairment | 16,006 | 18,861 | ||
Total loan balance | $ 16,010 | $ 18,867 |
Loans - Purchased Credit Impair
Loans - Purchased Credit Impaired Loans (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Loans | |
Commercial | $ 876 |
Outstanding balance | 876 |
Carrying amount, net of discount of $639,000 | 237 |
Discount | 639 |
Increase in allowance for loan losses | 0 |
Reversal of allowance for loan losses | $ 0 |
Loans - Loans Held for Investme
Loans - Loans Held for Investment Individually Evaluated for Impairment by Class of Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Unpaid Principal Balance | ||
Total with no related allowance recorded | $ 5,139 | $ 6,951 |
Total with an allowance recorded | 2,265 | 829 |
Total | 7,404 | 7,780 |
Recorded Investment | ||
Total with no related allowance recorded | 4,262 | 5,193 |
Total with an allowance recorded | 2,265 | 829 |
Total | 6,527 | 6,022 |
Total with an allowance recorded, Allowance for Loan Losses Allocated | 286 | 404 |
Commercial | ||
Unpaid Principal Balance | ||
Total with no related allowance recorded | 745 | 2,282 |
Total with an allowance recorded | 1,506 | 829 |
Recorded Investment | ||
Total with no related allowance recorded | 745 | 1,872 |
Total with an allowance recorded | 1,506 | 829 |
Total with an allowance recorded, Allowance for Loan Losses Allocated | 174 | 404 |
Real estate | Commercial and residential | ||
Unpaid Principal Balance | ||
Total with no related allowance recorded | 3,851 | 2,510 |
Recorded Investment | ||
Total with no related allowance recorded | 2,992 | 1,651 |
Real estate | Land and construction | ||
Unpaid Principal Balance | ||
Total with no related allowance recorded | 237 | 1,808 |
Recorded Investment | ||
Total with no related allowance recorded | 219 | 1,319 |
Real estate | Home equity | ||
Unpaid Principal Balance | ||
Total with no related allowance recorded | 302 | 345 |
Total with an allowance recorded | 759 | |
Recorded Investment | ||
Total with no related allowance recorded | 302 | 345 |
Total with an allowance recorded | 759 | |
Total with an allowance recorded, Allowance for Loan Losses Allocated | 112 | |
Consumer | ||
Unpaid Principal Balance | ||
Total with no related allowance recorded | 4 | 6 |
Recorded Investment | ||
Total with no related allowance recorded | $ 4 | $ 6 |
Loans - Interest Recognized and
Loans - Interest Recognized and Cash Basis Interest Earned on Impaired Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Interest Recognized and Cash Basis Interest Earned on Impaired Loans | ||
Average of impaired loans during the period | $ 6,024 | $ 9,040 |
Interest income during impairment | 16 | 56 |
Commercial | ||
Interest Recognized and Cash Basis Interest Earned on Impaired Loans | ||
Average of impaired loans during the period | 1,774 | 4,069 |
Interest income during impairment | 14 | 56 |
Real estate | Commercial and residential | ||
Interest Recognized and Cash Basis Interest Earned on Impaired Loans | ||
Average of impaired loans during the period | 3,006 | 2,758 |
Real estate | Land and construction | ||
Interest Recognized and Cash Basis Interest Earned on Impaired Loans | ||
Average of impaired loans during the period | 764 | 1,628 |
Real estate | Home equity | ||
Interest Recognized and Cash Basis Interest Earned on Impaired Loans | ||
Average of impaired loans during the period | 475 | 529 |
Interest income during impairment | 2 | |
Consumer | ||
Interest Recognized and Cash Basis Interest Earned on Impaired Loans | ||
Average of impaired loans during the period | $ 5 | $ 56 |
Loans - Nonperforming Loans (De
Loans - Nonperforming Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Loans | ||
Nonaccrual loans - held-for-investment | $ 4,716 | $ 5,855 |
Restructured and loans over 90 days past due and still accruing | 1,662 | |
Total nonperforming loans | 6,378 | 5,855 |
Other restructured loans | 149 | 167 |
Total | $ 6,527 | $ 6,022 |
Loans - Nonperforming Loans by
Loans - Nonperforming Loans by Class (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Nonperforming Loans by Class | ||
Nonaccrual | $ 4,716 | $ 5,855 |
Restructured and Loans Over 90 Days Past Due and Still Accruing | 1,662 | |
Total | 6,378 | 5,855 |
Commercial | ||
Nonperforming Loans by Class | ||
Nonaccrual | 724 | 2,534 |
Restructured and Loans Over 90 Days Past Due and Still Accruing | 1,378 | |
Total | 2,102 | 2,534 |
Consumer | ||
Nonperforming Loans by Class | ||
Nonaccrual | 4 | 6 |
Total | 4 | 6 |
Commercial and residential | Real estate | ||
Nonperforming Loans by Class | ||
Nonaccrual | 2,992 | 1,651 |
Total | 2,992 | 1,651 |
Land and construction | Real estate | ||
Nonperforming Loans by Class | ||
Nonaccrual | 219 | 1,320 |
Total | 219 | 1,320 |
Home equity | Real estate | ||
Nonperforming Loans by Class | ||
Nonaccrual | 777 | 344 |
Restructured and Loans Over 90 Days Past Due and Still Accruing | 284 | |
Total | $ 1,061 | $ 344 |
Loans - Aging of Past Due Loans
Loans - Aging of Past Due Loans by Class of Loans - Tabular Disclosure (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Aging of Past Due Loans by Class of Loans | ||
30-59 Days Past Due | $ 3,504 | $ 3,002 |
60-89 Days Past Due | 262 | 195 |
90 Days or Greater Past Due | 1,988 | 3,043 |
Total Past Due | 5,754 | 6,240 |
Loans Not Past Due | 1,353,704 | 1,082,989 |
Total loan balance | 1,359,458 | 1,089,229 |
Commercial | ||
Aging of Past Due Loans by Class of Loans | ||
30-59 Days Past Due | 3,285 | 3,002 |
60-89 Days Past Due | 262 | 195 |
90 Days or Greater Past Due | 1,704 | 1,978 |
Total Past Due | 5,251 | 5,175 |
Loans Not Past Due | 551,271 | 457,228 |
Total loan balance | 556,522 | 462,403 |
Real estate | ||
Aging of Past Due Loans by Class of Loans | ||
Total loan balance | 786,926 | 607,959 |
Real estate | Commercial and residential | ||
Aging of Past Due Loans by Class of Loans | ||
90 Days or Greater Past Due | 1,065 | |
Total Past Due | 1,065 | |
Loans Not Past Due | 625,665 | 477,270 |
Total loan balance | 625,665 | 478,335 |
Real estate | Land and construction | ||
Aging of Past Due Loans by Class of Loans | ||
30-59 Days Past Due | 219 | |
Total Past Due | 219 | |
Loans Not Past Due | 84,209 | 67,980 |
Total loan balance | 84,428 | 67,980 |
Real estate | Home equity | ||
Aging of Past Due Loans by Class of Loans | ||
90 Days or Greater Past Due | 284 | |
Total Past Due | 284 | |
Loans Not Past Due | 76,549 | 61,644 |
Total loan balance | 76,833 | 61,644 |
Consumer | ||
Aging of Past Due Loans by Class of Loans | ||
Loans Not Past Due | 16,010 | 18,867 |
Total loan balance | $ 16,010 | $ 18,867 |
Loans - Aging of Past Due Loa80
Loans - Aging of Past Due Loans by Class of Loans - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Aging of Past Due Loans by Class of Loans | ||
Past due loans 30 day or greater | $ 5,754 | $ 6,240 |
30 days or greater past due nonaccrual loans | 591 | 3,130 |
Less than 30 days past due nonaccrual loans held-for-investment | $ 4,125 | $ 2,725 |
Loans - Credit Quality Indicato
Loans - Credit Quality Indicators (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Credit Quality Indicators | ||
Balance to report | $ 1,339,790 | $ 1,070,264 |
Loan classified as loss | ||
Credit Quality Indicators | ||
Recovery value | 0 | |
Balance to report | $ 0 |
Loans - Summary of the Loan Por
Loans - Summary of the Loan Portfolio by Loan Type and Credit Quality Classification (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | $ 1,359,458 | $ 1,089,229 |
Nonclassified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 1,340,826 | 1,073,742 |
Classified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 18,632 | 15,487 |
Commercial | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 556,522 | 462,403 |
Commercial | Nonclassified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 547,536 | 455,767 |
Commercial | Classified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 8,986 | 6,636 |
Real estate | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 786,926 | 607,959 |
Real estate | Commercial and residential | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 625,665 | 478,335 |
Real estate | Commercial and residential | Nonclassified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 617,865 | 472,061 |
Real estate | Commercial and residential | Classified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 7,800 | 6,274 |
Real estate | Land and construction | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 84,428 | 67,980 |
Real estate | Land and construction | Nonclassified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 84,209 | 66,660 |
Real estate | Land and construction | Classified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 219 | 1,320 |
Real estate | Home equity | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 76,833 | 61,644 |
Real estate | Home equity | Nonclassified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 75,511 | 60,736 |
Real estate | Home equity | Classified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 1,322 | 908 |
Consumer | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 16,010 | 18,867 |
Consumer | Nonclassified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | 15,705 | 18,518 |
Consumer | Classified | ||
Summary of the Loan Portfolio by Loan Type and Credit Quality Classification | ||
Total | $ 305 | $ 349 |
Loans - Troubled Debt Restructu
Loans - Troubled Debt Restructurings (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Loans | ||
Recorded investment of troubled debt restructurings | $ 153 | $ 1,083 |
Troubled debt restructurings, nonaccrual loans | 4 | 916 |
Troubled debt restructurings, accruing loans | 149 | 167 |
Specific reserves | 3 | 113 |
Additional amount of loan classified as a troubled debt restructurings | $ 0 | $ 0 |
Loans - Troubled Debt Restruc84
Loans - Troubled Debt Restructurings by Class (Details) - contract | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Loans | ||
Number of Contracts | 0 | 0 |
Loans - Defaults on Troubled De
Loans - Defaults on Troubled Debt Restructurings (Details) - item | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Loans | ||
Default period contractually past due under modified terms (in days) | 30 days | |
Number of defaults on troubled debt restructurings | 0 | 0 |
Loans - Loans Due From Related
Loans - Loans Due From Related Parties (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Loans due from related parties | ||
Balance, beginning of year | $ 576 | $ 590 |
Advances on loans during the year | 4,175 | |
Repayment on loans during the year | (4,189) | (14) |
Balance, end of year | $ 562 | $ 576 |
Loan Servicing - SBA Loans (Det
Loan Servicing - SBA Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Loans | ||
Serviced SBA loans sold to secondary market | $ 175,457 | $ 130,611 |
Weighted average servicing rate for loans serviced (as a percent) | 1.16% | 1.20% |
Loan Servicing - Activity for L
Loan Servicing - Activity for Loan Servicing Rights (Details) - Loan servicing rights - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Activity for Loan Servicing Rights | |||
Balance, beginning of year | $ 565 | $ 525 | $ 709 |
Additions | 2,126 | 319 | 106 |
Amortization | (482) | (279) | (290) |
Balance, end of year | $ 2,209 | $ 565 | $ 525 |
Loan Servicing - Loan Servicing
Loan Servicing - Loan Servicing Rights - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Loan Servicing | ||
Carrying amount/fair value | $ 3,650 | $ 2,426 |
Prepayment speed assumption (annual rate) (as a percent) | 7.42% | 7.32% |
Residual cash flow discount rate assumption (annual) (as a percent) | 12.52% | 12.11% |
Loan servicing rights | ||
Loan Servicing | ||
Valuation allowance | $ 0 | $ 0 |
Loan servicing rights | Focus Business Bank | ||
Loan Servicing | ||
Increase in loan servicing rights | $ 1,976 |
Loan Servicing - Activity for I
Loan Servicing - Activity for I/O Strip Receivables (Details) - I/O strip receivables - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Activity for I/O Strip Receivables | |||
Balance, beginning of year | $ 1,481 | $ 1,647 | $ 1,786 |
Unrealized loss | (114) | (166) | (139) |
Balance, end of year | $ 1,367 | $ 1,481 | $ 1,647 |
Premises and Equipment - Premis
Premises and Equipment - Premises and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Premises and Equipment | ||
Premises and equipment, gross | $ 19,904 | $ 18,896 |
Accumulated depreciation and amortization | (12,131) | (11,445) |
Premises and equipment, net | 7,773 | 7,451 |
Building | ||
Premises and Equipment | ||
Premises and equipment, gross | 3,279 | 3,256 |
Land | ||
Premises and Equipment | ||
Premises and equipment, gross | 2,900 | 2,900 |
Furniture and equipment | ||
Premises and Equipment | ||
Premises and equipment, gross | 8,468 | 8,082 |
Leasehold improvements | ||
Premises and Equipment | ||
Premises and equipment, gross | $ 5,257 | $ 4,658 |
Premises and Equipment - Deprec
Premises and Equipment - Depreciation and Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Premises and Equipment | |||
Depreciation and amortization | $ 685 | $ 725 | $ 729 |
Leases - Operating Leases - Ren
Leases - Operating Leases - Renewal Options (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Minimum | |
Operating Leases - Renewal Options | |
Renewal option, term | 5 years |
Maximum | |
Operating Leases - Renewal Options | |
Renewal option, term | 15 years |
Leases - Future Minimum Payment
Leases - Future Minimum Payments under Operating Leases (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Future Minimum Payments under Operating Leases | |
2,016 | $ 3,434 |
2,017 | 2,683 |
2,018 | 2,172 |
2,019 | 1,998 |
2,020 | 956 |
Thereafter | 232 |
Total | $ 11,475 |
Leases - Rent Expense under Ope
Leases - Rent Expense under Operating Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Rent Expense under Operating Leases | |||
Rent expense | $ 2,997 | $ 2,692 | $ 2,719 |
Business Combinations - Bay Vie
Business Combinations - Bay View Funding and Focus Business Bank - Consideration Paid (Details) $ / shares in Units, $ in Thousands | Aug. 20, 2015USD ($)$ / sharesshares | Nov. 01, 2014USD ($) |
BVF/CSNK | ||
Consideration Paid | ||
Total consideration | $ 22,520 | |
Purchase consideration paid in cash | 20,268 | |
Portion of purchase price deposited into escrow account | $ 2,252 | |
Percentage of purchase consideration deposited into escrow account | 10.00% | |
Term of escrow deposit | 18 months | |
Focus Business Bank | ||
Consideration Paid | ||
Total consideration | $ 66,558 | |
Fixed exchange ratio of company's common stock | 1.8235 | |
Shares issued in acquisition | shares | 5,456,713 | |
Common stock issued to acquire Focus Business Bank | $ 58,278 | |
Stock price (in dollars per share) | $ / shares | $ 10.68 | |
Purchase consideration paid in cash | $ 8,280 |
Business Combinations - Bay V97
Business Combinations - Bay View Funding - Pro Forma Information (Details) - BVF/CSNK - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Pro Forma Information | ||
Net interest income | $ 66,105 | $ 59,998 |
Non interest income | 8,293 | 8,080 |
Total revenue | 74,398 | 68,078 |
Net income | $ 15,141 | $ 13,397 |
Net income per share - basic (in dollars per share) | $ 0.47 | $ 0.42 |
Net income per share - diluted (in dollars per share) | $ 0.47 | $ 0.42 |
Business Combinations - Focus B
Business Combinations - Focus Business Bank - Acquisition and Integration Costs (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Focus Business Bank | |
Acquisition and Integration Costs | |
Pre-tax severance, retention, acquisition and integration costs | $ 6,398 |
Business Combinations - Focus99
Business Combinations - Focus Business Bank - Estimated Fair Values of the Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Aug. 20, 2015 | Dec. 31, 2014 |
Assets acquired: | |||
Goodwill | $ 45,664 | $ 13,044 | |
Focus Business Bank | |||
Assets acquired: | |||
Cash and cash items | $ 5,651 | ||
Federal funds sold and deposits in other financial institutions | 168,415 | ||
Securities available-for-sale | 53,940 | ||
Securities held-to-maturity | 8,665 | ||
Loans held-for-sale--SBA | 4,416 | ||
Net loans | 170,353 | ||
Goodwill | 32,620 | ||
Core deposit intangible asset | 6,285 | ||
Corporate owned life insurance | 7,067 | ||
Other assets, net | 20,250 | ||
Total assets acquired | 477,662 | ||
Liabilities assumed: | |||
Deposits | 405,123 | ||
Other liabilities | 5,981 | ||
Total liabilities | 411,104 | ||
Net assets acquired | $ 66,558 |
Business Combinations - Focu100
Business Combinations - Focus Business Bank - Acquired Receivables and Goodwill (Details) $ in Thousands | Aug. 20, 2015USD ($)loan | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Goodwill | |||
Goodwill | $ 45,664 | $ 13,044 | |
Focus Business Bank | |||
Acquired Receivables | |||
Fair value, nonimpaired loans | $ 141,343 | ||
Goodwill | |||
Goodwill | $ 32,620 | ||
Income tax attributes related to the purchase accounting adjustments | $ 1,758 | ||
Focus Business Bank | Loans receivable | |||
Acquired Receivables | |||
Purchased credit impaired loans acquired, number | loan | 4 | ||
Gross contractual amount, impaired loans | $ 1,124 | ||
Contractual cash flows not expected to be collected on the purchased credit impaired loans | $ 819 | ||
Contractual cash flows not expected to be collected on the purchased credit impaired loans as a percentage of gross outstanding principal (as a percent) | 72.90% | ||
Fair value, nonimpaired loans | $ 170,048 | ||
Gross contractual amount, nonimpaired loans | 174,660 | ||
Purchase discount | $ 4,612 | ||
Purchase discount (as a percentage) | 2.60% | ||
Fair value of loans | $ 170,353 |
Business Combinations - Focu101
Business Combinations - Focus Business Bank - Consideration Paid Summary (Details) - Focus Business Bank $ / shares in Units, $ in Thousands | Aug. 20, 2015USD ($)$ / shares |
Consideration Paid | |
Cash paid for Focus in-the-money stock options | $ 8,280 |
Common stock issued to Focus shareholders at $10.68 per share | 58,278 |
Total consideration | $ 66,558 |
Stock price (in dollars per share) | $ / shares | $ 10.68 |
Business Combinations - Focu102
Business Combinations - Focus Business Bank - Pro Forma Information (Details) - Focus Business Bank - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Pro Forma Information | ||
Net interest income | $ 83,876 | $ 68,175 |
Provision (credit) for loan losses | 82 | (38) |
Non interest income | 11,443 | 9,624 |
Noninterest expense | 60,372 | 53,600 |
Income before income taxes | 34,865 | 24,237 |
Income tax expense | 13,941 | 8,784 |
Net income | $ 20,924 | $ 15,453 |
Net income per share - basic (in dollars per share) | $ 0.56 | $ 0.41 |
Net income per share - diluted (in dollars per share) | $ 0.55 | $ 0.41 |
Goodwill and Other Intangibl103
Goodwill and Other Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands | Aug. 20, 2015 | Nov. 01, 2014 | Dec. 31, 2015 | Dec. 31, 2014 |
Goodwill | ||||
Goodwill | $ 45,664 | $ 13,044 | ||
Impairment charges | $ 0 | |||
BVF/CSNK | ||||
Goodwill | ||||
Goodwill acquired | $ 13,044 | |||
Focus Business Bank | ||||
Goodwill | ||||
Goodwill | $ 32,620 | |||
Goodwill acquired | $ 32,620 |
Goodwill and Other Intangibl104
Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands | Aug. 20, 2015 | Nov. 01, 2014 | Jun. 30, 2007 | Dec. 31, 2015 | Dec. 31, 2014 |
Other Intangible Assets | |||||
Accumulated amortization | $ 4,703 | $ 4,257 | |||
Diablo Valley Bank | Core deposit | |||||
Other Intangible Assets | |||||
Intangible assets acquired | $ 5,049 | ||||
Useful life, amortization period | 10 years | ||||
Diablo Valley Bank | Customer relationship | |||||
Other Intangible Assets | |||||
Intangible assets acquired | $ 276 | ||||
Useful life, amortization period | 7 years | ||||
Focus Business Bank | |||||
Other Intangible Assets | |||||
Useful life, amortization period | 10 years | ||||
Focus Business Bank | Core deposit | |||||
Other Intangible Assets | |||||
Intangible assets acquired | $ 6,285 | ||||
Accumulated amortization | 288,000 | ||||
Useful life, amortization period | 10 years | ||||
BVF/CSNK | |||||
Other Intangible Assets | |||||
Accumulated amortization | $ 360 | $ 51 | |||
BVF/CSNK | Below market-value lease | |||||
Other Intangible Assets | |||||
Intangible assets acquired | $ 109 | ||||
Useful life, amortization period | 3 years | ||||
BVF/CSNK | Customer relationship and brokered relationship | |||||
Other Intangible Assets | |||||
Intangible assets acquired | $ 1,900 | ||||
Useful life, amortization period | 10 years | ||||
BVF/CSNK | Non-compete agreements | |||||
Other Intangible Assets | |||||
Intangible assets acquired | $ 250 | ||||
Useful life, amortization period | 3 years |
Goodwill and Other Intangibl105
Goodwill and Other Intangible Assets - Estimated Amortization Expense (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Estimated Amortization Expense | |
2,016 | $ 1,567 |
2,017 | 1,361 |
2,018 | 965 |
2,019 | 924 |
2,020 | 906 |
Total | 5,723 |
Diablo Valley Bank | Core deposit | |
Estimated Amortization Expense | |
2,016 | 427 |
2,017 | 195 |
Total | 622 |
Focus Business Bank | Core deposit | |
Estimated Amortization Expense | |
2,016 | 831 |
2,017 | 875 |
2,018 | 775 |
2,019 | 734 |
2,020 | 716 |
Total | 3,931 |
BVF/CSNK | Below market-value lease | |
Estimated Amortization Expense | |
2,016 | 36 |
2,017 | 31 |
Total | 67 |
BVF/CSNK | Customer relationship and brokered relationship | |
Estimated Amortization Expense | |
2,016 | 190 |
2,017 | 190 |
2,018 | 190 |
2,019 | 190 |
2,020 | 190 |
Total | 950 |
BVF/CSNK | Non-compete agreements | |
Estimated Amortization Expense | |
2,016 | 83 |
2,017 | 70 |
Total | $ 153 |
Deposits - Time Deposits (Detai
Deposits - Time Deposits (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deposits | ||
Time deposits, including deposits within the CDARS and brokered deposits, $250,000 or more | $ 178,640 | $ 193,068 |
Deposits - Scheduled Maturities
Deposits - Scheduled Maturities of all Time Deposits and Brokered Deposits for the Next Five Years (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Scheduled Maturities of Time Deposits Including Brokered Deposits for the Next Five Years | |
2,016 | $ 233,765 |
2,017 | 7,986 |
2,018 | 1,829 |
2,019 | 1,056 |
2,020 | 225 |
Total | $ 244,861 |
Deposits - Additional Informati
Deposits - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Additional Information | ||
CDARS - money market and time deposits | $ 7,583 | $ 11,248 |
Money market accounts under CDARS program | 3,388 | 4,036 |
Certificate of deposits from State of California | 78,026 | 98,019 |
Fair value of securities pledged | 93,042 | 109,764 |
Time deposits under CDARS program | 4,195 | 7,212 |
Deposits from executive officers, directors, and their affiliates | $ 13,426 | $ 2,593 |
Borrowing Arrangements - Federa
Borrowing Arrangements - Federal Home Loan Bank Borrowings, Federal Reserve Bank Borrowings, and Available Lines of Credit (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Borrowing Arrangements | ||
Securities pledged as collateral | $ 93,042 | $ 109,764 |
FHLB | Line of credit | FHLB of San Francisco | ||
Borrowing Arrangements | ||
FHLB overnight borrowings | 0 | 0 |
FHLB | Line of credit | FHLB of San Francisco | ||
Borrowing Arrangements | ||
Loans pledged as collateral | 245,607 | 246,635 |
Securities pledged as collateral | 0 | 0 |
Line of credit | $ 141,875 | $ 139,990 |
Borrowing Arrangements - Fed110
Borrowing Arrangements - Federal Reserve Bank Borrowings (Details) - Line of credit - FRB - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Borrowing Arrangements | ||
Loans pledged as collateral | $ 395,006 | $ 387,972 |
Line of credit | 243,156 | 260,439 |
Amount outstanding | $ 0 | $ 0 |
Borrowing Arrangements - Availa
Borrowing Arrangements - Available Lines of Credit (Details) - Federal funds purchase arrangement - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Borrowing Arrangements | ||
Federal funds purchase arrangements available | $ 55,000 | |
Federal funds purchased | $ 0 | $ 0 |
Borrowing Arrangements - Line o
Borrowing Arrangements - Line of Credit with a Corresponding Bank (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Borrowing Arrangements | |
Amount outstanding | $ 3,000 |
HCC (Parent) | |
Borrowing Arrangements | |
Amount outstanding | 3,000 |
Line of credit | Line of credit | |
Borrowing Arrangements | |
Line of credit | 5,000 |
Amount outstanding | $ 3,000 |
Borrowing Arrangements - Securi
Borrowing Arrangements - Securities Sold under Repurchase Agreements (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Borrowing Arrangements | ||
Amount of securities sold under agreements | $ 0 | $ 0 |
Borrowing Arrangements - Subord
Borrowing Arrangements - Subordinated Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Sep. 30, 2013 | |
Subordinated debentures | ||
Subordinated Debt | ||
Period of interest payment deferment | 5 years | |
Junior subordinated debentures | Floating Rate Junior Subordinated Debentures due July 31, 2031 | Heritage Statutory Trust II | ||
Subordinated Debt | ||
Floating rate subordinated debt, redemption amount | $ 5,000 | |
Junior subordinated debentures | Floating Rate Junior Subordinated Debentures due September 26, 2032 | Heritage Statutory Trust III | ||
Subordinated Debt | ||
Floating rate subordinated debt, redemption amount | $ 4,000 |
Income Taxes - Income Tax (Bene
Income Taxes - Income Tax (Benefit) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Currently payable tax: | |||||||||||
Federal | $ 5,445 | $ 4,392 | $ 5,015 | ||||||||
State | 2,544 | 818 | 63 | ||||||||
Total currently payable | 7,989 | 5,210 | 5,078 | ||||||||
Deferred tax (benefit): | |||||||||||
Federal | 2,029 | 1,114 | (130) | ||||||||
State | 86 | 1,214 | 1,258 | ||||||||
Total deferred tax (benefit) | 2,115 | 2,328 | 1,128 | ||||||||
Income tax expense | $ 2,812 | $ 2,172 | $ 2,690 | $ 2,430 | $ 1,993 | $ 1,969 | $ 1,837 | $ 1,739 | $ 10,104 | $ 7,538 | $ 6,206 |
Income Taxes - Effective Tax Ra
Income Taxes - Effective Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Effective tax rate differs from the federal statutory rate | |||
Statutory Federal income tax rate (as a percent) | 35.00% | 35.00% | 35.00% |
State income taxes, net of federal tax benefit (as a percent) | 6.90% | 6.50% | 5.30% |
Low income housing credits, net of investment losses (as a percent) | (0.00%) | 0.80% | 0.60% |
Increase in cash surrender value of life insurance (as a percent) | (2.20%) | (2.70%) | (3.50%) |
Non-taxable interest income (as a percent) | (2.70%) | (3.20%) | (2.90%) |
Split dollar term insurance (as a percent) | 0.10% | 0.10% | 0.20% |
Other, net (as a percent) | 0.90% | (0.50%) | 0.30% |
Effective tax rate (as a percent) | 38.00% | 36.00% | 35.00% |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
Defined postretirement benefit obligation | $ 11,049 | $ 10,327 |
Allowance for loan losses | 7,815 | 7,728 |
Federal net operating loss carryforwards | 2,397 | |
Stock compensation | 2,008 | 1,693 |
Accrued expenses | 1,689 | 1,446 |
State income taxes | 889 | 213 |
Premises and equipment | 945 | 702 |
California net operating loss carryforwards | 591 | |
Split-dollar life insurance benefit plan | 107 | 112 |
Tax credit carryforwards | 57 | 2,441 |
Loans | 2 | |
Nonaccrual interest | 25 | |
Other | 742 | 359 |
Total deferred tax assets | 28,289 | 25,048 |
Deferred tax liabilities: | ||
Intangible assets | (2,101) | (1,334) |
Loan fees | (1,331) | (1,131) |
Prepaid expenses | (1,022) | (464) |
I/O strips | (574) | (621) |
Securities available-for-sale | (505) | (2,351) |
FHLB stock | (245) | (245) |
Other | (293) | (375) |
Total deferred tax liabilities | (6,071) | (6,521) |
Net deferred tax assets | $ 22,218 | $ 18,527 |
Income Taxes - Operating Loss C
Income Taxes - Operating Loss Carryforward (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Operating Loss Carryforward | |
Valuation allowance | $ 0 |
Federal | IRS | |
Operating Loss Carryforward | |
Net operating loss carryforward | 6,850 |
Net operating loss carryforward, annual limit | 1,877 |
State | California | |
Operating Loss Carryforward | |
Net operating loss carryforward | $ 8,389 |
Income Taxes - Tax Credit Carry
Income Taxes - Tax Credit Carryforwards (Details) $ in Thousands | Dec. 31, 2015USD ($) |
California | State | |
Tax Credit Carryforwards | |
Total tax credit carryforwards | $ 57 |
Income Taxes - Liability for Un
Income Taxes - Liability for Uncertain Tax Positions (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Income Taxes | |
Reserve for income taxes, net of Federal benefit for uncertain tax positions | $ 130 |
Income Taxes - Net Deferred Tax
Income Taxes - Net Deferred Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Net deferred tax assets | ||
Net deferred tax assets | $ 22,218 | $ 18,527 |
Deferred Tax Assets, Valuation Allowance | $ 0 | $ 0 |
Income Taxes - Carry Amounts of
Income Taxes - Carry Amounts of the Low Income Housing Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Income Taxes | ||
Low income housing investments | $ 4,304 | $ 5,268 |
Income Taxes - Future Commitmen
Income Taxes - Future Commitments of the Low Income Housing Investments (Details) - Low income housing investments - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Future Commitments | ||
Future commitments | $ 1,271 | $ 1,827 |
2,016 | 550 | |
2,017 | 14 | |
2018 through 2023 | $ 707 |
Income Taxes - Components of Lo
Income Taxes - Components of Low Income Housing Investment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Income Taxes | ||
Low income housing tax credits | $ 685 | $ 581 |
Low income housing investment losses | $ 916 | $ 338 |
Equity Plan - General Disclosur
Equity Plan - General Disclosures (Details) | 12 Months Ended |
Dec. 31, 2015shares | |
2013 Plan | |
Equity Plan | |
Number of shares available for future grants | 940,985 |
Options | |
Equity Plan | |
Vesting period | 4 years |
Expiration term | 10 years |
Restricted stock | |
Equity Plan | |
Number of equity awards issued (in shares) | 103,855 |
Nonqualified stock options | |
Equity Plan | |
Number of equity awards issued (in shares) | 243,000 |
Equity Plan - Stock Option Acti
Equity Plan - Stock Option Activity (Details) - Options | 12 Months Ended |
Dec. 31, 2015USD ($)$ / sharesshares | |
Number of Shares | |
Outstanding at the beginning of the period (in shares) | 1,726,106 |
Granted (in shares) | 243,000 |
Exercised (in shares) | (54,406) |
Forfeited or expired (in shares) | (139,673) |
Outstanding at the end of the period (in shares) | 1,775,027 |
Vested or expected to vest (in shares) | 1,686,276 |
Exercisable at the end of the period (in shares) | 1,259,434 |
Weighted Average Exercise Price | |
Outstanding at the beginning of the period (in dollars per share) | $ / shares | $ 11.23 |
Granted (in dollars per share) | $ / shares | 9.50 |
Exercised (in dollars per share) | $ / shares | 5.79 |
Forfeited or expired (in dollars per share) | $ / shares | 18.12 |
Outstanding at the end of the period (in dollars per share) | $ / shares | $ 10.62 |
Additional Information | |
Weighted Average Remaining Contractual Life - Outstanding at the end of the period (in years) | 5 years 9 months 18 days |
Weighted Average Remaining Contractual Life - Vested or expected to vest (in years) | 5 years 9 months 18 days |
Weighted Average Remaining Contractual Life - Exercisable at the end of the period (in years) | 4 years 8 months 12 days |
Aggregate Intrinsic Value - Outstanding at the end of the period (in dollars) | $ | $ 6,381,061 |
Aggregate Intrinsic Value - Vested or expected to vest (in dollars) | $ | 6,062,008 |
Aggregate Intrinsic Value - Exercisable at the end of the period (in dollars) | $ | $ 4,527,179 |
Equity Plan - Information Relat
Equity Plan - Information Related to the Equity Plans for each of the Last Three Years (Details) - Options - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Information Related to the Equity Plans | |||
Intrinsic value of options exercised | $ 216,681 | $ 258,467 | $ 51,000 |
Cash received from option exercise | 315,076 | 262,035 | 88,000 |
Tax benefit realized from option exercises | $ 85,411 | $ 102,710 | $ 17,245 |
Weighted average fair value of options granted (in dollars per share) | $ 3.15 | $ 3.90 | $ 3.84 |
Equity Plan - Unrecognized Comp
Equity Plan - Unrecognized Compensation Cost - Nonvested Stock Options (Details) - Options $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Unrecognized Compensation Cost | |
Total unrecognized compensation cost related to nonvested stock options granted | $ 1,842 |
Expected weighted-average period for recognition of compensation costs related to nonvested stock options | 2 years 5 months 23 days |
Equity Plan - Assumptions Used
Equity Plan - Assumptions Used to Estimate Fair Value (Details) - Options | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Assumptions Used to Estimate Fair Value | |||
Expected life in months | 72 months | 84 months | 96 months |
Volatility (as a percent) | 47.00% | 57.00% | 54.00% |
Weighted average risk-free interest rate (as a percent) | 1.57% | 2.09% | 1.49% |
Expected dividends (as a percent) | 3.37% | 2.06% | 0.12% |
Equity Plan - Restricted Stock
Equity Plan - Restricted Stock Activity (Details) - Restricted stock | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Number of Shares | |
Nonvested shares at the beginning of the period (in shares) | shares | 100,000 |
Granted (in shares) | shares | 103,855 |
Vested (in shares) | shares | (31,250) |
Forfeited or expired (in shares) | shares | (5,000) |
Nonvested shares at the end of the period (in shares) | shares | 167,605 |
Weighted Average Grant Date Fair Value | |
Nonvested shares at the beginning of the period (in dollars per share) | $ / shares | $ 8.25 |
Granted (in dollars per share) | $ / shares | 9.80 |
Vested (in dollars per share) | $ / shares | 7.81 |
Forfeited or expired (in dollars per share) | $ / shares | 8.70 |
Nonvested shares at the end of the period (in dollars per share) | $ / shares | $ 9.28 |
Equity Plan - Unrecognized C131
Equity Plan - Unrecognized Compensation Cost - Nonvested Restricted Stock Awards (Details) - Restricted stock $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Unrecognized Compensation Cost | |
Total unrecognized compensation cost related to nonvested restricted stock awards | $ 1,363 |
Expected weighted-average period for recognition of compensation costs related to nonvested restricted stock awards | 3 years 1 month 28 days |
Benefit Plans - 401(k) Savings
Benefit Plans - 401(k) Savings Plan (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
401(k) Savings Plan | |||
Maximum discretionary contribution matched by employer for each employee's contribution | $ 1,500 | $ 1,000 | $ 1,000 |
Contribution expense | $ 342,000 | $ 206,000 | $ 196,000 |
Benefit Plans - Employee Stock
Benefit Plans - Employee Stock Ownership Plan (Details) | 12 Months Ended |
Dec. 31, 2015itemshares | |
Employee Stock Ownership Plan | |
Minimum number of hours of service required for plan eligibility | item | 1,000 |
Number of shares of Company's common stock owned by ESOP | shares | 123,707 |
Benefit Plans - Deferred Compen
Benefit Plans - Deferred Compensation Plan (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015USD ($)director | Dec. 31, 2014USD ($) | |
Deferred Compensation Plan | ||
Maximum percentage of board fees deferred by participating director into deferred account | 100.00% | |
Maximum term of distribution schedule elected by director | 10 years | |
Deferred compensation obligation | $ | $ 20 | $ 50 |
Number of former directors for whom life insurance policies purchased | director | 1 | |
Term for commencement of disbursement of deferred fees after death of director | 1 month |
Benefit Plans - Defined Benefit
Benefit Plans - Defined Benefit Plans - Nonqualified Defined Benefit Pension Plan (Details) - Supplemental Retirement Plan $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($)item | |
Supplemental Retirement Plan | |
Combined number of active and retired/terminated participants in the defined benefit plan | item | 53 |
Vesting period of defined benefit stated amount, minimum | 9 years |
Plan assets associated with the plan | $ | $ 0 |
Benefit Plans - Defined Bene136
Benefit Plans - Defined Benefit Plans - Change in Projected Benefit Obligation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Supplemental Retirement Plan | ||
Change in Projected Benefit Obligation | ||
Projected benefit obligation at beginning of year | $ 24,570 | $ 20,712 |
Service cost | 862 | 714 |
Actuarial loss (gain) | 805 | 3,059 |
Interest cost | 883 | 911 |
Benefits paid | (833) | (826) |
Projected benefit obligation at end of year | 26,287 | 24,570 |
Split-Dollar Life Insurance Benefit Plan | ||
Change in Projected Benefit Obligation | ||
Projected benefit obligation at beginning of year | 4,641 | 4,353 |
Actuarial loss (gain) | 1,405 | 92 |
Interest cost | 169 | 196 |
Projected benefit obligation at end of year | $ 6,215 | $ 4,641 |
Benefit Plans - Defined Bene137
Benefit Plans - Defined Benefit Plans - Amounts Recognized in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Supplemental Retirement Plan | ||
Amounts Recognized in Accumulated Other Comprehensive Loss | ||
Net actuarial loss | $ 7,149 | $ 6,730 |
Split-Dollar Life Insurance Benefit Plan | ||
Amounts Recognized in Accumulated Other Comprehensive Loss | ||
Net actuarial loss | 2,147 | 540 |
Prior transition obligation | 1,418 | 1,507 |
Accumulated other comprehensive loss | $ 3,565 | $ 2,047 |
Benefit Plans - Defined Bene138
Benefit Plans - Defined Benefit Plans - Weighted-average Assumptions Used to Determine the Benefit Obligation at Year-end (Details) | Dec. 31, 2015 | Dec. 31, 2014 |
Supplemental Retirement Plan | ||
Weighted-average Assumptions Used to Determine the Benefit Obligation at Year-end | ||
Discount rate | 4.00% | 3.65% |
Split-Dollar Life Insurance Benefit Plan | ||
Weighted-average Assumptions Used to Determine the Benefit Obligation at Year-end | ||
Discount rate | 4.00% | 3.65% |
Benefit Plans - Defined Bene139
Benefit Plans - Defined Benefit Plans - Estimated Benefit Payments over the Next Ten Years (Details) - Supplemental Retirement Plan $ in Thousands | Dec. 31, 2015USD ($) |
Estimated Benefit Payments | |
2,016 | $ 919 |
2,017 | 1,413 |
2,018 | 1,549 |
2,019 | 1,585 |
2,020 | 1,635 |
2021 to 2025 | $ 9,468 |
Benefit Plans - Defined Bene140
Benefit Plans - Defined Benefit Plans - Components of Pension Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Supplemental Retirement Plan | ||
Components of Net Periodic Benefit Cost | ||
Service cost | $ 862 | $ 714 |
Interest cost | 883 | 911 |
Amortization of net actuarial loss | 386 | 142 |
Net periodic benefit cost | 2,131 | 1,767 |
Split-Dollar Life Insurance Benefit Plan | ||
Components of Net Periodic Benefit Cost | ||
Amortization of prior transition obligation | (113) | (102) |
Interest cost | 169 | 196 |
Net periodic benefit cost | $ 56 | $ 94 |
Benefit Plans - Defined Bene141
Benefit Plans - Defined Benefit Plans - Estimated Net Actuarial Loss and Prior Service Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Supplemental Retirement Plan | ||
Estimated net actuarial loss and prior service cost that will be amortized from accumulated other comprehensive loss into net periodic cost over next fiscal year | ||
Estimated net actuarial loss and prior service cost that will be amortized from accumulated other comprehensive loss into net periodic cost over next fiscal year | $ 239 | $ 386 |
Split-Dollar Life Insurance Benefit Plan | ||
Estimated net actuarial loss and prior service cost that will be amortized from accumulated other comprehensive loss into net periodic cost over next fiscal year | ||
Estimated net actuarial loss and prior service cost that will be amortized from accumulated other comprehensive loss into net periodic cost over next fiscal year | $ 90 | $ 90 |
Benefit Plans - Defined Bene142
Benefit Plans - Defined Benefit Plans - Weighted-average Assumptions Used to Determine Net Periodic Cost (Details) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Supplemental Retirement Plan | ||
Weighted-average Assumption Used to Determine Net Periodic Benefit Cost: | ||
Discount rate | 3.65% | 4.50% |
Split-Dollar Life Insurance Benefit Plan | ||
Weighted-average Assumption Used to Determine Net Periodic Benefit Cost: | ||
Discount rate | 3.65% | 4.50% |
Fair Value - Financial Assets a
Fair Value - Financial Assets and Liabilities Measured on a Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | $ 385,079 | $ 206,335 |
Agency mortgage-backed securities | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 324,230 | 154,172 |
U.S. Treasury | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 30,003 | |
Trust preferred securities | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 15,132 | 15,300 |
U.S. Government sponsored entities | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 9,041 | |
Corporate bonds | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 6,673 | 36,863 |
Significant Other Observable Inputs (Level 2) | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 355,076 | 206,335 |
I/O strip receivables | 1,367 | 1,481 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 30,003 | |
Recurring basis | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
I/O strip receivables | 1,367 | 1,481 |
Transfers between Level 1 and Level 2 | ||
Transfers between Level 1 and Level 2 | 0 | 0 |
Transfers between Level 2 and Level 1 | 0 | 0 |
Recurring basis | Agency mortgage-backed securities | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 324,230 | 154,172 |
Recurring basis | U.S. Treasury | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 30,003 | |
Recurring basis | Trust preferred securities | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 15,132 | 15,300 |
Recurring basis | U.S. Government sponsored entities | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 9,041 | |
Recurring basis | Corporate bonds | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 6,673 | 36,863 |
Recurring basis | Significant Other Observable Inputs (Level 2) | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
I/O strip receivables | 1,367 | 1,481 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Agency mortgage-backed securities | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 324,230 | 154,172 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Trust preferred securities | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 15,132 | 15,300 |
Recurring basis | Significant Other Observable Inputs (Level 2) | U.S. Government sponsored entities | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 9,041 | |
Recurring basis | Significant Other Observable Inputs (Level 2) | Corporate bonds | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | 6,673 | $ 36,863 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Treasury | ||
Financial Assets and Liabilities Measured on a Recurring Basis | ||
Securities available-for-sale | $ 30,003 |
Fair Value - Financial Asset144
Fair Value - Financial Assets and Liabilities Measured on a Non-Recurring Basis (Details) - Non-recurring basis - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Impaired loans - held-for-investment: | $ 2,702 | $ 2,622 |
Foreclosed assets | 31 | |
Land and construction | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Foreclosed assets | 31 | |
Commercial | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Impaired loans - held-for-investment: | 1,333 | 859 |
Real estate | Commercial and residential | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Impaired loans - held-for-investment: | 503 | 587 |
Real estate | Land and construction | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Impaired loans - held-for-investment: | 219 | 1,176 |
Real estate | Home equity | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Impaired loans - held-for-investment: | 647 | |
Significant Unobservable Inputs (Level 3) | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Impaired loans - held-for-investment: | 2,702 | 2,622 |
Foreclosed assets | 31 | |
Significant Unobservable Inputs (Level 3) | Land and construction | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Foreclosed assets | 31 | |
Significant Unobservable Inputs (Level 3) | Commercial | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Impaired loans - held-for-investment: | 1,333 | 859 |
Significant Unobservable Inputs (Level 3) | Real estate | Commercial and residential | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Impaired loans - held-for-investment: | 503 | 587 |
Significant Unobservable Inputs (Level 3) | Real estate | Land and construction | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Impaired loans - held-for-investment: | 219 | $ 1,176 |
Significant Unobservable Inputs (Level 3) | Real estate | Home equity | ||
Financial Assets and Liabilities Measured on a Non-Recurring Basis | ||
Impaired loans - held-for-investment: | $ 647 |
Fair Value - Impaired Loans Hel
Fair Value - Impaired Loans Held-for-investment - Tabular Disclosure (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Impaired Loans Held-for-investment | ||
Impaired loans held-for-investment | $ 6,527 | $ 6,022 |
Portion carried at fair value | ||
Impaired Loans Held-for-investment | ||
Impaired loans held-for-investment | 2,988 | 3,026 |
Specific valuation allowance | (286) | (404) |
Impaired loans held-for-investment carried at fair value, net | 2,702 | 2,622 |
Portion carried at cost | ||
Impaired Loans Held-for-investment | ||
Impaired loans held-for-investment | $ 3,539 | $ 2,996 |
Fair Value - Impaired Loans 146
Fair Value - Impaired Loans Held-for-investment - Additional Disclosures (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Impaired Loans Held-for-investment | ||
Impaired loans held-for-investment | $ 6,527 | $ 6,022 |
Partial charge-offs | 0 | 107 |
Additional provision (credit) for loan losses | 156 | 100 |
Valuation allowance on foreclosed assets | 0 | 0 |
Portion carried at fair value | ||
Impaired Loans Held-for-investment | ||
Impaired loans held-for-investment | 2,988 | 3,026 |
Specific valuation allowance | 286 | 404 |
Portion carried at cost | ||
Impaired Loans Held-for-investment | ||
Impaired loans held-for-investment | 3,539 | 2,996 |
Carrying amount | ||
Impaired Loans Held-for-investment | ||
Foreclosed assets | $ 364 | $ 696 |
Fair Value - Quantitative Infor
Fair Value - Quantitative Information about Level 3 Fair Value Measurements (Details) - Non-recurring basis - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Impaired loans - held-for-investment, Fair Value | $ 2,702 | $ 2,622 |
Foreclosed assets, Fair Value | 31 | |
Land and construction | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Foreclosed assets, Fair Value | 31 | |
Commercial | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Impaired loans - held-for-investment, Fair Value | 1,333 | 859 |
Real estate | Commercial and residential | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Impaired loans - held-for-investment, Fair Value | 503 | 587 |
Real estate | Land and construction | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Impaired loans - held-for-investment, Fair Value | 219 | 1,176 |
Real estate | Home equity | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Impaired loans - held-for-investment, Fair Value | 647 | |
Significant Unobservable Inputs (Level 3) | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Impaired loans - held-for-investment, Fair Value | 2,702 | 2,622 |
Foreclosed assets, Fair Value | 31 | |
Significant Unobservable Inputs (Level 3) | Land and construction | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Foreclosed assets, Fair Value | $ 31 | |
Significant Unobservable Inputs (Level 3) | Foreclosed assets - land and construction | Market Approach | Maximum | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 1.00% | |
Significant Unobservable Inputs (Level 3) | Commercial | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Impaired loans - held-for-investment, Fair Value | $ 1,333 | $ 859 |
Significant Unobservable Inputs (Level 3) | Commercial | Market Approach | Minimum | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 0.00% | 0.00% |
Significant Unobservable Inputs (Level 3) | Commercial | Market Approach | Maximum | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 5.00% | 3.00% |
Significant Unobservable Inputs (Level 3) | Commercial | Market Approach | Weighted average | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 5.00% | 3.00% |
Significant Unobservable Inputs (Level 3) | Real estate | Commercial and residential | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Impaired loans - held-for-investment, Fair Value | $ 503 | $ 587 |
Significant Unobservable Inputs (Level 3) | Real estate | Commercial and residential | Market Approach | Minimum | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 0.00% | 0.00% |
Significant Unobservable Inputs (Level 3) | Real estate | Commercial and residential | Market Approach | Maximum | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 3.00% | 3.00% |
Significant Unobservable Inputs (Level 3) | Real estate | Commercial and residential | Market Approach | Weighted average | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 3.00% | 3.00% |
Significant Unobservable Inputs (Level 3) | Real estate | Land and construction | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Impaired loans - held-for-investment, Fair Value | $ 219 | $ 1,176 |
Significant Unobservable Inputs (Level 3) | Real estate | Land and construction | Market Approach | Minimum | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 1.00% | |
Significant Unobservable Inputs (Level 3) | Real estate | Land and construction | Market Approach | Maximum | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 1.00% | 2.00% |
Significant Unobservable Inputs (Level 3) | Real estate | Land and construction | Market Approach | Weighted average | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 2.00% | |
Significant Unobservable Inputs (Level 3) | Real estate | Home equity | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Impaired loans - held-for-investment, Fair Value | $ 647 | |
Significant Unobservable Inputs (Level 3) | Real estate | Home equity | Market Approach | Minimum | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 0.00% | |
Significant Unobservable Inputs (Level 3) | Real estate | Home equity | Market Approach | Maximum | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 2.00% | |
Significant Unobservable Inputs (Level 3) | Real estate | Home equity | Market Approach | Weighted average | ||
Quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | ||
Discount adjustment for differences between comparable sales (as a percent) | 2.00% |
Fair Value - Carrying Amounts a
Fair Value - Carrying Amounts and Estimated Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Assets | ||
Securities available-for-sale | $ 385,079 | $ 206,335 |
Securities held-to-maturity | 109,821 | 94,953 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets | ||
Cash and cash equivalents | 344,092 | 122,403 |
Securities available-for-sale | 30,003 | |
Significant Other Observable Inputs (Level 2) | ||
Assets | ||
Securities available-for-sale | 355,076 | 206,335 |
Securities held-to-maturity | 109,821 | 94,953 |
Loans (including loans held-for-sale), net | 7,297 | 1,172 |
Accrued interest receivable | 1,654 | 1,435 |
I/O strips receivables | 1,367 | 1,481 |
Liabilities | ||
Time deposits | 245,279 | 256,589 |
Other deposits | 1,817,914 | 1,132,163 |
Short-term borrowings | 3,000 | |
Accrued interest payable | 195 | 201 |
Significant Unobservable Inputs (Level 3) | ||
Assets | ||
Loans (including loans held-for-sale), net | 1,337,939 | 1,071,854 |
Accrued interest receivable | 3,389 | 3,609 |
Carrying amount | ||
Assets | ||
Cash and cash equivalents | 344,092 | 122,403 |
Securities available-for-sale | 385,079 | 206,335 |
Securities held-to-maturity | 109,311 | 95,362 |
Loans (including loans held-for-sale), net | 1,347,087 | 1,071,436 |
FHLB and FRB stock and other investments | 12,694 | 10,598 |
Accrued interest receivable | 5,043 | 5,044 |
I/O strips receivables | 1,367 | 1,481 |
Liabilities | ||
Time deposits | 244,861 | 256,223 |
Other deposits | 1,817,914 | 1,132,163 |
Short-term borrowings | 3,000 | |
Accrued interest payable | 195 | 201 |
Carried at fair value | ||
Assets | ||
Cash and cash equivalents | 344,092 | 122,403 |
Securities available-for-sale | 385,079 | 206,335 |
Securities held-to-maturity | 109,821 | 94,953 |
Loans (including loans held-for-sale), net | 1,345,236 | 1,073,026 |
Accrued interest receivable | 5,043 | 5,044 |
I/O strips receivables | 1,367 | 1,481 |
Liabilities | ||
Time deposits | 245,279 | 256,589 |
Other deposits | 1,817,914 | 1,132,163 |
Short-term borrowings | 3,000 | |
Accrued interest payable | $ 195 | $ 201 |
Commitments and Contingencies -
Commitments and Contingencies - Financial Instruments with Off-Balance Sheet Risk (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Commitments and Contingencies | ||
Commitments to extend credit, fixed rate | $ 20,319 | $ 11,399 |
Commitments to extend credit, variable rate | $ 553,355 | 427,929 |
Expiration term of commitments (in years) | 1 year | |
Reserves in the form of vault cash and balances at Federal Reserve Bank of San Francisco | $ 29,015 | |
Unused lines of credit and commitments to make loans | ||
Commitments and Contingencies | ||
Commitments to extend credit, fixed rate | 16,917 | 8,164 |
Commitments to extend credit, variable rate | 539,897 | 415,146 |
Standby letters of credit | ||
Commitments and Contingencies | ||
Commitments to extend credit, fixed rate | 3,402 | 3,235 |
Commitments to extend credit, variable rate | $ 13,458 | $ 12,783 |
Commitments and Contingencie150
Commitments and Contingencies - Loss Contingencies (Details) | 12 Months Ended |
Dec. 31, 2015item | |
Commitments and Contingencies | |
Number of claims set for trial | 1 |
Number of complaints in pleading and in mid-discovery | 3 |
Number of complaint in mid-discovery | 1 |
Shareholders' Equity and Ear151
Shareholders' Equity and Earnings Per Share - Series A Preferred Stock (Details) - Series A Preferred Stock $ / shares in Units, $ in Thousands | Nov. 21, 2008USD ($)$ / sharesshares |
Series A Preferred Stock | |
Preferred stock, shares issued | shares | 40,000 |
Preferred stock, shares issued, value | $ | $ 40,000 |
Liquidation preference (in dollars per share) | $ / shares | $ 1,000 |
Shareholders' Equity and Ear152
Shareholders' Equity and Earnings Per Share - Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 12, 2013 | Dec. 31, 2013 | Nov. 21, 2008 |
Warrants | |||
Payments for repurchase of warrant | $ 140 | ||
Series A Preferred Stock | Preferred Stock Warrants | |||
Warrants | |||
Exercise price of warrant (in dollars per share) | $ 12.96 | ||
Allocated fair value of warrant | $ 1,979 | ||
Payments for repurchase of warrant | $ 140 |
Shareholders' Equity and Ear153
Shareholders' Equity and Earnings Per Share - Series C Preferred Stock (Details) - Series C convertible perpetual preferred stock | Jun. 21, 2010$ / sharesshares |
Series C Preferred Stock | |
Preferred stock, shares issued | shares | 21,004 |
Conversion price (in dollars per share) | $ / shares | $ 3.75 |
Number of common stock into which preferred stock are convertible (in shares) | shares | 5,601,000 |
Liquidation preference (in dollars per share) | $ / shares | $ 1,000 |
Shareholders' Equity and Ear154
Shareholders' Equity and Earnings Per Share - Dividends (Details) | Jan. 28, 2016$ / shares |
Series C convertible perpetual preferred stock | |
Dividends | |
Dividends declared per share | $ 0.09 |
Shareholders' Equity and Ear155
Shareholders' Equity and Earnings Per Share - Antidilutive Securities (Details) - USD ($) $ in Thousands | Jun. 12, 2013 | Dec. 31, 2013 |
Earnings Per Share | ||
Payments for repurchase of warrant | $ 140 | |
Preferred Stock Warrants | Series A Preferred Stock | ||
Earnings Per Share | ||
Payments for repurchase of warrant | $ 140 |
Shareholders' Equity and Ear156
Shareholders' Equity and Earnings Per Share - Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reconciliation of factors used in computing basic and diluted earnings (loss) per common share | |||||||||||
Net income available to common shareholders | $ 3,975 | $ 3,011 | $ 4,029 | $ 3,690 | $ 3,322 | $ 3,145 | $ 3,100 | $ 2,852 | $ 14,705 | $ 12,419 | $ 11,204 |
Less: undistributed earnings allocated to Series C Preferred Stock | (209) | (111) | (331) | (274) | (349) | (320) | (358) | (315) | (912) | (1,342) | (1,687) |
Distributed and undistributed earnings allocated to common shareholders | $ 3,766 | $ 2,900 | $ 3,698 | $ 3,416 | $ 2,973 | $ 2,825 | $ 2,742 | $ 2,537 | $ 13,793 | $ 11,077 | $ 9,517 |
Weighted average common shares outstanding for basic earnings per common share | 28,567,213 | 26,390,615 | 26,338,161 | ||||||||
Dilutive effect of stock options outstanding, using the treasury stock method (in shares) | 218,865 | 135,667 | 48,291 | ||||||||
Shares used in computing diluted earnings per common share | 28,786,078 | 26,526,282 | 26,386,452 | ||||||||
Net income per share - basic(in dollars per share) | $ 0.12 | $ 0.10 | $ 0.14 | $ 0.13 | $ 0.11 | $ 0.11 | $ 0.10 | $ 0.10 | $ 0.48 | $ 0.42 | $ 0.36 |
Net income per share - diluted(in dollars per share) | $ 0.12 | $ 0.10 | $ 0.14 | $ 0.13 | $ 0.11 | $ 0.11 | $ 0.10 | $ 0.10 | $ 0.48 | $ 0.42 | $ 0.36 |
Capital Requirements - Tabular
Capital Requirements - Tabular Disclosure (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Total Capital (to risk-weighted assets) | ||
Actual, Amount | $ 218,915 | $ 186,068 |
To Be Well Capitalized Under Regulatory Requirements, Amount | 134,109 | |
Required For Capital Adequacy Purposes, Amount | $ 140,041 | $ 107,287 |
Actual, Ratio (as a percent) | 12.50% | 13.90% |
To Be Well Capitalized Under Regulatory Requirements, Ratio (as a percent) | 10.00% | |
Required For Capital Adequacy Purposes, Ratio (as a percent) | 8.00% | 8.00% |
Tier 1 Capital (to risk-weighted assets) | ||
Actual, Amount | $ 199,299 | $ 169,278 |
To Be Well Capitalized Under Regulatory Requirements, Amount | 80,465 | |
Required For Capital Adequacy Purposes, Amount | $ 105,031 | $ 53,644 |
Actual, Ratio (as a percent) | 11.40% | 12.60% |
To Be Well Capitalized Under Regulatory Requirements, Ratio (as a percent) | 6.00% | |
Required For Capital Adequacy Purposes, Ratio (as a percent) | 6.00% | 4.00% |
Common Equity Tier 1 Capital (to risk-weighted assets) | ||
Actual, Amount | $ 181,221 | |
Required For Capital Adequacy Purposes, Amount | $ 78,773 | |
Actual, Ratio (as a percent) | 10.40% | |
Required For Capital Adequacy Purposes, Ratio (as a percent) | 4.50% | |
Tier 1 Capital (to average assets) | ||
Actual, Amount | $ 199,299 | $ 169,278 |
Required For Capital Adequacy Purposes, Amount | $ 92,918 | $ 63,949 |
Actual, Ratio (as a percent) | 8.60% | 10.60% |
Required For Capital Adequacy Purposes, Ratio (as a percent) | 4.00% | 4.00% |
HBC (Wholly-owned Subsidiary) | ||
Total Capital (to risk-weighted assets) | ||
Actual, Amount | $ 219,943 | $ 175,765 |
To Be Well Capitalized Under Regulatory Requirements, Amount | 175,022 | 134,095 |
Required For Capital Adequacy Purposes, Amount | $ 140,018 | $ 107,276 |
Actual, Ratio (as a percent) | 12.60% | 13.10% |
To Be Well Capitalized Under Regulatory Requirements, Ratio (as a percent) | 10.00% | 10.00% |
Required For Capital Adequacy Purposes, Ratio (as a percent) | 8.00% | 8.00% |
Tier 1 Capital (to risk-weighted assets) | ||
Actual, Amount | $ 200,327 | $ 158,976 |
To Be Well Capitalized Under Regulatory Requirements, Amount | 140,018 | 80,457 |
Required For Capital Adequacy Purposes, Amount | $ 105,013 | $ 53,638 |
Actual, Ratio (as a percent) | 11.40% | 11.90% |
To Be Well Capitalized Under Regulatory Requirements, Ratio (as a percent) | 8.00% | 6.00% |
Required For Capital Adequacy Purposes, Ratio (as a percent) | 6.00% | 4.00% |
Common Equity Tier 1 Capital (to risk-weighted assets) | ||
Actual, Amount | $ 200,327 | |
To Be Well Capitalized Under Regulatory Requirements, Amount | 113,764 | |
Required For Capital Adequacy Purposes, Amount | $ 78,760 | |
Actual, Ratio (as a percent) | 11.40% | |
To Be Well Capitalized Under Regulatory Requirements, Ratio (as a percent) | 6.50% | |
Required For Capital Adequacy Purposes, Ratio (as a percent) | 4.50% | |
Tier 1 Capital (to average assets) | ||
Actual, Amount | $ 200,327 | $ 158,976 |
To Be Well Capitalized Under Regulatory Requirements, Amount | 116,112 | 79,959 |
Required For Capital Adequacy Purposes, Amount | $ 92,889 | $ 63,967 |
Actual, Ratio (as a percent) | 8.60% | 9.90% |
To Be Well Capitalized Under Regulatory Requirements, Ratio (as a percent) | 5.00% | 5.00% |
Required For Capital Adequacy Purposes, Ratio (as a percent) | 4.00% | 4.00% |
Capital Requirements - Dividend
Capital Requirements - Dividends to Parent (Details) $ in Thousands | Jan. 01, 2016USD ($) |
HCC (Parent) | |
Cash dividend | |
Cash dividend available | $ 22,361 |
Noninterest Expense (Details)
Noninterest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Noninterest Expense | |||||||||||
Salaries and employee benefits | $ 35,146 | $ 26,250 | $ 23,450 | ||||||||
Occupancy and equipment | 4,300 | 4,053 | 4,043 | ||||||||
Acquisition and integration related costs | $ 2,991 | $ 2,865 | $ 423 | $ 119 | 3,546 | 895 | |||||
Professional fees | 1,828 | 1,891 | 2,588 | ||||||||
Data processing | 1,371 | 969 | 1,078 | ||||||||
Software subscriptions | 1,214 | 999 | 1,289 | ||||||||
Insurance expense | 1,127 | 1,126 | 1,032 | ||||||||
FDIC deposit insurance premiums | 1,092 | 892 | 894 | ||||||||
Correspondent bank charges | 1,021 | 760 | 684 | ||||||||
Amortization of other intangible assets | 1,043 | 510 | 473 | ||||||||
Foreclosed assets | (94) | 53 | (251) | ||||||||
Other | 7,079 | 5,824 | 5,190 | ||||||||
Total noninterest expense | $ 17,361 | $ 16,419 | $ 12,617 | $ 12,276 | $ 12,415 | $ 10,492 | $ 10,769 | $ 10,546 | 58,673 | $ 44,222 | $ 40,470 |
Pre-tax severance and retention cost | $ 2,887 |
Business Segment Information -
Business Segment Information - Business Segments (Details) | 12 Months Ended |
Dec. 31, 2015segment | |
Business Segment Information | |
Number of business segments | 2 |
Business Segment Information161
Business Segment Information - Operating Statements (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating Income (Loss) | |||||||||||
Interest income | $ 22,896 | $ 20,306 | $ 18,175 | $ 17,366 | $ 16,717 | $ 14,492 | $ 14,192 | $ 13,855 | $ 78,743 | $ 59,256 | $ 52,786 |
Total interest expense | 758 | 623 | 533 | 508 | 625 | 500 | 507 | 521 | 2,422 | 2,153 | 2,600 |
Net interest income | 22,138 | 19,683 | 17,642 | 16,858 | 16,092 | 13,992 | 13,685 | 13,334 | 76,321 | 57,103 | 50,186 |
Provision (credit) for loan losses | 371 | (301) | 22 | (60) | (106) | (24) | (198) | (10) | 32 | (338) | (816) |
Net interest income after provision | 21,767 | 19,984 | 17,620 | 16,918 | 16,198 | 14,016 | 13,883 | 13,344 | 76,289 | 57,441 | 51,002 |
Noninterest income | 2,829 | 2,066 | 2,164 | 1,926 | 1,812 | 1,870 | 2,047 | 2,017 | 8,985 | 7,746 | 7,214 |
Noninterest expense | 17,361 | 16,419 | 12,617 | 12,276 | 12,415 | 10,492 | 10,769 | 10,546 | 58,673 | 44,222 | 40,470 |
Income before income taxes | 7,235 | 5,631 | 7,167 | 6,568 | 5,595 | 5,394 | 5,161 | 4,815 | 26,601 | 20,965 | 17,746 |
Income tax expense | 2,812 | 2,172 | 2,690 | 2,430 | 1,993 | 1,969 | 1,837 | 1,739 | 10,104 | 7,538 | 6,206 |
Net income | 4,423 | $ 3,459 | $ 4,477 | $ 4,138 | 3,602 | $ 3,425 | $ 3,324 | $ 3,076 | 16,497 | 13,427 | $ 11,540 |
Total assets | 2,361,579 | 1,617,103 | 2,361,579 | 1,617,103 | |||||||
Loans, net of deferred fees | 1,358,716 | 1,088,643 | 1,358,716 | 1,088,643 | |||||||
Goodwill | 45,664 | 13,044 | 45,664 | 13,044 | |||||||
Banking | |||||||||||
Operating Income (Loss) | |||||||||||
Interest income | 66,306 | 57,178 | |||||||||
Intersegment interest allocations | 1,087 | 31 | |||||||||
Total interest expense | 2,422 | 2,033 | |||||||||
Net interest income | 64,971 | 55,176 | |||||||||
Provision (credit) for loan losses | (156) | (338) | |||||||||
Net interest income after provision | 65,127 | 55,514 | |||||||||
Noninterest income | 8,234 | 7,662 | |||||||||
Noninterest expense | 51,438 | 43,132 | |||||||||
Intersegment expense allocation | 386 | ||||||||||
Income before income taxes | 22,309 | 20,044 | |||||||||
Income tax expense | 8,301 | 7,151 | |||||||||
Net income | 14,008 | 12,893 | |||||||||
Total assets | 2,306,543 | 1,561,911 | 2,306,543 | 1,561,911 | |||||||
Loans, net of deferred fees | 1,318,657 | 1,048,631 | 1,318,657 | 1,048,631 | |||||||
Goodwill | 32,620 | 32,620 | |||||||||
Factoring | |||||||||||
Operating Income (Loss) | |||||||||||
Interest income | 12,437 | 2,078 | |||||||||
Intersegment interest allocations | (1,087) | (31) | |||||||||
Total interest expense | 120 | ||||||||||
Net interest income | 11,350 | 1,927 | |||||||||
Provision (credit) for loan losses | 188 | ||||||||||
Net interest income after provision | 11,162 | 1,927 | |||||||||
Noninterest income | 751 | 84 | |||||||||
Noninterest expense | 7,235 | 1,090 | |||||||||
Intersegment expense allocation | (386) | ||||||||||
Income before income taxes | 4,292 | 921 | |||||||||
Income tax expense | 1,803 | 387 | |||||||||
Net income | 2,489 | 534 | |||||||||
Total assets | 55,036 | 55,192 | 55,036 | 55,192 | |||||||
Loans, net of deferred fees | 40,059 | 40,012 | 40,059 | 40,012 | |||||||
Goodwill | $ 13,044 | $ 13,044 | $ 13,044 | $ 13,044 |
Parent Company only Condense162
Parent Company only Condensed Financial Information - Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Assets | ||||
Cash and cash equivalents | $ 344,092 | $ 122,403 | $ 112,605 | $ 373,565 |
Total assets | 2,361,579 | 1,617,103 | ||
Liabilities and Shareholders' Equity | ||||
Short-term borrowings | 3,000 | |||
Shareholder's equity | 245,436 | 184,358 | 173,396 | 169,741 |
Total liabilities and shareholders' equity | 2,361,579 | 1,617,103 | ||
HCC (Parent) | ||||
Assets | ||||
Cash and cash equivalents | 1,686 | 10,159 | $ 19,009 | $ 11,193 |
Investment in subsidiary bank | 246,357 | 173,453 | ||
Other assets | 400 | 953 | ||
Total assets | 248,443 | 184,565 | ||
Liabilities and Shareholders' Equity | ||||
Short-term borrowings | 3,000 | |||
Other liabilities | 7 | 207 | ||
Shareholder's equity | 245,436 | 184,358 | ||
Total liabilities and shareholders' equity | $ 248,443 | $ 184,565 |
Parent Company only Condense163
Parent Company only Condensed Financial Information - Statements of Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Condensed statements of income | |||||||||||
Interest expense | $ (758) | $ (623) | $ (533) | $ (508) | $ (625) | $ (500) | $ (507) | $ (521) | $ (2,422) | $ (2,153) | $ (2,600) |
Income (loss) before income taxes and equity in net income of subsidiary bank | 7,235 | 5,631 | 7,167 | 6,568 | 5,595 | 5,394 | 5,161 | 4,815 | 26,601 | 20,965 | 17,746 |
Equity in net income of subsidiary bank: | |||||||||||
Income tax (expense) benefit | (2,812) | (2,172) | (2,690) | (2,430) | (1,993) | (1,969) | (1,837) | (1,739) | (10,104) | (7,538) | (6,206) |
Net income | 4,423 | 3,459 | 4,477 | 4,138 | 3,602 | 3,425 | 3,324 | 3,076 | 16,497 | 13,427 | 11,540 |
Dividends and discount accretion on preferred stock | (448) | (448) | (448) | (448) | (280) | (280) | (224) | (224) | (1,792) | (1,008) | (336) |
Net income available to common shareholders | $ 3,975 | $ 3,011 | $ 4,029 | $ 3,690 | $ 3,322 | $ 3,145 | $ 3,100 | $ 2,852 | 14,705 | 12,419 | 11,204 |
HCC (Parent) | |||||||||||
Condensed statements of income | |||||||||||
Dividend from subsidiary bank | 16,000 | ||||||||||
Interest expense | (18) | (229) | |||||||||
Other expenses | (2,705) | (2,033) | (2,080) | ||||||||
Income (loss) before income taxes and equity in net income of subsidiary bank | (2,723) | (2,033) | 13,691 | ||||||||
Equity in net income of subsidiary bank: | |||||||||||
Reduction in contributed capital and distribution from subsidiary bank | (16,000) | ||||||||||
Net income of subsidiary bank | 18,081 | 14,614 | 13,155 | ||||||||
Income tax (expense) benefit | 1,139 | 846 | 694 | ||||||||
Net income | 16,497 | 13,427 | 11,540 | ||||||||
Dividends and discount accretion on preferred stock | (1,792) | (1,008) | (336) | ||||||||
Net income available to common shareholders | $ 14,705 | $ 12,419 | $ 11,204 |
Parent Company only Condense164
Parent Company only Condensed Financial Information - Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | |||||||||||
Net income | $ 4,423 | $ 3,459 | $ 4,477 | $ 4,138 | $ 3,602 | $ 3,425 | $ 3,324 | $ 3,076 | $ 16,497 | $ 13,427 | $ 11,540 |
Adjustments to reconcile net income to net cash provided by (used in) operations: | |||||||||||
Amortization of restricted stock award, net | 265 | (9) | 200 | ||||||||
Net Cash Provided by (used in) Operating Activities, continuing operations | 28,494 | 19,384 | 16,263 | ||||||||
Cash flows from financing activities: | |||||||||||
Repayment of subordinated debt | (9,279) | ||||||||||
Net change in purchased funds and other short-term borrowings | 3,000 | ||||||||||
Proceeds from issuance of common stock, net of issuance costs | 315 | 262 | 88 | ||||||||
Payment of repurchase of common stock warrant | (140) | ||||||||||
Net cash provided by (used in) financing activities | 261,699 | 65,022 | (204,394) | ||||||||
Net increase (decrease) in cash and cash equivalents | 221,689 | 9,798 | (260,960) | ||||||||
Cash and cash equivalents, beginning of period | 122,403 | 112,605 | 122,403 | 112,605 | 373,565 | ||||||
Cash and cash equivalents, end of period | 344,092 | 122,403 | 344,092 | 122,403 | 112,605 | ||||||
HCC (Parent) | |||||||||||
Cash flows from operating activities: | |||||||||||
Net income | 16,497 | 13,427 | 11,540 | ||||||||
Adjustments to reconcile net income to net cash provided by (used in) operations: | |||||||||||
Amortization of restricted stock award, net | 265 | (9) | 200 | ||||||||
Equity in undistributed loss/(net income) of subsidiary bank | (18,081) | (14,614) | 2,845 | ||||||||
Net change in other assets and liabilities | 269 | (2,158) | 4,478 | ||||||||
Net Cash Provided by (used in) Operating Activities, continuing operations | (1,050) | (3,354) | 19,063 | ||||||||
Cash flows from financing activities: | |||||||||||
Repayment of subordinated debt | (9,279) | ||||||||||
Net change in purchased funds and other short-term borrowings | 3,000 | ||||||||||
Payment of cash dividends | (10,738) | (5,758) | (1,916) | ||||||||
Proceeds from issuance of common stock, net of issuance costs | 315 | 262 | 88 | ||||||||
Payment of repurchase of common stock warrant | (140) | ||||||||||
Net cash provided by (used in) financing activities | (7,423) | (5,496) | (11,247) | ||||||||
Net increase (decrease) in cash and cash equivalents | (8,473) | (8,850) | 7,816 | ||||||||
Cash and cash equivalents, beginning of period | $ 10,159 | $ 19,009 | 10,159 | 19,009 | 11,193 | ||||||
Cash and cash equivalents, end of period | $ 1,686 | $ 10,159 | $ 1,686 | $ 10,159 | $ 19,009 |
Quarterly Financial Data (Un165
Quarterly Financial Data (Unaudited) - Selected Unaudited Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Quarterly Financial Data (Unaudited) | |||||||||||
Interest income | $ 22,896 | $ 20,306 | $ 18,175 | $ 17,366 | $ 16,717 | $ 14,492 | $ 14,192 | $ 13,855 | $ 78,743 | $ 59,256 | $ 52,786 |
Interest expense | 758 | 623 | 533 | 508 | 625 | 500 | 507 | 521 | 2,422 | 2,153 | 2,600 |
Net interest income | 22,138 | 19,683 | 17,642 | 16,858 | 16,092 | 13,992 | 13,685 | 13,334 | 76,321 | 57,103 | 50,186 |
Provision (credit) for loan losses | 371 | (301) | 22 | (60) | (106) | (24) | (198) | (10) | 32 | (338) | (816) |
Net interest income after provision for loan losses | 21,767 | 19,984 | 17,620 | 16,918 | 16,198 | 14,016 | 13,883 | 13,344 | 76,289 | 57,441 | 51,002 |
Noninterest income | 2,829 | 2,066 | 2,164 | 1,926 | 1,812 | 1,870 | 2,047 | 2,017 | 8,985 | 7,746 | 7,214 |
Noninterest expense | 17,361 | 16,419 | 12,617 | 12,276 | 12,415 | 10,492 | 10,769 | 10,546 | 58,673 | 44,222 | 40,470 |
Income before income taxes | 7,235 | 5,631 | 7,167 | 6,568 | 5,595 | 5,394 | 5,161 | 4,815 | 26,601 | 20,965 | 17,746 |
Income tax expense | 2,812 | 2,172 | 2,690 | 2,430 | 1,993 | 1,969 | 1,837 | 1,739 | 10,104 | 7,538 | 6,206 |
Net income | 4,423 | 3,459 | 4,477 | 4,138 | 3,602 | 3,425 | 3,324 | 3,076 | 16,497 | 13,427 | 11,540 |
Dividends and discount accretion on preferred stock | (448) | (448) | (448) | (448) | (280) | (280) | (224) | (224) | (1,792) | (1,008) | (336) |
Net income available to common shareholders | 3,975 | 3,011 | 4,029 | 3,690 | 3,322 | 3,145 | 3,100 | 2,852 | 14,705 | 12,419 | 11,204 |
Undistributed earnings allocated to Series C Preferred Stock | (209) | (111) | (331) | (274) | (349) | (320) | (358) | (315) | (912) | (1,342) | (1,687) |
Distributed and undistributed earnings allocated to common shareholders | $ 3,766 | $ 2,900 | $ 3,698 | $ 3,416 | $ 2,973 | $ 2,825 | $ 2,742 | $ 2,537 | $ 13,793 | $ 11,077 | $ 9,517 |
Earnings per common share: | |||||||||||
Basic (in dollars per share) | $ 0.12 | $ 0.10 | $ 0.14 | $ 0.13 | $ 0.11 | $ 0.11 | $ 0.10 | $ 0.10 | $ 0.48 | $ 0.42 | $ 0.36 |
Diluted (in dollars per share) | $ 0.12 | $ 0.10 | $ 0.14 | $ 0.13 | $ 0.11 | $ 0.11 | $ 0.10 | $ 0.10 | $ 0.48 | $ 0.42 | $ 0.36 |
Quarterly Financial Data (Un166
Quarterly Financial Data (Unaudited) - Acquisition and Integration Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly Financial Data (Unaudited) | ||||||||
Acquisition and integration related costs | $ 2,991 | $ 2,865 | $ 423 | $ 119 | $ 3,546 | $ 895 | ||
BVF/CSNK | ||||||||
Quarterly Financial Data (Unaudited) | ||||||||
Acquisition and integration related costs | $ 609 | $ 234 |